The Third Country Regime for Investment Firms

25 Pages Posted: 12 Jan 2024

See all articles by Marije Louisse

Marije Louisse

Radboud University Nijmegen

Mirik van Rijn

Dutch Central Bank (DNB); Radboud University Nijmegen

Date Written: January 12, 2024

Abstract

In this article we discuss how an investment firm established outside the EU may provide services (to clients) in the EU. We explore how such third country firms may enter the European market and discuss the current state of the third country regimes as provided (partly) under EU law, their use – or notable lack thereof – and the challenges involved in the supervision of third country firms. We note that the recent updates to the third country equivalence regime for the provision of services to professional clients render the use of this regime even more difficult. In respect of the (optional) third country regime for the provision of services to retail clients, we observe that this regime is much akin to a full license requirement, albeit with notable difficulties when it comes to supervision and enforcement. Altogether, we come to the unfortunate conclusion that the EU third country regime for investment firms established in third countries can barely be called successful.

Keywords: Investment firms ⸱ Third country ⸱ Market access ⸱ Equivalence ⸱ ESMA registration ⸱ Branch office ⸱ Subsidiary ⸱ Reverse solicitation ⸱ Supervision ⸱ Member State option ⸱ Investment services ⸱ Investment activities ⸱ MiFID II ⸱ MiFIR ⸱ IFD ⸱ IFR ⸱ CRD6

JEL Classification: G15, G21, G23, G2, K22, K23

Suggested Citation

Louisse, Marije and van Rijn, Mirik, The Third Country Regime for Investment Firms (January 12, 2024). European Banking Institute Working Paper Series 159, Available at SSRN: https://ssrn.com/abstract=4692733 or http://dx.doi.org/10.2139/ssrn.4692733

Marije Louisse (Contact Author)

Radboud University Nijmegen ( email )

Postbus 9108
Nijmegen, 6500 HK
Netherlands

Mirik Van Rijn

Dutch Central Bank (DNB) ( email )

Radboud University Nijmegen ( email )

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
145
Abstract Views
654
Rank
433,670
PlumX Metrics