Andorra and San Marino move closer to the EU: why an account there still falls under CRD VI from 2027

On 19 October 2026 the European Commission signed an association agreement with Andorra and San Marino in Brussels. The two microstates gain access to the EU single market, under common rules and a level playing field. That is what the Commission's press release says. Anyone who holds an account in Andorra or wants to open one is quick to read this as good news: if Andorra joins the single market, surely its banks will soon be something like EU banks? One sentence in the same release puts a brake on that hope. For the banks in both countries nothing changes before 11 January 2027, and whether anything changes after that is open.

What was signed on 19 October

The agreement has a long history. The Council adopted the negotiating directives in December 2014, and talks with Andorra, Monaco and San Marino began in 2015. With Monaco the negotiations were suspended in September 2023; with Andorra and San Marino they were concluded in December 2023. In April 2024 the Commission put forward its proposals for the Council decisions, and in July 2026 the Council approved signature and provisional application.

In substance the Commission describes three levels:

• Single market: Andorra and San Marino gain access to the single market under common rules. This is meant to give citizens, businesses and authorities more legal certainty, make trade easier and encourage investment.
• Cooperation: on top of that comes a framework for dialogue and cooperation in areas such as research, education, social policy, the environment, consumer protection and culture.
• Currency: in parallel the EU signed amended monetary agreements with both states. The original agreements on the use of the euro date from 2011 (Andorra) and 2012 (San Marino); the amendments are meant to remove overlaps with the new agreement.

The process continues: the Council now asks the European Parliament for its consent before it concludes the agreement. It can be applied provisionally as soon as the ratification procedures in Andorra and San Marino allow. At the signing, Commissioner Šefčovič spoke of a new chapter of a deeper partnership.

The sentence that matters for your account

On financial services the press release contains exactly one sentence. Integration happens gradually and under certain conditions, and these include an assessment of whether both partners' regulatory and supervisory frameworks are robust enough.

In plain words: the signature does not give banks in Andorra and San Marino a European passport. They may not offer their services in the EU the way a bank from France or Austria may in Sweden. When integration in financial services begins, how far it goes and under what conditions, the Commission does not say. There is no date for it.

What CRD VI means for banks in Andorra and San Marino

This is exactly where the link lies with the rule that changes access to banks outside the EU from January 2027. Article 21c of Directive (EU) 2024/1619, CRD VI, obliges member states to require undertakings established in a third country to set up a branch with its own authorisation if they want to start or continue core banking services in that member state. Under the recitals of the directive, core banking services are taking deposits, lending and guarantees. A current account, a savings account and a fixed deposit all fall under this. Under Article 2 of the directive, member states apply this provision from 11 January 2027.

Andorra and San Marino are not EU member states, nor are they part of the European Economic Area. Their banks are third-country undertakings within the meaning of the directive. As things stand today, the association agreement changes nothing about that. From January, then, a bank in Andorra la Vella is in the same position as a bank in Zurich or Singapore: if it wants to offer an account to clients resident in Sweden, Denmark or Finland, it generally needs an authorised branch in exactly that country.

The directive has exceptions, and they apply here too:

• Own initiative. If a client approaches the bank at their own exclusive initiative, the branch requirement does not apply under Article 21c(2). If the bank solicits, itself or through someone acting on its behalf, it is no longer the client's own initiative.
• Existing contracts. Under Article 21c(5) the requirement applies without prejudice to existing contracts concluded before 11 July 2026. That date is behind us.
• Investment services. Services under the markets in financial instruments directive MiFID II, including related deposits, are exempt under paragraph 4.

How a third-country bank can get such a branch authorised and what that means for clients is described in your foreign account from 2027: what the EBA guidelines mean.

Which routes a bank in Andorra has

Under the directive the banks themselves have essentially three ways to keep serving clients in the EU. They can have a branch authorised in each member state where they have clients, with its own resources and supervision. They can run their EU business through a subsidiary established in the EU; the recitals of the directive name this route expressly as an alternative to the branch. Or they limit themselves to clients who come of their own accord and to clients outside the EU.

For you as a client the consequences differ widely. With the subsidiary solution your money then sits with an EU company, under EU supervision and in an EU deposit guarantee scheme, even if the bank's name stays the same. With the third solution everything stays as it is, but the bank will check carefully with new clients from the EU who took the first step. Which route a particular bank chooses is its own decision; the agreement of 19 October does not make that decision for it.

