Law 11/2015, Of June 18, Recovery And Resolution Of Credit Institutions And Investment Services Companies.

Original Language Title: Ley 11/2015, de 18 de junio, de recuperación y resolución de entidades de crédito y empresas de servicios de inversión.

Read the untranslated law here: http://www.boe.es/buscar/doc.php?id=BOE-A-2015-6789

FELIPE VI


KING OF SPAIN
To all who see and hear.

Know: that the Parliament has approved and I hereby sanction the following law:
INDEX


Chapter I. General Provisions.

Article 1. Purpose and scope.

Article 2. Definitions.

Article 3. Objectives of the resolution.

Article 4. Principles resolution.

Article 5. Evaluation.

Chapter II. early action.

SECTION 1. Planning early action.

Article 6. Recovery Plan.
Section 2
intragroup financial assistance.
Article 7. Agreements
financial aid within a group.
SECTION 3. Performance
early.

Article 8. Conditions for early action.
Article 9.
early action measures.

Article 10. Intervention or provisional replacement of directors as a measure of early action.

Article 11. Monitoring of early action measures and information to the resolution authorities.

Article 12. Coordination of early action measures in groups of bodies of the European Union.

Chapter III. preventive phase of the resolution.
SECTION 1. Planning
resolution.
Article 13. Plans
resolution.

Article 14. group resolution plans.

Section 2 Evaluation of solvability.

Article 15. Evaluation of the solvability of entities.

Article 16. Evaluation of the solvability of groups.

Article 17. Obstacles to the solvability of entities.

Article 18. Obstacles to the solvability of groups.

Chapter IV. Resolution.

Article 19. Conditions for resolution.

Article 20. Concept of unviable entity.

Article 21. Opening the resolution process.

Article 22. Replacing the board and general or treated as a measure of resolution directors.

Article 23. Contents of the decision on the initiation of the resolution process.

Article 24. Obligations of notification and publication.
Chapter V. Instruments
resolution.
SECTION 1. Instruments
resolution.

Article 25. Definition of the resolution tools and general rules.

Article 26. Sale of business entity.

Article 27. bridge institution.

Article 28. Asset Management Company.

Article 29. Regime of transfer of assets.

Article 30. Regime supervision of asset management companies.
Section 2
recapitalization operations.

Article 31. Operations recapitalization resource utilization National Resolution Fund.

Article 32. Ordinary shares or capital contributions.

Article 33. Instruments convertible into ordinary shares or contributions to share capital.

Article 34. Special arrangements for the subscription or acquisition by the FROB recapitalization instruments.

Chapter VI. Redemption and conversion of capital instruments and internal recapitalization.

Section 1 General provisions.

Article 35. Redemption and conversion of capital instruments and internal recapitalization.

Article 36. Amount of recapitalization.

Article 37. Effects of amortization and conversion of capital instruments and internal recapitalization.
Section 2
Redemption and conversion of capital instruments.

Article 38. Redemption and conversion of capital instruments.

Article 39. Rules for the redemption or conversion of capital instruments.
Section
3rd internal Recapitalization.

Article 40. Internal Recapitalization.
4th Section
eligible for recapitalization internal liabilities.

Article 41. Eligible for internal recapitalization liabilities.
Article 42. Liabilities
necessarily excluded from the internal recapitalization.

Article 43. Liabilities subject to exclusion of internal FROB recapitalization decision.

Article 44. Determination of the minimum requirement of eligible own funds and liabilities.

Article 45. Removal of obstacles to internal recapitalization.

Article 46. Recognition of contractual internal recapitalization.

Section 5th Implementation of internal recapitalization instrument.

Article 47 Treatment of shareholders.

Article 48. Sequence and special rules of internal recapitalization.

Article 49. Reorganization plan of activities.


Section 6th Other contributions to the internal recapitalization.

Article 50. Conditions for the contribution of the National Resolution Fund.

Article 51. Alternative sources of funding.

Chapter VII. FROB.

Section 1 Nature, composition and legal status.

Article 52. FROB.

Article 53. Financing mechanisms and budget.

Article 54. Governing Commission.

Article 55. President.

Article 56. Parliamentary control.

Article 57. Cooperation and coordination with other relevant national authorities.

Article 58. Cooperation and coordination with other international authorities.

Article 59. Duty of secrecy.

Article 60. Application of competition law.

Article 61. Adoption of international recommendations.

Section 2 Powers of the FROB.

Article 62. Powers of the FROB.
Article 63. Powers
commercial.

Article 64. General administrative powers.

Article 65. Enforceability of measures.

Article 66. Exclusion of certain contract conditions on early action and resolution.

Article 67. Partial transfer of assets and liabilities.

Article 68. Emergency measures.

Article 69. Advertising.

Article 70. Powers of suspension of contracts and guarantees.

Chapter VIII. procedural regime.

Article 71. Actions against the decisions and resolutions of the FROB adopted in the exercise of their commercial powers under Article 63

Article 72. Specialties of appeal against decisions and administrative acts within the framework of processes of early action and resolution.

Article 73. Specialties of appeal against decisions and administrative acts issued on redemption or conversion of capital instruments and internal recapitalization.

Article 74. Impossibility of execution of judgment in the administrative-law referred to Articles 72 and 73. resources

Chapter IX. sanctions.

Section 1 General provisions.

Article 75. General provisions.

Article 76. Competition for the instruction of records.

Article 77. Prescription of offenses and penalties.
Section 2
Offenses.

Article 78. Classes of infringements.

Article 79. Very serious offenses.

Article 80. Serious offenses.

Article 81. Minor offenses.

SECTION 3. Penalties.

Article 82. Sanctions.

Article 83. Penalties for the commission of very serious infringements.

Article 84. Penalties for serious infringements.

Article 85. Penalties for committing minor offenses.

Article 86. Penalties those holding administrative or management by the commission of very serious infringements.

Article 87. Penalties those holding administrative or management for the commission of grave breaches.

Article 88. Penalties those holding administrative or management for committing minor offenses.

Article 89. Criteria for determining penalties.

Article 90. Responsibility of the administrative or management positions.

Article 91. Temporary Appointment of members of the governing body.

Section 4th General rules of procedure.

Article 92. Procedure for the imposition of sanctions.

Article 93. Enforceability of sanctions and appeal through administrative channels.

First additional provision. Structure and functioning of the authorities of preventive resolution.

Second additional provision. Deadline for National Fund allocation resolution.

Third additional provision. legal regime applicable to the guarantees provided to the FROB and the Deposit Guarantee Fund of Credit Institutions.

Fourth additional provision. Single Resolution Mechanism and the Single Resolution Fund.

Fifth additional provision. Recordkeeping of financial contracts by entities.

Sixth additional provision. Integration of the Funds Deposit Guarantee Savings Bank, Banking Institutions and Credit Unions.

Seventh additional provision. References to Law 9/2012 of 14 November on restructuring and resolution of credit institutions.

Eighth additional provision. Spanish resolution authority in the field of the Single Resolution Mechanism.

Ninth additional provision. financial institutions and other companies.


Tenth additional provision. General feasibility plans.

Eleventh additional provision. Constitution of the Governing Committee of the FROB.

Twelfth additional provision. Capital authorized for conversion of capital instruments in case of a triggering event occurs.

Thirteenth additional provision. Bank staff Spain in the FROB.

Fourteenth additional provision. Regime applicable in the event of insolvency of an entity.

Fifteenth additional provision. Effects of the processes of early action and resolution on the continuity of the activities of an entity.

Sixteenth additional provision. Fee for activities conducted by the FROB as resolution authority.

