Additional implementation to Article 27(1)(d)

As regards compatibility of the Articles with the European Convention on Human Rights (ECHR), the case can be made that it is proportional to have the trigger in Article 28 of Directive 2014/59/EU (BRRD) without conducting an individual analysis, on the basis of Article 52 of the Charter of Fundamental Rights, as the removal is designed to pursue the objective of financial stability in the general public interest. As regards the level of implementation of the provision, ECHR issues will very much depend on the nature of the decision that is taken in the Member State as regards the removal of the senior management/board. If it is not a ”penalty”, there would not appear to be an issue of ECHR. Even if it were viewed as a penalty, it would be necessary to look at the nature of the penalty (administrative / criminal) and whether it is proportionate and justified. Also, this power should be viewed as a power available to a competent authority (to replace the senior management or the management body) before it considers an even more interventionist power, i.e. the appointment of temporary administrator (who will take on some or all of the powers of the management body) is exercised. At the same time, it was intended as a stronger power than that included in Article 27(1)(d) of Directive 2014/59/EU (BRRD) when persons are found unfit to perform their duties under CRD or CDR IV since it allows for the removal of senior management or management body in its entirety when the relevant conditions are met, namely that there is a significant deterioration in the financial situation or serious infringements of law etc. or serious administrative irregularities. In these instances Article 28 BRRD assumes that the senior management in its entirety is unfit to run the bank and to solve the problems of the institution. In practical terms, whether each person is considered individually or not (to comply with ECHR), the rationale is the ability for the competent authority to remove senior management or management body in its entirety, provided that the relevant conditions are met. 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.