Article 4a
Supervisory independence of competent authorities
1.
For the purposes of this Article, ‘members of the competent authority’s governance body’ means natural persons that form part of the most senior collective decision-making body of the competent authority and who are vested with the power to exercise executive functions regarding the day-to-day management of the supervisory function of the competent authority, excluding governors of national central banks.
2.
For the purpose of preserving the independence of competent authorities in the exercise of their powers, Member States shall provide for the necessary arrangements to ensure that competent authorities, including their members of staff and the members of their governance bodies, can exercise their supervisory powers independently and objectively, without seeking or taking instructions from supervised institutions, from any body of the Union or any government of a Member State or from any other public or private body. Member States shall ensure that the governance bodies of competent authorities are functionally independent of other public and private bodies. Those arrangements shall be without prejudice to the arrangements under national law whereby competent authorities are subject to public and democratic accountability.
Member States shall ensure that no member of a competent authority’s governance body who is appointed after 11 January 2026 remains in office for more than 14 years. Member States shall ensure that members of a competent authority’s governance body are appointed on the basis of published criteria that are objective and transparent and that those members can be dismissed if they no longer meet the criteria of appointment or have been convicted of a serious criminal offence. The reasons for dismissal shall be made public unless the member of the competent authority’s governance body concerned objects to the publication.
Member States shall ensure that competent authorities publish their objectives, are accountable for the discharge of their duties in relation to those objectives and are subject to financial control in a manner which does not affect their independence.
This paragraph shall be without prejudice to the rights and obligations of competent authorities pursuant to international or European systems of financial supervision, in particular the European system of financial supervision established pursuant to Regulation (EU) No 1093/2010 ( 4 ), the single supervisory mechanism established pursuant to Council Regulation (EU) No 1024/2013 ( 5 ) and Regulation (EU) No 468/2014 of the European Central Bank ( 6 ), and the Single Resolution Mechanism established pursuant to Regulation (EU) No 806/2014 of the European Parliament and of the Council ( 7 ).
3.
Member States shall, in particular, ensure that competent authorities have in place all the necessary arrangements to prevent conflicts of interest of their members of staff and of the members of their governance bodies. For that purpose, Member States shall lay down rules that are proportionate to the role and responsibilities of the members of staff and the members of governance bodies, and that, at a minimum, prohibit them from:
(a)
trading in financial instruments issued by or referenced to the institutions supervised by their competent authorities, and the direct or indirect parent undertakings, subsidiaries or affiliates of those institutions, with the exception of:
(i)
instruments managed by third parties, provided that the owners of those instruments are precluded from intervening in the management of the portfolio;
(ii)
investments in collective investment undertakings;
(b)
being hired by or accepting any kind of contract for the provision of professional services during a certain period (‘cooling-off period’) with any of the following:
(i)
institutions with which the member of staff or the member of the competent authority’s governance body has been directly involved for the purposes of supervision or decision-making, including the direct or indirect parent undertakings, subsidiaries or affiliates of those institutions;
(ii)
entities providing services to any of the entities referred to in point (i), unless the member of staff or the member of the competent authority’s governance body is strictly precluded from taking part in the provision of those services during the cooling-off period;
(iii)
entities conducting lobbying and advocacy activities directed at the competent authority on matters for which the member of staff or the member of the competent authority’s governance body was responsible during that member’s employment or term of office.
The exceptions provided for in the first subparagraph, points (a)(i) and (ii), shall only apply where the third parties and collective investment undertakings do not predominantly invest in instruments issued by or referenced to the entities referred to in point (a).
4.
The cooling-off period shall start from the date on which direct involvement in the supervision of the entities referred to in paragraph 3, point (b)(i), ceased. Competent authorities shall ensure that their members of staff and the members of their governance bodies have no access to confidential or sensitive information relating to those entities during the cooling-off period. In the case of hirings by entities referred to in paragraph 3, points (b)(i) and (ii), the length of the cooling-off period shall be no less than six months for members of staff directly involved in the supervision of entities referred to in paragraph 3, point (b)(i), and no less than 12 months for members of the competent authority’s governance body. In the case of hirings by entities referred to in paragraph 3, point (b)(iii), the length of the cooling-off period shall be no less than three months for both members of staff and members of the competent authority’s governance body.
