Minister Donohoe signs new EU prudential rules for investment firms into national law
The Minister for Finance, Paschal Donohoe, T.D., has signed S.I. 355 of 2021 and S.I. 356 of 2021 to complete a partial transposition of Directive (EU) 2019/2034 (the Investment Firms Directive or IFD) and the implementation of Regulation (EU) 2019/2033 (the Investment Firms Regulation or IFR) into Irish law. These regulations came into effect on the day of their signing, 21 September 2021.
IFD and IFR puts in place a new prudential framework for investment firms authorised under the Markets in Financial Instruments Directive (MiFID II). However, systemic investment firms will remain under the prudential requirements of the Capital Requirements Directive and Regulation (CRD/CRR).
While SI 355 of 2021 gives effect to the vast majority of the provisions in IFD, Article 62(6) of IFD remains to be transposed into Irish law. Article 62(6) inserts a new Article 8a into CRD and essentially requires Member States to impose an obligation on certain large systemic investment firms (Class 1 Firms) to re-authorise as credit institutions. The Department of Finance will conclude work, as soon as possible, to establish in legislation a re-authorisation process for those investment firms required to re-authorise as credit institutions.