1.   An external reviewer with an annual turnover generated at group level of below EUR 5 000 000 shall be exempt from having to pay ESMA an annual supervisory fee. That exemption shall apply until the end of the third full calendar year following registration or recognition as applicable. After that date, those external reviewers shall pay an annual supervisory fee that is calculated in accordance with paragraph 2.

2.   ESMA shall calculate the total annual supervisory cost and the annual supervisory fee for a given external reviewer as follows:

(a)	the total annual supervisory cost for a given year (n) shall be the estimate of expenditures relating to the supervision of external reviewers’ activities under Regulation (EU) 2023/2631 as included in ESMA’s budget for that year;

(b)

an external reviewer’s annual supervisory fee for a given year (n) shall be the total annual supervisory cost determined pursuant to point (a), divided between all external reviewers except those external reviewers that are exempt pursuant to paragraph 1 in year (n), in proportion to their applicable turnover calculated in accordance with Article 3;

(c)	the annual supervisory fee charged to an external reviewer shall not represent more than 3 % of its applicable turnover. However, no external reviewer shall pay an annual supervisory fee that is lower than EUR 30 000.

3.   By way of derogation from paragraphs 1 and 2, the first-year supervisory fee shall be equal to the fee referred to in Article 1(1) or, where applicable, to the fee referred to in Article 1(2) or, where applicable, the fee referred to in Article 1(3), multiplied by the number of days between registration or recognition and the end of the year and divided by the total number of days in that year.

4.   An external reviewer that is registered or recognised during the month of December shall not pay the first-year supervisory fee.