text: COM(2012) 352 final.

text: Se punkt 12 i ECB:s yttrande

text: av den 22 mars 2012 om i) ett förslag till direktiv om marknader för finansiella instrument och om upphävande av

text: Europaparlamentets och rådets direktiv 2004/39/EG

text: , ii) ett förslag till förordning om marknaderna för finansiella instrument och ändring av förordning (EMIR) om OTC-derivat, centrala motparter och transaktionsregister, iii) förslag till direktiv om straffrättsliga sanktioner för insiderhandel och otillbörlig marknadspåverkan samt (iv) ett förslag till förordning om insiderhandel och otillbörlig marknadspåverkan (marknadsmissbruk) (EUT C 161, 7.6.2012, s. 3). Alla ECB:s yttranden finns på ECB:s webbplats http://www.ecb.europa.eu

text: COM(2011) 652 final, se artiklarna

text: och

text: Se t.ex. reglerna som tillåter att värdepappersföretag tillhandahåller investeringstjänster som endast omfattar utförande av tjänster i artikel 25.3 i förslaget till Europaparlamentets och rådets direktiv om marknader för finansiella instrument och om upphävande av

text: , COM(2011) 656 final (nedan kallat MiFID-förslaget)

text: EUT L 345, 31.12.2003, s. 64.

text: EUT L 335, 17.12.2009, s. 1. Se särskilt artiklarna

text: Se artikel 5 i förslaget till förordning.

text: Se artikel 75.2 e och f i MiFID-förslaget. Se även

text: artikel 99

text: a.2 e och f som ska läggas till

text: Europaparlamentets och rådets direktiv 2009/65/EG av den 13 juli 2009

text: om samordning av lagar och andra författningar som avser företag för kollektiva investeringar i överlåtbara värdepapper (fondföretag) (EUT L 302, 17.11.2009, s. 32) genom förslaget till Europaparlamentets och rådets direktiv om ändring av direktiv

text: om samordning av lagar och andra författningar som avser företag för kollektiva investeringar i överlåtbara värdepapper (fondföretag) när det gäller förvaringsinstitutsfunktioner, ersättningspolicy och sanktioner, COM(2012) 350 final (nedan kallat förslaget till UCITS V direktiv).

text: Text markerad med fet stil anger ECB:s förslag till ny text. Genomstruken text anger de strykningar som ECB föreslår.

text: EUT L …, …, s. ….

title: Europeiska Centralbankens yttrande av den 11 december 2012 om ett förslag till Europaparlamentets och rådets förordning om faktablad för investeringsprodukter (CON/2012/103)

text: Inledning och rättslig grund

text: Den 11 respektive 18 september 2012 mottog Europeiska centralbanken (ECB) en begäran från Europeiska unionens råd och Europaparlamentet om ett yttrande över ett förslag till Europaparlamentets och rådets förordning om faktablad för investeringsprodukter (nedan kallat förslaget till förordning).

text: ECB:s behörighet att avge ett yttrande grundas på artiklarna

text: och

text: i fördraget om Europeiska unionens funktionssätt, eftersom förslaget till förordning innehåller bestämmelser som berör Europeiska centralbankssystemets (ECBS) medverkan till ett smidigt genomförande av politiken för det finansiella systemets stabilitet i enlighet med artikel 127.5 i fördraget. I enlighet med artikel 17.5 första meningen i arbetsordningen för Europeiska centralbanken har detta yttrande antagits av ECB-rådet.

text: Allmänna kommentarer

text: ECB välkomnar förslaget till förordning vars syfte är att öka transparensen på investeringsprodukter för icke-professionella investerare samt säkerställa att dessa förstår investeringsprodukternas basfakta och risker samt kan jämföra olika produkters egenskaper. Lämpliga informationskrav främjar konsumentskyddet som är viktigt för att bevara stabiliteten på det finansiella systemet.

text: Specifika kommentarer

text: 1. Överensstämmelse med andra lagstiftningsinitiativ inom EU

text: 1.1 Informationskrav bör åtföljas av lämpliga tillsynsregler både på nationell nivå och unionsnivå för att förhindra eller begränsa saluföring, distribution eller försäljning av vissa finansiella instrument när det föreligger ett hot mot de finansiella marknadernas korrekta funktion eller stabiliteten för hela eller delar av det finansiella systemet eller investerarskyddet. ECB anser att det är mycket viktigt att unionslagstiftningen avseende finansiella tjänster ger de europeiska tillsynsmyndigheterna och de behöriga nationella myndigheterna tillräckliga möjligheter att ingripa när så är nödvändigt. Tillsynsmyndigheterna för bank och försäkringsväsendet bör få liknande behörigheter att ingripa som Europeiska värdepappers- och marknadsmyndigheten (Esma) och nationella behöriga myndigheter ges i förslaget till Europaparlamentets och rådets förordning om marknader för finansiella instrument och om ändring av förordning (EMIR) om OTC-derivat, centrala motparter och transaktionsregister (nedan kallat MiFIR-förslaget).

text: 1.2 Därutöver föreslår ECB att man, utöver harmoniseringen av de regler som förslaget till förordning inför om information som ska lämnas före ett avtals ingång, även harmoniserar de regler som avser försäljningen av finansiella produkter mellan olika finansiella tjänstesektorer med sådana förslag som delvis redan gjorts.

text: 1.3 Slutligen bör man eftersträva likvärdiga konkurrensvillkor mellan olika investeringsprodukter för att undvika regelarbitrage med sådana investeringsprodukter som inte omfattas av förslaget till förordning, t.ex. icke-komplexa finansiella instrument. Informationskrav för andra kategorier av finansiella produkter enligt gällande unionslagstiftning bör kompletteras med det standardiserade faktabladet som införs genom förslaget till förordning. Detta kan särskilt beröra produkter som omfattas av

text: Europaparlamentets och rådets direktiv 2003/71/EG av den 4 november 2003

text: om de prospekt som ska offentliggöras när värdepapper erbjuds till allmänheten eller tas upp till handel och om ändring av direktiv

text: och

text: Europaparlamentets och rådets direktiv 2009/138/EG av den 25 november 2009

text: om upptagande och utövande av försäkrings- och återförsäkringsverksamhet (Solvens II).

text: 2. Ansvaret för att ta fram faktabladet

text: Enligt förslaget till förordning faller uttryckligen ansvaret för att ta fram faktabladet på investeringsproduktens utvecklare som även blir ansvarig enligt den information han tillhandahåller. Icke-professionella investerare har dock direktkontakt med distributörerna, inte utvecklarna av investeringsprodukterna. Därför bör även distributörerna av investeringsprodukter bära ett ansvar för att icke-professionella investerare har en effektiv möjlighet att klaga på en utvecklare avseende faktabladet och inleda ett förfarande för tvistlösning. ECB anser också att förslaget bör innehålla effektiva möjligheter till tvistlösning i gränsöverskridande tvister, särskilt om utvecklaren befinner sig i en annan medlemsstat eller i tredje land.

text: 3. Faktabladets innehåll

text: ECB rekommenderar att förslaget till förordning uttryckligen stadgar att faktabladet ska ange i) de motpartsrisker, operativa risker och likviditetsrisker som är aktuella för investeringsprodukten, ii) produkternas utveckling i stresscenarier samt iii) produktens hävstångskomponent om denna komponent kan öka riskerna med produkten. Sådan ytterligare information säkerställer att faktabladet inte förleder investerare att fästa alltför stor vikt vid produktens historiska utveckling och att faktabladet ger en fullständig och korrekt beskrivning av de risker som är förknippade med investeringsprodukten.

text: 4. Administrativa sanktioner och åtgärder

text: ECB rekommenderar att förslaget till förordning ändras så att man säkerställer en harmonisering med annan unionslagstiftning genom att introducera administrativa sanktioner som omfattar bestämmelser om administrativa böter.

text: I de fall där ECB rekommenderar att förslaget till förordning ska ändras anges de specifika förslagen i bilagan åtföljt av en förklaring.

text: BILAGA

text: Kommissionens förslag | ECB:s ändringsförslag

text: Artikel 25

text: 1. Kommissionen ska se över denna förordning fyra år efter dagen för förordningens ikraftträdande. Översynen ska omfatta en allmän undersökning av den praktiska tillämpningen av förordningens bestämmelser, med vederbörlig hänsyn till utvecklingen på marknaden för produkter för icke-professionella investerare. När det gäller fondföretag enligt definitionen i

text: artikel 1.2 i direktiv 2009/65/EG

text: ska det vid översynen bedömas om övergångsbestämmelserna enligt artikel 24 i denna förordning ska förlängas eller om bestämmelserna om basfakta för investerare i direktiv

text: efter kartläggning av eventuellt nödvändiga justeringar kan ersättas eller anses likvärdiga med faktabladet enligt denna förordning. Vid översynen ska även en eventuell utvidgning av förordningens tillämpningsområde till andra finansiella produkter övervägas. 2. Kommissionen ska efter samråd med den gemensamma kommittén för de europeiska tillsynsmyndigheterna lägga fram en rapport för Europaparlamentet och rådet, vid behov åtföljd av ett lagstiftningsförslag. |

text: Artikel 25

text: 1. När denna förordning trätt i kraft ska kommissionen granska unionslagstiftningen för finansiella tjänster för att bedöma huruvida i) det behövs nya standardiserade faktablad i enlighet med de regler som införs genom denna förordning även för sådana finansiella instrument som inte omfattas av denna förordning, särskilt avseende produkter som omfattas av direktiv

text: och direktiv

text: ii) det behövs nya harmoniserade regler för marknaden avseende försäljningen av finansiella produkter samt iii) de europeiska tillsynsmyndigheterna och de behöriga nationella myndigheterna bör ges behörighet att ingripa när det gäller specifika kategorier av finansiella produkter, bl.a. genom förbud som motiveras av investerarskyddet och den finansiella stabiliteten, med beaktande av de behörigheter som introduceras genom Europaparlamentets och rådets förordning (EU) nr xx/xx av den [datum] om marknader för finansiella instrument och om ändring av förordning [EMIR] om OTC-derivat, centrala motparter och transaktions-register. 12. Kommissionen ska se över denna förordning fyra år efter dagen för förordningens ikraftträdande. Översynen ska omfatta en allmän undersökning av den praktiska tillämpningen av förordningens bestämmelser, med vederbörlig hänsyn till utvecklingen på marknaden för produkter för icke-professionella investerare. När det gäller fondföretag enligt definitionen i

text: artikel 1.2 i direktiv 2009/65/EG

text: efter kartläggning av eventuellt nödvändiga justeringar kan ersättas eller anses likvärdiga med faktabladet enligt denna förordning. Vid översynen ska även en eventuell utvidgning av förordningens tillämpningsområde till andra finansiella produkter övervägas. 23. Kommissionen ska efter samråd med den gemensamma kommittén för de europeiska tillsynsmyndigheterna lägga fram en rapport för Europaparlamentet och rådet, vid behov åtföljd av ett lagstiftningsförslag.

