(1) In respect of the application of -

(a) the PRA Rulebook, Financial Conglomerates Annex 1 Threshold Test 1, 2 and 3, or

(b) the Threshold Test 1, 2 and 3 of Annex 4 of Chapter 3 of the FCA General Prudential sourcebook,

the relevant competent authorities may by common agreement take the action specified in paragraph (2).

(2) The action the relevant competent authorities may take is -

(a) to exclude an entity when calculating the ratios, in the cases referred to in regulation 24, unless -

(i) the entity moved from the UK to a third country, and

(ii) there is evidence that the entity changed its location to avoid regulation;

(b) to take into account compliance with the thresholds envisaged in -

(i) the PRA Rulebook, Financial Conglomerates Annex 1 Threshold Test 1 and 2, or

(ii) the Threshold Test 1 and 2 of Annex 4 of Chapter 3 of the FCA General Prudential sourcebook,

for three consecutive years so as to avoid sudden regime shifts, and disregard such compliance if there are significant changes in the group's structure;