MIFIDPRU 2.5 Prudential consolidation

1. (1)

   1This section applies to a UK parent entity that is not subject to the group capital test under MIFIDPRU 2.6.

2. (2)

   This section also applies to a MIFIDPRU investment firm that forms part of the same investment firm group as the relevant UK parent entity in (1).

1A UK parent entity must comply with the following on the basis of its consolidated situation:

1. (1)

   MIFIDPRU 3 (Own funds);

2. (2)

   MIFIDPRU 4 (Own funds requirements);

3. (3)

   MIFIDPRU 5 (Concentration risk);

4. (4)

   [deleted]2

5. (5)

   MIFIDPRU 9 (Reporting).

1To ensure that the data required to comply with the consolidated requirements under MIFIDPRU 2.5.7R are duly processed and forwarded, a UK parent entity to which MIFIDPRU 2.5.7R applies and any MIFIDPRU investment firm in the same investment firm group must establish the following:

1. (1)

   a proper organisational structure; and

2. (2)

   appropriate internal control mechanisms.

1A UK parent entity to which MIFIDPRU 2.5.7R applies and any MIFIDPRU investment firm in the same investment firm group must each ensure that any of their subsidiaries that are not subject to MIFIDPRU implement the necessary arrangements, processes and mechanisms to ensure that the UK parent entity complies with the consolidated requirements under MIFIDPRU 2.5.7R.

1. (1)

   1When applying MIFIDPRU 3 on a consolidated basis, the requirements in Title II of Part Two of the UK CRR shall also apply with the modifications in this rule2.

2. (2)

   A reference in Title II of Part Two of the UK CRR to an entity or person included within the “consolidation pursuant to Chapter 2 of Title II of Part One” is a reference to an entity or person included in the consolidated situation of the investment firm group under MIFIDPRU 2.5.

3. (3)

   2The relevant subsidiaries for the purposes of articles 81(1)(a) and 82(a) of the UK CRR are:

   1. (a)

      a MIFIDPRU investment firm;

   2. (b)

      a designated investment firm; and

   3. (c)

      a UK credit institution that is included in the consolidated situation under MIFIDPRU 2.5 because it is a connected undertaking.

4. (4)

   2The modifications in (5) apply where the following provisions of the UK CRR apply to a subsidiary that is a MIFIDPRU investment firm:

   1. (a)

      article 84(1)(a)(i);

   2. (b)

      article 85(1)(a)(i); and

   3. (c)

      article 87(1)(a)(i).

5. (5)

   2The modifications referred to in (4) are as follows:

   1. (a)

      the relevant amount of common equity tier 1 capital in article 84(1)(a)(i) is the sum of:

      1. (i)

         the amount of common equity tier 1 capital required to meet the firm’s own funds threshold requirement; and

      2. (ii)

         any other requirements that apply to the firm under additional third countries local supervisory regulations in to the extent that those requirements must be met by common equity tier 1 capital;

   2. (b)

      the relevant amount of tier 1 capital in article 85(1)(a)(i) is the sum of:

      1. (i)

         the amount of tier 1 capital required to meet the firm’s own funds threshold requirement; and

      2. (ii)

         any other requirements that apply to the firm under additional local supervisory regulations in third countries to the extent that those requirements must be met by tier 1 capital; and

   3. (c)

      the relevant amount of own funds in article 87(1)(a)(i) is the sum of:

      1. (i)

         the amount of own funds required to meet the firm’s own funds threshold requirement; and

      2. (ii)

         any other requirements that apply to the firm under additional local supervisory regulations in third countries to the extent that those requirements must be met by own funds.

6. (6)

   2The following provisions of the UK CRR are modified as follows:

   1. (a)

      article 84(1)(a)(ii) applies as if it refers to the sum of:

      1. (i)

         the amount of consolidated common equity tier 1 capital that relates to the subsidiary that is required on a consolidated basis to meet the requirement in MIFIDPRU 2.5; and

      2. (ii)

         any other requirements that apply to the subsidiary under additional local supervisory regulations in third countries to the extent that those requirements must be met by common equity tier 1 capital;

   2. (b)

      article 85(1)(a)(ii) applies as if it refers to the sum of:

      1. (i)

         the amount of consolidated tier 1 capital that relates to the subsidiary that is required on a consolidated basis to meet the requirement in MIFIDPRU 2.5; and

      2. (ii)

         any other requirements that apply to the subsidiary under additional local supervisory regulations in third countries to the extent that those requirements must be met by tier 1 capital; and

   3. (c)

      article 87(1)(a)(ii) applies as if it refers to the sum of:

      1. (i)

         the amount of consolidated own funds that relates to the subsidiary that is required on a consolidated basis to meet the requirement in MIFIDPRU 2.5; and

      2. (ii)

         any other requirements that apply to the subsidiary under additional local supervisory regulations in third countries to the extent that those requirements must be met by own funds.

