Question ID
2019_5057
Legal act
Regulation (EU) No 575/2013 (CRR)
Topic
Other issues
Article
12
Paragraph
a
COM Delegated or Implementing Acts/RTS/ITS/GLs/Recommendations
Not applicable
Article/Paragraph
-
Type of submitter
Resolution authority
Subject matter
Implementation of the Article 12e(4) of Regulation EU 2019/876 (“CRR”) for subsidiaries that do not belong to the same resolution group as the EU parent institution.
Question
Is it possible to adopt a reading of Article 12a and 92a CRR that would allow the application of the provision to subsidiaries established in third countries that are not included in a resolution group of the parent institution in line with point (83b)(iii) of Article 2(1) of Directive 2014/59/EU (“BRRD”)?
Background on the question
Article 12a CRR provides that G-SII groups with multiple point of entry (“MPE”) resolution strategy shall calculate the theoretical SPE requirement and compare it with the sum of the MPE requirements. However, the definition of “resolution entity” in Article 2 (83a) BRRD refers to a person established in the Union. While the definition of “resolution group” in Article 2 (83b) BRRD provides flexibility with respect to the possibility of including subsidiaries in third countries in any resolution group, it would not be possible to identify resolution groups with resolution entities established outside the EU in the resolution plans for banking groups with parent entities established in the Union. Consequently, the sum of the parts of an MPE group could only be performed with resolution groups established in the EU. This would contradict the spirit of the TLAC Term Sheet developed by the Financial Stability Board (FSB), which allows the identification of resolution entities in all FSB member jurisdictions that adhere to the FSB principles.
Submission date
Rejected publishing date
Rationale for rejection

Please note that as part of adjustments to the Single Rulebook Q&A process, agreed by the EBA and the European Commission, it has been decided to reject outstanding questions submitted before 1 January 2020, when the Q&A process was updated as part of the last ESAs Review. In particular, the question that you have submitted has now regrettably been rejected and will not be addressed.

If you believe your question would still benefit from clarification, you are invited to resubmit your question, adapting it to reflect any legislative, regulatory or other relevant developments that may have occurred since the initial date of submission. The EBA will aim to address resubmitted questions as a matter of priority. When considering to resubmit, you are kindly requested to observe the updated admissibility criteria agreed in the context of the adjustment of the Q&A process, available in the Additional background and guidance for asking questions. We hope for your understanding.

For further information please refer to the press release and the updated Q&A page.

Status
Rejected question