Decision (EU) 2017/935 of the European Central Bank of 16 November 2016 on delegation of the power to adopt fit and proper decisions and the assessment of fit and proper requirements (ECB/2016/42)
Decision (EU) 2017/935 of the European Central Bank of 16 November 2016 on delegation of the power to adopt fit and proper decisions and the assessment of fit and proper requirements (ECB/2016/42)
Decision (EU) 2017/935 · Decision · 6 articles
Data as of 2026-07-04 · Compiled from an official source version. Later amendments or repeals may not be reflected; the official text prevails. · Read the official text ↗
For the purposes of this Decision, the following definitions shall apply:
(1)
‘fit and proper requirements’ means the requirements that the members of the management body of a significant supervised entity must fulfil at all times in accordance with Article 91 of Directive 2013/36/EU and any other applicable law;
(2)
‘fit and proper decision’ means an ECB decision stating whether an individual fulfils the fit and proper requirements;
(3)
‘applicable law’ means relevant Union law within the meaning of Article 4(3) of Regulation (EU) No 1024/2013, and any national law which is relevant for the assessment of the fit and proper requirements;
(4)
‘participating Member State’ means a participating Member State as defined in point (1) of Article 2 of Regulation (EU) No 1024/2013;
(5)
‘significant supervised entity’ means a significant supervised entity as defined in point (16) of Article 2 of Regulation (EU) No 468/2014 (ECB/2014/17);
(6)
‘supervised entity’ means a supervised entity as defined in point (20) of Article 2 of Regulation (EU) No 468/2014 (ECB/2014/17);
(7)
‘significant supervised group’ means a significant supervised group as defined in point (22) of Article 2 of Regulation (EU) No 468/2014 (ECB/2014/17);
(8)
‘delegated decision’ means a decision adopted on the basis of a delegation of power by the Governing Council pursuant to Decision (EU) 2017/933 (ECB/2016/40);
(9)
‘management body’ means a management body as defined in point (7) of Article 3(1) of Directive 2013/36/EU, subject to Article 3(2) thereof;
(10)
‘member’ means a proposed or appointed member of a management body or, where applicable, a proposed or appointed key function holder as defined in accordance with applicable law;
(11)
‘heads of work units’ means the heads of work units of the ECB to whom the power to jointly adopt fit and proper decisions is delegated;
(12)
‘national competent authority’ means a national competent authority as defined in point (2) of Article 2 of Regulation (EU) No 1024/2013;
(13)
‘non-objection procedure’ means the procedure set out in Article 26(8) of Regulation (EU) No 1024/2013 and further specified in Article 13g of Decision ECB/2004/2;
(14)
‘Guide to fit and proper assessments’ means a document with this title, adopted and amended from time to time in accordance with the non-objection procedure and published on the ECB's website, which contains guidance on how fit and proper assessments should be conducted;
(15)
‘credit institution’ means a credit institution as defined in point (1) of Article 4(1) of Regulation (EU) No 575/2013 of the European Parliament and of the Council ( 9 ) .
1. In accordance with Article 4 of Decision (EU) 2017/933 (ECB/2016/40), the Governing Council hereby delegates the power to adopt fit and proper decisions to the heads of work units nominated by the Executive Board in accordance with Article 5 of that Decision.
2. The heads of work units shall adopt delegated decisions in accordance with this Decision and applicable law.
1. A fit and proper decision shall not be adopted by means of a delegated decision if the relevant supervised entity is one of the following:
(a)
the supervised entity at the highest level of consolidation within the participating Member States of a significant supervised group;
(b)
the credit institution with the largest total value of assets in a significant supervised group, if this entity is different to that referred to in point (a);
(c)
a significant supervised entity that is not part of a significant supervised group.
2. A fit and proper decision shall not be adopted by means of a delegated decision if the fit and proper decision:
(a)
states that the member does not fulfil the fit and proper requirements; or
(b)
contains conditions, unless such conditions are necessary to ensure that the member fulfils the fit and proper requirements and have been agreed in writing.
3. A fit and proper decision shall not be adopted by means of a delegated decision if, based on information submitted to the ECB:
(a)
the member is currently subject to criminal proceedings before a court of law or has been convicted of a criminal offence at first or final instance; or
(b)
an investigation has been or is currently being carried out in relation to, or an enforcement action or an administrative sanction is pending against or has been imposed upon, the member for non-compliance with any financial services legislation or regulatory provisions.
4. A fit and proper decision shall not be adopted by means of a delegated decision if:
(a)
the national competent authority does not submit to the ECB a draft delegated decision 20 working days before the expiry of the deadline for the adoption of a fit and proper decision under applicable law; or
(b)
insufficient information or the complexity of the assessment require that the fit and proper decision is adopted under the non-objection procedure.
5. Where, pursuant to paragraphs 1 to 4, a fit and proper decision cannot be adopted by means of a delegated decision, it shall be adopted in accordance with applicable law and the non-objection procedure.
6. For the purpose of paragraphs 2 to 4, if the assessment of the fit and proper requirements concerns more than one member of a management body and a decision cannot be adopted by means of a delegated decision with regard to one or more of them, the assessment shall result in two fit and proper decisions. One decision shall be adopted in accordance with applicable law and the non-objection procedure, and the other by means of a delegated decision.
The assessment of the fit and proper requirements shall be carried out in accordance with applicable law taking into account the Guide to fit and proper assessments (chapter on assessment criteria) covering the following criteria:
(a)
Experience. The member shall have sufficient knowledge, skills and experience to fulfil their functions.
(b)
Reputation. The member shall at all times be of sufficiently good repute to ensure the sound and prudent management of the supervised entity. The principle of proportionality shall not apply to the assessment of good repute.
(c)
Potential conflicts of interest and independence of mind. The member shall have the ability to act independently. The assessment of any potential conflicts of interest and independence of mind shall include an assessment of the supervised entity's governance arrangements for disclosing, mitigating, managing or preventing conflicts of interest.
(d)
Time commitment. The member shall have the ability to dedicate sufficient time to the performance of their functions in the supervised entity. The assessment may be impacted by several factors, such as the number of directorships held by the member, the nature, scale and complexity of the supervised entity's activities, and other relevant commitments.
(e)
Collective suitability. The member shall be assessed with respect to the collective suitability requirement at the time of their initial fit and proper assessment, taking into account the ongoing supervision of the governance of the supervised entity, as well as the self-assessment of the management body, in particular with regard to its composition and collective suitability needs.
This Decision shall not apply to proposals for a fit and proper decision submitted by a national competent authority to the ECB prior to the entry into force of this Decision.
