The new regulations within the Tax Act Relating to Brexit (Brexit Steuerbegleitgesetz) and the CRD V, both of which came into force in 2019, have brought about changes within the framework of the application of the Remuneration Ordinance for Institutions (Institutsvergütungsverordnung; IVV).
The German banking supervisory authority must therefore adjust the IVV in any case with regard to the remuneration exemption limit for the performance-related remuneration of risk takers as a result of the new CRD V regulations. In particular, this is likely to have an impact on the current EUR 15 billion limit. In the CRD V, the threshold to become a major institution is already envisaged when a balance sheet total of only five billion euros is reached. This threshold can be increased by the EU member states, but the CRD V stipulates further special requirements in the event of an increase in order to be able to refrain from applying the special risk taker requirements for the variable remuneration of risk takers.
In addition, the EU member states should be able to exempt individual groups of risk takers from the remuneration exemption limit if this is appropriate in view of their specific function or responsibility or the standard market remuneration system.
In view of the new stricter requirements, we advise you to monitor the legislative process in Germany and establish the necessary processes in your institution in advance. As a law firm, we have supported institutions in the internal implementation of the remuneration guidelines from the very beginning and have trained employees on the basis of practical implementation examples. We therefore have extensive experience in advising on remuneration models of all company sizes.
Contact us and we will be happy to support you in the development of internal remuneration processes or train your employees in in-house seminars.