Changes from report parliamentary committee draft to plenary report

Added4. The Board shall have the power to market to potential purchasers, or make arrangements for such marketing, the entity referred to in Article 7(2), or the entity referred to in Article 7(4), point (b), and Article 7(5) where the conditions for the application of those provisions are met or require the entity to do so, for the following purposes:

Added(a) to prepare for the resolution of that entity, subject to the conditions specified in Article 39(2) of Directive 2014/59/EU and the requirements of professional secrecy laid down in Article 88 of this Regulation;

Added(b) to inform the assessment by the Board of the condition referred to in Article 18(1), point (b), of this Regulation.

Added4a. Where, in the exercise of the power referred to in paragraph 4, the Board decides to directly market the entity concerned to potential purchasers, it shall have due regard to the circumstances of the case and the potential impact that the exercise of that power might have on the entity’s overall position.

Added5. For the purposes of paragraph 4, the Board shall have the power to:

Added(a) request the entity concerned to put in place a digital platform for sharing the information that is necessary for the marketing of that entity with potential purchasers or with advisors and valuers engaged by the Board;

Added(b) require the relevant national resolution authority to draft a preliminary resolution scheme for the entity concerned.

AddedWhere the Board exercises its power under the first subparagraph, point (b), of this paragraph, Article 88 shall apply.

Added6. The determination that the conditions laid down in Article 13(1) of this Regulation or Article 27(1) of Directive 2014/59/EU are met and the prior adoption of early intervention measures are not necessary conditions for the Board to prepare for the resolution of the entity or to exercise the powers referred to in the paragraphs 4 and 5 of this Article.

Added7. The Board shall inform the Commission, the ECB, the relevant national competent authorities and the relevant national resolution authorities of any action taken pursuant to paragraphs 4 and 5 without delay.

Added8. The ECB, the national competent authorities, the Board and the relevant national resolution authorities shall closely cooperate:

Added(a) when considering taking the measures referred to in paragraph 1, first subparagraph, point (a) that aim to address a deterioration in the situation of an entity and group, and the measures referred to in paragraph 1, first subparagraph, point (c);

Added(b) when considering taking any of the actions referred to in paragraphs 4 and 5;

Added(c) during the implementation of the actions referred to in points (a) and (b) of this subparagraph.

AddedThe ECB, the national competent authorities, the Board and the relevant national resolution authorities shall ensure that those measures and actions are consistent, coordinated and effective.’;

Added(17) in Article 14(2), points (c) and (d) are replaced by the following:

Added‘(c) to protect public funds by minimising reliance on extraordinary public financial support, in particular when provided from the budget of a Member State;

Added(d) to protect covered deposits and, to the extent possible, also the uncovered part of eligible deposits of natural persons and micro, small and medium-sized enterprises, and to protect investors covered by Directive 97/9/EC;’;

Added(18) in Article 16, paragraph 2 is replaced by the following:

Added‘2. The Board shall take a resolution action in relation to a parent undertaking as referred to in Article 2, point (b), where the conditions laid down in Article 18(1) are met.

AddedFor those purposes, a parent undertaking as referred to Article 2, point (b), shall be deemed to be failing or likely to fail in any of the following circumstances:

Added(a) the parent undertaking meets one or more of the conditions laid down in Article 18(4), points (b), (c) or (d);

Added(b) the parent undertaking infringes materially, or there are objective elements that show that the parent undertaking will, in the near future, infringe materially, the applicable requirements laid down in Regulation (EU) No 575/2013 or in the national provisions that transpose Directive 2013/36/EU.’;

Added(19) Article 18 is amended as follows:

Added(a) paragraphs 1, 1a, 2 and 3 are replaced by the following:

Added‘1. The Board shall adopt a resolution scheme pursuant to paragraph 6 in relation to the entities referred to in Article 7(2), and to the entities referred to in Article 7(4), point (b) and Article 7(5) where the conditions for the application of those provisions are met, only when it has determined, in its executive session, upon receiving a communication pursuant to the second subparagraph or on its own initiative, that all of the following conditions are met:

