When does the third-country branch requirement apply?

The directive sets 11 January 2027 as the date from which Member States must apply the transposing measures for those provisions, later than the rest of CRD VI. The date that binds you is the date of the national measure in the Member State concerned, so check that as well as the directive.

Does a third-country branch let us serve the whole EU?

No. A third-country branch is authorised by, and confined to, the Member State that authorises it. Passporting under the freedom of establishment is available to credit institutions authorised in a Member State, which a third-country branch is not.

Banking branches authorisation in the EU

Direct answer

A credit institution authorised in one Member State can establish branches and provide services in others on notification through its home authority.5 For third-country banks the position is different and is changing: CRD VI inserts a requirement to establish an authorised branch, or a subsidiary, before providing core banking services in a Member State.2 The directive sets 11 January 2027 as the date from which Member States must apply the measures transposing those third-country branch provisions, later than the rest of CRD VI, and whether a given Member State has transposed them, and on what terms, has to be checked for that Member State.3 The requirement carries exceptions in the same article, and a third-country branch is authorised by, and confined to, the Member State that authorises it.2 4 5

Who this applies to

EEA banks expanding cross-border
Third-country banks serving EU clients
Institutions considering branch or subsidiary

Regulated activities

Deposit-taking and lending through a branch2
Core banking services provided to EU clients2
Cross-border provision by an institution authorised in a Member State5

Routes to market

Branch of an EEA institution

An institution authorised in a Member State establishes branches in others under the freedom of establishment, on notification through its home authority.5

Third-country branch under CRD VI

An authorised branch for a non-EU bank, with requirements on capital endowment, booking arrangements, governance and reporting. It is authorised by, and confined to, the Member State that authorises it: there is no passport into the rest of the Union.4 5

Subsidiary

A separate credit institution authorisation in the Member State concerned, with its head office in the same Member State as its registered office.6

Capital and substance

Capital endowment, booking arrangements, governance and reporting requirements apply to a third-country branch itself.4
Local senior management, risk and reporting substance.1 6 7
A subsidiary means a full credit institution authorisation rather than a lighter version of one.6
Recovery and resolution considerations.

Authorisation stages

1
Model choice
Assess branch or subsidiary, and whether the third-country branch requirement applies to the services you provide or falls within one of its exceptions.2
2
Timing
Confirm the position in the Member State concerned against the 11 January 2027 application date, because national transposition can differ in timing and in terms.3
3
Pre-application
Prepare governance, booking-model and capital evidence.4
4
Establishment and launch
Stand up local operations and reporting.

Where applications commonly fail

Assuming a third-country branch authorisation reaches other Member States4 5
Planning against the directive alone rather than the national transposing measure and its date3
Overlooking the exceptions, and establishing where the activity did not require it2
Unclear branch or subsidiary rationale6
Weak local risk and reporting capability

Frequently asked questions

It inserts a requirement that a third-country undertaking establish an authorised branch, or a subsidiary, before providing core banking services in a Member State. The requirement carries exceptions in the same article, including services provided at the exclusive initiative of the client and investment services and activities covered by MiFID II.

Primary sources for this page

7 citations, each to the article or section the statement rests on. The numbers beside a statement point to the citation behind it. Always confirm against the current official text.

Last updated 2026-08-21. 3 min read, calculated from 581 words.

Banking branches: passporting and CRD VI