text: Förklaring Man bör eftersträva likvärdiga konkurrensvillkor mellan olika investeringsprodukter för att undvika regelarbitrage med sådana investeringsprodukter som inte omfattas av förslaget till förordning, t.ex. icke-komplexa finansiella instrument. Informationskrav för andra kategorier av finansiella produkter enligt gällande unionslagstiftning bör kompletteras med det standardiserade faktabladet som införs genom förslaget till förordning. På samma sätt bör man på ett harmoniserat sätt även introducera regler somavser försäljningen av ett stort antal olika finansiella produkter. De europeiska tillsynsmyndigheterna och de behöriga nationella myndigheterna bör samtidigt ges möjlighet att ingripa när det gäller specifika kategorier av finansiella produkter, bl.a. genom förbud som motiveras av investerarskyddet och den finansiella stabiliteten. I detta hänseende bör man beakta resultaten av den pågående lagstiftningsprocessen där sådana marknadsregler och ingripande av tillsynsmyndigheter införs genom MiFIR-förslaget.

text: 2. Faktabladet ska innehålla följande uppgifter: a) I ett avsnitt i början av dokumentet: namnet på investeringsprodukten och namnet på dess utvecklare. b) I ett avsnitt med titeln Vad investeringen gäller?: investeringsproduktens natur och huvuddrag, inklusive i) typen av investeringsprodukt, ii) dess syften och hur de ska uppnås, iii) en uppgift om huruvida utvecklaren av investeringsprodukten har specifika miljöresultat, sociala resultat eller ledningsresultat, antingen för sin affärsverksamhet eller investeringsprodukten, och i så fall en uppgift om vilka resultat som eftersträvas och hur de ska uppnås, iv) närmare uppgifter om försäkringsförmåner, om investeringsprodukten erbjuder sådana, v) investeringsproduktens löptid, om denna är känd, vi) resultatscenarior, om detta är relevant för produktens natur. c) I ett avsnitt med titeln Kan jag förlora pengar?: en kortfattad upplysning om huruvida kapitalförluster är möjliga, inklusive i) erbjudna garantier eller erbjudet kapitalskydd, samt dessas eventuella begränsningar, ii) om investeringsprodukten omfattas av en kompensations- eller garantiordning. d) I ett avsnitt med titeln Vad innebär den?: uppgifter om den rekommenderat kortaste innehavstiden och produktens väntade likviditetsprofil, inklusive möjligheterna och villkoren för en minskning eller avveckling under löptiden, med beaktande av investeringsproduktens risk- och avkastningsprofil samt den marknadsutveckling den är inriktad på. e) I ett avsnitt med titeln Vilka är riskerna och vad kan jag få tillbaka?: investeringsproduktens risk- och avkastningsprofil, inklusive en sammanfattande indikator på denna profil och varningar för särskilda risker som eventuellt inte helt beaktas i den sammanfattande indikatorn. f) I ett avsnitt med titeln Vilka är kostnaderna?: investeringsproduktens kostnader, som ska omfatta investerarens direkta och indirekta kostnader, inbegripet sammanfattande indikatorer på dessa kostnader. g) I ett avsnitt med titeln Tidigare resultat?: investeringsproduktens tidigare resultat, om detta är relevant med tanke på produktens natur och hur länge resultat förelegat. h) För pensionsprodukter, i ett avsnitt med titeln Vad får jag när jag pensioneras?: beräkningar av möjliga framtida resultat. | 2. Faktabladet ska innehålla följande uppgifter: a) I ett avsnitt i början av dokumentet: namnet på investeringsprodukten och namnet på dess utvecklare. b) I ett avsnitt med titeln Vad investeringen gäller?: investeringsproduktens natur och huvuddrag, inklusive i) typen av investeringsprodukt, ii) dess syften och hur de ska uppnås, iii) en uppgift om huruvida utvecklaren av investeringsprodukten har specifika miljöresultat, sociala resultat eller ledningsresultat, antingen för sin affärsverksamhet eller investeringsprodukten, och i så fall en uppgift om vilka resultat som eftersträvas och hur de ska uppnås, iv) närmare uppgifter om försäkringsförmåner, om investeringsprodukten erbjuder sådana, v) investeringsproduktens löptid, om denna är känd, vi) resultatscenarior, om detta är relevant för produktens natur. c) I ett avsnitt med titeln Kan jag förlora pengar?: en kortfattad upplysning om huruvida kapitalförluster är möjliga, inklusive i) erbjudna garantier eller erbjudet kapitalskydd, samt dessas eventuella begränsningar, ii) om investeringsprodukten omfattas av en kompensations- eller garantiordning. d) I ett avsnitt med titeln Vad innebär den?: uppgifter om den rekommenderat kortaste innehavstiden och produktens väntade likviditetsprofil, inklusive möjligheterna och villkoren för en minskning eller avveckling under löptiden, med beaktande av investeringsproduktens risk- och avkastningsprofil samt den marknadsutveckling den är inriktad på. e) I ett avsnitt med titeln Vilka är riskerna och vad kan jag få tillbaka?: investeringsproduktens risk- och avkastningsprofil, inklusive en sammanfattande indikator på denna profil och en varning att produktens avkastning kan påverkas negativt av de angivna riskerna följt av en beskrivning av i) motpartsrisker, operativa risker och likviditetsrisker förknippade med produkten, ii) hur produkten utvecklas i stresscenarier, iii) produktens hävstångskomponent om denna komponent kan öka riskerna med produkten, iv) och varningar för särskilda andra risker som eventuellt inte helt beaktas i den sammanfattande indikatorn. f) I ett avsnitt med titeln Vilka är kostnaderna?: investeringsproduktens kostnader, som ska omfatta investerarens direkta och indirekta kostnader, inbegripet sammanfattande indikatorer på dessa kostnader. g) I ett avsnitt med titeln Tidigare resultat?: investeringsproduktens tidigare resultat, om detta är relevant med tanke på produktens natur och hur länge resultat förelegat, inklusive en varning om att historiska resultat inte är en garanti för den framtida utvecklingen och att de risker som omnämns i faktabladets övriga avsnitt kan få avsevärda negativa effekter på investeringen. h) För pensionsprodukter, i ett avsnitt med titeln Vad får jag när jag pensioneras?: beräkningar av möjliga framtida resultat.

text: Förklaring Den ytterligare information som föreslås ska säkerställa att faktabladet inte förleder investerare att fästa alltför stor vikt vid produktens historiska utveckling och att faktabladet ger en fullständig och korrekt beskrivning av de risker som är förknippade med investeringsprodukten.

text: Artikel 14

text: Utvecklaren av investeringsprodukten ska upprätta lämpliga förfaranden och arrangemang som säkerställer att icke-professionella investerare som har framfört klagomål på faktabladet får ett ordentligt svar i tid och på ett adekvat sätt. |

text: Artikel 14

text: Utvecklaren av investeringsprodukten och distributören ska upprätta lämpliga förfaranden och arrangemang som säkerställer att i) att icke-professionella investerare har en effektiv möjlighet att klaga på utvecklaren av investeringsprodukten och inleda ett förfarande för tvistlösning, ii) icke-professionella investerare som har framfört klagomål på faktabladet får ett ordentligt svar i tid och på ett adekvat sätt samt iii) effektiva möjligheter till tvistlösning även finns för gränsöverskridande tvister, särskilt om utvecklaren av investeringsprodukten befinner sig i en annan medlemsstat eller i tredje land.

text: Förklaring Enligt förslaget till förordning faller uttryckligen ansvaret för att ta fram faktabladet på investeringsproduktens utvecklare som även blir ansvarig enligt den information han tillhandahåller. Icke-professionella investerare har dock direktkontakt med distributörerna, inte utvecklarna av investeringsprodukterna. Därför bör även distributörerna av investeringsprodukter bära ett ansvar för att icke-professionella investerare har en effektiv möjlighet att klaga på en utvecklare avseende faktabladet och inleda ett förfarande för tvistlösning. Förfarandet för tvistlösning bör vara effektivt i gränsöverskridande tvister, särskilt om utvecklaren befinner sig i en annan medlemsstat eller i tredje land.

text: 2. Medlemsstaterna ska se till att de behöriga myndigheterna har befogenhet att vidta åtminstone följande administrativa åtgärder och sanktioner: a) Ett förbud mot saluföringen av en investeringsprodukt. b) Ett tillfälligt förbud mot saluföringen av en investeringsprodukt. c) En varning som ska offentliggöras och innehåller uppgifter om den ansvariga personenens identitet och överträdelsens art. d) Ett beslut om publikation av en ny version av faktabladet. | 2. Medlemsstaterna ska se till att de behöriga myndigheterna har befogenhet att vidta åtminstone följande administrativa åtgärder och sanktioner: a) Ett förbud mot saluföringen av en investeringsprodukt. b) Ett tillfälligt förbud mot saluföringen av en investeringsprodukt. c) En varning som ska offentliggöras och innehåller uppgifter om den ansvariga personenens identitet och överträdelsens art. d) Ett beslut om publikation av en ny version av faktabladet. e) När det gäller juridiska personer administrativa böter upp till 10 procent av den sammanlagda årsomsättningen som den juridiska personen hade under föregående räkenskapsår; om den juridiska personen är ett dotterbolag ska böterna beräknas utifrån den sammanlagda årsomsättningen från den konsoliderade årsomsättningen som det slutliga moderbolaget hade under föregående räkenskapsår. f) När det gäller fysiska personer administrativa böter upp till 5 miljoner euro eller, i medlemsstater där euron inte är den officiella valutan, motsvarande belopp i den nationella valutan den dag då denna förordning träder i kraft.

