Article 1 Materiality thresholds for operations under the freedom to provide services


This is a draft act

This text has been parsed from the AMLA final report draft as published on 16 December 2025. While we run a suite of validations, the automated parsing can result in errors. Also, before it is finally adopted by the Commission, its wording, numbering and references may change, and entire articles might be removed or added.

Summary What does Article 1 of the RTS on risk assessment to select institutions for direct supervision say?

This article establishes the quantitative thresholds that determine when a credit or financial institution's cross-border activities — carried out under the freedom to provide services — are considered "material" for the purposes of Article 12(1) of Regulation (EU) 2024/1620.

In essence, it draws a clear line between incidental and significant cross-border presence, using two concrete metrics: customer numbers and transaction volumes.

The article also addresses how these thresholds are calculated, notably requiring that all delivery channels be counted together and that group entities operating in the same Member State pool their figures.

Important points:

  • Your cross-border activities in another Member State are considered material if you exceed 20,000 resident customers or EUR 50,000,000 in annual transaction volume in that Member State.
  • Count all activities toward these thresholds regardless of whether they are conducted directly, through branches, agents, or distributors.
  • Where multiple entities within the same group operate under the freedom to provide services in the same Member State, their activities must be aggregated when applying the thresholds.

Springlex's summary of the article, a reading aid, not a substitute for the legal text.

    1. The minimum activities carried out by a credit institution or a financial institution under the freedom to provide services in a Member State other than the Member State where it is established shall be considered material for the purposes of meeting the conditions of Article 12(1) of Regulation (EU) 2024/1620, where:

      1. the number of its customers that are resident in that Member State exceeded 20 000 as of 31 December in the previous year; or

      2. the total annual amount of incoming and outgoing transactions generated by customers referred to in point (a) in the previous year exceeds EUR 50 000 000, or the equivalent in national currency.

    2. For the purposes of the first subparagraph, all activities carried out under the freedom to provide services in a given Member State by a credit institution or a financial institution shall be taken into account, irrespective of whether those activities are carried out directly, through its branches, its agents, or its distributors.

    3. Where several credit institutions or financial institutions within the same group carry out activities under the freedom to provide services in the same Member State, their activities in that Member State shall be aggregated for determining the minimum activities pursuant to points (a) and (b) of the first subparagraph.

    1. Whether the activity of a credit institution or a financial institution or a group thereof meets any of the materiality thresholds referred to in paragraph 1, points (a) and (b), shall be determined based on the data points listed in Section C of Annex I.

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