- Question ID
- Legal act
- Directive 2014/59/EU (BRRD)
- Resolution tools and powers
- COM Delegated or Implementing Acts/RTS/ITS/GLs/Recommendations
- Not applicable
- Type of submitter
- Subject matter
Appointment of management body of a bridge institution
Can the resolution authority appoint the first management body of the bridge institution at the time of its creation? Should the resolution authority appoint a temporary management body until the shareholders can meet and decide on the institution’s management body?
- Background on the question
Article 41 (1) (b) of Directive 2014/59/EU (BRRD) (Operation of a bridge institution) provides that “Member States shall ensure that the operation of a bridge institution respects the following requirements: (b) subject to the bridge institution’s ownership structure, the resolution authority either appoints or approves the bridge institution’s management body”. Even though the wording of the provision is clear, there might be practical concerns. Since the shareholders of the bridge institution can be the resolution fund but also other entities or persons whose claims or debt instruments were converted, it might prove difficult to have an appointment by the shareholders of the management body of the bridge institution right after the creation of the bridge institution by the resolution authority.
- Submission date
- Final publishing date
- Final answer
Article 41 (1) (b) provides for a double alternative as regards the appointment of the management body of the institution depending on the ownership structure of the institution. Where the ownership structure is fragmented and it is not possible for the majority shareholders to directly and swiftly appoint the members of the management body, the resolution authority should appoint those members, until the shareholders can meet and decide upon the institution 19s management body. In that case the resolution authority shall approve the members so designated.
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.
- Answer prepared by
Answer prepared by the European Commission because it is a matter of interpretation of Union law.
- Note to Q&A
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.