Changes from report parliamentary committee draft to plenary report

Added(e) marketing shall take account of the need to effect a rapid resolution action;

Added(f) marketing shall aim at maximising, as far as possible, the sale price for the shares or other instruments of ownership, assets, rights or liabilities involved.

AddedThe principles referred to in this paragraph shall not prevent resolution authorities from soliciting particular potential purchasers.

AddedAny public disclosure of the marketing of the undertaking under resolution or entity referred to in Article 1(1), points (b) to (e), or of the bridge undertaking that would otherwise be required in accordance with Article 17(1) of Regulation (EU) No 596/2014 may be delayed in accordance with Article 17, paragraph 4 or 5 of that Regulation.

Added3. Resolution authorities may decide not to comply with the requirement to market a sale where they determine that compliance with the requirements laid down in paragraph 2 would be likely to undermine one or more of the resolution objectives referred to in Article 18.

Added3a. When resolution authorities adopt the decision referred to in paragraph 3, they shall justify that decision and communicate it to EIOPA.

AddedThe asset and liability separation tool

Added1. Member States shall ensure that resolution authorities have the power to transfer assets, rights or liabilities of an undertaking under resolution or a bridge undertaking to one or more asset and liability management vehicles.

Added2. For the purposes of the asset and liability separation tool, an asset and liability management vehicle shall be a legal person that meets all of the following requirements:

Added(a) it is wholly or partially owned by one or more public authorities which may include the resolution authority and is controlled by the resolution authority;

Added(b) it has been created for the purpose of receiving some or all of the assets, rights and liabilities of one or more undertakings under resolution or a bridge undertaking.

Added3. The asset and liability management vehicle shall manage the portfolios transferred to it with a view to maximise their value through a sale of those portfolios or an orderly wind down.

Added4. Member States shall ensure that the operation of an asset and liability management vehicle respects the following requirements:

Added(a) the resolution authority concerned has approved the asset and liability management vehicle’s constitutional documents;

Added(b) subject to the asset and liability management vehicle’s ownership structure, the resolution authority concerned either appoints or approves the vehicle’s administrative, management or supervisory body;

Added(c) the resolution authority concerned approves the remuneration of the members of the administrative, management or supervisory body and specifies their responsibilities;

Added(d) the resolution authority concerned approves the strategy and risk profile of the asset and liability management vehicle.

Added5. Resolution authorities may exercise the power specified in paragraph 1 to transfer assets, rights or liabilities only in conjunction with other resolution tools as referred to in Article 26(3) and where any of the following situations occurs:

Added(a) the situation of the particular market for those assets, rights or liabilities is such that the liquidation of those assets, rights or liabilities under normal insolvency proceedings could have an adverse effect on one or more financial markets;

Added(b) such a transfer is necessary to facilitate the use of the solvent run-off tool or to ensure the proper functioning of the undertaking under resolution or a bridge undertaking;

Added(c) such a transfer is necessary to maximise liquidation proceeds.

Added6. When applying the asset and liability separation tool, resolution authorities shall, in accordance with Article 23 and in accordance with the Union State aid framework, determine the consideration for which assets, rights and liabilities are transferred to the asset and liability management vehicle. This paragraph shall not prevent the consideration having nominal or negative value.

Added7. Where resolution authorities have applied the bridge undertaking tool, asset and liability management vehicles may, subsequent to the application of the bridge undertaking tool, acquire assets, rights or liabilities from the bridge undertaking.

Added8. Resolution authorities may transfer assets, rights or liabilities from the undertaking under resolution to one or more asset and liability management vehicles on more than one occasion and transfer assets, rights or liabilities back from one or more asset and liability management vehicles to the undertaking under resolution in any of the following situations:

Added(a) the possibility that the assets, rights or liabilities might be transferred back is stated expressly in the instrument under which the transfer was made;

Added(b) the assets, rights or liabilities do not fall within the classes of, or meet the conditions for transfer of, assets, rights or liabilities specified in the instrument under which the transfer was made.

AddedIn either of the cases referred in points (a) and (b), the transfer back may be made within any period, and shall comply with any other conditions, stated in that instrument for the relevant purpose.

AddedThe undertaking under resolution shall be obliged to take back any assets, rights or liabilities transferred in accordance with points (a) and (b).

Added9. The objectives of an asset and liability management vehicle shall not imply any duty or responsibility to shareholders or creditors of the undertaking under resolution. The members of the administrative, management or supervisory body or senior management of the asset and liability management vehicle shall have no liability to such shareholders or creditors for acts and omissions in the discharge of their duties, unless such acts or omissions implied gross negligence or serious misconduct under national law which have directly affected the rights of such shareholders or creditors.

AddedMember States may further limit the liability of an asset and liability management vehicle, and of the members of its administrative, management or supervisory body or senior management for acts and omissions in the discharge of their duties.

AddedThe sale of business tool

Added1. Member States shall ensure that resolution authorities have the power to transfer to a purchaser other than a bridge undertaking:

Added(a) shares or other instruments of ownership issued by an undertaking under resolution;

Added(b) all or any assets, rights or liabilities of an undertaking under resolution.

Added2. A transfer made pursuant to paragraph 1 shall be made on commercial terms, having regard to the circumstances, and in accordance with the Union State aid framework.

