CRD VI: Belgium Adopts New Rules For Third-country Branches Banking Activities

The Belgian legislator has adopted the law transposing Directive (EU) 2024/1619 of the European Parliament and of the Council of 31 May 2024 amending Directive 2013/36/EU as regards supervisory powers, sanctions, third-country branches, and environmental, social and governance risks (the “CRD VI”) into Belgian law (the “Belgian CRD VI Law”). The law was passed by the Chamber of Representatives on 16 July 2026 and is still to be published in the Belgian Official Gazette (Moniteur belge/Belgisch Staatsblad).

Among other reforms, it implements the new harmonised regime imposing the establishment of a branch authorised by the National Bank of Belgium (the “NBB”) for non-EEA (third country) undertakings to provide core banking services in Belgium. While the Belgian text largely mirrors the CRD VI Directive, it embeds a number of national specificities. With the law now adopted, in-scope institutions should move from monitoring to action ahead of the 11 January 2027 application date for the third country branch regime.

In a nutshell:

• Third-country undertakings providing “core banking services” in Belgium will need an authorised NBB branch unless an exemption applies, from 11 January 2027.
• Contracts for in scope core banking services entered into before 11 July 2026 are grandfathered as acquired rights for the Belgian borrowers.
• Already-authorised branches of third country undertakings will be able to keep their authorisation subject to NBB reassessment against compliance with the new statutory requirements.

1. The new Belgian legal framework

Prior to the implementation of CRD VI, the regulatory treatment of cross-border lending by third-country institutions varied significantly across Member States. While certain jurisdictions, such as France, already required a local establishment or licensed presence in order to conduct lending activities, others, including Belgium and Ireland, generally permitted cross-border lending to corporate borrowers without requiring local authorisation, while maintaining specific regimes governing the establishment and operation of third-country branches.

The European legislator took the view that this fragmentation entailed risks to financial stability and market integrity in the European Union (the “EU”), justifying a common set of minimum requirements (see recital 17 CRD VI). CRD VI introduces a harmonised regime for the provision of certain ‘core banking services’ (deemed in-scope) in the EU by third-country undertakings.

In Belgium, its transposition is achieved principally by amending, amongst others, the Law of 25 April 2014 on the legal status and supervision of credit institutions (the “Banking Law”), the law of 22 February 1998 establishing the organic statute of the National Bank of Belgium and the law of 20 July 2022 on the status and supervision of stockbroking firms. New articles 333 to 340/1 of the Banking Law transpose the harmonised regime for third-country branches set out in articles 21quater and 47 to 48 octodecies of CRD VI.

2. The new CRD VI regime

A. Branch establishment and licensing requirement

As of 11 January 2027, an undertaking governed by the law of a third-country (i.e. a non-EEA country) will have to set up a branch in Belgium and obtain authorisation from the NBB when it provides, in Belgium, one or more “core banking services” (in-scope services), namely:

1. the taking of deposits and other repayable funds from the public;
2. the granting of credits; and
3. the granting of guarantees and commitments.

Deposit-taking activities in Belgium always requires an authorised branch irrespective of the status or activities of the undertaking governed by the laws of a third-country. Granting credits, guarantees and commitments, however, require a branch only to the extent that the undertaking “would be considered a credit institution if it were established in the EU”, based on its activities in its home jurisdiction (or would meet the “Class 1 investment firm” threshold).

This is a broadening of scope. The obligation to set up an authorised branch no longer applies solely to third-country credit institutions carrying out banking services in Belgium. The Belgian parliamentary works confirm that being labelled as a credit institution in its home country is deliberately not used to delineate this scope. In other words, the precise status of the undertaking in its home jurisdiction is not determinative. The relevant question is whether the undertaking’s activities, assessed as a whole, would make it a credit institution if it were established in the EU, which is defined as cumulatively, taking deposits or other repayable funds from the public and granting credit.

A cautious reading is that the test does not require that deposit-taking and lending be both performed in Belgium. However, it seems that the undertaking must perform both activities in its home country.

A genuine non-deposit-taking lender, such as a private equity or private credit fund that originates loans but is a collective investment undertaking, is not in scope.

It should, however, be noted that falling outside the scope of the third-country branch regime does not mean that no authorisation or regulatory requirements apply in Belgium in respect of lending activities.

Belgian consumer credit and mortgage credit rules, the legislation governing SME financing, and the loan origination framework introduced under AIFMD II continue to apply without being affected by the implementation of CRD VI in Belgium. 