text: Förklaring De rekommenderade ändringarna säkerställer en harmonisering med administrativa böter enligt andra förslag till unionslagstiftning, särskilt MiFID-förslaget och förslaget till UCITS V direktiv.


text: OJ L 189, 3.7.1998, p. 42.

text: See new Section 75(4) of the Law on financial business, as inserted by Section 1(7) of the draft law. 4 See new wording of Section 354(6) of the Law on financial business, as inserted by Section 1(39) of the draft law. 5 See Section 1(43) and (46), Section 2(33), Section 3(4), Section 4(9), Section 5(6), Section 8(3), Section 11(5), Section 12(2), Section 13(2), Section 14(4) and Section 15(2) of the draft law. 6 See new Section 344(5) of the Law on financial business, as inserted by Section 1(33) of the draft law. 7 See new Section 225(2) of the Law on financial business, as inserted by Section 1(23) of the draft law. 8 See new wording of Section 152(b) of the Law on financial business, as inserted by Section 1(18) of the draft law. 9 See new wording of Section 205 of the Law on financial business, as inserted by Section 1(19) of the draft law. 10 See new wording of Section 209(2) of the Law on financial business, as inserted by Section 1(21) of the draft law.

text: See new Section 343(s) and (t) of the Law on financial business, as inserted by Section 1(31) of the draft law. 12 See new Section 343(s) of the Law on financial business, as inserted by Section 1(30) of the draft law. 13 See new Section 343(s)(3) of the Law on financial business. 14 See new Section 343(s)(1) of the Law on financial business. 15 See new Section 343(s)(1)of the Law on financial business. 16 See new Section 343(s)(5) of the Law on financial business. 17 See new Section 343(s)(6) of the Law on financial business. 18 See new Section 343(s)(7) and (8) of the Law on financial business. 19 See new Section 343(s)(9) of the Law on financial business.

text: See the proposal for a directive of the European Parliament and of the Council on the access to the activity of credit institutions and the prudential supervision of credit institutions and investment firms and amending Directive

text: of the European Parliament and of the Council on the supplementary supervision of credit institutions, insurance undertakings and investment firms in a financial conglomerate (COM(2011) 453 final) and the proposal for a regulation of the European Parliament and of the Council on prudential requirements for credit institutions and investment firms (COM(2011) 452 final). 21 See Opinion

text: , paragraph 3.10. 22 See Opinion

text: . 23 See the Eurosystem's response of 14 November 2012 to the European Commission's public consultation on the regulation of indices, available on the ECB's website www.ecb.europa.eu.

text: See Opinion

text: . 25 See paragraph 2.6.3 of the explanatory memorandum of the draft law. 26 See the ECB’s Convergence Report, May 2012, p. 25. All ECB documents are available on the ECB’s website at www.ecb.europa.eu. 27 See paragraph 2.2.6 of Opinion

text: . See

text: Article 12 of Directive 2002/87/EC

text: of the European Parliament and of the Council of 16 December 2002 on the supplementary supervision of credit institutions, insurance undertakings and investment firms in a financial conglomerate and amending Council Directives

text: and

text: (OJ L 35, 11.2.2003, p. 1),

text: Article 58(5) of Directive 2004/39/EC

text: of the European Parliament and of the Council of 21 April 2004 on markets in financial instruments amending Council Directives

text: and

text: and Directive

text: of the European Parliament and of the Council and repealing

text: Council Directive 93/22/EEC

text: (OJ L 145, 30.4.2004, p. 1),

text: Article 49 of Directive 2006/48/EC

text: of the European Parliament and of the Council of 14 June 2006 relating to the taking up and pursuit of the business of credit institutions (OJ L 177, 30.6.2006, p. 1), Article 70 of the Directive

text: of the European Parliament and of the Council of 25 November 2009 on the taking-up and pursuit of the business of Insurance and Reinsurance (Solvency II) (OJ L 335, 17.12.2009, p. 1) and

text: Article 1(4) of Regulation (EU) No 1092/2010

text: ; see also

text: Article 57

text: (a) of the proposal for a directive of the European Parliament and of the Council on the access to the activity of credit institutions and the prudential supervision of credit institutions and investment firms and amending Directive

text: of the European Parliament and of the Council on the supplementary supervision of credit institutions, insurance undertakings and investment firms in a financial conglomerate (COM(2011) 453 final). 28 See Article 3(1) of Regulation EU (No) 1092/2010. 29 See Opinion

text: , paragraph 4.1. See also

text: Article 57

text: See Opinion

text: , paragraph 4.2.

publisher: Europeiska centralbanken

sprak: en

title: Opinion of the European Central Bank of 11 December 2012 on financial legislation (CON/2012/104)

serie: con

text: OPINION OF THE EUROPEAN CENTRAL BANK of 11 December 2012 on financial legislation (

text: ) Introduction and legal basis

type: rubrik

text: On 5 November 2012, the European Central Bank (ECB) received a request from the Danish Financial Supervisory Authority (FSA) (Finanstilsynet) for an opinion on a draft law amending the Law on financial business, the Law on securities trading, the Law on payment services and electronic money, the Law on measures to prevent money laundering and financing of terrorism, the Law on equal treatment of men and women in connection with insurance, pension and similar financial services and various other laws (hereinafter the 'draft law'). The ECB’s competence to deliver an opinion is based on Articles 127(4) and 282(5) of the Treaty on the Functioning of the European Union and the sixth indent of

text: Article 2(1) of Council Decision 98/415/EC of 29 June 1998

text: on the consultation of the European Central Bank by national authorities regarding draft legislative provisions , as the draft law relates to rules applicable to financial institutions insofar as they materially influence the stability of financial institutions and markets. In accordance with the first sentence of Article 17.5 of the Rules of Procedure of the European Central Bank, the Governing Council has adopted this opinion.

type: stycke

text: 1. Purpose of the draft law

text: 1.1 The draft law introduces a number of amendments to the financial legislation. These are intended to enhance the supervision of financial institutions, ensure effective enforcement in cases of breach of the financial legislation, and strengthen the financial sector overall. The draft law also provides for the establishment of a national Systemic Risk Board to exercise macro-prudential oversight, and provides for the implementation in national law of certain European Union legislation. 1.2 Enhancing financial supervision and ensuring efficient enforcement In order to enhance financial supervision and ensure efficient enforcement where there is a breach of the financial legislation, the draft law amends the financial legislation, inter alia, as set out below.

text: (a) The draft law extends the current reporting obligations laid down in section 75 of the Law on financial business to financial holding companies regarding matters of material significance to the continued operation of their subsidiaries . (b) It allows the FSA to exchange confidential information with the public prosecutor and the police at an earlier stage than is currently possible, i.e. before it has been established that there are reasonable grounds for suspecting that a legal or natural person has committed an offence covered by the Criminal Code or the supervision legislation . (c) It provides that the FSA may publish the outcomes of (i) cases referred by the FSA to the police for investigation, (ii) cases which conclude with the imposition of an administrative fine, and (iii) orders by the FSA that a financial institution shall correct misleading information which it has published about itself . (d) It provides that the FSA may enter into agreements to perform, for payment, certain kinds of tasks for public authorities, state institutions and other similar bodies, if the performance of such tasks contributes to financial stability . (e) It introduces a new approach to the enforcement of solvency requirements, including the possibility for the FSA to impose certain measures on financial institutions in order to enhance the capital position of such institutions . 1.3 Measures to strengthen the financial sector In order to strengthen the individual financial institutions and the financial sector overall, as well as facilitate further consolidation, the draft law also provides for the measures set out below. (a) The scope of loans raised by financial institutions which have been granted a licence to issue covered bonds is widened so that loans may also be used to strengthen these institutions’ solvency ratios . (b) New rules are established regarding mergers between savings banks, cooperative savings banks, mutual insurance companies and limited companies in order to facilitate consolidation of the financial sector . In order to ensure the independence of the board of directors in savings bank trusts or cooperative savings bank trusts, the appointment of members of board of directors of such trusts is made more transparent. (c) The FSA is made responsible for supervising the procedures used by financial institutions to establish benchmark interest rates. The aim of this measure is to restore confidence in the

text: Copenhagen Interbank Offered Rate (CIBOR) and ensure enhanced control over the setting of CIBOR and other relevant benchmark rates . 1.4 Establishment of a national Systemic Risk Board The draft law provides for the establishment of a national macro-prudential Systemic Risk Board competent to adopt and communicate observations, warnings and recommendations to the relevant public authorities, the government and the public regarding systemic risks in the financial area . These warnings and recommendations will primarily be addressed to the FSA, but those relating to legislation will be addressed to the Government. The Systemic Risk Board may be consulted on warnings and recommendations issued by the European Systemic Risk Board (ESRB) . The Systemic Risk Board will comprise two representatives from Danmarks Nationalbank, two from the FSA, one from each of the three economic ministries, and three independent experts nominated by the Ministry of Business Affairs and Growth following consultation with Danmarks Nationalbank . The Governor of the Board of Danmarks Nationalbank will chair the Systemic Risk Board . The Systemic Risk Board's decisions will be adopted by simple majority. However, representatives from the FSA and the ministries have no voting rights with regard to decisions on observations, recommendations and warnings to be addressed to the Government . These observations, recommendations and warnings are to be made public unless the Systemic Risk Board takes the view that confidentiality is necessary to safeguard financial stability . The recipients of a warning or a recommendation shall be obliged within three months of receipt to publicly notify the Board as regards the measures which will be taken or explain any non-action . The FSA, the relevant ministries and Danmarks Nationalbank shall be obliged to exchange relevant information and documentation on request of the Systemic Risk Board, including confidential statistical information obtained by Danmarks Nationalbank, if the Board assesses that such information is necessary for it to fulfil its tasks .

