ECB: Guide to on-site inspections and internal model investigations

21 September 2018

The Guide describes the inspection process, from the decision to launch the inspection to the follow-up stage, and sets out the best practices to foster fruitful cooperation between the entities being inspected and the inspection teams.

The objective of the Guide is to provide a useful reference document for the supervised entities and other legal entities for which the ECB has decided to launch an on-site inspection, as well as for the work of the on-site inspection teams.

The Guide applies to the inspections conducted in:

• significant institutions (SIs),
• less significant institutions (LSIs), when the ECB decides to exercise directly all the relevant supervisory powers for an LSI, and
• other legal entities as referred to in Article 10(1) of the SSM Regulation, in particular third parties to whom credit institutions have outsourced functions or activities, and any other undertaking included in supervision on a consolidated basis where the ECB is the consolidating supervisor.

This Guide is not, however, a legally binding document and cannot in any way replace the legal requirements laid down in the relevant applicable Union law. In the case of divergences between the relevant applicable law and the Guide, the former will prevail.

Inspections dedicated to areas which do not fall within the scope of the supervisory tasks conferred upon the ECB are also not included in this Guide. This is the case, for example, with inspections related to consumer protection or the use of the financial system for the purposes of -money laundering or terrorist financing arrangements, as such inspections remain under the responsibility of each participating Member State.

Planned inspections are in general included in the simplified supervisory examination programmes (SEPs) which are drawn up for each SI for a period of 12 months and discussed by the Joint Supervisory Team coordinator (JSTC) and institutions beforehand.

This Guide comprises the three sections:

• Section 1: general framework;
• Section 2: inspection process;
• Section 3: applicable principles for inspections.

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