B. Exemptions from the branch establishment requirement

In-scope third-country undertakings may continue to serve Belgian clients without an authorised branch in Belgium when any of the following exemptions applies:

• Intra-group exemption. Core bankingservices provided exclusively to a Belgian group company.
• Interbank exemption. Core bankingservices provided exclusively to a Belgian credit institution.
• MiFID services. Certain investment services and ancillary services within the scope of MiFID II resemble core banking services (e.g. custody and cash/collateral management, credit linked to securities transaction, portfolio management). Where core banking services are linked to, and necessary for, the provision and performance of the aforementioned investment and ancillary services, they fall outside the branch establishment requirement. By contrast, where such core banking services are provided on a standalone basis, the establishment of an authorised branch is required. We expect that the scope of this exemption is likely to give rise to a number of interpretation questions in practice.
• Reverse solicitation. A service provided where the client established or located in Belgium has approached the undertaking exclusively on its own initiative. There is no “right” to passive provision of services for the third-country undertaking: the exemption is a prerogative of the EU-based client and must be interpreted restrictively. It falls away in the event of any solicitation of the Belgian client, including through an entity acting on the undertaking’s behalf. Reverse solicitation exemption does not permit to offer any product or service other than the one solicited, or those closely related or necessary to it. The undertaking must be able to evidence that the initiative came from the client and that no prohibited solicitation occurred. In this context, article 135 of the Banking Law expands NBB’s enquiries powers.

C. No European passport

Unlike credit institutions authorised under Book II of the Banking Law, a third-country branch authorised under the new regime enjoys no European passport: its authorised activities may, in principle, be carried out only in Belgium. The new article 334/1 of the Banking Law provides for only two exceptions where services can be performed within the EEA by the branch:

• intra-group financing operations with other third-country branches of the same head undertaking (such transactions being carried out within one and single legal entity), and
• reverse solicitation.

As a result, and as expressly acknowledged in the Belgian parliamentary works, a third-country undertaking may itself carry out a broader range of cross-border activities within the EEA than its branch established in the EEA. This gave rise to questions as to the coherence of the regime, particularly given that the third-country undertaking and its branch constitute one and the same legal entity, but was confirmed by the European Commission.

D. Branch classification

One of the key innovations introduced by CRD VI is the classification of third-country branches into Class 1 (high risk to financial stability) and Class 2 (less significant risk to financial stability) categories. This distinction is intended to ensure that supervisory requirements are calibrated to the risk profile of the branch.

The classification of a branch as a Class 1 branch may be triggered by its size (assets of at least EUR 5 billion), its reliance on deposit-taking activities (where deposits and other repayable funds represent at least 5% of total liabilities or exceed EUR 50 million), or the fact that the third-country branch does not qualify as an eligible third-country branch (meaning that its head office is established in a third country that has not been recognised by the European Commission as having prudential and anti-money laundering frameworks equivalent to those of the EU). To date, the European Commission has not adopted any such equivalence decision.

E. Minimum authorisation requirements

Class 1 branches are subject to a more demanding prudential framework. Depending on the circumstances, this may include a higher capital endowment, the application of liquidity requirements, more frequent regulatory reporting, the appointment of heads of control functions without the possibility of derogation, and potential participation in supervisory colleges. The NBB may also require the establishment of a local management committee. By contrast, Class 2 branches remain subject to the core prudential and organisational requirements applicable to third-country branches but are not automatically exposed to the additional safeguards reserved for Class 1 branches.

For the sake of completeness, the Belgian legislator has not exercised the option provided under article 48a(4) of CRD VI to subject third-country branches, or certain categories thereof, to the same requirements as those applicable to credit institutions. Nevertheless, a number of existing cross-references have been retained, with the result that third-country branches remain subject to certain provisions of the Banking Law that apply to Belgian credit institutions.

a. Capital endowment and assets for seizure

The new regime introduces differentiated capital endowment requirements for third-country branches. A Class 1 branch must maintain a capital endowment equal to 2.5% of the average liabilities of the third-country branch, subject to a minimum of EUR 10 million. A Class 2 branch must maintain a capital endowment equal to 0.5% of the average liabilities of the third-country branch, subject to a minimum of EUR 5 million.

The corresponding assets must be deposited with a Belgian credit institution, in an escrow account which does not form part of the third-country undertaking's group. Such deposited assets may only be made available with the prior consent of the NBB.

Article 48(6) of CRD VI gave Member States the option to require that the capital endowment be deposited with the central bank of the host Member State. However, the Belgian legislator decided to not confer such power to the NBB at this stage.

Further, Belgium has retained a specific local asset requirement for certain third-country branches. Where a third-country branch accepts covered deposits or receives investor funds in Belgium, it must maintain attachable assets in Belgium equal to the amount of such protected deposits or investor assets. The requirement does not apply where the branch can demonstrate that the insolvency law of its home jurisdiction affords depositors or investors protection equivalent to that available under Belgian law, notably in terms of treatment in insolvency and ranking of claims.

b. Liquidity endowment

Authorisation as a third-country branch is subject to compliance with specific liquidity requirements. Third-country branches must at all times maintain a sufficient volume of unencumbered and liquid assets to cover their cash outflows over a minimum 30-day period. In addition, Class 1 branches are subject to the liquidity requirements set out in Regulation (EU) No 575/2013 (the “CRR”).

The Belgian CRD VI Law further provides that these liquidity requirements may be waived for Class 1 and Class 2 branches qualifying as "eligible third-country branches", subject to the conditions laid down in the legislation.

c. Governance

The Belgian CRD VI Law goes beyond merely transposing the prudential requirements applicable to third-country branches. It also substantially enhances the NBB’s supervisory powers, ensuring that larger and more complex branches are subject to robust local oversight and effective supervisory scrutiny.