The euro is not the EU

Many clients confuse two things that sit particularly close together in Andorra and San Marino. Both countries use the euro, on the basis of their own monetary agreements with the EU. So your account in Andorra is denominated in euros, the card works across the eurozone, and transfers run in euros.

For banking supervision that makes no difference. The currency does not decide which supervisory law applies. A bank in Andorra is supervised by the Andorran financial authority AFA, and its deposits are guaranteed by the Andorran deposit guarantee fund FAGADI. According to the AFA's own description, Law 20/2018 sets up this fund as a guarantee scheme modelled on the EU deposit guarantee directive 2014/49/EU. That is a similar level of protection, but a third country's own system. The EU reform of deposit protection, which we describe in our piece on Directive 2026/804, does not apply there automatically.

What about Monaco

Monaco was part of the same negotiations from the start. Since the suspension in September 2023 the process with Andorra and San Marino has continued on its own, and the agreement now signed does not apply to Monaco. If you hold or plan an account in Monaco, 19 October brings no change. What opening an account in Monaco means for non-residents today is described in open a bank account in Monaco.

The data exchange has been running for years

One point is easily overlooked in the debate about microstates: Andorra, San Marino and Monaco have not offered discretion from your own tax office for years. According to the OECD's list of commitments, San Marino has exchanged under the CRS since 2017, Andorra and Monaco since 2018. The OECD's table of activated exchange relationships shows all three sending data to the UK and Norway under the multilateral CRS agreement, and to Sweden, Denmark and Finland under the EU's agreements with them. Balances and income of clients resident there therefore flow automatically to their tax authority every year. Which countries exchange data, and how, is set out in the overview CRS countries 2026.

The association agreement changes nothing here, because this part was settled long ago. An account in any of the three countries is legal, the income is taxable in your country of residence, and your tax office learns about it anyway.

For readers in the UK and the Nordic countries

Sweden, Denmark and Finland. All three are member states, and Article 21c applies equally to clients resident in each of them. A bank in Andorra or San Marino needs an authorisation in Sweden for clients in Sweden, one in Denmark for clients in Denmark and one in Finland for clients in Finland, unless an exception applies. How hard this rule bites for clients and which routes remain is described in CRD VI: it comes down to where you live.

Norway. Norway is in the EEA, not in the EU. The EEA Joint Committee took CRD VI into the EEA Agreement on 20 March 2026; according to the EFTA database the decision enters into force once the constitutional requirements are fulfilled. Readers resident in Norway should therefore plan on the same rule.

United Kingdom. For readers resident in the UK the question does not arise. The rule attaches to clients established or situated in the Union. Someone living in Manchester can open an account in Andorra on whatever terms the bank there allows, without CRD VI coming into it.

One point holds for everyone: the directive is addressed to the banks, not to you. According to its own recitals, the use of banking services outside the Union remains unaffected. Nobody forbids you to hold an account in Andorra. The rule determines under which conditions the bank may serve you as a client resident in the EU.

What this means for you

For the coming months the situation can be summed up in four points.

1. If you already hold an account in Andorra or San Marino that was opened before 11 July 2026, keep the contract and the opening confirmation. Grandfathering depends on the existing contract.
2. If you want to open a new one, take the first step yourself and keep a written record of it. From January, own initiative is the most important exception, and it ends where the bank starts courting you.
3. If you are waiting for the association agreement, you are waiting for a date nobody has named. Integration in financial services is tied to conditions, and first the European Parliament must consent and both countries must ratify.
4. If you are looking for a European solution with a banking passport, you will find it in the European Economic Area. Banks in Liechtenstein may keep serving clients in the EU, with all the pros and cons described in opening a bank account in Liechtenstein.

One more thought suggests itself with Andorra. The agreement does not make Andorra an EU member state. Anyone whose residence genuinely lies outside the EU does not fall under Article 21c as a client anyway, wherever the bank is based. A change of residence, however, is a life decision with tax consequences, not a form for the bank.

Which combination of bank, country and, where relevant, residence works in your case is what we clarify in the free consultation. You will receive a written assessment within 48 hours.