Key Benefits:
Publics concerned: Prudential and Resolution Control Authority, Deposit and Resolution Guarantee Fund.
Subject: setting the criteria taken into account by the Autorité de contrôle prudentiel et de résolution to issue the notice provided for in the third paragraph of Article L. 312-10 of the Monetary and Financial Code the decisions of the Supervisory Board of the Deposit Guarantee and Resolution Fund relating to contributions to the Fund.
Entry into force: the text comes into force on the day after publication.
Notice: The Order transposes Articles 10, 11 and 13 of Directive 2014/49/EU of the European Parliament and the Council of 16 April 2014 on deposit guarantee systems and Article 109 of Directive 2014/59/EU of the European Parliament and of the Council of 15 May 2014 establishing a framework for the recovery and resolution of credit institutions and investment companies. It specifies the criteria to be taken into account by the Authority for prudential control and resolution to issue the notice referred to in the I of Article L. 312-10 of the Monetary and Financial Code. It further specifies the conditions for the application of the procedure provided for in that same article when the supervisory board does not deliberate in a manner consistent with the advice rendered by the prudential and resolution authority.
References: the provisions of this Order are available on the website Légifrance (http://www.legifrance.gouv.fr).
Minister of Finance and Public Accounts,
Having regard to Directive 2014/49/EU of the European Parliament and the Council of 16 April 2014 on deposit guarantee systems;
Considering Directive 2014/59/EU of the European Parliament and of the Council of 15 May 2014 establishing a framework for the recovery and resolution of credit institutions and investment companies and amending Council Directive 82/891/EEC as well as the directives of the European Parliament and Council 2001/24/EC, 2002/47/EC, 2004/25/EC, 2005/56/EC, 2007/36/EC, 2011/35/EU, 2012/30/EU and 2013/36/EU and EU regulations
Vu le monetary and financial codeincluding articles L. 312-4 to L. 312-16;
Considering the advice of the Advisory Committee on Financial Legislation and Regulation dated 26 October 2015;
In the light of the opinion of the Chairman of the Deposit Guarantee and Resolution Fund Board of 23 October 2015,
Stop it!
I. - To issue the notice referred to in I of Article L. 312-10 of the Monetary and Financial Code, the Supervisory Board or, where appropriate, the Resolution Control and Resolution Authority Resolution College shall ensure that the rate or amount of contributions set by the Supervisory Board of the Deposit and Resolution Guarantee Fund is sufficient to fund the exercise by the fund of its missions and its operation.
The relevant college of the Authority for prudential control and resolution takes into account the phase of the economic cycle and the impact of the contributions called on the status of the members of the mechanism or device concerned.
When it is intended to call contributions that do not take the form of contributions, the appropriate college of the prudential and resolution control authority shall ensure that the distribution of such contributions complies with the rules applicable to them and, where appropriate, the ceilings fixed under the 3rd of Article L. 312-16 of the same code.
II. - A. - With regard to the deposit guarantee mechanism, the Supervisory Board of the Supervisory and Resolution Authority shall ensure, inter alia, that the rate or amount of contributions set by the Supervisory Board may increase, no later than 3 July 2024, and that the financial resources available under this mechanism, at least at the target level established under Article 10 of Directive 2014/49/EU of the European Parliament and the Council of the European Parliament.
It ensures that annual contributions follow a steady pace and take due account of the economic cycle phase and the potential impact of pro-cyclical contributions to reach the target level.
It also ensures that the rate or amount of these annual contributions is sufficient to raise, within six years, the financial resources available under this mechanism at the target level established under Article 10 of Directive 2014/49/EU of the European Parliament and the Council of 16 April 2014 referred to above when the following conditions are met:
1° The target level mentioned above has already been achieved;
2° The financial resources available under this mechanism fell below two thirds of this target as a result of the use of funds.
B. - It further ensures that the rate or amount of annual or exceptional contributions is sufficient to raise the level of financial resources available under this mechanism at the target level established under Article 10 of Directive 2014/49/EU of the European Parliament and of the Council of 16 April 2014 referred to above when the Fund intervened under Article II of Article L. 312-5 of the same Code and that either of the following conditions is met:
1° The financial resources available under this mechanism have fallen below 25 per cent of this target;
2° The financial resources available under this mechanism have fallen below two thirds of this target and the fund must intervene in accordance with Article I L. 312-5 of the same code.
C. - It also ensures that the deliberation of the Supervisory Board does not increase the level of outstanding contributions to more than 0.5% of the deposits guaranteed by the Deposit and Resolution Guarantee Fund by calendar year, except in exceptional circumstances and has previously authorized it.
III. - A. - With regard to the financing mechanism for the resolution, the resolution panel of the prudential and resolution control authority shall ensure, inter alia, that the rate or amount of contributions, as determined by the supervisory board, allows to increase, by 31 December 2024, and then to maintain the financial resources available under this arrangement at least the applicable target level.
It ensures that annual contributions are spread over time as regularly as possible until the target level is reached.
It also ensures that the rate or amount of such contributions is sufficient to raise, within six years, the level of financial resources available under this mechanism at the target level applicable where the following conditions are met:
1° The target level mentioned above has already been achieved;
2° The financial resources available under the resolution ' s funding framework fell below two thirds of that target level.
B. - It further ensures that the deliberation of the Supervisory Board does not increase the level of outstanding contributions to more than three times the amount of annual contributions under this scheme during the allocation of resources.
