Amendments to Article 19

Article 19(1) of Directive 2014/59/EU (BRRD) and the exemption in Article 19(2) exclude all "arrangements" (a broad generic term which includes agreements) from the IGFS Chapter that do not confine financial support exclusively and specifically to early intervention scenarios, i.e. situations in which a party meets the conditions set out in Article 27(1). This also limits the scope of application of the IGFS Chapter to those intra-group financing agreements that are set up to support institutions. However, if such IGFS agreement envisages the provision of financial support not only to institutions that meet the conditions for early intervention but also to other group entities, it is still subject to authorisation (the exemption requires that "none of the parties" meets the conditions for early intervention). If, on the basis of such IGFS agreement, one party considers to grant financial support to another party that is not an institution, the competent authority may, however, not oppose such financial support under Article 25. Given the authorisation requirement under Article 20, a broader scope of application that would include business-as-usual financial support agreements (such as guarantees, letters of comfort) would not seem in line with the purpose of facilitating intra-group financial support. Potential risks for financial stability caused by business-as-usual intragroup financial support can be addressed through other instruments, e.g. the powers to remove impediments to resolvability (see e.g. Art. 17(5)(a)). 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.