1A UK parent entity must comply with MIFIDPRU 6 (Liquidity) on the basis of its consolidated situation.

1. (1)

   1For the purposes of determining the consolidated situation under MIFIDPRU 2.5.7R and MIFIDPRU 2.5.11R, a UK parent entity must carry out a full consolidation of all relevant financial undertakings that form part of its investment firm group, unless (2) applies.

2. (2)

   A UK parent entity is not required to carry out a full consolidation of a relevant financial undertaking under (1) where:

   1. (a)

      the relevant financial undertaking is a connected undertaking that forms part of the investment firm group due to a participation in accordance with MIFIDPRU 2.4.15R; and

   2. (b)

      the conditions for proportional consolidation under MIFIDPRU 2.5.17R are satisfied.

1. (1)

   1This rule applies where a relevant financial undertaking forms part of an investment firm group because it is a connected undertaking due to a participation in accordance with MIFIDPRU 2.4.15R.

2. (2)

   For the purposes of determining the consolidated situation under MIFIDPRU 2.5.7R and MIFIDPRU 2.5.11R, a UK parent entity (“A”) may apply proportional consolidation in relation to the relevant financial undertaking in (1) (“B”) if the following conditions are met:

   1. (a)

      A’s liability is limited to the share of capital that it holds in B;

   2. (b)

      the liability of the other shareholders or members of B (“participating undertakings”) is clearly established by a legally binding and enforceable contract between A and all participating undertakings which:

      1. (i)

         limits the liability of each party to the percentage of its shareholding;

      2. (ii)

         clearly states that any potential losses arising from B will be borne by all shareholders or members proportionately to the share of capital held by each of them at such point in time;

      3. (iii)

         states that any change in the share of capital of a shareholder or member is subject to the explicit consent of all the shareholders or members;

      4. (iv)

         states that if B is recapitalised, A will inform the FCA in a timely manner about the progress of the recapitalisation process and that each shareholder or member is liable to contribute to the recapitalisation no more than an amount that is proportionate to its current share of capital held in A;

   3. (c)

      there are no other agreements or arrangements between any of the following that would override or undermine any of the conditions in (b);

      1. (i)

         some or all of the participating undertakings; or

      2. (ii)

         some or all of the participating undertakings and one or more third parties;

   4. (d)

      any participating undertakings who do not form part of the same investment firm group as A either:

      1. (i)

         are subject to prudential supervision; or

      2. (ii)

         can reasonably be expected to have sufficient resources to fund any contribution for which they may be liable under (b)(iv);

   5. (e)

      the solvency of the participating undertakings is satisfactory and can be expected to remain satisfactory;

   6. (f)

      the UK parent entity has notified the FCA in advance that it intends to apply proportional consolidation in relation to B; and

   7. (g)

      the notification in (f) has been made using the form in MIFIDPRU 2 Annex 3R and submitted using the online notification and application system.

1A UK parent entity is exempt from MIFIDPRU 2.5.11R if:

1. (1)

   the UK parent entity has applied to the FCA in accordance with MIFIDPRU 2.5.20R; and

2. (2)

   the application in (1) demonstrates the following to the satisfaction of the FCA:

   1. (a)

      all MIFIDPRU investment firms in the investment firm group are subject to the rules in MIFIDPRU 6 (Liquidity) on an individual basis; and

   2. (b)

      the exemption is appropriate, taking into account the nature, scale and complexity of the investment firm group.

1A UK parent entity must make an application under MIFIDPRU 2.5.19R(1) by completing the form in MIFIDPRU 2 Annex 4R and submitting it using the online notification and application system.

1. (1)

   1This rule applies for the purpose of determining whether a UK parent entity should be treated as an SNI MIFIDPRU investment firm when applying the chapters of MIFIDPRU specified in MIFIDPRU 2.5.7R and MIFIDPRU 2.5.11R on a consolidated basis.

