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Decision Sg/bog/2014/05/04 Of The Board Of Governors In Accordance With Article 19 Of The Treaty Establishing The European Stability Mechanism Between The Kingdom Of Belgium, The Federal Republic Of Germany...

Original Language Title: Beschluss SG/BoG/2014/05/04 des Gouverneursrats gemäß Artikel 19 des Vertrags zur Einrichtung des Europäischen Stabilitätsmechanismus zwischen dem Königreich Belgien, der Bundesrepublik Deutschla...

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Decision SG/BoG/2014/05/04 of the Board of Governors pursuant to Article 19 of the Treaty establishing the European Stability Mechanism between the Kingdom of Belgium, the Federal Republic of Germany, the Republic of Estonia, Ireland and the Hellenic Republic Republic of Cyprus, the Kingdom of Spain, the French Republic, the Italian Republic, the Republic of Cyprus, the Grand Duchy of Luxembourg, Malta, the Kingdom of the Netherlands, the Republic of Austria, the Portuguese Republic, the Republic of Portugal, the Republic of Cyprus, the Republic of Cyprus, the Republic of Cyprus, the Republic of Slovenia, the Slovak Republic and the Republic of Finland 1 on setting up the instrument for direct recapitalisation of institutions

SG/BoG/2014/05/04

EUROPEAN STABILITY MECHANISM

BOARD OF GOVERNORS

Sitting of 8 December 2014

_____________

DECISION No 4

Establishment of the instrument for direct recapitalisation of institutions

THE BOARD OF GOVERNORS,

Having regard to the Summit Declaration of the members of the euro area of 29 June 2012, which states that ' once an effective single supervisory mechanism [...] has been established with the involvement of the ECB, [...] the ESM shall be established in accordance with a This decision would have the possibility to recapitalize banks directly ";

Bearing in mind the establishment of this single supervisory mechanism by Regulation (EU) No 1024/2013 of the Council;

Bearing in mind the purpose of the ESM, in accordance with Article 3 of the Treaty, to mobilise financial resources and to ensure that ESM Members who have serious financing problems or who are in danger of such problems, under strict conditions, appropriate to the financial assistance instrument chosen the provision of stability assistance where this is essential in order to safeguard the financial stability of the euro area as a whole and its Member States;

Bearing in mind the limitation of liability of each ESM Member in accordance with Article 8 (5) of the Treaty, which shall in all circumstances be determined by its share of the authorized capital stock at the rate of issue;

Having regard to the principles laid down in Article 12 of the Treaty;

Bearing in mind the framework established by Regulation (EU) No 1024/2013, and with the aim of consistency with the definitions laid down therein,

HAS DECIDED, in accordance with Article 19 of the Treaty, the establishment of the ESM instrument for the direct recapitalisation of institutions within the meaning of Article 2 (3) to (5) of Council Regulation (EU) No 1024/2013 ("Institute") as a financial assistance instrument, as well as the definition of the framework based on Article 13 of the Treaty, including, in particular, the procedure for the granting of financial assistance in the form of this instrument:

The procedure for granting financial assistance in the form of a direct recapitalisation shall be based on Article 13 of the Treaty, with additional procedural steps, rules and tasks relating to this instrument, which shall: The Executive Director, the European Commission, the ECB and, where appropriate, the IMF, shall be more closely specified in the following and in the specific guideline referred to in paragraph 5.

The Board of Governors may decide to grant financial assistance in the form of a direct recapitalisation of institutions, in accordance with the provisions of Article 12 of the Treaty. The financial assistance shall be subject to specific conditions which are relevant to this instrument.

The Board of Governors may not decide to grant or implement financial assistance by means of the direct recapitalisation instrument of institutions where the urgency procedure referred to in Article 4 (4) of the Treaty is applied , unless mutual agreement can be reached.

Without prejudice to Articles 107 and 108 of the Treaty on the Functioning of the European Union, the financing conditions of the financial assistance shall be carried out in the form of a direct recapitalisation of institutions in an agreement on a financial assistance facility to be provided by the Executive Director. . The institutional requirements for each institution and the details of the recapitalisation measure shall be based on a proposal by the Executive Director to be approved by the Board of Governors and in full compliance with Article 13. of the Treaty as defined in an institutional agreement. The institutional agreement and, where applicable, the first tranche of assistance shall be approved by the Executive Board. The institute-specific agreement shall be signed by the Executive Director.

The Executive Board shall adopt a detailed guideline for the implementation modalities of the financial assistance in the form of a direct recapitalisation of institutions, including in particular the eligibility conditions for the ESM Member and the institution concerned, and the allocation of specific tasks to the Executive Director, the European Commission, the ECB and, where appropriate, the IMF ("Guideline for financial assistance for direct recapitalisation of institutions").

6. Where applicable, the Management Committee shall, on a proposal from the Executive Director, decide by mutual agreement and upon receipt of the report referred to in the Guideline on financial assistance for the direct recapitalisation of institutions, which shall: Payment of the tranches of the grant to the first tranche.

The ESM shall, as an essential component of the instrument for the direct recapitalisation of institutions, establish a subordinate organisational unit in support of the Board of Governors by a decision of the Board of Governors by mutual agreement. ESM in the implementation of financial assistance in the form of a direct recapitalisation of institutions. With a view to this, the statutes must be amended accordingly.

On the basis of a general framework to be approved by the Board of Governors laying down the conditions for the establishment of sub-units for the implementation of financial assistance in the form of direct recapitalisation of institutions, and on the basis of a general framework to be adopted by the Board of Governors, In accordance with the provisions of the Treaty, the Management Committee or the Board of Governors may approve the establishment of these subunits and their statutes or foundation documents.

The ESM, including the subunit referred to in the first subparagraph, as well as all subunits, shall ensure an effective flow of information to ESM Members.

8. This Decision shall enter into force on the day of its adoption.

This Decision entered into force on 8 December 2014.

Ostermayer