text: 2. General observations

text: 2.1 The ECB welcomes the proposed amendments to the Danish financial legislation, which provide for enhanced supervision and enforcement and the overall strengthening of the financial sector. 2.2 Taking into account the need for appropriate action to address the possible systemic impact of failing cross-border institutions, the ECB highlights that the domestic legal framework for crisis

text: management may need to be further adapted to reflect future regulatory initiatives at Union level . In particular, the ECB urges that any initiatives undertaken by the competent national authorities to restore confidence in the financial markets be coordinated with other Member States and the Union institutions in a spirit of close cooperation, with a view to implementing common principles.

text: 3. Enhancing financial supervision and ensuring efficient enforcement

text: 3.1 The financial crisis has shown the importance of having effective and efficient supervision and enforcement mechanisms in place with regard to the financial system. The ECB welcomes measures that strengthen the powers of competent authorities to intervene when the stability of either individual financial institutions or the financial system as a whole is at risk. In this context, the draft law enhances the FSA’s capacity to respond in a timely and effective manner to difficulties that solvent financial institutions face by imposing early intervention measures upon them in order to enhance their capital position. 3.2 The ECB also notes the proposed measures to facilitate information-sharing and cooperation between competent authorities and the increased openness regarding the work of the FSA which aims to bring about greater transparency as well as efficient supervision and enforcement in the financial area. When considering measures aimed at achieving increased openness and informationsharing, it is however necessary to ensure that confidential information is adequately protected .

text: 4. Measures to strengthen the financial sector

text: The ECB supports the measures proposed to strengthen the solvency ratio via loans raised by financial institutions which have been granted a licence to issue covered bonds. Widening the scope for loans raised gives financial institutions greater flexibility and may thus contribute to maintaining a well-functioning mortgage-credit sector. However, the ECB notes that where junior covered bonds are used in the cover pool this should only be within the same banking group . The ECB welcomes initiatives to restore confidence in benchmark interest rates and emphasises that proposals to reform such benchmark interest rates should be coordinated at Union level to ensure consistency and a level playing field. In this regard, the ECB notes the Eurosystem's response to the European Commission’s public consultation on the regulation of indices, published on 14 November 2012 . While the Eurosystem’s recommendations focus on the strengthening of governance relating to Euribor calculations, they may also serve as guidelines for the regulation and supervision of other systemically important indices. Such guidelines would include ensuring that the membership of the boards of the rate-setting bodies and the relevant steering committees

text: are sufficiently diverse to reflect the public nature of the rates, that entities independent of the rate-

text: setting bodies perform substantive checks of the rates, and that the banks’ rate-submission

text: processes are subject to mandatory audits.

text: 5. Establishment of a national Systemic Risk Board

text: 5.1 The ECB welcomes the proposed amendments, which provide for the establishment of a national

text: Systemic Risk Board as a national macro-prudential authority . It supports the proposed

text: institutional framework for national macro-prudential oversight in which Danmarks Nationalbank

text: is represented and acts as chair. The ECB understands that pursuant to the explanatory

text: memorandum of the draft law Danmarks Nationalbank’s central bank independence will not be

text: affected by its involvement in the Systemic Risk Board . In this respect, the ECB notes that the

text: secretariat services for the Systemic Risk Board will be provided by Danmarks Nationalbank in

text: conjunction with other authorities. The ECB recommends that measures are taken to ensure that the

text: increased use of resources by Danmarks Nationalbank does not affect its financial independence .

text: 5.2 The draft law provides that the Systemic Risk Board and Danmarks Nationalbank may exchange

text: information insofar as the Systemic Risk Board needs this information to carry out its tasks. The

text: ECB notes that national provisions establishing national macro-prudential authorities should be

text: consistent with Union law provisions which regulate the exchange of supervisory and statistical

text: information and establish the ESRB as a Union body responsible for macro-prudential oversight

text: of the financial system within the Union . In this context, the ECB is of the view that the draft law

text: should expressly mandate the Systemic Risk Board to exchange information with other macro-

text: prudential authorities, central banks and the ESRB, particularly on actions taken to address

text: systemic risks at national level .

text: 5.3 Lastly, actions taken by national macro-prudential authorities should not conflict with but rather complement ESRB actions taken at Union level . The ECB recommends that the draft law ensures that the Systemic Risk Board liaises closely with the ESRB and informs it of all actions taken to address systemic risks at national level and that it also ensures that, if significant cross-border effects are anticipated, the Systemic Risk Board notifies the ESRB of this prior to the issuance or the publication of its warnings and recommendations.

text: This opinion will be published on the ECB’s website.

text: Done at Frankfurt am Main, 11 December 2012.

text: [signed]

text: The President of the ECB

text: Mario DRAGHI

type: vagledning

utgivare: ecb


text: OJ L 189, 3.7.1998, p. 42.

text: The TSCG was signed by 25 Member States on 2 March 2012 and will come into force on 1 January 2013, provided that twelve euro area Member States have deposited their instrument of ratification, or on the first day of the month following the deposit of the twelfth instrument of ratification by a euro area Member State, whichever is earlier http://europeancouncil.europa.eu/eurozone-governance/treaty-on-stability. The Lithuanian Parliament ratified the TSCG on 28 June 2012 and deposited the ratification instrument with the Council of the European Union on 6 September 2012.

text: Communication from the Commission: Common principles on national fiscal correction mechanisms (COM(2012) 342 final, 20 June 2012). Available at: http://eurlex.europa.eu/LexUriServ/LexUriServ.do?uri=COM:2012:0342:FIN:EN:PDF

text: Code of conduct: Specifications on the implementation of the Stability and Growth Pact and Guidelines on the format and content of Stability and Convergence Programmes (3 September 2012). Available at: http://ec.europa.eu/economy_finance/economic_governance/sgp/pdf/coc/code_of_conduct_en.pdf

text: Titles III (Fiscal Compact) and IV (Economic Policy Coordination and Convergence).

text: The Stability and Growth Pact is enshrined in two main Council Regulations: (1) the ‘preventive arm’,

text: Council Regulation (EC) No 1466/97

text: of 7 July on the strengthening of the surveillance of budgetary positions and the surveillance and coordination of economic policies (OJ L 209, 2.8.1997, p. 1); and (2) the ‘corrective arm’,

text: Council Regulation (EC) No 1467/97 of 7 July 1997

text: on speeding up and clarifying the implementation of the excessive deficit procedure (OJ L 209, 2.8.1997, p. 6).

text: OJ L 145, 10.6.2009, p. 1.

text: Principle 6 (escape clauses).

text: Article 9 of the draft constitutional law.

text: Article 2

text: a of

text: Regulation (EC) No 1466/97

text: See also principle 7 (the role and independence of monitoring institutions) of the common principles.

text: See the ECB’s Convergence Report, 2012, p. 25.

title: Opinion of the European Central Bank of 11 December 2012 on the implementation of the Treaty on Stability, Coordination and Governance in the Economic and Monetary Union (CON/2012/105)

text: OPINION OF THE EUROPEAN CENTRAL BANK of 11 December 2012 on the implementation of the Treaty on Stability, Coordination and Governance in the Economic and Monetary Union (

text: ) Introduction and legal basis

text: On 9 November 2012, the European Central Bank (ECB) received a request from the Lithuanian Ministry of Finance for an opinion on a draft constitutional law on the sustainability of general government sector finances (hereinafter the ‘draft constitutional law’) and the draft law amending the Law on Lietuvos bankas (hereinafter the ‘draft amending law’) (collectively referred to as the ‘draft legislation’). The ECB’s competence to deliver an opinion is based on Articles 127(4) and 282(5) of the Treaty on the Functioning of the European Union (TFEU) and the third indent of

text: Article 2(1) of Council Decision 98/415/EC of 29 June 1998

text: on the consultation of the European Central Bank by national authorities regarding draft legislative provisions , as the draft legislation relates to Lietuvos bankas. In accordance with the first sentence of Article 17.5 of the Rules of Procedure of the European Central Bank, the Governing Council has adopted this opinion.

text: 1. Purpose of the draft legislation

text: 1.1 The draft legislation aims to implement certain provisions of the Treaty on Stability, Coordination and Governance in the Economic and Monetary Union (TSCG) to strengthen fiscal discipline by (a) establishing a ‘balanced budget rule’ and an automatic correction mechanism, and (b) introducing a stricter surveillance mechanism, which includes the designation of Lietuvos bankas as an institution responsible at national level for monitoring compliance with the balanced budget rule. 1.2 The draft constitutional law sets a medium-term objective of ensuring that the general government sector finances are in surplus, balanced or close to balance . 1.2.1 It aims to achieve this objective by improving the structural balance of the general government

text: sector in the medium-term. 1.2.2 The draft constitutional law sets two ratios for assessing the management of the structural balance of the general government sector: the planned structural target, and the minimum executive target. Non-implementation of these ratios is intended to trigger automatic corrective measures. 1.2.3 The draft constitutional law provides for several escape clauses. For example, ‘the obligation under the TSCG’ does not have to be fulfilled and the automatic corrective measures will not be triggered if the expected public sector deficit is higher than 3% of GDP or if one of the following exceptional circumstances occurs: (a) actual production is or will be below the potential production for at least two consecutive calendar years ; (b) the GDP chain volume for the current quarter of the calendar year has continued to decrease, as compared to the respective quarter of the preceding calendar year, or (c) the GDP chain volume for the current calendar year will continue to decrease, as compared to the preceding year. 1.3 The draft legislation designates Lietuvos bankas as the institution responsible for budget policy control at national level. Its main task is to strengthen the implementation and transparency of the correction mechanisms. This includes: (a) monitoring the preparation and implementation of the planned structural target; (b) assessing and making public communications about whether the planned structural target or the minimum executive target will be reached; (c) approving the expected economic developments scenario prepared by the Ministry of Finance; (d) delivering an opinion to the Parliament on whether the planned budgetary policy is appropriate to achieve the planned structural target.

