What kind of costs does the term "expenses" in Article 37 (7) of Directive 2014/59/EU (BRRD) refer to?
It is not further defined in Article 37 (7) of Directive 2014/59/EU (BRRD) what kind of costs the term "expenses" refers to. It is not clear, if ancillary expenses only are comprised (e.g., personnel costs, costs of valuation; costs of counsels etc.) or whether the actual costs of the measures of the financing arrangement referred to in Article 101 (1) are also included (e.g., the compensation paid to shareholders or creditors in accordance with Article 75; the contribution paid to the institution under resolution in accordance with Article 44).
Only the ancillary expenses are the costs comprised in the term "expenses" in this context.
This question goes beyond matters of consistent and effective application of the regulatory framework. A Directorate General of the Commission (Directorate General Financial Stability, Financial Services and Capital Markets Union) has prepared the answer, albeit that only the Court of Justice of the European Union can provide definitive interpretations of EU legislation. This is an unofficial opinion of that Directorate General, which the European Banking Authority publishes on its behalf. The answers are not binding on the European Commission as an institution. You should be aware that the European Commission could adopt a position different from the one expressed in such Q&As, for instance in infringement proceedings or after a detailed examination of a specific case or on the basis of any new legal or factual elements that may have been brought to its attention.
Update 26.03.2021: This Q&A has been reviewed in the light of the changes introduced to Directive 2014/59/EU (BRRD) and continues to be relevant.