Interpretation of Article 19(2)

Article 19(2) of Directive 2014/59/EU (BRRD) has to be interpreted as excluding from the scope of Chapter III of Title II (the "IGFS Chapter") arrangements and agreements that do not exclusively and specially envisage financial support for an early intervention scenario. The term "intra-group financial arrangements" mentioned in Article 19(2) is a broad concept that includes "agreements", in particular also the IGFS agreement defined in Article 19(1). It then follows that the part "provided that none of the parties to such arrangements meets the conditions for early intervention" cannot refer to the situation when the arrangement (or agreement) is set up. If this were the case, IGFS agreements within the meaning of Article 19(1) would not be covered by the IGFS Chapter since Article 19(8) - requires IGFS agreements to be drawn up in a situation where none of the parties meets the conditions for early intervention and thus requires the application of the IGFS chapter, in particular the ex-ante authorisation procedure, in that situation. Article 19(2) and Article 19(1) and (8) appear to be contradictive. The phrase "provided that none of the parties to such arrangements meets the conditions for early intervention" in Article 19(2) therefore needs to be interpreted as referring to the scenarios for which financial support is envisaged under the arrangement or agreement. Article 19(2) excludes from the application of the IGFS chapter all arrangements and agreements which envisage financial support only or also in scenarios where none of the parties meets the conditions for early intervention. This interpretation would, in particular, exclude "business-as-usual" agreements from the application of the IGFS chapter. These agreements may envisage financial support in all kinds of scenarios, not limited to early intervention. They should not be subject to ex-ante authorisation under the IGFS chapter, even if they cover financial support in early intervention scenarios. 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.