Added(a) the entity is failing or is likely to fail;

Added(b) ▌there is no reasonable prospect that any alternative private sector measure, including measures by an IPS, supervisory action, early intervention measures, or the write down or conversion of relevant capital instruments and eligible liabilities as referred to in Article 21(1), taken in respect of the entity would prevent the ▌ entity from failing or being likely to fail within a reasonable timeframe;

Added(c) a resolution action is necessary in the public interest pursuant to paragraph 5.

AddedThe assessment of the condition referred to in the first subparagraph, point (a), shall be made by the ECB for the entities referred to in Article 7(2), point (a), or by the relevant national competent authority for the entities referred to in Article 7(2), point (b), Article 7(3), second subparagraph, Article 7(4), point (b) and Article 7(5), after having consulted the Board. The Board, in its executive session, may make such an assessment only after having informed the ECB or the relevant national competent authority of its intention to make such an assessment and only if the ECB or the relevant national competent authority, within three calendar days of receipt of that information, do not make such an assessment themselves. The ECB or the relevant national competent authority shall, without delay, provide the Board with any relevant information that the Board requests to inform its assessment, before or after being informed by the Board of its intention to make the assessment of the condition referred to in the first subparagraph, point (a).

AddedWhere the ECB or the relevant national competent authority has assessed that the condition referred to in the first subparagraph, point (a), is met in relation to an entity as referred to in the first subparagraph, they shall communicate that assessment to the Commission and to the Board without delay.

AddedThe assessment of the condition referred to in the first subparagraph, point (b), ▌shall be made by the Board, in its executive session and in close cooperation with the ECB or the relevant national competent authority, after consulting, without delay, a designated authority of the DGS, and, where appropriate, an IPS of which the institution is a member. The consultation with the IPS shall include a consideration of the availability of measures by the IPS that could prevent the failure of the institution within a reasonable timeframe. The ECB or the relevant national competent authority shall, without delay, provide the Board with any relevant information that the Board requests to inform its assessment. The ECB or the relevant national competent authority may also inform the Board that it considers the condition laid down in the first subparagraph, point (b), to be met.

Added1a. The Board shall adopt a resolution scheme in accordance with paragraph 1 in relation to a central body and all credit institutions permanently affiliated to it that are part of the same resolution group only where the central body and all credit institutions permanently affiliated to it, or the resolution group to which they belong, comply as a whole with the conditions laid down in paragraph 1, first subparagraph.

Added2. Without prejudice to cases where the ECB has decided to exercise directly supervisory tasks relating to credit institutions pursuant to Article 6(5), point (b) of Regulation (EU) No 1024/2013, in the event of receipt of a communication pursuant to paragraph 1 in relation to an entity or group as referred to in Article 7(3), the Board shall communicate its assessment as referred to paragraph 1, fourth subparagraph, to the ECB or the relevant national competent authority without any delay.

Added3. The previous adoption of a measure pursuant to Article 16 of Regulation (EU) No 1024/2013, to Article 27 of Directive 2014/59/EU, to Article 13 of this Regulation or to Article 104 of Directive 2013/36/EU shall not be a condition for taking a resolution action.’;

Added(b) paragraph 4 is amended as follows:

Added(i) in the first subparagraph, point (d) is replaced by the following:

Added‘(d) extraordinary public financial support is required except where such support is granted in one of the forms referred to in Article 18a(1)’;

Added(ii) the second and third subparagraphs are deleted;

Added(c) paragraph 5 is replaced by the following:

Added‘5. For the purposes of paragraph 1, point (c), a resolution action shall be treated as in the public interest where that resolution action is necessary for the achievement of, and is proportionate to, one or more of the resolution objectives referred to in Article 14 and where winding up of the institution under normal insolvency proceedings would not meet those resolution objectives more effectively.