Seventeenth additional provision. Legal framework of the Official Credit Institute.

First transitional provision. Arrangements for certain restructuring procedures, recovery and resolution.

Second transitional provision. Rules on internal recapitalization.

Third transitory provision. administrative and judicial proceedings initiated prior to the entry into force.

Fourth transitional provision. annual contributions to deposit guarantee compartment.

Fifth transitional provision. Accrual rate for the activities undertaken by the FROB as resolution authority during 2015.

Sixth transitional provision. Adaptation to new Directive 2013/50 / EU of the European Parliament and of the Council of 22 October 2013.

Seventh transitional provision. Implementation of the first final provision and Regulation (EU) No 909/2014 of the European Parliament and of the Council of 23 July 2014 on improving securities settlement in the European Union and central securities depositories and Directives 98/26 / EC and 2014/65 / EU and Regulation (EU) No 236/2012 are amended.

Derogatory provision.

First final provision. Amendment of Law 24/1988 of 28 July on Securities Market.

Second final provision. Amendment of Law 6/1997 of 14 April, Organization and Functioning of the General State Administration.

Final disposition third. Amendment of Law 29/1998 of July 13, regulating the Administrative Jurisdiction.

Fourth final provision. Amendment of Law 41/1999 of 12 November, on payment systems and securities settlement.

Final provision fifth. Amendment of Law 22/2003 of July 9, Insolvency.

Sixth final provision. Amendment of Law 35/2003 of 4 November on collective investment schemes.

Seventh final provision. Amendment of Royal Decree-Law 5/2005 of 11 March, on urgent measures for boosting productivity and improving public contracting.

Eighth final provision. Amendment of Law 6/2005 of 22 April on the reorganization and winding up of credit institutions.

Ninth final provision. Amendment of Royal Decree Law 1/2010, of July 2, approving the Consolidated Capital Companies Act is approved.

Final Disposition tenth. Amendment of Royal Decree-Law 16/2011 of 14 October, the Deposit Guarantee Fund of Credit Institutions is created.

Eleventh final provision. Amendment of Law 3/2012, of 6 July, on urgent measures to reform the labor market.

Final provision twelfth. Amendment of Law 10/2014 of 26 June, management, supervision and solvency of credit institutions.

Thirteenth final provision. Amendment of Law 22/2014, of 12 November, by which the venture capital entities, other collective investment entities closed-end management companies and collective investment entities regulated closed type, and why Law 35/2003 of 4 November on Collective Investment Institutions changes.

Final provision fourteenth. competence titles.

Final provision fifteenth. Incorporation of European Union law.

Sixteenth final provision. Faculty development.

Seventeenth final provision. Entry into force.
PREAMBLE


I


The increasing complexity of the financial system due to the size of the entities that comprise the greater sophistication of the products with which they operate, as well as its high interconnection requires public authorities to have mechanisms and enhanced powers for face the potential difficult situation in which you can find the credit institutions and companies providing investment services, respecting the essential idea behind all the articles of the law, to avoid any impact to the resources of taxpayers.

During the financial crisis of recent years, most developed countries experienced a greater or lesser extent, the enormous challenge entails carrying out the resolution of a credit institution in an orderly manner and without jeopardizing public money. This has shown that it is necessary to include in the legal systems specific powers to enable public authorities to manage a process, the resolution of the entity, a strong and agile at the same time respecting the rights of shareholders and creditors, but on the principle that it is these, and not the citizens with their taxes, who must absorb the losses of the resolution.

The realization of this new branch of financial regulation has been progressively articulated from the experiences of recent years in bank resolution processes and coordinating activity of international forums with competence in financial policy, and has crystallized in a series of principles that ultimately underpin the articles of this law, and that its importance should explain preliminarily.

A basic principle from which the law is that traditional bankruptcy proceedings conducted in court proceedings, are not, in many cases, useful for carrying out the restructuring or closure of a viable financial institution. Given its size, complexity and uniqueness of their funding sources, including deposits legally guaranteed, and interconnection with other entities, ordinary liquidation of a financial institution could hardly avoid irreparable damage to the financial system and the economy of a country. Therefore, it is necessary to articulate a special, rigorous and flexible time, allowing public authorities equip themselves with extraordinary powers in relation to the failed entity and its shareholders and creditors procedure. A method, in short, allowing close monitoring and continued on the entity to resolve by the resolution authority, and that is exclusively focused on the task of solving it efficiently.

From the above, the distinction between the settlement and the resolution of a financial institution is derived. In this sense, the liquidation of a financial institution refers to the completion of their activities as part of a normal judicial process, a process that will occur mainly in the case of entities because of their small size and complexity, are likely to be treated under this regime without detriment to the public interest; while the resolution of a financial institution is a unique process, administrative, on the infeasibility of those credit institutions and companies providing investment services that can not be operated through its bankruptcy liquidation on grounds of public interest and stability be managed financial.

The regime established by this Act is, therefore, an administrative, special and complete procedure, which seeks the maximum speed in the operation of the entity, in order to facilitate the continuity of its essential functions, while minimizing the impact of its impracticality in the economic system and public resources.


The second general principle, integrated in this Act is the necessary separation between supervisory functions and defeasance with the stated order to eliminate the conflict of interest that could incur the supervisory authority should play at the same time, the powers of resolution. The classic mandate of supervisory authorities is to ensure compliance with the rules that discipline the activity of the entities and especially the solvency rules, with the ultimate aim of safeguarding financial stability. This mandate, now adds a new one called to ensure that if an entity becomes unable to remain active on their own, despite regulation and traditional supervision, closure will occur with minimal distortion over the entire financial system and in particular, without any impact on public finances. It's time to articulate a new public-finance function aimed at ensuring that entities are, de facto, settled without drag an economic impact of such a magnitude that could harm the overall economy. It is not therefore a simple new supervisory approach, but a new area of ​​public intervention, autonomously, require entities exercising their activity so that its resolution is feasible and respectful interest overall, in the event that traditional supervision is insufficient.

At this point it should be noted that the interest of the monitoring is, above all, the continuity of the entity while the resolution is more focused on the settlement of those parts of it that are not viable. This difference in approaches to the tasks advised to perform both functions simultaneously and independently loyal collaboration between those responsible for the supervision and resolution. To address these principles and at the same time not affect the restructuring and pending completion resolution, this Act establishes a model that distinguishes between the functions of resolution in preventive phase, the Bank of Spain and the National Stock Market Commission is entrusted Securities, and they shall be exercised through internal organs functioning operational independence, and resolution functions in executive phase, which are assigned to the FROB. Notwithstanding the above, once culminated the processes currently under way and taking into account the experience of the Single Resolution Mechanism and the resolution authorities of the Member States of the Eurozone, and the evolution of the financial situation, assess the institutional model for greater efficiency.

A third principle that takes into account this Act, and that is also the result of a shared experience with neighboring countries, is the desirability of comprehensively articulate both a preventive phase as a phase of early action in the decisional process. It is, on the one hand, to integrate into the ordinary life of the entities continued reflection on their solvability, ie, that regardless of any operational difficulties, its operators devote efforts and attention to ensure that if an entity has to be settled at a particular time, structure or mode of operation would enable such a resolution without compromising financial stability, the economy and, especially, deposits and public money at risk. And, on the other hand, tries to place special emphasis on the need to allow supervisory authorities and resolution act on an entity from the outset, when the entity is still solvent and viable. At this early stage both public intervention and adjustments of the entity itself will be normally much more effective, which already occur in an environment of serious deterioration. A rigorous work on both lines of action, both preventive planning and early action, must necessarily provide a predictable and orderly resolution of entities that is what will have less impact on financial markets.
Based on these criteria
law includes a truly comprehensive and forceful preventive measures such as recovery plans and resolution set, early action measures or analysis of the solvability, which reaches even the possibility that the authority of resolution imposing a perfectly solvent entities adopting structural, organizational changes in its line of business, or otherwise, if necessary to ensure that in the event that the entity accrues unfeasible, its resolution can be done in an orderly manner without costs for the taxpayer.


