Question ID
2016_2907
Legal act
Directive 2014/49/EU (DGSD)
Topic
Rights of depositors (Eligibility, coverage level, repayable amount, repayment, claim against DGS, depositor information)
Article
8
Paragraph
4
COM Delegated or Implementing Acts/RTS/ITS/GLs/Recommendations
Not applicable
Article/Paragraph
0
Type of submitter
Resolution authority
Subject matter
Provision of data to cover the cost of living
Question

Does the data referred to in Article 8(4) DGSD have to be provided by the credit institution after the date on which the credit institution has become unable to repay deposits? Or is it possible for a DGS to use data which has been provided by the credit institution before the credit institution has become unable to repay? If DGS are expected to use data which is provided after the aforementioned date, does the data have to be provided specifically for calculating the appropriate amount or can/must data be used which is (mainly) provided for making the repayments?

Background on the question

DGSs shall ensure that depositors have access to an appropriate amount of their covered deposits to cover the cost of living within five working days of a request.

According to the DGSD, DGSs shall ensure that the repayable amount is available within seven working days of the date on which deposits have become unavailable. However, Member States may, for a transitional period until 31 December 2023, establish the longer repayment periods.

Article 8(4) DGSD states that during the transitional period, where DGSs cannot make the repayable amount available within seven working days, DGSs shall ensure that depositors have access to an appropriate amount of their covered deposits to cover the cost of living within five working days of a request.

DGSs shall only grant access to the appropriate amount on the basis of data provided by the DGS or the credit institution. (Incidentally, consideration 39 of the DGSD states that access to the appropriate amount should only be made on the basis of data provided by the credit institution, and does not mention data provided by the DGS.) Credit institutions provide data on a regular basis to DGSs, for tests and for calculating contributions to the fund. Furthermore, a credit institution which is not able to repay deposits, will specifically provide data to the DGS so that the DGS can repay.

During the transitional period a DGS has to do two things when deposits become unavailable: 1) make repayments available within 20/15/10 days; 2) ensure that depositors have access to an appropriate amount as meant in Article 8(4) DGSD. DGS shall not want that task 2 interferes with task 1.

Submission date
Final publishing date
Final answer

A key principle of the Directive 2014/49/EU (DGSD, DGS Directive) is that the repayable amount must be based on the amount of covered deposits that the depositor maintained with the credit institution on the date of determination of unavailable deposits. This is explicitly stated within Article 7(4) of the DGS Directive:

“The reference date for the calculation of the repayable amount shall be the date on which a relevant administrative authority makes a determination as referred to in point (8)(a) of Article 2(1) or when a judicial authority makes a ruling as referred to in point (8)(b) of Article 2(1).”

Article 8 of the DGS Directive outlines the provisions to repay the repayable amount within seven days, “DGSs shall ensure that the repayable amount is available within seven working days of the date on which a relevant administrative authority makes a determination […]”.

Access to an appropriate amount to cover the cost of living is applicable within the context of Article 8 of the DGS Directive where the repayable amount cannot be made within seven working days. Article 8(4) states:

“During the transitional period until 31 December 2023, where DGSs cannot make the repayable amount available within seven working days they shall ensure that depositors have access to an appropriate amount of their covered deposits to cover the cost of living within five working days of a request […] The appropriate amount as referred to in the first subparagraph shall be deducted from the repayable amount as referred to in Article 7”.

In the context of Article 8 of the DGS Directive, it is implicit that access to an appropriate amount to cover a cost of living request must also be based on covered deposits in existence on the reference date.

Status
Final Q&A
Answer prepared by
Answer prepared by the EBA.

Disclaimer

The Q&A refers to the provisions in force on the day of their publication. The EBA does not systematically review published Q&As following the amendment of legislative acts. Users of the Q&A tool should therefore check the date of publication of the Q&A and whether the provisions referred to in the answer remain the same.