2. (2)

   Where any individual MIFIDPRU investment firm within the investment firm group has been classified as a non-SNI MIFIDPRU investment firm in accordance with MIFIDPRU 1.2 (including on a combined basis under MIFIDPRU 1.2.10R), the UK parent entity in (1) must comply with the relevant chapters of MIFIDPRU that apply on a consolidated basis as if it were a non-SNI MIFIDPRU investment firm.

3. (3)

   Where no individual MIFIDPRU investment firm within the investment firm group has been classified as a non-SNI MIFIDPRU investment firm (including on a combined basis under MIFIDPRU 1.2.10R), the UK parent entity in (1) must apply the criteria and comply with the calculation requirements in MIFIDPRU 1.2 on the basis of the consolidated situation.

4. (4)

   When applying the criteria in MIFIDPRU 1.2 in accordance with (3), if any entity included within the consolidated situation is dealing on own account, the UK parent entity in (1) must comply with the relevant chapters of MIFIDPRU that apply on a consolidated basis as if it were a non-SNI MIFIDPRU investment firm.

5. (5)

   For the purposes of (3), when calculating the contribution of a collective portfolio management investment firm to the consolidated situation, the UK parent entity is required to include only amounts that are attributable to the investment services and/or activities carried on by the collective portfolio management investment firm.

1. (1)

   1This rule applies for the purposes of a UK parent entity’s calculation of the fixed overheads requirement on a consolidated basis.

2. (2)

   A UK parent entity must:

   1. (a)

      use figures arising from its most recent:

      1. (i)

         audited consolidated annual financial statements after distribution of profits; or

      2. (ii)

         unaudited consolidated annual financial statements, where audited financial statements are not available;

   2. (b)

      if the relevant figures under (a) are not available, calculate the consolidated fixed overheads as the sum of the following:

      1. (i)

         the individual fixed overheads of the UK parent entity;

      2. (ii)

         the full amount of the individual fixed overheads of each relevant financial undertaking that is fully consolidated within the consolidated situation; and

      3. (iii)

         the relevant proportion of the individual fixed overheads of each relevant financial undertaking that is subject to proportional consolidation on a consolidated basis.

   3. (c)

      Where the relevant figures under (2)(a) are available, but the consolidated annual financial statements include undertakings that are not members of the investment firm group, a UK parent entity may use the approach in (2)(b) to calculate its fixed overheads requirement on a consolidated basis.3

3. (3)

   Where these amounts are not already included in the relevant figures under (2), a UK parent entity must include within its calculation of the consolidated fixed overheads any fixed expenses incurred by a third party, including a tied agent, on behalf of:

   1. (a)

      the UK parent entity; or

   2. (b)

      any relevant financial undertaking included in the consolidated situation.

4. (4)

   Where the figures under (2)(b) include expenses that are incurred between entities included in the consolidated situation, the UK parent entity may adjust the consolidated fixed overheads figure to avoid double-counting of these amounts.

1. (1)

   1This rule applies for the purposes of a UK parent entity’s calculation of the consolidated permanent minimum capital requirement when MIFIDPRU 4 applies on a consolidated basis.

2. (2)

   The consolidated permanent minimum capital requirement is the sum of the following:

   1. (a)

      for entities that are fully consolidated within the consolidated situation, the full amount of each of the following:

      1. (i)

         the individual permanent minimum capital requirement of each MIFIDPRU investment firm; and

      2. (ii)

         where applicable, the base own funds requirement or initial capital requirement of any other relevant financial undertaking; and

   2. (b)

      for entities that are subject to proportional consolidation under the consolidated situation, the relevant proportion of each of the amounts specified in (a).

3. (3)

   For the purposes of (2):

   1. (a)

      references to a MIFIDPRU investment firm include a third country entity within the investment firm group that would satisfy the definition if it were established in the UK; and

   2. (b)

      the individual permanent minimum capital requirement, base own funds requirement or initial capital requirement of any third country entity in (a) is the individual requirement that would apply if that entity were established in the UK.

1. (1)

   1This rule applies for the purposes of a UK parent entity’s calculation on a consolidated basis of the following:

   1. (1)

      the K-AUM requirement;

   2. (2)

      the K-COH requirement; and

   3. (3)

      the K-DTF requirement.