Finally, as a fourth principle underlying the law, the need for all entities resolution scheme credibly rests on an assumption of costs not exceeding the limits of the financial industry itself is facing. That is, public resources and citizens can not be affected during the process of resolution of an entity, but are shareholders and creditors, or if any industry, who must take losses. This requires defining the resources to be used to finance the costs of a settlement procedure, which sometimes are enormously high. This Act, in line with the provisions in the countries of our environment, designs the internal mechanisms of absorption of losses by shareholders and creditors of the institution under resolution, and, alternatively, the creation of a resolution fund financed by own financial industry.

Deserves special mention the instrument internal recapitalization, legal translation of the English term "bail in" drawing the outline of absorption of losses by shareholders and creditors of the institution. His ultimate goal is to internalize the cost of resolving the financial institution itself, so that, with the maximum legal certainty, your creditors know the impact on them would not viable entity. It pursued ultimately solve the old problem of implicit government guarantees that would protect creditors of those entities which, by its relevance to the financial system in any case would not be liquidated. the special protection of bank deposits: For this medium is both an end in itself and one of the guiding principles of this Act is used. In case of internal recapitalization of the bank, these will be the last credits that may be affected, besides being covered to a large extent by the Fund Deposit Guarantee, so that the vast majority of depositors remains intact in the event of termination of a credit institution. On the other hand, the National Resolution Fund will be called to join in the near future on a background of European level and ex ante funded by contributions from credit institutions themselves. This fund will complement the effect of internal recapitalization and other instruments providing for the standard resolution, and, if necessary, can be used to relax or complete assumption of losses by shareholders and creditors.

The existence of these instruments resolve the question of how it should be paid for the resolution of a credit institution and articulates a procedure for the proper allocation of costs; bet also that such funding will be made, first, by the entity concerned and, secondly, the other entities, under the understanding that these also make a profit if the resolution of another entity is done so orderly; and ultimately, in a way that minimizes moral hazard incurred by entities if presumed to be rescued by taxpayer resources, it lends credibility to the principle that the costs of resolving an entity can not fall on the budget public.


II
Understanding the structure and content of this law can only be complete if we add to the principles described above two other important circumstances. On the one hand, the essentially European dimension of the rule, in that this law represents the transposition of European Union law on the resolution of credit institutions and investment services companies. And on the other hand, the continuity that this law represents about Law 9/2012 of 14 November on restructuring and resolution of credit institutions, which partially repealed.


First, the law undertook the transposition into Spanish law of Directive 2014/59 / EU of the European Parliament and of the Council of 15 May 2014 establishing a framework for establishing and restructuring resolution of credit institutions and companies providing investment services, and Directive 82/891 / EEC are amended and Directives 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 Regulation (EU) No 1093/2010 and (EU) No 648 / 2012 of the European Parliament and the Council, which is, in turn, one of the standards that contribute to the establishment of the Single Resolution Mechanism, established by Regulation (EU) No 806/2014 of the European Parliament and of the Council of 15 July 2014 laying down uniform rules and a uniform for the resolution of credit institutions and certain companies of investment services in the framework of a Single resolution Mechanism and a Single resolution Fund procedures are established and amending Regulation (EU) No 1093/2010, this being one of the pillars of the so-called banking union.

In the European Union they have experienced the effects of the financial crisis in very specific conditions resulting from the further integration of financial markets and the concurrence of the sovereign debt crisis in the monetary union. This complex situation led to all the Member States of the Union to strongly promote greater integration of financial regulation, and the Member States of the Eurozone to deepen the idea of ​​Banking Union as a guarantee of a genuine internal banking market subject to the same rules and supervised by the same authorities.

This integrative impulse, unprecedented since the creation of the single currency, has not been restricted to the area of ​​traditional prudential supervision, but has spread with equal force to the scope of the resolution of financial institutions. In this sense, the same way that the supervisor field progressed strongly in the harmonization of the rules of capital adequacy (with reference to the Basel Accords III) and the Single Monitoring Mechanism was established under the auspices of the Central Bank Europe, in the field of bank resolution, the aforementioned directive fully harmonises the rules in this area, and opens the way for the creation of a unique mechanism of European resolution to the Member States of the Eurozone, will form the only authority on the subject.

With this Law, therefore performed the implementation of Directive 2014/59 / EU of 15 May 2014 and Directive 2014/49 / EU of the European Parliament and of the Council of 16 April 2014 on the deposit insurance systems, and those provisions that allow the correct articulation and coordination of the Spanish the European system of resolution and which will be fully operational from 2016. So are introduced the law regulates the cooperation between the authorities of European resolution, if an entity operating in different Member States of the Union is resolved, and the representation of the Spanish resolution authorities in the Single resolution Mechanism.

Second, it is important to note that this rule clearly connects with a previously existing regulation and operating in Spain. Indeed, this law is heir to the Law 9/2012, of 14 November, in the drafting and preparatory work that then existed today of Directive 2014/59 / EU of 15 May 2014. It considered sits on the same principles, replicates much of its structure and articulate and has not understood, therefore, but as an instrument while recasts all regulation, completes the prior right in those areas of European Union law that they were not incorporated into our legal system. Thus, compliance is given to one of the requirements contained in that law resolution, whose preamble already provided that "at the time that the work done in international fora to advance and especially when in the field the European Union a final text for a directive on recovery and resolution of credit institutions, this standard will be adapted to the new rules "agreed.


Law 9/2012, of 14 November, has been robust since its adoption under the program of assistance to Spain for recapitalization of the financial sector, being the legal framework used to carry out the largest process financial restructuring of the history of our country, during which its provisions have been applied effectively by the resolution authority and progressively consolidated by judicial doctrine, in the environment inevitably litigation that involves this type of process.

That is why the legislature chooses this Act to give the greatest possible continuity both the content and the structure of the Law 9/2012, of November 14, completing only what the correct implementation of Directive 2014 / 59 / EU of 15 May 2014, is essential. The aspects in this text are more novel can be grouped into three areas. First, the preventive phase of the resolution reinforces, for all entities, and not only unworkable, must have recovery plans and resolution. Second, the absorption of losses in the old law reached only to the so-called subordinated debt, through management tools hybrids affect the new law to all types of creditors, articulating the effect a new regime of maximum depositor protection. And finally, a specific resolution fund which will be financed by contributions from the private sector is constituted.

It may be noted, in short, that in those areas where this Act diverges from the Law 9/2012, of November 14, it is to ensure greater absorption of losses by shareholders and creditors entity and provide greater protection to depositors and public resources.

The fact that this Act opts for the repeal of the previous law rather than to amend but not due to the effort that the legislature has been doing in recent times to improve the systematic and clarity of financial rules.


III
The structuring replica chapters of this standard mostly, for the reasons mentioned above, the Law 9/2012 of 14 November, which was successfully applied in recent years and that response was the needs of the banking sector during the financial crisis.

Chapter I contains general provisions specifying the purpose, scope and definitions of the key concepts of the law. As much substantive novelty, unlike the previous legislation and in line with the directive is transposed, this Act applies not only to credit institutions but also to investment services companies.