First, the NBB may require a Class 1 branch to establish a local management committee, particularly where justified by the scale, nature or complexity of the branch’s activities.

The Belgian proposal further introduces a Supervisory Review and Evaluation Process (SREP) specifically tailored to third-country branches. Under this regime, the NBB will periodically assess, among other things, the branch’s governance arrangements, internal control mechanisms, risk management framework, liquidity position, booking practices, outsourcing arrangements and the potential effects of developments affecting the third-country head undertaking.

Additionally, Class 1 branches are required to appoint dedicated heads for all independent control functions and cannot benefit from any waiver in this respect.

Finally, Class 1 branches belonging to third-country banking groups with branches across multiple Member States are subjected to dedicated supervisory colleges. These colleges are designed to facilitate cooperation and information sharing between the competent authorities supervising the various EEA branches of the same third-country group.

d. Reporting

Under the Belgian CRD VI Law, third-country branches are required to submit regular regulatory reports to the NBB to allow it to assess on an ongoing basis whether the branch continues to satisfy the conditions underlying its authorization and whether its activities could create prudential or financial stability concerns triggering a need to reclassify the branch as a Class 1 branch.

The reporting requirements are proportionate to the classification of the branch as either a Class 1 or a Class 2 branch. Such information must be reported at least semi-annually by Class 1 branches and at least annually by Class 2 branches.

e. Summary table

F. Power to require subsidiarisation

A key innovation of the CRD VI framework is the introduction of a specific regime for systemically important branches, where the total aggregate assets of all third-country branches established in the EEA and belonging to the same third-country group amount to or exceed EUR 40 billion. In such a case, the NBB will be required to assess whether a third-country branch poses a potential risk to the stability of the Belgian or EU financial system, taking into account factors, including the branch’s size, organisational and operational complexity, degree of interconnectedness with the Belgian and EU financial systems, substitutability of its services and activities, market share, potential impact on financial stability in the event of disruption, importance within the third-country group, relevance in a resolution or liquidation scenario, and the relative scale of the group’s activities conducted through branches as opposed to authorised EEA subsidiaries.

Where a branch is designated as systemically important, the NBB may impose a range of supervisory measures aimed at mitigating the identified risks. As a measure of last resort or in the absence of any other appropriate measure, the NBB may require converting the Belgian branch into a locally authorised subsidiary, after prior consultation of the European Banking Authority and the authorities of the other Member States where the group has branches or subsidiaries.

The NBB's power to require the establishment of a Belgian-law subsidiary for the conduct of banking activities, whether at the time of a third-country branch's authorisation or subsequently in respect of an already authorised branch, is not new and was already provided for under the Banking Law. However, new article 48r of CRD VI now subjects the exercise of this power to a minimum harmonised framework, which is now reflected in the Banking Law.

3. Staggered entry into force and transition period

Article 355 of the Belgian CRD VI Law provides for phased entry-into-force dates rather than a single date. The key point for third-country players: the branch regime enters into force and will fully apply as of 11 January 2027.

The new requirements are without prejudice to contracts entered into before 11 July 2026, which are safeguarded as acquired rights (grandfathering). However, material amendments to such contracts are likely to bring them within the new regime, and renewals or extensions should not be assumed to benefit from the protection in every case.

Additionally, branches in Belgium of third-country credit institutions already authorised by the NBB will be able to retain their authorisation, provided that, following a reassessment by the NBB, they can be considered to meet the new statutory requirements.

The new reporting obligations of third-country branches will only fully take effect once the European Banking Authority has defined the necessary detailed rules.

4. A broader transposition package…

Although the third-country branch regime constitutes the most far-reaching reform affecting non-EEA banking groups, the Belgian CRD VI Law also introduces a number of significant changes for Belgian credit institutions and banking groups. These include measures aimed at strengthening the independence of the supervisory authority (applicable to the NBB only), the integration of ESG-related risks and risks stemming from crypto-asset activities and exposures, enhanced governance requirements, a harmonised framework for the supervisory assessment of material transactions, adjustments linked to the implementation of the output floor, and an expansion of the NBB's enforcement toolkit, notably through broader powers to impose periodic penalty payments.

The Belgian CRD VI Law further transposes Directive (EU) 2023/2864 and implements Regulation (EU) 2023/2859 establishing the European Single Access Point (ESAP), as well as Directive (EU) 2024/2994 on the treatment of concentration risk arising from exposures to central counterparties.

How can we help?

With the Belgian CRD VI Law now adopted, the practical work begins. Our Financial Regulatory team advises credit institutions, banking groups and third-country players on mapping their exposure to the new regime, preparing branch authorisation applications, assessing reliance on the available exemptions, and bringing existing branches into line with the new capital, liquidity, governance and reporting requirements ahead of 11 January 2027.

As a fully integrated cross-border firm with offices in Belgium, the Netherlands, Luxembourg and Switzerland, we are well placed to guide you through the new regime. Please feel free to contact one of our lawyers listed below.