Commission responds to EBA on CRD4 proportionality: The Commission has responded to EBA's request for clarification as to the effect of the proportionality principle in Article 92(2) of the Capital Requirements Directive (CRD4) in respect of remuneration. The Commission agreed that the phrase "competent authorities shall ensure that institutions comply with these principles in a manner and to the extent that is appropriate to their size, internal organisation and the nature, scope and complexity of their activities" means that any discretion left to Member States and competent authorities must be exercised in compliance with the general EU principle of proportionality. It said this cannot justify a decision not to apply one or other rule contained, in this case, in the remuneration provisions in Article 94 of CRD4. The Commission thinks that, contrary to the interpretation by some EBA board members, national regulators and EBA cannot decide that certain rules adopted by the co-legislators do not apply. So, in relation to EBA's specific question on the implementation costs of the requirements on deferral and payment in instruments for small and non-complex institutions, the rules would apply uniformly to all those affected. EBA also hosted a public hearing on the draft guidelines on sound remuneration policies on 8 May. (Source: Commission Letter to EBA: Interpretation of Article 92(2) of CRD4  ̶  Remuneration Policies and EBA Slides for Presentation on Draft Guidelines on Sound Remuneration Policies)