Question ID
2013_261
Legal act
Regulation (EU) No 575/2013 (CRR)
Topic
Own funds
Article
469, 470, 478
COM Delegated or Implementing Acts/RTS/ITS/GLs/Recommendations
Not applicable
Article/Paragraph
n.a.
Type of submitter
Accounting firm
Subject matter
Consistency regarding the specification of the transition period according to Articles 469(1), 470(2) and 478(2) CRR
Question

How can the applicable percentages of Article 478(2) CRR be applied for the purposes of Article 469(1)(c) CRR until 31.12.2023 provided that the provisions of Article 469(1)(c) and Article 470(2) CRR are applicable only until 31.12.2017?

Background on the question

According to Article 469(1)(c) and Article. 470(2) there is a transition period until 31.12.2017 for the threshold deductions for deferred tax assets (DTA) relying on future profitability and resulting from temporary differences and significant investments in financial sector entities’ CET1-instrumtents.

However, with regard to DTA relying on future profitability and resulting from temporary differences that existed before 31.12.2014 the applicable percentage and the transition period (10% intervals until 31.12.2023) for the amount exceeding the thresholds differ from those (20% intervals until 31.12.2017) for the excess amounts from DTA relying on future profitability and resulting from temporary differences after 31.12.2014 and significant investments in financial sector entities’ CET1-instrumtens.

I.e., DTA relying on future profitability and resulting from temporary differences that existed before 31.12.2014 and exceeding the thresholds of Article 470(2) CRR may be deducted from CET1 according to the applicable percentages of Article 478(2) CRR until 31.12.2023, while simultaneously the permission to determine the threshold deductions according to Article 470 CRR and to determine the deduction amount according to Article 469(1)(c) CRR is restricted until 31.12.2017.

Consequently, the question arises to which deduction amount the applicable percentage according to Article 478(2) CRR should be applied between 31.12.2017 and 31.12.2023?

Submission date
Rejected publishing date
Rationale for rejection

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Status
Rejected question