text: 2. General observations

text: 2.1 The ECB welcomes the consulting authority’s initiative and the objective of implementing the TSCG. This is particularly important for Lithuania, since it has been subject to the excessive deficit procedure since July 2009 in order to bring the government deficit below 3% of GDP, and the deadline for correction of the deficit has been extended to 2012. In addition, with a view to the introduction of the euro in Lithuania, it is important that the fiscal framework contributes to the prevention of renewed macroeconomic imbalances. 2.2 As regards the methodology for the national implementation of the TSCG, the ECB draws the consulting authority’s attention to the guidance provided by the European Commission and the Council, in particular, the Common principles on national fiscal correction mechanisms (hereinafter the ‘common principles’) and the Specifications on the implementation of the Stability

text: and Growth Pact and Guidelines on the formal and content of Stability and Convergence Programmes . The ECB also notes that the European Commission will present a report on the national provisions implementing the TSCG provisions adopted by the Member States which have signed and ratified the TSCG and will have the competence to assess compliance with Article 3(2) of the TSCG. 2.3 Article 14(5) of the TSCG provides Lithuania as a Member State with a derogation with the opportunity to declare its intention to be bound by all or part of the provisions in Titles III (Fiscal Compact) and IV (Economic Policy Coordination and Convergence) of the TSCG at an earlier date than that when the abrogation of the derogation in accordance with Article 140(2) of the TFEU takes effect. The ECB notes that, the draft legislation will only enter into force as from the date when the abrogation of the derogation takes effect, i.e. once the euro is introduced in Lithuania.

text: 3. Specific observations

text: The ECB notes several issues with regard to the draft legislation. 3.1 The concepts and definitions used in the draft constitutional law should be fully consistent with existing Union legislation (such as the TSCG and the Stability and Growth Pact ). 3.1.1 Both definitions of ‘general government balance indicator’ and ‘general government sector debt’ in the draft constitutional law should refer to

text: Council Regulation (EC) No 479/2009 of 25 May 2009

text: on the application of the Protocol on the excessive deficit procedure annexed to the Treaty establishing the European Community . In addition, the European Commission (Eurostat) validates and publishes deficit (surplus) and debt data for the general government sector pursuant to the excessive deficit procedure definition. 3.1.2 Article 4 of the draft constitutional law contains concepts of ‘agreed bias’, ‘minimum executive target’, ‘planned structural target’ and ‘structural investment’, which are not contained in the TSCG. The draft legislation must be fully compatible with the concepts and methodology used in the TSCG and the existing Stability and Growth Pact legislation. 3.2 The escape clauses provided for in Articles

text: , and 7(3) of the draft constitutional law are broader than those in the TSCG. The ECB underlines that, in line with the common principles , escape clauses should be based on Union agreed notions, in order to promote consistency and avoid

text: overly permissive definitions of exceptional circumstances. The suspension of the correction mechanism should be limited in time, and a minimum pace of adjustment should follow the exit from the escape clause. 3.3 The ‘unjustified failure of execution of the minimum executive target’ lacks sufficient automatic follow-up. The Prime Minister’s oral presentation in the Lithuanian Parliament on the reasons to justify such failure of execution and on the guidelines for avoidance of such circumstances is insufficient in this regard. 3.4 Article 11 of the draft constitutional law needs to be clarified in order to ensure that the method for calculating the cyclical position of the economy is consistent with the official method used in the European semester for economic policy coordination . 3.5 The draft constitutional law is complex and would benefit from greater clarity, which could be achieved by following more closely the provisions of the TSCG. The ‘implementing legal act’ as referred to in Article 11 of the draft constitutional law is a more appropriate legal instrument for addressing not only the methodology for the calculation of the multi-annual growth average, but also other issues of a technical nature, including a number of formulas, currently present in the draft constitutional law. In using this instrument, the national legislator will also be able to take into account any future technical developments at European level by incorporating these in the implementing legal act.

text: 4. Lietuvos bankas’ role

text: 4.1 Lietuvos bankas’ conclusions as regards the implementation of the planned structural target and the minimum executive target will be crucial for activating corrective measures, i.e. amendments to the budgetary laws relating to the current year or upcoming years. 4.2 Lietuvos bankas will also assess and approve the expected economic developments scenario prepared by the Ministry of Finance and will consider whether the planned budgetary policy is appropriate to reach the planned structural target. 4.3 The ECB understands that Lietuvos bankas’ role as ‘budget policy control institution’ is intended to implement the role of the institution responsible in Lithuania for monitoring compliance with the rules set out in Article 3(1) of the TSCG. In this respect, Lietuvos bankas’ role, as specified in the draft legislation, should not go beyond the role of a monitoring institution . The provisions of the draft constitutional law, which contain the obligation on Lietuvos bankas to approve the expected economic developments scenario prepared by the Ministry of Finance, raise particular concern in this respect. Ensuring compliance with the obligations under Article 3(1) of the TSCG is the responsibility of the Lithuanian government.

text: In addition, the powers of Lietuvos bankas under the draft constitutional law and the draft amending law should be aligned to avoid any inconsistencies between the two draft laws. 4.4 The ECB also notes that any involvement of Lietuvos bankas in the application of the balanced budget rule must ensure that these functions will not affect Lietuvos bankas’ ability to carry out its ESCB-related tasks from an operational and financial point of view. Financial independence, which is an element of the central bank independence referred to in Article 130 of the Treaty, requires an NCB to have sufficient means not only to perform its ESCB-related tasks but also its national tasks (e.g. financing its administration and own operations) .

text: [signed]

text: The President of the ECB

text: Mario DRAGHI


text: OJ L 189, 3.7.1998, p. 42. 2 See draft law, Title I.

text: See draft law, Title II.

text: See draft law, Title III. 5 See draft law, Title IV. 6 Available on the European Commission’s website at: http://ec.europa.eu/internal_market/bank/docs/highlevel_expert_group/report_en.pdf.

text: See IOSCO Report ‘Regulatory Issues Raised by the Impact of Technological Changes on Market Integrity and Efficiency’, October 2011, and ‘Principles for the Regulation and Supervision of Commodity Derivatives Markets’, September 2011. 8 Opinion

text: of 22 March 2012 on: (i) a proposal for a directive on markets in financial instruments repealing Directive

text: of the European Parliament and of the Council; (ii) a proposal for a regulation on markets in financial instruments and amending Regulation (EMIR) on OTC derivatives, central counterparties and trade repositories; (iii) a proposal for a directive on criminal sanctions for insider dealing and market manipulation; and (iv) a proposal for a regulation on insider dealing and market manipulation (market abuse) (OJ C 161, 7.6.2012, p. 3). Paragraphs 10.1 to 10.4. 9 Paragraph 11.1. See for example ECB Opinion

text: . All ECB documents are available on the ECB’s website at 10 www.ecb.europa.eu.

text: Article 3(1) of Regulation EU (No) 1092/2010 of the European Parliament and of the Council of 24 November 2010 on 11 European Union macro-prudential oversight of the financial system and establishing a European Systemic Risk Board (OJ L 331, 15.12.2010, p. 1). 12 See for example ECB’s Convergence Report 2012, p. 22. 13 See for example ECB’s Convergence Report 2012, p. 22. 14 COM(2012) 280 final, available on the European Commission’s website at http://ec.europa.eu.

text: Paragraph 1.5 of ECB Opinion

text: of 27 November 2012 on a proposal for a Council regulation conferring specific tasks on the European Central Bank concerning policies relating to the prudential supervision of credit institutions and a proposal for a regulation of the European Parliament and of the Council amending

text: Regulation (EU) No 1093/2010

text: establishing a European Supervisory Authority (European Banking Authority), not yet published in the Official Journal. 16 See ‘Key Attributes of Effective Resolution Regimes for Financial Institutions’, October 2011, available on the Financial Stability Board’s website at www.financialstabilityboard.org. 17 See

text: Article 115(1)

text: , third paragraph of the proposed directive. See also paragraph 6.1 of ECB Opinion

title: Opinion of the European Central Bank of 12 December 2012 on banking and financial stability (CON/2012/106)

text: OPINION OF THE EUROPEAN CENTRAL BANK of 12 December 2012 on banking and financial stability (

text: ) Introduction and legal basis

text: On 15 November 2012, the European Central Bank (ECB) received a request from the Minister for Economic Affairs and Finance for an opinion on a draft law on banking and financial stability (hereinafter the ‘draft law’). The ECB’s competence to deliver an opinion is based on Articles 127(4) and 282(5) of the Treaty on the Functioning of the European Union and the third and sixth indents of

text: on the consultation of the European Central Bank by national authorities regarding draft legislative provisions , as the draft law relates to the Banque de France and to rules applicable to financial institutions insofar as they materially influence the stability of financial institutions and markets. In accordance with the first sentence of Article 17.5 of the Rules of Procedure of the European Central Bank, the Governing Council has adopted this opinion.