This implies that references to the relevant supervisor should be understood as references to the Bank of Spain, in the case of resolution of credit institutions and the Comisión Nacional del Mercado de Valores, in the event of termination of investment services companies . All this notwithstanding that, sometimes, the competent supervisor or resolution authority will be the institutions, agencies and European bodies established as sole supervisory and resolution authorities.
You
On the other hand, is distinguished in this Chapter between the functions of resolution and executive preventive phase, corresponding the first to the Bank of Spain and the Comisión Nacional del Mercado de Valores, through operationally independent bodies to determine, and the second to the FROB.

Chapter II regulates the procedure for early action, understood as that which applies to an entity when it is unable to comply with solvency regulations but is ready to return to compliance by their own means. One of the main instruments of early action are the recovery plans that must be developed by all entities. If under the previous standard only plans were to be developed by those entities that were going through difficulties, now that obligation extends to all entities, it has an eminently preventive.

Chapter III contains the definition and process of drafting resolution plans, which contain measures that the FROB, in principle, apply if the entity would be ultimately unworkable and does not carry its bankruptcy liquidation. These plans completely exclude the existence of public financial support.

This chapter also includes the ability to have the authority to preventive resolution to indicate the occurrence of obstacles to the resolution and, where applicable, the power to impose measures to eliminate entities.


In Chapter IV the resolution procedure understood as that which applies to an entity when it is not feasible or foreseeable that will be in the future and for reasons of public interest and financial stability necessary to prevent its bankruptcy liquidation is regulated . In the articles of this Chapter it determines how the opening of the resolution process occurs. To do so will require that the FROB or the relevant supervisory authority determine that an entity is in a situation of infeasibility. Subsequently, the FROB who will examine whether the other conditions to be met to start the resolution procedure are given.

From that moment, the FROB activated, as best consider, but considering resolution plans, different resolution tools that are contained in Chapter V. Except for the internal recapitalization which, by their particularities, is devoted the next chapter in full, the other instruments were already covered by Law 9/2012 of 14 November. This Act, however, complements and enhances the regulation in accordance with European standards.

The resolution tools are, first, the transmission of the entity or part of it to a private individual to protect essential services. Second, the creation of a bridge institution to which the salvageable part of the entity is transferred in resolution. And, thirdly, the creation of an asset management company to which the assets of the entity damaged resolution is transferred.

Certain provisions on the use of National Resolution Fund in the context of the application of resolution tools, without prejudice to the general regulation to this fund devotes Chapter VII are also included in this chapter.

Chapter VI is intended to call internal recapitalization. This is a very substantive novelty among the resolution tools. Its ultimate goal is, as already advanced, minimizing the impact of the resolution on taxpayers, ensuring adequate distribution of costs between shareholders and creditors.

The novelty of this instrument, as it is regulated by law, is that it allows imposing losses on all levels of creditor of the entity, and not only to the level of subordinated creditors, as gathered Law 9 / 2012 of 14 November. Under the terms provided in the law, it may refer the Resolution Fund to supplement or replace the absorption loss by the creditors.

This need to impose losses on shareholders and creditors is compatible with special protection for deposits to which reference has already been made. With this Act, the guaranteed deposits of less than 100,000 euros maintain direct guarantee of the Deposit Guarantee Fund, and also will have a maximum preferential treatment in the hierarchy of creditors. Also, deposits of individuals or small and medium companies have recognized people preference as creditors, only less than that granted to deposits of less than 100,000 euros.

Chapter VII introduces new light on the composition of the FROB, as it expands the number of members of the Governing Commission and creates the figure of the President as its chief representative, responsible for management and administration ordinary, with a term of five not extendable and causes a cessation priced. a member of the Comisión Nacional del Mercado de Valores, due to the extension of the scope of application of the law is also incorporated.

Another of the great innovations resulting from the transposition of the Directive, it is the creation of a National Fund Resolution. This fund will aim to finance resolution measures that run the FROB, who will exercise its management and administration. The Fund shall be financed by contributions from credit institutions and investment service companies, financial resources should reach at least 1 percent of the guaranteed deposits of all entities.

As of January 1, 2016, when the Single European Resolution Authority is fully operational and the National Resolution Fund merged with the rest of National Funds from Member States of the Eurozone in a Single Fund European resolution, the Spanish credit institutions make their contributions to this European Fund and the National Fund for businesses resolution will be investment services only.


Finally, Chapters VIII and IX collect two separate specific regimes, one procedural and other penalties, respectively. In the first the particularities of the remedies against acts dictated by the FROB and the decisions taken in the processes of early action and resolution are regulated. Chapter IX closes the law regulating its own sanctions regime for the entities and persons holding administrative or management positions in them, in the event that violate the obligations under this Act.

In the final part of the standard, including the additional provisions, the regime applicable to deposits if a credit institution is collected into competition. That scheme provides a maximum preferential treatment in the hierarchy of creditors to deposits guaranteed by the Deposit Guarantee Fund of Credit Institutions, and a general privilege to all deposits of small businesses and individuals. This is a very relevant in the Spanish insolvency regulation is to strengthen the level of maximum protection of bank deposits novelty. Also in connection with the insolvency regime of entities, a reference to the different levels of subordination that may exist within the group of credits by contractual agreement are designated as subordinated bankruptcy laws, which is limited to collecting practice is done which is usual in our legal system and in accordance with the rules of solvency to distinguish different degrees of subordination within the same type of credits, provided it is not done to the detriment of other creditors.
Among the final provisions
a change in the legal regime of the Deposit Guarantee Fund, following the implementation of Directive 2014/49 / EU of 16 April 2014, harmonizing the operation of these funds is included scale European. Since the directive provides that the functions can play systems deposit guarantee should be limited to the coverage of deposits or funding measures early performance or termination, the Fund Deposit Guarantee is divided into two compartments watertight: the deposit guarantee compartment, whose funds will be allocated to the tasks mandated by the Directive, and collateralised compartment which assumes other functions previously attributed to the Deposit guarantee Fund. In addition, a minimum target level to be achieved compartment resources deposit guarantee will be 0.8 percent of insured deposits, this level may be reduced to 0.5 percent prior authorization from the European Commission is established.
CHAPTER
I
General provisions


Article 1. Purpose and scope.

1. This Act is to regulate the processes of early action and resolution of credit institutions and companies providing investment services established in Spain, and to establish the legal status of "FROB" as authority executive resolution and its overall framework for action, with in order to protect the stability of the financial system minimizing the use of public resources.

2. This Act shall apply to the following entities:

A) Credit institutions and investment service companies established in Spain.

B) Financial institutions established in Spain, other insurance and reinsurance companies, which are subsidiaries of a credit institution or investment services company, or an entity referred to in points c) or d), and are regulated by the consolidated supervision of the parent company, in accordance with articles 6-17 of Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements for institutions credit and investment firms, and Regulation (EU) No 648/2012 is modified.
It
shall also apply to financial institutions established in Spain, other insurance and reinsurance companies, which are subsidiaries of the undertakings referred to in paragraph c) which are established in any country of the European Union or in the letter d) .

C) financial holding companies, mixed financial holding companies and mixed holding companies established in Spain.

D) Consolidated Financial holding companies and mixed financial holding companies of portfolio matrices other Member States of the European Union whose supervision on the basis corresponding to one of the competent supervisors referred to in Article 2.1.b).


E) branches of institutions referred to in point a) which are established outside the European Union in accordance with the specific conditions set out in this Act.

