Out-Law News 1 min. read

EBA sets standards for PSD2 'passporting'

The European Banking Authority (EBA) has finalised new regulatory technical standards designed to smooth the process for payments firms to 'passport' under the forthcoming new Payment Services Directive (PSD2).

Passporting arrangements enable firms based in one EU member state to trade anywhere in the bloc without having to seek multiple authorisations.

The EBA was tasked by EU law makers with setting draft regulatory technical standards specifying the framework for cooperation, and for the exchange of information, between regulators to allow for passporting under PSD2. It has now finalised those standards and submitted them to the European Commission, which has the power to adopt them.

PSD2 was introduced into EU law early last year and needs to be implemented into national laws across the EU by 13 January 2018.

Under the Directive, the EBA's standards have to "specify the method, means and details of cooperation in the notification of payment institutions operating on a cross-border basis and, in particular, the scope and treatment of information to be submitted, including common terminology and standard notification templates to ensure a consistent and efficient notification process".

The EBA's finalised standards (69-page / 600KB PDF) will apply where payment institutions or electronic money (e-money) institutions apply to set up an establishment in another EU country, provide services in that country or where they intend to use agents to provide payment services. The standards will also apply to cases where e-money institutions intend to operate via distributors.

The EBA is responsible for defining eleven sets of regulatory technical standards in total under PSD2. In November 2016 the regulator announced that it was unlikely to meet its deadline of 13 January 2017 to finalise its standards on strong customer authentication

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