Establishing a Branch, Cross-Border Provision of Services by Domestic Institutions

(1) An institution licensed under section 10(1) or section 11(1), or registered under section 34(1), that intends to establish a branch in another Member State or another state party to the Agreement on the European Economic Area, or to engage agents there, must notify this to BaFin and the Deutsche Bundesbank without delay, in accordance with the second sentence. The notification must contain: 1. a statement of the state in which the branch is to be established or the agent engaged; 2. a business plan showing the type of business planned, the organisational structure of the branch and the particulars under section 10(2), first sentence, nos. 2 and 5; 3. the particulars under section 25(1), where the engagement of agents is intended; 4. the address at which documents can be served on, and information requested from, the institution in the state in which it maintains a branch; 5. the names of the heads of the branch.
(2) Subsection (1), first sentence, applies correspondingly to the intention to provide payment services or to carry on the e-money business by way of the cross-border provision of services in another Member State or another state party to the Agreement on the European Economic Area. The notification must contain: 1. a statement of the state in which the cross-border service is to be provided, 2. a business plan stating the intended activities, and 3. the particulars under section 25(1), where agents or e-money agents are to be engaged in that state.
(3) Where an institution intends to outsource operational tasks relating to payment services or the e-money business to another undertaking in another Member State or another state party to the Agreement on the European Economic Area, it must notify BaFin and the Deutsche Bundesbank of this without delay.
(4) BaFin communicates the relevant particulars to the competent authorities of the host Member State concerned within one month of receipt of the complete notifications under subsections (1) to (3).
(5) BaFin decides whether the branch or the agent is to be entered in the institutions register under section 43(1) or section 44(2), and communicates its decision to the competent authorities of the host Member State and to the institution within three months of complete receipt of the particulars named in subsections (1) to (3). In doing so it has regard to an assessment by the competent authorities of the host Member State. Where BaFin does not agree with the assessment made by the competent authorities of the host Member State, it communicates the reasons for its decision to them. Where BaFin's assessment, in particular having regard to the particulars communicated by the competent authorities of the host Member State, is negative, it refuses to enter the agent or the branch in the institutions register under section 43(1) or section 44(2), or deletes that entry where it has already been made.
(6) After entry in the institutions register under section 43(1) or section 44(2), the agents or the branch may take up their activities in the host Member State. The institution must notify BaFin and the Deutsche Bundesbank of the date from which the agents or the branch take up their activities in the relevant host Member State. BaFin informs the competent authorities of the host Member State accordingly.
(7) Where the competent authority of the host Member State informs BaFin that a domestically licensed institution having agents or branches in the territory of the other Member State is not meeting its supervisory obligations there, BaFin must, after evaluating the information communicated to it, without delay take all measures necessary to ensure that the obligations are met. It keeps the competent authorities of the host Member State and the competent authorities of every other Member State concerned informed of the measures it has taken.
(8) As against the foreign branch, and as against the agents, e-money agents and outsourcing undertakings used by a domestic institution in other states of the European Economic Area, BaFin and the Deutsche Bundesbank have directly the same rights under this Act as against the domestic offices of the institution. In the case of on-site examinations, BaFin or the Deutsche Bundesbank must, as a rule, first obtain, through BaFin, the consent of the competent authorities of the host Member State.
(9) Where circumstances notified under subsection (1), second sentence, subsection (2), second sentence, or subsection (3) change, the institution must notify BaFin and the Deutsche Bundesbank of these changes in writing or electronically without delay. Subsections (4) and (5) apply correspondingly to the procedure.