2. (2)

   Subject to (4), the consolidated AUM, COH or DTF for the purposes of (1) is the sum of the following:

   1. (a)

      the full amount of the relevant individual K-factor metrics of each MIFIDPRU investment firm that is fully consolidated within the consolidated situation; and

   2. (b)

      the relevant proportion of the relevant individual K-factor metrics of each MIFIDPRU investment firm that is subject to proportional consolidation on a consolidated basis.

3. (3)

   For the purposes of (2):

   1. (a)

      references to a MIFIDPRU investment firm include a third country entity within the investment firm group that would satisfy that definition if it were established in the UK; and

   2. (b)

      the relevant individual K-factor metric of any third country entity in (a) is the individual K-factor metric that would be attributable to that entity if that entity were established in the UK.

4. (4)

   Where the consolidated AUM, COH or DTF under (2) includes amounts attributable to transactions or arrangements solely between two or more entities included within the consolidated situation, those amounts are excluded when calculating the consolidated AUM, COH or DTF.

1The consolidated K-CMH requirement and consolidated K-ASA requirement for an investment firm group must be calculated in accordance with the following:

1. (1)

   the contribution of any individual MIFIDPRU investment firm to the consolidated situation must be determined by applying the rules for calculating CMH and ASA in MIFIDPRU 4.8 and MIFIDPRU 4.9 to that individual firm; and

2. (2)

   the contribution of any other entity (“X”) in the investment firm group to the consolidated situation must be determined by:

   1. (a)

      identifying whether, in the course of, or in connection with, business which would be MiFID business if it were carried on by a MIFIDPRU investment firm in the UK, X holds:

      1. (i)

         any money that was received from its clients; or

      2. (ii)

         any assets belonging to its clients;

   2. (b)

      subject to (3), applying the calculation rules in MIFIDPRU 4.8 or 4.9 to the amounts in (a) by treating:

      1. (i)

         the amounts identified in (a)(i) as CMH;

      2. (ii)

         the amounts identified in (a)(ii) as ASA;

   3. (c)

      where an amount under (a) was originally received by X from a client in the form of money but has subsequently been placed in a collective investment undertaking to meet segregation requirements, treating the relevant amount as:

      1. (i)

         ASA if, on the insolvency of X, the relevant client would be considered to have a direct proprietary interest in the relevant units, shares or equivalent interests in the collective investment undertaking; or

      2. (ii)

         CMH in any other circumstance.

3. (3)

   when applying the calculation rules in MIFIDPRU 4.8, an arrangement operated by X in relation to client money is a segregated account only if (ignoring MIFIDPRU 4.8.9E, which does not apply for these purposes) it meets the requirements in MIFIDPRU 4.8.8R.

1Where the UK parent entity of the investment firm group has been unable to ascertain whether:

1. (1)

   the money or assets referred to in MIFIDPRU 2.5.30R(2)(a) were received or are held in the course of, or in connection with, business which would be MiFID business if it were carried on by a MIFIDPRU investment firm in the UK, it must treat the amounts as if they were received or are held in connection with such business;

2. (2)

   any amount treated as CMH held by X under MIFIDPRU 2.5.30R(2) is held in an account which meets the requirements to be classified as a segregated account, it must treat the relevant amount as held in a non-segregated account; and

3. (3)

   a client would be considered to have a direct proprietary interest in a unit, share or equivalent interest in a collective investment undertaking on the insolvency of X for the purposes of MIFIDPRU 2.5.30R(2)(c), it must treat the relevant amount as CMH.

1A UK parent entity must apply the relevant provisions for the calculation of the K-NPR requirement in MIFIDPRU 4 to a position or exposure included in the consolidated situation unless a rule in this section:

1. (1)

   permits the UK parent entity to include that position or exposure within the calculation of the consolidated K-CMG requirement; or

2. (2)

   otherwise permits the position or exposure to be excluded from the calculation of the consolidated K-NPR requirement.

1. (1)

   1This rule applies to a UK parent entity when calculating the K-NPR requirement on a consolidated basis.

2. (2)

   The UK parent entity may only use positions in one undertaking to offset positions in another undertaking if it has obtained permission to do so in accordance with (3).

3. (3)

   The permission in (2) will only be granted where:

   1. (a)

      the UK parent entity has applied to the FCA in accordance with (4); and

   2. (b)

      the application demonstrates to the satisfaction of the FCA that the conditions in article 325b of the UK CRR are met.