IV. - The Supervisory Board or, where applicable, the Resolution College of the prudential and resolution control authority shall ensure that the deliberation of the Supervisory Board does not lead to the fact that the share represented by the payment commitments exceeds 30% of the available financial resources allocated to the deposit guarantee mechanism or to the resolution financing mechanism and that this limit is met at any time.
To assess this limit, the available financial resources of the deposit guarantee mechanism and the resolution financing mechanism are defined as the sum of the financial assets and the availability of the funds allocated to this mechanism or device and the payment commitments received for contributions to each of them and the reduction of the security deposits received as a guarantee of the same commitments.
I. - A. - For application third paragraph of Article L. 312-10 of the Monetary and Financial Code, the Deposit and Resolution Guarantee Fund Supervisory Board shall de-regulate the rate or amount and nature of annual contributions to its members by October 31 of each year.
The draft deliberation is notified to the Autorité de contrôle prudentiel et de résolution no later than three weeks before the scheduled date for this deliberation. This deliberation includes a statement of available means of the mechanism concerned and, where appropriate, forecasts of resource outflows from the fund.
The notice of the relevant college of the Authority for prudential control and resolution is forwarded to the Deposit and Resolution Guarantee Fund no later than two days before the date on which the Fund's Supervisory Board must meet.
The deliberation referred to in the first paragraph is notified to the Authority of prudential control and resolution no later than the day after its adoption.
B. - For the purposes of the third paragraph of Article L. 312-10 of the same code, the Supervisory Board of the Deposit and Resolution Guarantee Fund shall delibrate on the rate or amount and nature of the outstanding contributions referred to by its members no later than three months after:
- whether the unavailability of deposits or securities has been recognized, or the failure of a credit institution or a financing company to meet its bond commitments;
- that the deposit guarantee and resolution guarantee fund has been notified of the amounts paid by the resolution control panel of the prudential and resolution control authority under the resolution financing mechanism;
- that Deposit and Resolution Guarantee Fund has agreed to intervene as a preventive measure pursuant to II of Article L. 312-5 of the Monetary and Financial Code.
The procedure referred to in A applies. However, the notification referred to in the second paragraph of the same A may take place within a shorter period in accordance with the relevant college of the Autorité de contrôle prudentiel et de résolution.
C. - If no deliberation is notified to him under the A or B or if the deliberation notified to him is not in accordance with the notice he has rendered, the relevant college of the Autorité de contrôle prudentiel et de résolution notifies a finding of deficiency or non-compliance with the Deposit and Resolution Guarantee Fund within three days. This notification is still made to its supervisory board to deliberate. It sets the time limit for the supervisory board to decide; it is accompanied by the draft deliberation to which it is requested to comply.
This faculty is open as long as the college concerned considers that either of the situations mentioned in the previous paragraph is likely to contravene specific and unconditional provisions of the above-mentioned directives or decisions of the European Commission on their basis.
In accordance with the provisions of the fifth paragraph of Article L. 312-10 of the same code, the draft deliberation shall be deemed to be adopted after the time limit set by the notification in the absence of a deliberation of the supervisory board.
D. - The appropriate College of the Prudential and Resolution Authority shall calculate the contributions of the members of the Deposit and Resolution Guarantee Fund based on the deliberations referred to in A, B or, where appropriate, in C.
II. - For the purposes of the fourth paragraph I of Article L. 312-10 of the same code, the Supervisory Board of the Supervisory and Resolution Authority shall transmit to the Deposit and Resolution Guarantee Fund the draft decisions stopping the method of calculating contributions under the Deposit Guarantee Mechanism no later than thirty days before the date on which the College shall meet in case of change in the specified method.
In accordance with the provisions of the fifth paragraph of Article L. 312-10 of the same code, the notice of the Supervisory Board of the Deposit and Resolution Guarantee Fund shall be deemed to have been made without notice of its express notice before that date.
I. - The Deposit and Resolution Guarantee Fund may, under the deposit guarantee mechanism, derogate from the limit of payment commitments referred to in Article 1 IV during the period of the establishment of means of the deposit guarantee mechanism or of the resolution financing mechanism. In order to assess the distribution of payment commitments and other available means and to render its opinion, the Supervisory Board shall take into account the amount of resources available under this mechanism prior to the coming into force of this Order and assumes that annual contributions are regularly called to allow the financing of the total amount required to meet the funding target referred to in Article 1.
For the purposes of Article 1 IV, before the level of financial means available under the deposit guarantee mechanism reaches the target level referred to in Article 1st, the supervisory college appreciates the extent to which available means already made up of payment commitments received by the Deposit and Resolution Guarantee Fund may be renewed or reduced to allow for the late 30 per cent of Article IV of July 1
II. - During the period of the establishment of the means of the deposit guarantee mechanism or of the financing mechanism of the resolution, the appropriate college of the prudential and resolution control authority shall take into account in rendering its opinion of any interventions of the Deposit Guarantee and Resolution Fund under this mechanism or mechanism during that period. When the cumulative amount of deposits under the deposit guarantee mechanism exceeded 0.8 per cent of the deposits guaranteed by the fund over the period or the cumulative amount of the payments under this resolution financing arrangement exceeded 0.5 per cent of the deposits guaranteed by the fund over the period, the college concerned assumes that this period may be extended by four years to assess the regular nature of the annual contributions that result from the rate of advice or the amount determined by the fund
The provisions of this Order are applicable in New Caledonia, French Polynesia and the Wallis and Futuna Islands.
The present order will be issued in the Official Journal of the French Republic.
Done on 27 October 2015.
For the Minister and by delegation:
The chief of duty,
C. Bavagnoli
