1.   For the purposes of point (a) of Article 382(4) of Regulation (EU) No 575/2013, institutions shall consider as non-financial counterparties established in a third country, counterparties that meet both of the following conditions:

(a)	they are established in a third country;

(b)	they would qualify as a non-financial counterparty within the meaning of point (9) of Article 2 of Regulation (EU) No 648/2012 if they were established in the Union.

2.   Institutions shall verify whether a counterparty is a non-financial counterparty established in a third country:

(a)	at trade inception when trading with a new counterparty;

(b)	on an annual basis for existing counterparties;

(c)	where there is reason to believe that the counterparty is no longer a non-financial counterparty established in a third country.

3.   Institutions shall substantiate their opinion that an undertaking is a non-financial counterparty established in a third country.