4. (4)

   An entity that applies for a permission under (3) must complete the form in MIFIDPRU 2 Annex 5R and submit it using the online notification and application system.

1When applying MIFIDPRU 4 on a consolidated basis, a UK parent entity may calculate a consolidated K-CMG requirement in relation to portfolios that form part of its consolidated situation in accordance with MIFIDPRU 2.5.38R to MIFIDPRU 2.5.42R.

1. (1)

   1This rule applies where a MIFIDPRU investment firm:

   1. (a)

      is included within the consolidated situation of a UK parent entity; and

   2. (b)

      has been granted a K-CMG permission in relation to a portfolio on an individual basis.

2. (2)

   Where this rule applies, the UK parent entity may include the portfolio in (1)(b) within its calculation of the consolidated K-CMG requirement without requiring a further K-CMG permission.

1. (1)

   1This rule applies where a designated investment firm (“A”) is included within the consolidated situation of a UK parent entity.

2. (2)

   A UK parent entity may include a portfolio of A within the calculation of the UK parent entity’s consolidated K-CMG requirement if:

   1. (a)

      the UK parent entity, or a MIFIDPRU investment firm within the same investment firm group, has applied to the FCA in accordance with MIFIDPRU 2.5.42R; and

   2. (b)

      the application demonstrates to the satisfaction of the FCA that A satisfies the requirements in MIFIDPRU 4.13 as modified by (3) to obtain a K-CMG permission in respect of the portfolio on an individual basis.

3. (3)

   For the purposes of (2), the following modifications apply to the rules relating to the calculation of the K-CMG requirement in MIFIDPRU 4.13:

   1. (a)

      a reference to the “MIFIDPRU investment firm” or “firm” is a reference to A;

   2. (b)

      the clearing member in MIFIDPRU 4.13.9R(2)(c) may be one of the following:

      1. (i)

         A itself;

      2. (ii)

         another designated investment firm;

      3. (iii)

         a MIFIDPRU investment firm;

      4. (iv)

         a third country investment firm;

      5. (v)

         a UK credit institution; or

      6. (vi)

         a credit institution established in a third country.

   3. (c)

      the reference in MIFIDPRU 4.13.12R to MIFIDPRU 4.13.9R is a reference to MIFIDPRU 4.13.9R as modified by this rule; and

   4. (d)

      the requirement in MIFIDPRU 4.13.13R(1)(b) does not apply, but A must ensure that its ongoing processes and systems for assessing the nature and level of risks to which it is, or might be, exposed take into account the understanding of relevant individuals within A of the margin model for the purposes of considering whether:

      1. (i)

         the resulting consolidated K-CMG requirement for the portfolio(s) is sufficient to cover the relevant risks to which A is exposed; and

      2. (ii)

         the K-CMG permission remains appropriate in relation to the portfolio(s) in respect of which it was granted.

1. (1)

   1This rule applies where a third country entity (“B”) is included within the consolidated situation of a UK parent entity.

2. (2)

   A UK parent entity may include a portfolio of B within the calculation of the UK parent entity’s consolidated K-CMG requirement if:

   1. (a)

      the UK parent entity, or a MIFIDPRU investment firm within the same investment firm group, has applied to the FCA in accordance with MIFIDPRU 2.5.42R; and

   2. (b)

      the application demonstrates to the satisfaction of the FCA that B satisfies the requirements in MIFIDPRU 4.13 as modified by (3) to obtain a K-CMG permission in respect of the portfolio on an individual basis.

3. (3)

   For the purposes of (2), the following modifications apply to the rules relating to the calculation of the K-CMG requirement in MIFIDPRU 4.13:

   1. (a)

      a reference to the “MIFIDPRU investment firm” or “firm” is a reference to B;

   2. (b)

      the clearing member for the purposes of MIFIDPRU 4.13.9R(2)(c) may be any of the following:

      1. (i)

         an entity listed in MIFIDPRU 4.13.9R(2)(c);

      2. (ii)

         another entity that the application in (2)(a) demonstrates is subject to appropriate prudential regulation and supervision in the jurisdiction in which it operates; or

      3. (iii)

         B itself, provided that the application demonstrates that B satisfies the conditions in (ii);

   3. (c)

      a reference to the “clearing member” is a reference to the clearing member in (b);