3. Shall not apply the provisions of this Act to investment services companies:

A) whose minimum legally required capital is less than 730,000 euros, or

B) whose activity meets the following characteristics:

1st Providing only one or more of the investment services or activities listed in Article 63.1.a), b), d) and g) of Law 24/1988 of 28 July, the Securities Market .

2.º not be allowed to provide the ancillary service referred to in Article 63.2.a) of Law 24/1988 of 28 July refers.

3.º not able to take deposit money or securities of its clients and, therefore, can never be in debit with such customers.

Article 2. Definitions.

1. For the purposes of this Act means:

A) Entity: entities under Article 1.2.a), unless expressly provided otherwise.

B) Supervisor competent: the Bank of Spain and the European Central Bank, within the Single Supervisory Mechanism, as responsible for the supervision of credit institutions authorities; and the Comisión Nacional del Mercado de Valores, responsible for the supervision of investment services companies authority.

C) preventive Authority resolution: the Bank of Spain, in relation to credit institutions, and the Comisión Nacional del Mercado de Valores, in relation to investment services companies, both through their respective operationally independent bodies, as authorities responsible for the preventive phase of the resolution.

D) Authority executive decision: the FROB, responsible for the executive phase of the resolution authority.

E) Resolution competent authorities the authority of preventive resolution and the resolution authority competent executive.

F) Early Action: the procedure applicable to an entity, in accordance with the provisions of Chapter II, when breach or there are objective elements according to which is reasonably foreseeable that it can not comply with solvency regulations, management and discipline, but is in a position to return to compliance by their own means.

G) preventive phase of the resolution: the set of procedures and measures, in order to guarantee the solvability and facilitate the eventual resolution of an entity included in Chapter III.

H) Resolution: orderly restructuring or liquidation of an entity carried out subject to this Act when, in accordance with the provisions of Chapter IV, the entity is not feasible or foreseeable that will be in the near future, there is no reasonable prospect that from the private sector measures to correct this situation and for reasons of public interest and financial stability necessary avoid bankruptcy liquidation.

I) Phase executive of the resolution: the set of procedures and measures, in order to manage the resolution of an entity are contained in Chapters IV to VI.

J) extraordinary public financial support: the aid provided for in Article 107.1 of the Treaty on the Functioning of the European Union, as well as any other public aid on a supranational level in order to preserve or restore the viability, liquidity or solvency an entity that provided at national level, has the status of State aid.

K) financial holding company shall mean a financial holding company as defined in Article 4.1.20 of Regulation (EU) No 575/2013 of 26 June 2013.

L) mixed financial holding company means a mixed financial holding company as defined in Article 2.7 of the Law 5/2005 of 22 April, supervision of financial conglomerates and the others are modified financial sector laws.

M) mixed holding company means a mixed holding company as defined in Article 4.1.22 of Regulation (EU) No 575/2013 of 26 June 2013.

N) Group: a parent institution, parent financial holding company or a mixed financial holding company and its subsidiaries.

O) Financial Conglomerate: a financial conglomerate as defined in Article 2.1 of Law 5/2005 of 22 April.

O) institutional protection system: mechanism that meets the requirements of Article 113.7 of Regulation (EU) No 575/2013 of 26 June 2013.


2. They shall apply for the purposes of the provisions of this Act and its implementing provisions, the definitions contained in Article 3 of Regulation (EU) No 806/2014 of the European Parliament and of the Council of 15 July 2014 establishing uniform rules and a uniform procedure for the resolution of credit institutions and certain companies of investment services in the framework of a Single resolution Mechanism and a Single resolution Fund established and Regulation (EU) amending No. 1093/2010.

Article 3. Objectives of the resolution.

The resolution processes pursue the following objectives entities, equivalently weighted depending on the circumstances present in each case:

A) Ensuring continuity of activities, services and operations whose interruption would disrupt the provision of essential services to the real economy or financial stability, and in particular, financial services and systemically important payment systems, clearing and settlement, taking into account the size, market share, internal or external connections, complex or cross-border nature of the entity or its group.

B) To avoid adverse effects on the stability of the financial system, preventing the spread of the difficulties of an entity at the whole system and maintaining market discipline.

C) To ensure the most efficient use of public resources, minimizing public financial support that extraordinary basis, may be necessary to grant.

D) To protect depositors whose funds are guaranteed by the Deposit Guarantee Fund of Credit Institutions and investors covered by the Investment Guarantee Fund.

E) Protect reimbursable and other assets of clients of the entities funds.

The achievement of these objectives shall, in any event to minimize the cost of resolution and avoid any destruction of value, except when necessary to achieve the objectives of the resolution.

Article 4. Principles resolution.

1. Resolution processes will be based, to the extent necessary to ensure compliance with the objectives outlined in the previous article, the following principles:

A) The shareholders or partners, as applicable, of entities will be the first to bear losses.

B) Creditors bear entities, if any, losses resulting from the resolution after the shareholders or partners and in accordance with the order established in the bankruptcy law, with the exceptions set forth in this Law. | ||
C) Creditors of the same rank will be treated equivalently in this Act unless otherwise provided.

D) No shareholder or creditor bear greater losses that would have incurred if the company were liquidated under bankruptcy proceedings.

E) managers and general managers or similar entity directors will be replaced, unless, exceptionally, maintenance strictly necessary to achieve the objectives of the resolution is considered.

F) managers and general managers or similar entity shall provide all necessary assistance to achieve the objectives of the resolution. For the purposes of the provisions of this Act shall be construed by assimilated CEOs persons who meet the conditions laid down in Article 6.6 of Law 10/2014 of 26 June, management, supervision and solvency of credit institutions .

G) Pursuant to the provisions of the insolvency, commercial and criminal law, managers of entities and any other natural or legal person liable for the damages in proportion to their participation and the severity of those.

H) guaranteed deposits will be fully protected.

I) measures adopted resolution, will be accompanied by the appropriate guarantees and safeguards which provide for this Act and its implementing regulations.

2. The purpose of the application of the principles mentioned in the previous paragraph, and in order to determine the appropriate allocation of costs of resolution to that Chapter VI is concerned, the FROB not be considered in any case included among shareholders, partners or creditors to which this paragraph.


3. The supervisor and the authorities of relevant resolutions, to implement the instruments or enforce the obligations and requirements of this Act, shall take into account the unique circumstances of each entity derived, among others, its structure, nature and activity profile under the terms specified in the regulations.

In particular, the regulations may provide for simplified compliance requirements or exemptions preparatory measures provided for in Chapters II and III, provided that:

A) be attributed to the supervisor and the competent authority of preventive resolution the ability to impose, at any time, full compliance with this Act and

B) is not limited, in any case, the ability of the supervisor and the competent authorities to adopt a resolution as early action or resolution.

Article 5. Evaluation.

1. The purpose of the assessment is to determine the value of the assets and liabilities of the entity, so that the supervisor or the authority competent resolution can assess whether the conditions for the resolution and the adoption of any measure of resolution are met and, particularly for the application of resolution tools and losses that may arise from the application of the instruments that will be used are recognized.

2. Prior to the adoption of any resolution measure character and in particular, in order to determine whether the conditions for resolution and application of the instruments provided by this Act are met, the value of assets and liabilities will be determined entity on the basis of valuation reports entrusted to one or more experts appointed by the FROB. Experts shall be independent of both public authorities, including resolution, as the entity subject to valuation.

3. The valuation is subject to the procedure and be conducted in accordance with the aims, requirements and conditions established by regulation.

Also statutorily provisional assessment procedure for cases of urgency that, in any case, shall provide for the realization of a final and complete subsequent valuation, and valuation process to determine the losses that had supported the shareholders will be established and creditors if the institution had been liquidated under bankruptcy proceedings. The provisional assessment shall be based on the report, if necessary, issue the appropriate supervisor.

