EBA · 2015_2109 Final Q&A

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Regulation
Directive 2014/59/EU (BRRD)
Article
29, para. 2
Topic
Early intervention
Submitted by
Competent authority
Submitted
2015-07-06
Answered
2015-07-24
Answer provided by
ESAs (EBA, ESMA, EIOPA)

Question

Could you please clarify the interaction between Recital 39 and the last sentence of Article 29 (2) of Directive 2014/59/EU (BRRD)?

Background

Recital 39 of Directive 2014/59/EU (BRRD) states: ”During the recovery and early intervention phases laid down in this Directive, shareholders should retain full responsibility and control of the institution except when a temporary administrator has been appointed by the competent authority.“ Article 29 (2) of Directive 2014/59/EU (BRRD) states: ”The competent authority shall specify the powers of the temporary administrator at the time of the appointment of the temporary administrator based on what is proportionate in the circumstances. Such powers may include some or all of the powers of the management body of the institution under the statutes of the institution and under national law, including the power to exercise some or all of the administrative functions of the management body of the institution. The powers of the temporary administrator in relation to the institution shall comply with the applicable company law.“ Clarification would be needed on the objective of last sentence of Article 29 (2).

Answer

The objective of the last sentence of Article 29 (2) of Directive 2014/59/EU (BRRD) is to preserve as much as possible the requirements under national company law, in as much as they do not compromise the ability of the competent authority to take Early intervention measures. Disclaimer: 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.

Original source: European Banking Authority, Q&A ID 2015_2109

This Q&A is published by European Banking Authority and is non-binding. It does not constitute legal advice. Updated weekly from official ESA sources.

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