France (out of EEA) – CM PB

2024, Cross-border, Update

Country Manual Private Banking – France (out of EEA) BRP Update 2024

BRP has updated its Country Manual Private Banking for France (out of EEA) – (Def, RS, BT & RT)

Source of changesAnswers
Law / RegulationNo
New Position of the AuthoritiesNo
Evolution of Expert’s InterpretationNo

Regulatory Template, Regulatory Summary and Behaviour Template

Material changes

The documents have been reviewed following consultation with our local counsel and we can confirm that there have been no major relevant regulatory changes since the last publication of this Country Manual.

Non-material changes

The main changes have been made to the sections on business relationships with third parties. The rest of the documents only contain some aesthetic non-material changes.

Implications for business relations with third parties

The sections on business relationships with third parties, namely finders, tied agents, business introducers, and EAMs have been entirely reviewed.

Some answers and comments have been reformulated and developed for more clarity, without changing the previous approach. Apart from this, the main points to be noted are the following:

  • In general, mere referral activities are permitted without triggering any risks for the Bank.
  • The status of business introducers is not explicitly regulated in France. However, depending on the scope of its activities for the EEA bank, the business introducer would need to be registered as a banking transactions intermediary (IOB), or tied agent, and conclude a solicitation agency agreement (“mandat de démarchage” ) with the Bank.
  • When cooperating with third parties in France, the main risk for an EEA bank is to be considered as having a stable place of business in France, triggering the obligation for the Bank to set up a branch in France. To lower this risk, any collaboration activities should remain occasional.
  • To avoid the risk mentioned hereabove, any delegation of administrative tasks to a French business introducer or EAM is not recommended.
  • A French EAM can promote an EEA bank’s custody services provided a solicitation agency agreement (“mandat de démarchage”) is concluded and this remains an occasional activity.
  • The distribution of material to a French EAM for the subsequent distribution of the documents to the EAM’s clients (B2C) remains a grey zone, for the same reasons as just stated.
  • To be noted that the risk of being considered as having a stable place of business in France depends on the intensity of the activities exercised by the third party and on the number of third parties used by the Bank in France.

Regulatory Summary

This document has now a more user-friendly layout and reflects the changes contained in the RT.

For more information, please contact us:

Geneva, May 7th, 2024