text: 1. Purpose of the draft law

text: 1.1 Structure of banking groups The draft law separates activities that finance the economy from speculative operations. Above an exposure threshold defined by order of the Minister for Economic Affairs, speculative operations will have to be ring-fenced in dedicated subsidiaries in the form of investment firms or exceptionally credit institutions. The banking groups will be authorised to keep all trading activities relating to the provision of investment services to clients, financial instruments clearing, hedging investment risks of the credit institutions or group, market-making, the sound management of group treasury and financial operations between credit institutions and assimilated entities, as well as group investment operations. By contrast, proprietary trading relating to financial instruments without these objectives will have to be conducted in dedicated subsidiaries, as well as any operation involving unguaranteed counterparty risks towards money market funds with a gearing effect or similar investment vehicles, under criteria laid down by order of the Minister for Economic Affairs. The subsidiaries will not be able to accept guaranteed deposits or provide payment services to clients whose deposits qualify for the guarantee. The Prudential Control

text: Authority (Autorité de contrôle prudentiel, ACP) and, if relevant, the Financial Markets Authority (Autorité des marchés financiers, AMF), should be provided with an organisational chart of the units in charge of the operations relating to financial instruments, their objectives, the rules of good conduct and other applicable rules. The ACP may refuse authorisation if the structure of the organisation or the internal control system is not satisfactory. The transfer of activities will take place ipso jure, without the need for any formality. The deadline for identifying the activities to be transferred is 1 July 2014 and the deadline for transferring activities is 1 July 2015. 1.2 Implementation of a bank resolution scheme First, the ACP becomes the Prudential Control and Resolution Authority (Autorité de contrôle prudentiel et de résolution), with a new resolution college and the Deposit Guarantee Fund (Fonds de garantie des dépôts) becomes the Deposit Guarantee and Resolution Fund (Fonds de garantie des dépôts et de résolution) (hereinafter the ‘Fund’). The Prudential Control and Resolution Authority may ask the Fund to intervene in a credit institution or an assimilated entity which is failing and subject to resolution measures. The Fund would intervene according to the procedure determined by the Prudential Control and Resolution Authority in accordance with the draft law. In particular, the Fund may acquire some or all of the shares in the entity, subscribe to an increase in capital of the entity or the bridge institution set up by the Prudential Control and Resolution Authority, grant any form of funding to the entity or the bridge institution and assume part of the costs required to guarantee the solvency of the entity. The sums paid by the Fund benefit from the more favourable status granted to any creditor providing new financing to a bank or other undertaking subject to safeguard, receivership or winding-up proceedings. The Fund will only be liable in defined cases for losses resulting from the assistance granted. Second, rules are laid down for the preventive recovery and resolution plans of banks and a bank resolution scheme is introduced. In this framework, credit institutions and assimilated entities have to submit a preventive recovery plan to the Prudential Control and Resolution Authority for possible modification and adoption. The preventive recovery plan may not involve the possibility to receive financial support from the State or the Fund. The resolution college’s powers include appointing a temporary administrator, removing any manager, deciding that some or all activities should automatically be transferred or taken over, writing down or cancelling shares according to the entity’s losses, and setting up a bridge institution. The resolution college ensures that the measures taken guarantee financial stability and help to maintain the continuity of activities while limiting exceptional public financial support to the strict minimum. At the same time, the resolution college will ensure that no shareholder, member or creditor is worse off than they would have been had the institution been liquidated.

text: 1.3 Macro-prudential supervision The Financial Regulation and Systemic Risk Council (Conseil de régulation financière et du risque systémique) becomes the Financial Stability Council (Conseil de stabilité financière). It will supervise the financial system as a whole and will define macro-prudential policy, with the aim of maintaining the stability of the financial system. It will evaluate systemic risks, taking into account the opinions and recommendations of the competent European institutions, adopt opinions or recommendations it deems necessary to prevent any systemic risk and any threat to financial stability and decide to define additional capital requirements at the proposal of the Governor of the Banque de France. The Banque de France, in cooperation with the Financial Stability Council, will help to maintain the stability of the financial system, identify and monitor risks to it and contribute to the implementation of the measures taken by the Financial Stability Council. 1.4 Enhanced powers of the AMF and of the ACP In particular, the powers of the ACP are strengthened in relation to, inter alia, the nomination of managers and other persons on the Board of Directors or Supervisory Board of inter alia credit institutions. The ACP may object to a nomination if the criteria of good repute, competence and experience required are not met. It may also suspend persons who no longer fulfil the criteria.

text: 2. Measures relating to the structure of banking groups

text: This draft law arises in conjunction with the Report of the European Commission’s High-level Expert Group of 2 October 2012 on reforming the structure of the EU banking sector (hereinafter the ‘Liikanen report’) . The European Commission will prepare a comprehensive impact assessment of its recommendations and will make corresponding legislative proposals as appropriate, to ensure a consistent Union framework. Given that these measures primarily address internationally active banks, the ECB considers coordination and consistency to be important at European and international levels to avoid regulatory arbitrage. More specifically, the draft law provides for a mandatory separation of proprietary and other high-risk non-client related activities from the deposit-taking institution. Such a separation would further protect depositors from being exposed to losses from these high risk activities, reduce complexity and enhance resolvability. The ECB also notes that, unlike the Liikanen report, the draft law does not provide for ringfencing of market making activities.

text: 3. Prohibition on certain activities

text: The draft law prohibits the dedicated subsidiaries, in the form of investment firms or, exceptionally, of credit institutions, from carrying out high frequency trading (HFT), dealing with financial instruments

text: where the underlying asset is a raw food material, and the sale and purchase of derivative instruments for a credit event affecting a State without connection to the holding of securities issued by this State. In this respect, the ECB is of the view that less intrusive approaches, in line with international recommendations , might be preferable. In addition, consistency should be ensured at Union level. First, as regards HFT, as highlighted in Opinion

text: , the ECB supports the Commission’s proposal to introduce organisational safeguards for trading venues, such as circuit breakers, minimum tick sizes and maximum ratios of unexecuted orders, in line with international recommendations. Further, the ECB considered that all entities engaged in algorithmic trading on a professional basis should be considered as falling within the definition of investment firms and be subject to supervision and monitoring of their activities by competent authorities. Finally, the ECB supports the empowerment of competent authorities to temporarily prohibit or restrict certain types of financial activity or practices with a view to addressing a threat to the orderly functioning of financial markets or the stability of whole or part of the financial system. Second, as regards the proposed prohibition on operations relating to financial instruments where the underlying asset is a raw food material, Opinion

text: supports the empowerment of competent authorities to set ex ante position limits for commodity derivatives over a specified period of time, while the European Securities and Market Authority will be granted a coordination role of such measures as well as specific direct powers in this area .

text: 4. Financial Stability Council

text: The ECB welcomes the extension to the powers of the Financial Regulation and Systemic Risk Council, now renamed as a Financial Stability Council. This will enhance its role as a national macro-prudential authority in France . The tasks of the Financial Stability Council include: (a) ensuring that the institutions represented on its panel cooperate and exchange information, and examine the situation in the financial sector and markets, and (b) cooperating with equivalent authorities in the other Member States and the competent European authorities. Moreover, actions of national macro-prudential authorities should take account of the responsibility of the European Systemic Risk Board (ESRB) for macro-prudential oversight of the

text: financial system within the Union . The ECB recommends in this respect that the draft law requires the Financial Stability Council to inform the ESRB of all actions taken to address systemic risks at national level. Furthermore, it should inform the ESRB prior to the issuance or publication of its opinions and recommendations, if significant cross-border effects are to be expected. Lastly, the Financial Stability Council’s activities will have to take account of the ECB’s macroprudential supervisory powers in the context of the single supervisory mechanism.

text: 5. Involvement of the Banque de France in macro-prudential supervision

text: The ECB supports the enhancement of the macro-prudential functions performed by the Banque de France in cooperation with the Financial Stability Council. The ECB understands that the Banque de France will contribute to: (a) monitoring financial stability and systemic risks, (b) ensuring implementation of the Financial Stability Council’s recommendations, (c) making proposals to the Financial Stability Council concerning the application of the specified macro-prudential instruments, such as capital or own funds requirements or conditions for lending practices of credit institutions. As stated in the ECB’s Convergence Reports , the involvement of the Banque de France in the application of measures to strengthen financial stability must be compatible with the Treaty. A national central bank’s functions must be performed in a manner that is fully compatible with it functional, institutional and financial independence to safeguard the proper performance of its tasks under the Treaty and the Statute of the European System of Central Banks and of the European Central Bank. To the extent the role of the Banque de France under the new legislation goes beyond advisory functions and requires it to assume additional tasks, it must be ensured that these tasks will not affect the ability of the Banque de France to carry out its ESCB-related tasks from an operational and financial point of view. Additionally, the inclusion of Banque de France representatives in collegiate decision-making supervisory bodies or other authorities such as the Financial Stability Council or the Prudential Control and Resolution Authority would need to give due consideration to safeguards for the personal independence of the members of Banque de France’s decision-making bodies .

text: 6. Framework for the recovery and resolution of credit institutions and investment firms

text: The ECB welcomes the proposed amendments in the draft law. It notes that national legislation will have to be brought into line with forthcoming Union legislation, in particular the proposal for a directive of the European Parliament and of the Council establishing a framework for the recovery and resolution of credit institutions and investment firms (hereinafter the ‘proposed directive’) and the establishment of a

text: single resolution mechanism, focused on a European Resolution Authority, which the ECB fully supports . The draft law provides that the Prudential Control and Resolution Authority may, inter alia, write down or cancel shares. The ECB welcomes the development of bail-in as a debt write down or conversion mechanism to absorb losses of institutions that are failing or likely to fail. The bail-in mechanism should be in line with internationally agreed key attributes for effective resolution . In particular, the resolution authority should be empowered under a resolution regime to bail in a wide range of liabilities in accordance with the creditor hierarchy that would apply in liquidation. The ECB supports the introduction of such a bail-in tool by the Member States before 1 January 2018 . This would allow for further work on bail-in, which may be necessary to assess the possibility of introducing a minimum requirement for a targeted level of designated bail-in instruments while still maintaining the overall scope of bail-in and the practical implications of bail-in as a resolution tool.

text: This opinion will be published on the ECB’s website.

text: Done at Frankfurt am Main, 12 December 2012.

text: [signed]

text: The Vice-President of the ECB

text: Vítor CONSTÂNCIO


text: OJ L 189, 3.7.1998, p. 42.

text: COM(2011) 656 final. 3 COM(2011) 652 final. 4 COM(2011) 654 final. 5 COM(2011) 651 final. 6 Opinion

text: . All ECB opinions are available on the ECB’s website at www.ecb.europa.eu.

title: Opinion of the European Central Bank of 13 December 2012 on high frequency trading (CON/2012/107)

text: OPINION OF THE EUROPEAN CENTRAL BANK of 13 December 2012 on high frequency trading (

text: ) Introduction and legal basis

text: On 12 October 2012, the European Central Bank (ECB) received a request from the German Federal Ministry of Finance for an opinion on a draft law on the prevention of risks and abuses in high frequency trading (hereinafter the ‘draft law’). The ECB’s competence to deliver an opinion is based on Articles 127(4) and 282(5) of the Treaty on the Functioning of the European Union and the sixth indent of

text: Article 2(1) of Council Decision 98/415/EC of 29 June 1998

text: on the consultation of the European Central Bank by national authorities regarding draft legislative provisions , as the draft law relates to rules applicable to financial institutions insofar as they materially influence the stability of financial institutions and markets. In accordance with the first sentence of Article 17.5 of the Rules of Procedure of the European Central Bank, the Governing Council has adopted this opinion.