4. A determined under the tax legislation purposes shall mean market value resulting from the application of the assessment referred to in this article.
CHAPTER II

Acting early




SECTION 1. Planning early action



Article 6. Recovery Plan.

1. As a preventive measure, all entities prepare and keep updated recovery plan that includes measures and actions to be taken by the entity in order to restore its financial position in the event of a significant deterioration of it occurs. The plan and its updates shall be approved by the board of the entity, for review by the appropriate supervisor.

2. The recovery plan should include a set of indicators, quantitative and qualitative will be considered as a reference to undertake the actions envisaged. In any case, you can assume access to public financial support.

3. The competent supervisor will review the plan and its updates considering the possibilities it offers to maintain or restore the viability of the institution in an agile and effective.

If the competent supervisor considers that the plan is deficient or that there are impediments that hinder its application, the entity may require the introduction of specific modifications. If it is not possible to remedy the deficiencies or impediments, the entity may require the adoption of any additional measure, which is necessary and proportionate in view of its effect on the activity of the entity.

In particular, the competent supervisor, without prejudice to any other measures that could be applied in the field of supervision, may require the entity to take measures to:

A) reduce their risk profile, including liquidity risk,

B) enable timely recapitalization measures,

C) review its strategy and structure,

D) change the funding strategy to improve the robustness of the main areas of activity and essential functions, or


E) make changes to its corporate governance system.

4. The competent supervisor shall forward the recovery plan to the relevant resolution authorities, who may make proposals for amendment to the extent that the plan could adversely affect the solvability of the entity.

5. Recovery plans are updated at least annually, and:

A) whenever a change in the legal or organizational structure of the entity or its financial situation could significantly affect the plan or require changes thereof, or

B) if the competent supervisor deems appropriate.

6. Entities forming part of a consolidated group or an institutional system of protection provided for in the fifth additional provision of Law 10/2014, of June 26, will not be required to submit individual recovery plans, except in the circumstances which could be determined by regulation.

Matrices entity groups develop and maintain updated a recovery plan at group level on the measures to be applied by the parent and each of the subsidiaries are contemplated.

7. Content regulations and procedures applicable to individual recovery plans or group will develop.

8. The recovery plan will be considered a corporate procedure for the purposes of Article 29 of Law 10/2014, of June 26 government.



Section 2 intragroup financial assistance


Article 7. Agreements
financial aid within a group.

1. Entities and their subsidiaries integrated into the consolidated supervision may sign agreements to lend financial support for the event that any incurred in the event of early the following article refers to performance. These agreements must be approved by the competent supervisor.

In addition, these agreements must be approved by the shareholders of each of the entities claiming to be part.

These agreements may be concluded only if, at the time the authorization, neither party has committed an assumption early action is requested.

2. The competent supervisor shall submit the intra-group agreements authorized competent authorities resolution.

3. Financial support agreements will have effect only between the parties that had signed, can not be enforced by any third party outside them. Neither these agreements, or the rights or measures resulting therefrom may be assigned or transferred to third parties, except in cases of universal succession.

4. Competition for granting financial assistance for the national management of the entity. This decision must be substantiated, indicating the purpose of the aid proposal and justifying that the conditions are met. Also, the decision to accept financial assistance under this agreement shall be adopted by the board of the entity receiving it.

5. The competent supervisor may prohibit or restrict the terms of the financial aid granted pursuant to paragraph 4 if considered justifiably that have not fulfilled the conditions for their provision.

6. The provisions of this article and its implementing regulations shall not apply to intra-group financial transactions, including centralized funding mechanisms in the event that either party of such operations satisfy the conditions for early action.

7. The management body of each entity that is party to the agreement inform shareholders of its development and any decision taken under it annually.

Also make public entities if they have not signed or financial support agreement within a group and, where appropriate, make public, and updated annually, a description of the general conditions of the agreement and the participating entities.

8. Regulations will be developed as provided in this article and in particular the following elements of intra-group financial support agreements:

A) conditions for its validity,

B) their content and, in particular, the principles that inform the terms of the agreements,

C) the procedure for their authorization by the competent supervisor, and in particular their right to object to,

D) the conditions for application and the appropriate procedure for this purpose, and

E) disclosure obligations and communications to the shareholders.



Acting early 3rd section




Article 8. Conditions for early action.

1. When an entity, or a parent of a consolidated group of entities, breach or there are objective elements as that is reasonably foreseeable that it can not meet in the near future with the solvency rules, order and discipline, but it is in a position of return to compliance by their own means, the competent supervisor declare the situation started early action and may take all or some of the measures set out in this Chapter.

In the case of investment services companies, failure to which the preceding paragraph shall also include the violation of the provisions of Articles 3 to 7, 14 to 17, 24, 25 and 26 of Regulation (EU) No 600/2014 of the European Parliament and of the Council of 15 May 2014 concerning markets in financial instruments and amending Regulation (EU) No 648/2012 amending or Title II of Directive 2014/65 / EU of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments and Directive 2002/92 / EC and Directive 2011/61 / EU amending.

2. To assess the possibility of failure to comply with the requirements set forth in the preceding paragraph may address, among other things, the existence of a rapid deterioration in the financial position or liquidity of the entity or a rapid increase in their leverage, mora or concentration of exposures.

Reglamentariamente you may specify other objective indicators to be used to determine the presence of the conditions laid down in that paragraph.

3. The measures contained in this Chapter shall be compatible with those contained in the current regulations on management and discipline of credit institutions and Title VIII of Law 24/1988 of 28 July, for companies providing investment services . However, not carry out the withdrawal of the authorization of an entity from the moment it has started a process of early action on the terms provided in Article 9, unless the entity has not adopted during this phase the measures required by the supervisor or revocation had punitive nature.

4. When the entity ceases to be in the circumstances described in paragraph 1, the competent supervisor completed declare the situation of early action.
Article 9.
early action measures.

1. When an entity or consolidated group or subgroup of entities within any of the circumstances described in Article 8.1, it shall inform the competent character with immediate supervisor.

2. Without prejudice to the provisions of the preceding paragraph, from the time the competent supervisor becomes aware that an entity or consolidated group or subgroup of entities within any of the situations described in Article 8.1 may take the following measures:

A) require the management body of the entity applying one or more of the measures set out in its recovery plan within a specified time or to update the plan and apply one or more measures of the updated plan, where the circumstances have triggered early action differ from the assumptions set forth therein.

B) Require the board of the entity to examine your situation, determine the necessary measures to overcome the problems identified and draw up an action plan to address these issues, with a specific timetable for implementation.

C) require the management body of the institution to convene, or if the board fails to comply with this requirement convene directly to the board or general assembly of the entity and, in both cases, set the order of day and propose the adoption of certain resolutions.

D) Require the removal or replacement of one or more members of the board of directors, general managers or similar, if it is determined that such persons are unfit to fulfill their obligations in accordance with the requirements applicable suitability.

E) Appoint a competent supervisor delegate in the entity entitled to attend, with voice but not vote, at meetings of the board and its committees and with the same powers of access to information that the legal and statutorily planned for its members.

F) Require the board of the entity to draft a plan for negotiating debt restructuring with part or all of its creditors agree, where appropriate, with the recovery plan.


G) Require changes in the business strategy of the institution or the consolidated group or subgroup.

H) require changes to legal or operational structures of the institution or the consolidated group or subgroup.