AddedResolution action shall be presumed not to be in the public interest for the purposes of paragraph 1, point (c), of this Article where the resolution authority has decided to apply simplified obligations to an institution, pursuant to Article 4. The presumption shall be rebuttable and shall not apply where the resolution authority assesses that one or more of the resolution objectives would be at risk if the institution were to be wound up under normal insolvency proceedings.

AddedWhen carrying out the assessment referred to in the first subparagraph, the Board, based on the information available to it at the time of that assessment, shall evaluate consider and compare all extraordinary public financial support ▌to be granted to the entity, both in the event of resolution and in the event of winding up in accordance with the applicable national law.’;

AddedFor the purposes of the second subparagraph of this paragraph, participating Member States, deposit guarantee schemes and, where necessary, the designated authority as defined in Article 2(1), point (18), of Directive 2014/49/EU shall keep the Board informed of any preparatory measures for the granting of the measures referred to in Article 18a(1), points (c) and (d), of this Regulation, including any pre-notification contacts with the Commission.

Added(d) in paragraph 7, the second subparagraph is replaced by the following:

Added‘Within 24 hours from the transmission of the resolution scheme by the Board, the Commission shall endorse the resolution scheme or object to it, either with regard to the discretionary aspects of the resolution scheme in the cases not covered in the third subparagraph of this paragraph or with regard to the proposed use of State aid or Fund aid that is not considered compatible with the internal market.’;

Added(e) the following paragraphs are added:

Added‘11. Where the conditions referred to in paragraph 1, points (a) and (b), are met, the Board may instruct the national resolution authorities to exercise the powers under national law transposing Article 33a of Directive 2014/59/EU, in accordance with the conditions laid down in national law. The national resolution authorities shall implement the instructions of the Board in accordance with Article 29.

Added11a. In order to ensure effective and consistent application of this Article, the Board shall give guidance and provide instructions to national resolution authorities for the application of the regulatory technical standards referred to in Article 32(5a) of Directive 2014/59/EU.’

Added(20) the following Article 18a is inserted:

Added‘Article 18a

AddedExtraordinary public financial support

Added1. Extraordinary public financial support outside of resolution action may be granted to an entity as referred to in Article 2 on an exceptional basis only in one of the following cases and provided that the extraordinary public financial support complies with the conditions and requirements established in the Union State aid framework:

Added(a) where, to remedy a serious disturbance in the economy of a Member State of an exceptional or systemic nature and to preserve financial stability, the extraordinary public financial support takes any of the following forms:

Added(i) a State guarantee to back liquidity facilities provided by central banks in accordance with the central banks’ conditions;

Added(ii) a State guarantee of newly issued liabilities;

Added(iii) an acquisition of own funds instruments other than Common Equity Tier 1 instruments or of other capital instruments, or a use of impaired assets measures at prices, duration, and terms that do not confer an undue advantage upon the institution or entity concerned, provided that none of the circumstances referred to in Article 18(4), points (a), (b) or (c), or Article 21(1) are present at the time the public support is granted.

Added(b) where the extraordinary public financial support takes the form of a cost-effective intervention by a deposit guarantee scheme ▌in compliance with the conditions set out in Articles 11a and 11b of Directive 2014/49/EU, provided that none or of the circumstances referred to in Article 18(4) are present;

Added(c) where the extraordinary public financial support takes the form of a cost-effective intervention by a deposit guarantee scheme in the context of the winding up of a credit institution pursuant to Article 32b of Directive 2014/59/EU and in accordance with the conditions set out in Article 11(5) of Directive 2014/49/EU;

Added(d) where the extraordinary public financial support takes the form of State aid within the meaning of Article 107(1) TFEU granted in the context of the winding up of institution or entity pursuant to Article 32b of Directive 2014/59/EU, other than the support granted by a deposit guarantee scheme pursuant to Article 11(5) of Directive 2014/49/EU.