text: 1. Purpose of the draft law

text: The draft law is intended to counteract the specific risks of algorithmic high frequency trading. To that end, the draft law amends the Law on banking, the Law on the stock exchange, the Law on securities trading, the Law on investment and further related laws. In that context, the definition of the term ‘proprietary trading’ is expanded to include high frequency trading (HFT), which uses algorithmic-based trading, generating purchase and sale signals within seconds and provides for the holding of positions for a very short time. This aims to eliminate a supervisory loophole and to bring high frequency traders under the supervision of the Federal Financial Supervisory Authority (BaFin). In addition, algorithmic trading (AT) is made subject to stricter requirements, under which investment services providers, investment trusts and self-managed investment companies which conduct AT are to ensure that in the future, from an organisational point of view, their trading systems are designed in such a way as to avoid market disruptions. Furthermore, certain trading practices which are intended to disrupt or delay the functioning of trading systems or to mislead other trade participants are included under the definition of market manipulation.

text: Moreover, in addition to the introduction of a fee for excessive use of trading systems, an obligation is introduced whereby trade participants are to guarantee an appropriate ratio between (1) orders placed, changes to and cancellations of orders, and (2) business transactions that are actually concluded. A minimum tick size is introduced in order to counteract the trend towards ever smaller minimum tick sizes. In order to prevent a move towards multilateral trading systems to avoid such regulation, the draft law is also applicable to multilateral trading systems. The draft law also strengthens the intervention rights of the supervisory authority for the stock exchange and implements a specific right to receive information and to submit proposals.

text: 2. General observations

text: 2.1 The ECB welcomes the draft law as it aims to curb risks for financial stability and to contain market manipulation caused by high frequency trading. 2.2 The ECB points out that national legislation will need to be in line with forthcoming European Union legislation, in particular (1) the proposal for a directive on markets in financial instruments repealing Directive

text: of the European Parliament and of the Council (MiFID), (2) the proposal for a regulation on markets in financial instruments and amending Regulation on OTC derivatives, central counterparties and trade repositories (MiFIR), (3) the proposal for a directive on criminal sanctions for insider dealing and market manipulation , and (4) the proposal for a regulation on insider dealing and market manipulation (market abuse) . In that context, the ECB refers to its opinion on these proposals .

text: 3. Specific observations

text: 3.1 The ECB welcomes the fact that the draft law refers to specific cases of market manipulation, referring to new trading techniques such as AT, which includes HFT. As stated in paragraphs 10.1 and 14.3 of the aforementioned ECB opinion, although AT practices may have legitimate purposes, they might also jeopardise the liquidity and efficiency of financial markets, particularly in times of market stress, as they could disturb the normal functioning of the market and increase volatility, which would be contrary to the public interest. 3.2 The ECB welcomes the establishment of a special right to information for the stock exchange supervisory authority and also for the Trading Surveillance Office aimed at improving the monitoring of companies conducting AT. The ECB also supports the proposal under which HFT companies which are not credit institutions or other financial services institutions would be brought under the supervision of BaFin. In this regard, the ECB reiterates that in its Opinion

text: it considered that all entities engaged in AT on a professional basis should be considered to come within the definition of investment firms and thus fall under the scope of the MiFID and be subject to supervision and monitoring of their activities by competent authorities. Ensuring comprehensive coverage of all entities professionally involved in HFT and AT would limit potential circumvention of the proposed rules. 3.3 The ECB notes that the draft law introduces an obligation for appropriate marking of orders. Such provisions may need to be adjusted in light of the requirements under the proposed MiFIR and relating to transaction reporting details, with the introduction of a designation to identify the computer algorithms within the investment firm responsible for the investment decision and the execution of the transaction. In this regard, and as highlighted in Opinion

text: , to facilitate cross-market surveillance and to prevent and detect market abuse, such unique identifiers should be developed for the identification of trades generated by any AT within and across trading platforms. Furthermore, the introduction of a trader ID could be considered in order to be able to assign each order and each transaction to the person responsible within the investment firm. 3.4 The ECB welcomes the proposed granting of powers to the stock exchange supervisory authority to prohibit the use of a specific algorithmic trading strategy, notably with a view to preventing breaches of stock exchange regulations and trading orders and to eliminate abuse. Opinion

text: supported the empowerment of the European Securities and Markets Authority to temporarily prohibit or restrict certain types of financial activity or practice with a view to addressing a threat to the orderly functioning of financial markets or the stability of whole or part of the financial system. 3.5 In line with the views expressed in Opinion

text: , the ECB welcomes the proposed introduction of appropriate organisational safeguards for trading venues, namely (i) volatility interruptions, (ii) an appropriate ratio between orders that have been suspended and transactions actually conducted on a stock exchange, and (iii) an appropriate minimum tick size for traded financial instruments. 3.6 The ECB notes that the draft law introduces compulsory fees for the excessive use of stock exchange trading platforms, which are to be regularly reviewed by the stock exchange supervisory authority within the scope of its supervision. While welcoming provisions limiting the excessive use of suspended orders, it is important that such measures are clearly articulated, together with those to be provided for under the envisaged legislative proposal on the Financial Transaction Tax.

text: This opinion will be published on the ECB’s website. Done at Frankfurt am Main, 13 December 2012. [signed]

text: The Vice-President of the ECB

text: Vítor CONSTÂNCIO


text: OJ L 189, 3.7.1998, p. 42. 2 BOE 275, 15.11.2012.

text: Article 27 of the draft law. 4 BOE 182, 30.7.1998. 5 Seventh Additional Provision, paragraph 9, of Law 9/2012. 6 Available on the European Commission’s website at http://ec.europa.eu. See paragraphs 9, 21 and 22. 7 OJ L 331, 14.12.2011, p. 1.

text: OJ L 332, 31.12.1993, p. 1.

title: Opinion of the European Central Bank of 14 December 2012 on asset management companies (CON/2012/108)

text: OPINION OF THE EUROPEAN CENTRAL BANK of 14 December 2012 on asset management companies (

text: ) Introduction and legal basis

text: On 14 November 2012, the European Central Bank (ECB) received a request from the Spanish Secretary of State for Economic Affairs and Business Support for an opinion on a draft Royal Decree (hereinafter the ‘draft law’) on the legal regime for asset management companies (AMCs). The ECB’s competence to deliver an opinion is based on Articles 127(4) and 282(5) of the Treaty on the Functioning of the European Union and on the third and sixth indents of

text: on the consultation of the European Central Bank by national authorities regarding draft legislative provisions , as the draft law relates to the Banco de España and to rules applicable to financial institutions that materially influence the stability of financial institutions and markets. In accordance with the first sentence of Article 17.5 of the Rules of Procedure of the European Central Bank, the Governing Council has adopted this opinion.

text: 1. Purpose and contents of the draft law

text: 1.1 Legal framework The draft law implements Law 9/2012 of 14 November 2012 on restructuring and resolution of credit institutions , as regards the legal framework for AMCs in general and for the Asset Management Company for Assets Resulting from Bank Restructuring (hereinafter the ‘SAREB’). 1.2 AMCs’ objectives Article 3 of the draft law provides that AMCs must pursue the following objectives: (i) help restore the financial system by acquiring impaired assets harmful to the credit institutions’ balance sheets so that the associated risks are transferred to the AMCs; (ii) minimise public financial support; (iii) pay the debts and obligations incurred in the course of conducting their activities; (iv) minimise potential market distortions resulting from their actions; (v) dispose of the acquired assets in such a way that their value is optimised.

text: 1.3 Roles of the Fund for Orderly Bank Restructuring and the Banco de España The Fund for Orderly Bank Restructuring (hereinafter the ‘FROB’) defines the categories of assets to be transferred on the basis of pre-determined qualitative and quantitative criteria. The Banco de España may extend the criteria, define them more precisely and resolve doubts as to the inclusion of an asset in the defined categories. Once the valuation adjustments have been made and the transfer value determined by the Banco de España, the FROB orders the definitive transfer of the assets. The price to be paid for the assets is subject to valuation adjustments and criteria, taking into account whether the assets are listed on an active market and whether they are real estate assets, credit rights or equity instruments. The Banco de España determines the final transfer value on the basis of valuation reports by independent experts in accordance with the valuation criteria set out in the draft law. The transfer value is expressed for each category of assets as a percentage of the book value after applying the required valuation adjustments. 1.4 Regime applicable to the SAREB The draft law also lays down the regime applicable to the SAREB and its separate capital structures, the Bank Asset Funds, to which it may transfer its assets in order to facilitate the divestment procedure. The SAREB will be incorporated for a maximum period of 15 years as a public limited company with special features deriving from its unique corporate purpose and the public interest nature of its activities. Its only purpose is the holding, direct or indirect management, acquisition and disposal of assets to be transferred to it by credit institutions receiving public support. These institutions receive debt securities issued by the SAREB with a State guarantee as payment for the assets transferred. The assets to be transferred will include foreclosed assets with a net book value over EUR 100 000 after applying the required adjustments, loans to real estate developers with a net book value over EUR 250 000 after applying the required adjustments, and controlling corporate holdings linked to the real estate sector. The SAREB will have a maximum financial limit of EUR 90 billion. Public participation in the SAREB will be below 50%, and it will have to meet certain corporate governance requirements. One-third of its Board will be composed of independent members and it will be obliged to establish committees on audit, remuneration, appointments, management, risks, investments and assets and liabilities. The board members of the SAREB will be obliged to meet strict requirements with regard to their professionalism, integrity and relevant experience. The SAREB will prepare a six-monthly activity report; an independent expert will prepare an annual compliance report on the SAREB; and an external Monitoring Commission will be set up, and may agree to include permanent observers. The Monitoring Commission will oversee compliance with the SAREB’s general objectives, including, inter alia, helping restore the financial system by receiving the relevant assets so that, from the valuation date, there is an effective transfer of the risks associated with these assets. In this role, the Monitoring Commission will receive the SAREB’s activity and compliance reports and may request, and have full access to, information from the SAREB relating to its business plan and deviations from it; policies on divestment and amortisation of guaranteed debt; its economic and financial

text: situation or forecast; and any other information regarding assets, budget, accounts, organisation or procedures . Regarding the obligation to give the Monitoring Commission full access to the requested information, the SAREB is subject to a penalty regime under Law 26/1988 of 29 July 1988 on discipline and intervention of credit institutions . In order to facilitate the performance of the Monitoring Commission’s functions, the Banco de España and, where appropriate, the National Securities Market Commission, must inform the Monitoring Commission of the main conclusions arising from their supervision of the SAREB .