I) Seek, including through on-site inspections, and provide relevant resolution authorities, all the information necessary to update the resolution plan and prepare the possible resolution of the institution or the consolidated group or subgroup and performing an evaluation of its assets and liabilities, in accordance with Article 5.

J) If the above measures were not enough, agree to appoint one or more auditors or temporary replacement of the governing body of the entity or one or more of its members in accordance with the provisions of the following article.

3. By adopting any of the measures outlined in points a) to h) of the preceding paragraph, the competent supervisor shall specify the period for execution by the entity and to evaluate the effectiveness of the measures taken or.

Article 10. Intervention or provisional replacement of directors as a measure of early action.

1. The competent supervisor may agree to the intervention of the entity or the provisional replacement of its board or one or more of its members in accordance with the procedure laid down in Chapter V of Title III of Law 10/2014, 26 June, and the specialties provided in this Chapter.

2. The intervention of the entity or the provisional replacement agreed under this Article shall remain in force for a period of one year. Exceptionally, this period may be renewed for equal periods while the conditions justifying the intervention or provisional replacement is maintained. This circumstance is adequately justified in the agreement renewal of the measure.

Article 11. Monitoring of early action measures and information to the resolution authorities.

1. With the frequency set by the competent supervisor and at least quarterly, the company will send a report on the degree of compliance with the measures taken pursuant to Article 9. The competent supervisor shall transmit the report to the resolution authorities.

2. In order that the competent authorities resolution exercise the powers provided in this Act, the supervisor will inform:

A) an entity or consolidated group or subgroup of entities are in any of the circumstances described in Article 8.1.

B) If any, the adoption of the action plan referred to in Article 9.2 b) refers.

C) the remaining measures required by the competent supervisor in accordance with the provisions of Article 9.

D) completion of the early-acting situation under Article 8.4.

3. During the early action, competent authorities may request the relevant resolution monitor all information related to the entity or consolidated group or subgroup that is necessary to prepare its eventual resolution.

The FROB may also be performed during this phase of early action necessary to prepare the evaluation of the assets and liabilities of the entity for the purposes of Article 5 proceedings and require the institution to contact potential buyers in order to prepare its resolution, subject to the conditions set out in Article 19 and the confidentiality provisions set out in Article 59.

Article 12. Coordination of early action measures in groups of bodies of the European Union.

1. Reglamentariamente the procedure for taxation shall be fixed by the competent supervisor of any of the measures provided for in Article 9, in connection with the matrix or with a Spanish subsidiary of a consolidated group of entities established in the European Union.

2. regulations also stipulate how the competent supervisor participate in procedures for the adoption of any of the measures provided for in Article 9 by another authority of the European Union in relation to the matrix of a Spanish entity or a subsidiary of a Spanish group.
CHAPTER III


Preventive phase resolution



SECTION 1. Planning resolution


Article 13. Plans
resolution.


1. As a preventive measure, the authority of preventive resolution draft and approve the report of the FROB and the competent supervisor after consultation with resolution authorities of the jurisdictions in which established significant branches a resolution plan for each entity are not is part of a group subject to consolidated supervision. The plan will contain the resolution actions that the FROB may apply in the event that the entity complies with the conditions laid down in Article 19, notwithstanding that in the light of the circumstances the FROB may also apply other measures.

When obstacles to the solvability are appreciated under Article 17 shall be suspended obliged to draw up the plan until appropriate resolution to remove such obstacles measures.

2. Reglamentariamente the manufacturing process and the specific content of the resolution plans will be developed. For these purposes, banks are obliged to cooperate in the development and updating of plans and preventive resolution authority may require the entity the information necessary for the preparation, approval and updating of resolution plans.

In any case, the plan never presuppose resolution:

A) The existence of extraordinary public financial support outside funding mechanisms established under Article 53.

B) The existence of public support in the form of urgent provision of central bank liquidity.

C) The existence of public support in the form of provision of central bank liquidity in response to unconventional criteria for collateral, maturities and interest rates.

3. Resolution plans are updated in accordance with the procedure provided for in paragraph 2, at least annually, and in the following cases:

A) whenever a change in the legal or organizational structure of the entity or its financial situation could significantly affect the effectiveness of the plan or require changes thereof, or

B) provided that the authority of preventive resolution, on its own initiative or FROB, it deems appropriate.

Article 14. group resolution plans.

1. The authority competent preventive level resolution group, acting jointly with the resolution authorities of the subsidiaries in colleges of resolution authorities and after consultation with the competent supervisors appropriate, the FROB and the resolution authorities of the jurisdictions in which significant branches are established, approve and keep updated resolution plans of groups whose consolidated supervision applicable to a competent supervisor under Article 2.1.b). The adoption of the resolution plan will be reflected in a joint decision of the authority of preventive resolution with the resolution authorities of the subsidiaries of the group.

When obstacles to the solvability of an entity appreciate under Article 17, shall be suspended the obligation to prepare the group resolution plan until appropriate to remove obstacles such measures.

2. For the purposes of the preceding paragraph, the authority of preventive resolution by the FROB, will attend the school of resolution authorities, and contribute to the development and approval of the plan in accordance with the procedure laid down in the previous article.

3. The group resolution plans may provide resolution at the level of the parent company or by segregating and resolution of the subsidiaries.

4. Reglamentariamente the manufacturing process and the specific content of the plans group resolution as well as information that may be required to entities and should be facilitated by the resolution authority to other resolution authorities, competent supervisors be determined and the European Banking Authority for preparation and updating. In any case, the group resolution plans must identify measures to resolve:

A) The parent company.

B) The group's subsidiaries established in the European Union.

C) financial holding companies, mixed financial holding companies and mixed holding companies established in the European Union.

D) The group's subsidiaries established outside the European Union, under the provisions of Chapter VII on cross-border resolution.


5. Notwithstanding the provisions of the preceding paragraph, the entities that are subject to the direct supervision of the European Central Bank under Article 6.4 of Regulation (EU) No 1024/2013 of the Council of 15 October 2013, which entrusts the European Central Bank specific tasks concerning policies relating to the prudential supervision of credit institutions, or constitute a considerable part of the Spanish financial system, will also be the subject of individual resolution plans as foreseen in the previous article.

6. The competent authority for preventive resolution, acting as resolution authority of an authorized in Spain subsidiary entity whose parent is in another Member State of the European Union and whose supervision on a consolidated basis does not correspond to any of the competent supervisors referred to in Article 2.1.b), cooperate with the resolution authority at group level in the development, updating and approval of the group resolution plan in the terms established by regulation.



Section 2 Evaluation of solvability



Article 15. Evaluation of the solvability of entities.

1. In developing the plan resolution, the authority of preventive resolution on the report of the competent supervisor and the FROB and after consultation with resolution authorities of the jurisdictions in which established significant branches are located, determined that the entity is solvable if, if fulfilled the conditions for resolution, could proceed to its liquidation as part of bankruptcy proceedings or resolution, using different resolution tools and powers referred to in this Act, such that:

A) No significant adverse consequences for the Spanish financial system, from other Member States of the European Union or the European Union as a whole occur.

B) the continuity of essential functions performed by the entity is ensured.

2. For the purposes of the provisions of the preceding paragraph, the authority of preventive resolution will make the corresponding evaluation and assess whether, in the event that the company fulfilled the conditions for resolution, this could be done without the intervention of public support such and as provided for in Article 13.2. The result of this evaluation will be presented to the FROB.

3. In addition, the competent supervisor and the FROB may apply to the competent authority of preventive resolution to carry out the assessment provided for in paragraph whenever it considers that there may be major obstacles to the resolution of an entity.

