Regulatory

DCB published a consultation proposal for the Restrained Remuneration Policy Regulations AFS 2017 (Regeling beheerst beloningsbeleid Wft 2017, the RRP Regulations 2017) on 4 September 2017. The scope of the RRP Regulations 2017 will be restricted to banks, ‘CRR-investment firms’ and premium pension institutions.

The RRP Regulations 2017 recast the Restrained Remuneration Policy Regulations AFS 2014 (Regeling beheerst beloningsbeleid Wft 2014, the RRP Regulations 2014). The current RRP Regulations 2014 provide for a further substantiation of the requirements in relation to the remuneration policy of banks, investment firms, premium pension institutions, insurers, clearing institutions and entities for risk acceptation. Pursuant to the RRP Regulations 2014, these entities have, for example, to apply certain numerical requirements in relation to variable remuneration (inter alia, the requirement to pay variable remuneration 50/50 in cash and certain financial instruments and the requirement to defer at least 40% of the variable remuneration over a period of at least three years).

Based on the consultation text that is currently available, the remuneration policy requirements under the RRP Regulations 2017 will not substantially differ from the requirements under the RRP Regulations 2014. Only, the remuneration policy requirements for premium pension institutions will become more restricted under the RRP Regulations 2017.

The RRP Regulations 2017 will however have a narrower scope. They only apply to banks, ‘CRR-investment firms’ and premium pension institutions. Investment firms that do not qualify as ‘CRR-investment firms’, insurers, clearing institutions and entities for risk acceptation will fall outside the scope of the RRP Regulations 2017.

CRR-investment firms

CRR-investment firms are investment firms that may conduct the activity of safekeeping and administration of financial instruments for the account of clients, that deal on own account, conduct underwriting or placing activities, or operate a multilateral trading facility (MTF), or that are permitted to hold money or securities belonging to their clients (Article (4)(2) CRR (Regulation (EU) No 575/2013)).

Click here for the consultation of the RRP Regulations 2017 (Dutch). The consultation ended on 13 October 2017. The final text of the RRP Regulations 2017 may differ from the consultation text.