AddedResolution authorities shall take all reasonable steps to obtain commercial terms for the transfer that are conform with the valuation conducted under Article 23, having regard to the circumstances of the case.

Added3. Resolution authorities may, with the consent of the purchaser, revert the executed transfers where justified by the circumstances of the case. The undertaking under resolution or the original owners shall be obliged to take back any transferred shares or other instruments of ownership, or assets, rights or liabilities.

Added4. Purchasers shall be required to have the appropriate authorisation to carry out the business they acquire when a transfer as referred to in paragraph 1 is made. Supervisory authorities shall ensure that any application for such authorisation shall be considered, in conjunction with the transfer, in a timely manner.

Added5. By way of derogation from Articles 57 to 62 of Directive 2009/138/EC, where a transfer of shares or of other instruments of ownership by virtue of an application of the sale of business tool would result in the acquisition of or increase in a qualifying holding in an insurance or reinsurance undertaking as referred to in Article 57(1) of Directive 2009/138/EC, the supervisory authority of that insurance or reinsurance undertaking shall carry out the assessment required under those Articles in a timely manner that does not delay the application of the sale of business tool and prevent the resolution action from achieving the resolution objectives referred to in Article 18 of this Directive.

Added6. Member States shall ensure that where the supervisory authority has not completed the assessment referred to in paragraph 5 from the date of the transfer, the following shall apply:

Added(a) such a transfer of shares or other instruments of ownership to the acquirer shall have immediate legal effect;

Added(b) during the assessment period and during any divestment period provided for in point (f), the acquirer’s voting rights attached to such shares or other instruments of ownership shall be suspended and vested solely in the resolution authority, which shall have no obligation to exercise any such voting rights and which shall have no liability whatsoever for exercising or refraining from exercising any such voting rights;

Added(c) during the assessment period and during any divestment period provided for in point (f), the penalties and other measures for infringing the requirements for acquisitions or disposals of qualifying holdings laid down in Article 62 of Directive 2009/138/EC shall not apply to such a transfer of shares or other instruments of ownership;

Added(d) promptly upon completion of its assessment, the supervisory authority shall notify the resolution authority and the acquirer in writing of whether it approves or, in accordance with Article 58(4) of Directive 2009/138/EC, opposes such a transfer of shares or other instruments of ownership to the acquirer;

Added(e) where the supervisory authority approves such a transfer of shares or other instruments of ownership to the acquirer, the voting rights attached to such shares or other instruments of ownership shall be deemed to be fully vested in the acquirer immediately upon receipt by the resolution authority and the acquirer of such an approval from the supervisory authority;

Added(f) where the supervisory authority opposes such a transfer of shares or other instruments of ownership to the acquirer:

Added(i) the voting rights attached to such shares or other instruments of ownership as provided for in point (b) shall remain in full force and effect;

Added(ii) the resolution authority may require the acquirer to divest such shares or other instruments of ownership within a divestment period determined by the resolution authority having taken into account prevailing market conditions;(iii) where the acquirer does not comply with the request provided for in point (ii), the supervisory authority, with the consent of the resolution authority, may impose on the acquirer penalties and other measures for infringing the requirements for acquisitions or disposals of qualifying holdings laid down in Article 62 of Directive 2009/138/EC.

Added7. For the purposes of exercising the rights to provide services or to establish itself in another Member State in accordance with Directive 2009/138/EC, the purchaser shall be considered to be a continuation of the undertaking under resolution, and may continue to exercise any such right that was exercised by the undertaking under resolution in respect of the assets, rights or liabilities transferred.

AddedBridge undertaking tool

Added1. Member States shall ensure that resolution authorities have the power to transfer to a bridge undertaking:

Added(a) shares or other instruments of ownership issued by one or more undertakings under resolution;

Added(b) all or any assets, rights or liabilities of one or more undertakings under resolution.

Added2. The bridge undertaking shall be a legal person that meets all of the following requirements:

Added(a) it is wholly or partially owned by one or more public authorities which may include the resolution authority or, where applicable, an insurance guarantee scheme and is controlled by the resolution authority;

Added(b) it is created for the purpose of receiving and holding some or all of the shares or other instruments of ownership issued by an undertaking under resolution or some or all of the assets, rights and liabilities of one or more undertakings under resolution with a view to achieve the resolution objectives and selling the undertaking or entity referred to in Article 1(1), points (b) to (e).

Added3. When applying the bridge undertaking tool, resolution authorities shall ensure that the total value of liabilities transferred to the bridge undertaking does not exceed the total value of the rights and assets transferred from the undertaking under resolution.

Added4. Following an application of the bridge undertaking tool, resolution authorities may, where justified by the circumstances, revert the executed transfers, and the undertaking under resolution or the original owners shall be obliged to take back any transferred assets, rights or liabilities, or shares or other instruments of ownership, where justified by the circumstances of the case, in any of the following situations:

Added(a) the possibility that the specific shares or other instruments of ownership, assets, rights or liabilities might be transferred back is stated expressly in the instrument by which the transfer was made;

Added(b) the specific shares or other instruments of ownership, assets, rights or liabilities do not fall within the classes of, or meet the conditions for transfer of shares or other instruments of ownership, assets, rights or liabilities specified in the instrument by which the transfer was made.