text: 2. General observations

text: The draft law implements provisions which have been adopted in the context of the Memorandum of Understanding on Financial-Sector Policy Conditionality for Spain . The ECB welcomes this implementation as an important tool to facilitate the ongoing process of restructuring and recapitalising the Spanish banking sector.

text: 3. Eligibility of SAREB debt securities as collateral in Eurosystem credit operations

text: The ECB notes that participating banks will receive debt securities issued by the SAREB and guaranteed by Spain. Overall, the issuance of government guaranteed securities should improve the liquidity position of Spanish banks. These securities are structured to meet the conditions set out in Guideline ECB/2011/14 of 20 September 2011 on monetary policy instruments and procedures of the Eurosystem . The ECB would expect that as such the debt securities would be marketable, which could also contribute to increasing the possibility of Spanish banks to refinance themselves in the market. As such, the SAREB scheme is expected to improve the overall funding situation of the Spanish banks. The ECB emphasises that it is the prerogative of the Eurosystem to decide on the basis of any information it may consider relevant within the legal framework laid down in and according to Article 18.1 of the Statute of the European System of Central Banks and of the European Central Bank, whether collateral fulfils the criteria of its collateral framework.

text: 4. ECB’s role as observer in the Monitoring Commission

text: The Eurosystem has an interest in the successful functioning of the SAREB, insofar as the SAREB’s State-guaranteed debt securities may be eligible collateral in Eurosystem credit operations. The timely disposal of assets by the SAREB will facilitate the further deleveraging of participating banks’ balance sheets, thereby potentially reducing their reliance on Eurosystem credit operations. More generally, by

text: facilitating the transfer of non-performing assets into a separate institution, asset removal schemes such as the SAREB assist participating banks in restructuring their balance sheets, which should, in turn, improve their financial soundness. By facilitating banking sector restructuring and recovery, albeit by transferring risk from the banking sector to the State, such schemes should positively contribute to banks’ ability to extend credit and support economic recovery. In addition, the value of the distressed assets may be better recovered when consolidated and managed by independent specialists. The ECB is ready to nominate a permanent observer to hold a seat in the Monitoring Commission in accordance with the Eurosystem’s contribution, under Article 127(5) of the Treaty, to the smooth conduct of policies pursued by the competent authorities relating to the stability of the financial system. In this respect, the type of information and reporting the SAREB will be required to provide to the Monitoring Commission will need to be further developed and clarified, as the Monitoring Commission can only effectively fulfil its mandate with appropriate reporting from the SAREB.

text: 5. Prohibition on monetary financing

text: In order to avoid monetary financing concerns, the SAREB should not qualify as a public undertaking within the meaning of Council Regulation No 3603/93 of 13 December 1993 specifying definitions for the application of the prohibitions referred to in Articles

text: and

text: b (1) of the Treaty .

text: 6. Scope and capacity of the SAREB

text: The limitations with respect to the scope and capacity of the SAREB are reasonable and consistent with its viability.

text: 7. Pricing

text: The methodology applied to derive the prices of assets to be acquired by the SAREB appears appropriate and considered, and should lead to conservative prices, which in turn should minimise the risks to the vehicle in this respect.

text: 8. Vendor financing

text: The establishment of financing arrangements would greatly facilitate asset disposals by the SAREB. As the SAREB is not a bank, it cannot extend credit to potential buyers to facilitate asset purchases, but will be competing with banks which offer such financing to buyers of foreclosed and distressed assets. The terms of such financing arrangements should be competitive when compared with the terms offered by Spanish banks.

text: 9. Dividend payments and application of excess cash holdings by the SAREB

text: The draft law should be complemented by additional arrangements to ensure the timely redemption of State-guaranteed bonds. This may be accomplished by imposing limitations on the payment of dividends by the SAREB and ensuring that all cash held by the SAREB beyond that required for short-term operating and capital expenses and other liquidity needs is applied to the early repayment of the SAREB’s State-guaranteed bonds. These arrangements should not affect the pace of deleveraging – i.e. the pace at which assets will have to be disposed of – which will depend on the business plan approved by the SAREB’s Board.

text: 10. Potential conflicts of interest

text: Insofar as the SAREB’s capital comes from certain Spanish credit institutions, care will need to be taken to avoid potential conflicts of interest that might arise as these institutions may also have significant interests in the Spanish real estate sector.

text: This opinion will be published on the ECB’s website.

text: Done at Frankfurt am Main, 14 December 2012

text: [signed]

text: The Vice-President of the ECB

text: Vítor CONSTÂNCIO


text: OJ L 189, 3.7.1998, p. 42.

text: All ECB opinions are published on the ECB’s website at www.ecb.europa.eu.

text: of 8 December 2011, available on the European Banking Authority’s website at www.eba.europa.eu.

text: Commission Recommendation of 30 April 2009 on remuneration policies in the financial services sector (OJ L 120, 15.5.2009, p. 22). See also ECB Opinions

text: and

text: , paragraph 6.3.

title: Opinion of the European Central Bank of 17 December 2012 on the creation of capital buffers for the Banca Monte dei Paschi di Siena (CON/2012/109)

text: OPINION OF THE EUROPEAN CENTRAL BANK of 17 December 2012 on the creation of capital buffers for the Banca Monte dei Paschi di Siena (

text: ) Introduction and legal basis

text: On 6 December 2012, the European Central Bank (ECB) received a request from the Italian Ministry of Economic Affairs and Finance (hereinafter ‘the Ministry’) for an opinion on Article 8 of Decree Law No 216 of 11 December 2012 (hereinafter the ‘draft amendment’), amending Decree-Law No 95 of 6 July 2012 (hereinafter the ‘amended legislation’), on the creation of capital buffers for the Banca Monte dei Paschi di Siena (MPS) through the issuance by the MPS of hybrid instruments to be subscribed by the Ministry. The ECB’s competence to deliver an opinion is based on Articles 127(4) and 282(5) of the Treaty on the Functioning of the European Union and the sixth indent of

text: Article 2(1) of Council Decision 98/415/EC of 29 June 1998

text: on the consultation of the European Central Bank by national authorities regarding draft legislative provisions , as the draft amendment relates to rules applicable to financial institutions insofar as they materially influence the stability of financial institutions and markets. In accordance with the first sentence of Article 17.5 of the Rules of Procedure of the European Central Bank, the Governing Council has adopted this opinion.

text: 1. Purpose of the draft amendment

text: 1.1 Decree-Law No 87 of 27 June 2012, on which the ECB adopted Opinion

text: , was adopted by the Italian Government in order to create a temporary capital buffer for the MPS in line with the Recommendation of the European Banking Authority on the creation and supervisory oversight of temporary capital buffers to restore market confidence . The provisions contained in that Decree-Law were later included in Decree-Law No 95 of 6 July 2012, which was converted into law by Law No 135 of 7 August 2012. The amended legislation established a form of government support by authorising the Ministry to subscribe certain hybrid instruments (new financial instruments, NFIs) to be issued by the MPS, up to an amount of EUR 3.9 billion, of which EUR 1.9 billion would replace an equal outstanding amount of hybrid instruments previously issued by the MPS and subscribed by the Ministry.

text: 1.2 The draft amendment introduces several changes in the recapitalisation scheme currently in force for the MPS. In particular, the NFIs’ coupon is to be paid in cash up to the operating result from the MPS’s most recent financial statement, net of the provisions for obligatory reserves. If the MPS is not able to pay the coupon or any part of it in cash, for that amount the MPS could either allocate to the Ministry an equivalent nominal amount of new ordinary shares, issued at market price, or newly issued additional NFIs. The draft amendment also extends the deadline for the activation of the scheme to 31 January 2013.

text: 2. General observations

text: 2.1 The Ministry informed the ECB on an informal basis about the content of its draft amendment, before submitting it to the Italian Parliament. However, the consultation request should have been submitted so as to allow both the Ministry and the Parliament to take into consideration the ECB’s opinion before taking a decision on the substance of the draft amendment, in accordance with

text: Article 4 of Decision 98/415/EC

text: . 2.2 The ECB notes that, subsequent to the adoption of Opinion

text: , the Italian Parliament introduced in the amended legislation a new provision changing the way remuneration is determined for the members of the Board of Directors and certain executives to ensure that their remuneration is linked to the business performance of the bank, the risks to which the bank is exposed and the need to maintain adequate capital levels. The ECB welcomes the ongoing work on remuneration policies and schemes for financial institutions receiving public support in accordance with the Commission recommendation . 2.3 The ECB recommends specifying in more detail in the implementing legislation the features of the NFIs, in particular as regards subordination, interest payments on the coupon, conversion features and other terms and conditions of issue. 2.4 In the ECB’s view, the option granted to the MPS to pay the NFIs’ coupon, by issuing new shares to the Ministry, should be preferred to that of issuing additional NFIs. This second option, especially if repeated over time due to the absence or inadequacy of distributable profits, would add to the bank’s interest servicing burden on the NFIs in an already difficult operating environment. This could pose further challenges to the bank’s performance in the near term and impair its capacity to redeem the NFIs in a timely manner.

text: This opinion will be published on the ECB’s website. Done at Frankfurt am Main, 17 December 2012. [signed]

text: The President of the ECB

text: Mario DRAGHI