{
  "url": "https://openlegislation.uk/eu-regulation-2017-390/article-6",
  "json_url": "https://openlegislation.uk/eu-regulation-2017-390/article-6.json",
  "legislation": "eur/2017/390",
  "legislation_title": "Commission Delegated Regulation (EU) 2017/390 of 11 November 2016 supplementing Regulation (EU) No 909/2014 of the European Parliament and of the Council with regard to regulatory technical standards on certain prudential requirements for central securities depositories and designated credit institutions offering banking-type ancillary services (Text with EEA relevance)",
  "legislation_url": "https://openlegislation.uk/eu-regulation-2017-390",
  "path": "article/6",
  "kind": "article",
  "number": "6",
  "heading": "Capital requirements for business risk",
  "text": "1. The capital requirements of a CSD for business risk shall be whichever of the following is higher:\n(a) the estimate resulting from the application of paragraph 2, minus whichever of the following is the lowest:\n(i) the net income after tax of the last audited financial year;\n(ii) the expected net income after tax for the current financial year;\n(iii) the expected net income after tax for the previous financial year where audited results are not yet available;\n(b) 25 % of the CSD's annual gross operational expenses referred to in paragraph 3.\n2. For the purposes of point (a) of paragraph 1, a CSD shall apply all of the following:\n(a) estimate the capital necessary to cover losses resulting from business risk on reasonably foreseeable adverse scenarios relevant to its business model;\n(b) document the assumptions and the methodologies used to estimate the expected losses referred to in point (a);\n(c) review and update the scenarios referred to in point (a) at least annually.\n3. For the calculation of a CSD's annual gross operational expenses, the following shall apply:\n(a) the CSD's annual gross operational expenses shall consist of at least the following:\n(i) total personnel expenses including wages, salaries, bonuses and social costs;\n(ii) total general administrative expenses, and, in particular, marketing and representation expenses;\n(iii) insurance expenses;\n(iv) other employees' expenses and travelling;\n(v) real estate expenses;\n(vi) IT support expenses;\n(vii) telecommunications expenses;\n(viii) postage and data transfer expenses;\n(ix) external consultancy expenses;\n(x) tangible and intangible assets' depreciation and amortisation;\n(xi) impairment and disposal of fixed assets;\n(b) the CSD's annual gross operational expenses shall be determined in accordance with one of the following:\n(i) International Financial Reporting Standards (IFRS) adopted pursuant to Regulation (EC) No 1606/2002 of the European Parliament and of the Council;\n(ii) Council Directives 78/660/EEC, 83/349/EEC and 86/635/EEC;\n(iii) generally accepted accounting principles of a third country determined to be equivalent to IFRS in accordance with Commission Regulation (EC) No 1569/2007 or accounting standards of a third country the use of which is permitted in accordance with Article 4 of that Regulation;\n(c) the CSD may deduct tangible and intangible assets' depreciation and amortisation from annual gross operational expenses;\n(d) the CSD shall use the most recent audited information from their annual financial statement;\n(e) where the CSD has not completed business for one year from the date it starts its operations, it shall apply the gross operational expenses projected in its business plan.",
  "extent": "E+W+S+N.I.",
  "status": null,
  "version": "current",
  "annotations": [
    {
      "type": "X",
      "label": "X1",
      "text": "Substituted by Corrigendum to Commission Delegated Regulation (EU) 2017/390 of 11 November 2016 supplementing Regulation (EU) No 909/2014 of the European Parliament and of the Council with regard to regulatory technical standards on certain prudential requirements for central securities depositories and designated credit institutions offering banking-type ancillary services (Official Journal of the European Union L 65 of 10 March 2017)."
    },
    {
      "type": "footnote",
      "label": "f1",
      "text": "Regulation (EC) No 1606/2002 of the European Parliament and of the Council of 19 July 2002 on the application of international accounting standards (OJ L 243, 11.9.2002, p. 1)."
    },
    {
      "type": "footnote",
      "label": "f2",
      "text": "Fourth Council Directive 78/660/EEC of 25 July 1978 based on Article 54(3)(g) of the Treaty on the annual accounts of certain types of companies (OJ L 222, 14.8.1978, p. 11)."
    },
    {
      "type": "footnote",
      "label": "f3",
      "text": "Seventh Council Directive 83/349/EEC of 13 June 1983 based on the Article 54(3)(g) of the Treaty on consolidated accounts (OJ L 193, 18.7.1983, p. 1)."
    },
    {
      "type": "footnote",
      "label": "f4",
      "text": "Commission Regulation (EC) No 1569/2007 of 21 December 2007 establishing a mechanism for the determination of equivalence of accounting standards applied by third country issuers of securities pursuant to Directives 2003/71/EC and 2004/109/EC of the European Parliament and of the Council (OJ L 340, 22.12.2007, p. 66)."
    }
  ],
  "outstanding_effects": [],
  "provenance": {
    "source": "legislation.gov.uk",
    "source_url": "https://www.legislation.gov.uk/eur/2017/390/article/6",
    "retrieved_at": "2026-11-01T14:45:08.893870+00:00"
  },
  "licence": "Open Government Licence v3.0",
  "licence_url": "https://www.nationalarchives.gov.uk/doc/open-government-licence/version/3/",
  "attribution": "Contains public sector information licensed under the Open Government Licence v3.0. Source: legislation.gov.uk, The National Archives."
}