Examination of licence applications

The Autorité de Contrôle Prudentiel et de Résolution (ACPR – Prudential Supervision and Resolution Authority) is responsible for issuing licences to insurance undertakings, investment firms, financing companies, payment institutions, electronic money institutions and clearing houses. 

In the case of banks, it examines applications for licences and then submits them to the European Central Bank (ECB), which has decision-making powers in this area. 

The granting of a licence constitutes an authorisation to carry out the activities for which it was granted. Where applicable, it also constitutes a European passport entitling the entity to exercise its activities in another Member State of the European Union or one that has ratified the Agreement on the European Economic Area, once the required formalities have been completed and the ACPR has informed the competent authority of the host state.

Supervision of authorised entities

The ACPR is vested with supervisory powers to ensure the robustness and resilience of authorised institutions. It monitors their long-term structural vulnerabilities and emerging risks such as counterparty risk (exposures to non-bank financial institutions), climate risk and cyber risk.

Pursuant to this supervisory mandate, the ACPR performs three main tasks:

  • prudential and financial supervision
  • the monitoring of business practices
  • the prevention of money laundering and the financing of terrorism

To carry out these tasks, ACPR staff perform on-site and off-site inspections based on indicators, analysis of prudential and accounting data, and tools for monitoring and measuring risks, exposures and related strategies. This data collection, combined with market analysis and impact studies, enables staff to fine-tune regulations and supervisory tools such as stress tests.

The oversight of banks is conducted in close cooperation with the ECB, within the framework of the European banking union and the Single Supervisory Mechanism (SSM) set up on 4 November 2014. The ECB is responsible for the direct supervision of banking institutions recognised as "significant institutions" and the indirect supervision of other "less -significant institutions", for which primary responsibility lies with the competent national authorities, i.e. the ACPR in France. Additional criteria (size, economic importance, total value of assets, or direct public financial support) are used to determine whether or not an institution should be considered systemically important. 

The power to prevent and act

The ACPR has extensive powers to carry out its supervisory tasks. In particular, it can apply administrative police measures:

  • injunctions
  • warnings
  • precautionary measures
  • suspension of activities

It may also impose sanctions (reprimands, temporary bans, partial or total withdrawal of licences) in the event of failure to comply with one of the provisions applicable to it, or when a warning or formal notice has not been heeded.

The ACPR also has resolution powers. It notably ensures that the Single Resolution Mechanism (SRM) can be implemented to limit the impact of bank failures on financial stability, protect depositors and avoid the use of state aid. The ACPR also has resolution powers at the national level in respect of insurance undertakings and clearing houses.

Lastly, the ACPR is actively involved in developing the regulatory framework and international coordination by monitoring regulations, representing France in a wide range of European and international working groups and, where appropriate, entering into cooperation agreements with its foreign counterparts.