Member States may allow competent authorities to subject their members of staff and the members of their governance bodies to whom paragraph 3, point (b)(i), applies to a cooling-off period in the event of their hiring by direct competitors of one of the entities referred to in that point. For those purposes, the length of the cooling-off period shall be no less than three months for members of staff directly involved in the supervision of those entities and no less than six months for members of the competent authority’s governance body.
5.
By way of derogation from paragraph 4, Member States may allow competent authorities to apply shorter cooling-off periods of a minimum of three months for the members of staff directly involved in the supervision of institutions only where a longer cooling-off period:
(a)
would unduly restrict the ability of the competent authority to hire new members of staff with the adequate or necessary skills to exercise its supervisory functions, in particular taking into account the small size of the national labour market; or
(b)
would constitute a breach of any relevant fundamental right recognised in the constitution of the Member State concerned, of the Charter of Fundamental Rights of the European Union, or of any relevant workers’ rights as set out in national labour law.
6.
Members of staff and members of a competent authority’s governance body subject to the prohibition provided for in paragraph 3, point (b), shall be entitled to appropriate compensation for that prohibition. Member States shall decide on the appropriate form of such compensation.
7.
Member States shall ensure that members of staff and members of a competent authority’s governance body are subject to a declaration of interest. That declaration shall include information on the members’ holdings in the form of stocks, equities, bonds, mutual funds, investment funds, mixed-type funds, hedge funds and exchange-traded funds, that may raise conflict of interest concerns. The persons concerned shall submit the declaration of interest prior to their appointment and subsequently on an annual basis.
The declaration of interest shall be without prejudice to any requirement to submit a wealth declaration under applicable national rules.
8.
Where a member of staff or a member of a competent authority’s governance body owns, at the time of being hired or appointed or at any time thereafter, financial instruments that may give rise to conflicts of interest, the competent authority shall have the power to require on a case-by-case basis that those instruments be sold or disposed of within a reasonable timeframe. Competent authorities shall also have the power to allow, on a case-by-case basis, those members to sell or dispose of financial instruments that they owned at the time of being hired or appointed.
9.
To ensure a proportionate application of this Article, EBA shall, by 10 July 2026 issue guidelines, in accordance with Article 16 of Regulation (EU) No 1093/2010, addressed to the competent authorities, on the prevention of conflicts of interest in, and on the independence of, competent authorities, taking into account international best practices.
( 4 ) Regulation (EU) No 1093/2010 of the European Parliament and of the Council of 24 November 2010 establishing a European Supervisory Authority (European Banking Authority), amending Decision No 716/2009/EC and repealing Commission Decision 2009/78/EC (OJ L 331, 15.12.2010, p. 12).
( 5 ) Council Regulation (EU) No 1024/2013 of 15 October 2013 conferring specific tasks on the European Central Bank concerning policies relating to the prudential supervision of credit institutions (OJ L 287, 29.10.2013, p. 63).
( 6 ) Regulation (EU) No 468/2014 of the European Central Bank of 16 April 2014 establishing the framework for cooperation within the Single Supervisory Mechanism between the European Central Bank and national competent authorities and with national designated authorities (SSM Framework Regulation) (ECB/2014/17) (OJ L 141, 14.5.2014, p. 1).
( 7 ) Regulation (EU) No 806/2014 of the European Parliament and of the Council of 15 July 2014 establishing uniform rules and a uniform procedure for the resolution of credit institutions and certain investment firms in the framework of a Single Resolution Mechanism and a Single Resolution Fund and amending Regulation (EU) No 1093/2010 (OJ L 225, 30.7.2014, p. 1).