   4. (d)

      the reference in MIFIDPRU 4.13.12R to:

      1. (i)

         MIFIDPRU 4.13.9R is a reference to MIFIDPRU 4.13.9R as modified by this rule; and

      2. (ii)

         both the clearing member and client of the clearing member being entities listed in MIFIDPRU 4.13.9R(2)(c) is to both of those entities being entities listed in (b)(i) or (b)(ii);

   5. (e)

      the obligation in MIFIDPRU 4.13.13R(1)(b) does not apply, but B must ensure that its ongoing processes and systems for assessing the nature and level of risks to which it is, or might be, exposed incorporate the understanding of relevant individuals within B of the margin model for the purposes of considering whether:.

      1. (i)

         the resulting consolidated K-CMG requirement for the portfolio(s) is sufficient to cover the relevant risks to which B is exposed; and

      2. (ii)

         the K-CMG permission remains appropriate in relation to the portfolio(s) in respect of which it was granted.

1. (1)

   1A UK parent entity or a MIFIDPRU investment firm within the same investment firm group that wishes to apply for a K-CMG permission in relation to one or more portfolios included in the consolidated situation of its investment firm group must complete the application form in MIFIDPRU 2 Annex 6R or MIFIDPRU Annex 7R and submit it using the online notification and application system.

2. (2)

   A single application under (1) may be made in respect of multiple portfolios of multiple entities referenced in MIFIDPRU 2.5.40R or MIFIDPRU 2.5.41R, provided that the application demonstrates to the FCA how the relevant conditions in MIFIDPRU 4.13.9R (as modified by MIFIDPRU 2.5.40R(3) in relation to a portfolio of a designated investment firm or MIFIDPRU 2.5.41R(3) in relation to a portfolio of a third country entity) are satisfied in respect of each such portfolio.

3. (3)

   A UK parent entity or MIFIDPRU investment firm that submits an application under (1) must have the necessary authority to make the application on behalf of all entities within the investment firm group whose portfolios are the subject of that application.

1. (1)

   1When calculating its K-TCD requirement on a consolidated basis, a UK parent entity may only net offsetting transactions entered into between one or more entities included in the consolidated situation and a third party counterparty if the conditions in MIFIDPRU 4.14.28R, as modified by (2), are met.

2. (2)

   When applying MIFIDPRU 4.14.28R on the basis of the consolidated situation, the following modifications apply:

   1. (a)

      any netting agreement or netting contract referenced in that rule must cover all entities included in the consolidated situation whose transactions with the same third party counterparty are being netted;

   2. (b)

      any references in that rule to the rights and obligations of the “firm” refer to the rights and obligations of the entities included in the consolidated situation whose transactions with the same third party counterparty are being netted; and

   3. (c)

      the legal opinion referenced in MIFIDPRU 4.14.28R(3)(c):

      1. (i)

         may be obtained by the UK parent entity or any MIFIDPRU investment firm in the investment firm group; and

      2. (ii)

         must address the relevant claims and obligations of all entities included in the consolidated situation whose transactions with the same third party counterparty are being netted.

1When a UK parent entity is calculating a K-CON requirement on the basis of its consolidated situation, the provisions in MIFIDPRU 5 apply, subject to the following:

1. (1)

   the exposure value with regard to an individual client or group of connected clients must be calculated on the basis of all relevant exposures included in the consolidated situation;

2. (2)

   to the extent that the calculation rules for the K-NPR requirement or K-TCD requirement are relevant to the calculation of an exposure value under MIFIDPRU 5.4 or the OFR under MIFIDPRU 5.7.3R(2), the UK parent entity must apply the methods for the calculation of the consolidated K-NPR requirement in MIFIDPRU 2.5.32R to MIFIDPRU 2.5.34R and consolidated K-TCD requirement in MIFIDPRU 2.5.43G to MIFIDPRU 2.5.44R; and

3. (3)

   the own funds to be used for the purposes of calculating the limits in MIFIDPRU 5.5 and MIFIDPRU 5.9 on a consolidated basis are the consolidated own funds of the investment firm group, as explained in the guidance in MIFIDPRU 2.5.23G.

1When applying MIFIDPRU 6 on a consolidated basis, a UK parent entity must ensure that the total liquid assets held by the UK entities included within the consolidated situation are equal to or greater than the consolidated liquid assets requirement.