4. If the competent authority of preventive resolution concludes that an entity does not qualify to be resolved, it shall immediately notify the European Banking Authority.

5. Regulation regime solvability assessment under this section will be developed.

Article 16. Evaluation of the solvability of groups.

1. The competent authority for preventive decision where is the resolution authority group level, determine, based on the assessment that the next paragraph concerns that the group is solvable if, in the case fulfilled the conditions for resolution could proceed to its liquidation or resolution as set out in paragraph 1 of the preceding article.

2. In developing the plan group resolution, the authority of preventive resolution on the report of the competent supervisor and the FROB, along with the resolution authorities of the subsidiaries and after consulting the competent supervisors themselves and the resolution authorities of the jurisdictions where significant branches are established, assess the extent a group may be subject to resolution without the intervention of public support as provided for in Article 13.2.

3. If the competent authority of preventive resolution concluded that the group does not qualify to be resolved, it shall immediately notify the European Banking Authority.

Article 17. Obstacles to the solvability of entities.

1. The authority competent preventive decision after reviewing the evaluation carried out under Article 15 shall notify the competent supervisor, the entity and resolution authorities in whose jurisdiction are located the significant branches, the occurrence of major obstacles to resolution of the entity. The result of this review will be presented to the FROB.


2. Within four months of receipt of the notification, the entities propose to the competent authority of preventive resolution appropriate measures to reduce or eliminate the obstacles identified.

The competent authority shall promptly preventive resolution such measures to the competent supervisor and the FROB, for your report.

If the competent authority of preventive resolution on the report of the competent supervisor and the FROB, does not consider these sufficient measures to remove the obstacles identified, may request so motivated to adopt alternative measures entity to remove obstacles . Such measures may include:

A) Require the entity reviewing funding mechanisms or developing agreements to ensure the development of its essential functions.

B) Establish limits on individual and overall risks of the entity.

C) impose additional requirements relevant information to carry out the resolution.

D) requiring the institution to dispose of specific assets.

E) requiring the institution to limit or cease certain activities.

F) restrict or prevent the development of certain industries or sale of certain products.

G) Changes to the legal or operational structure of the entity or any group entity that is directly or indirectly under its control, in order to reduce complexity and to ensure that essential functions can be separated legally and operationally other functions through the application of resolution tools.

H) require an institution or a parent undertaking the establishment of a financial holding company in Spain or matrix in the European Union.

I) Require an entity issuing eligible liabilities to comply with the requirements of Article 44.

J) require an institution to take other measures to meet the minimum requirement of own funds and eligible liabilities referred to in Article 44. In particular, the authority of preventive resolution may require the entity to renegotiate any eligible person or instrument of additional tier 1 or level 2 issued, to ensure that the redemption or conversion decisions taken by the FROB applied under the law governing the instrument.

K) When an entity is a subsidiary of a joint holding company, require the joint holding company constituting a separate financial holding company to control the entity, if necessary to prevent the implementation of instruments resolution they had adverse effects on non-financial part of the group.

3. Within one month of receipt of the notification of the alternative measures imposed by the competent authority for preventive resolution under the preceding paragraph, the entity shall present a plan for implementation of these measures.

4. For the purposes of the provisions of this Article, the authorities of relevant resolutions shall consider, among other factors, the risk to financial stability posed obstacles identified, as well as the potential effect of the alternative measures proposed on the activity and stability the entity, its ability to contribute to the economy, the internal market for financial services and on financial stability in other Member States of the European Union and the European Union as a whole.

The authorities competent resolution, to determine alternatives to the proposals by the entity to remove obstacles to the solvability must demonstrate why the measures proposed by the entity would not get eliminate such obstacles and how alternative measures can be proportional to remove them.

Article 18. Obstacles to the solvability of groups.

1. The authority of preventive decision where is the resolution authority at group level, in accordance with the assessment provided for in Article 16, endeavor to reach a joint decision with the other authorities competent decision on appropriate measures to overcome obstacles to solvability.


To this end, preventive resolution authority, in cooperation with the competent supervisor on a consolidated basis, the FROB and the European Banking Authority, submit a report to the parent company and the resolution authorities of the subsidiaries and jurisdictions where significant branches are established. This report will analyze the impediments to the implementation of the resolution tools and exercise of resolution powers in relation to the group and contain the measures deemed appropriate to remove such impediments.

2. Within four months from the receipt of the report, the parent company of the group may propose to the resolution authority alternative preventive measures to eliminate the obstacles identified for resolution. The authority of preventive resolution of such measures without delay, the competent consolidating supervisor and the FROB.

The authority of preventive resolution and the resolution authorities of the subsidiaries, after consulting the FROB, competent supervisors and resolution authorities of the jurisdictions in which significant branches are located, seek to achieve in the school authorities resolution a joint decision on the obstacles to the resolution, the assessment of the measures proposed by the parent company and the measures that will be required to remove such obstacles, addressing the possible repercussions of these within the Member States of the European Union in which the group operates.

3. The authority of preventive resolution, when acting as resolution authority of an authorized in Spain subsidiary entity whose parent is in another Member State of the European Union and whose supervision on a consolidated basis does not correspond to any of the competent supervisors referred to in Article 2.1 .b), shall, in cooperation with the FROB, reach a joint decision with the other competent authorities resolution on appropriate measures to remedy the obstacles to the solvability in the terms established by regulation.
CHAPTER IV

Resolution


Article 19. Conditions for resolution.

1. It shall resolution attend an entity when, simultaneously, the following circumstances:

A) The entity is not feasible or is reasonably foreseeable that will be in the near future.

B) There are reasonable prospects that measures from the private sector, such as, among others, the measures implemented by institutional systems; monitoring, such as, among others, early action measures; or redemption or conversion of capital instruments in accordance with Section 2 of Chapter VI, may prevent the infeasibility of the entity within a reasonable time.

C) For reasons of public interest, necessary or appropriate to undertake the resolution of the institution to achieve any of the objectives referred to in Article 3, since the dissolution and liquidation of the entity in the context of insolvency proceedings not would reasonably achieve those objectives in equal measure.

2. It shall resolution of a financial institution under Article 1.2.b) when the conditions for resolution are given both the financial institution and the parent entity subject to consolidated supervision.

3. It shall resolution of a society under Article 1.2.c) or d) when the conditions for resolution are met both in society and in one of its subsidiaries is an institution or, in the event that the subsidiary is not established in the European Union, where the competent authority of the third State has determined that the conditions for resolution are given according to the laws of that State.

4. When entities which are subsidiaries of a joint holding company are directly or indirectly held by a finance company intermediate portfolio, the resolution actions at group level shall apply to the finance company intermediate portfolio and not on the joint venture of purse.

5. Although the company provided for in Article 1.2.c) d) does not meet the conditions for resolution, the FROB may apply to them a measure of resolution, when one of its subsidiaries is an entity meets the conditions for resolution and provided that:

A) Due to the nature of its assets and liabilities, its impracticality pose a threat to the institution or the group as a whole, and that the measure of resolution is necessary for the resolution of the subsidiaries that are institutions or the group as a whole.


B) The insolvency law requires the group to be addressed jointly and the extent of resolution in relation to society is necessary for the resolution of the subsidiaries which are institutions or for the group as a whole.

6. For the purposes of paragraphs 2 and 5, the FROB, jointly with the competent authority for resolution, in determining whether the conditions for resolution regarding a subsidiary is an entity are met, may not take into account the intra-group transfers of capital or losses between entities and the exercise of the redemption or conversion.

Article 20. Concept of unviable entity.

1. Means that an entity is unfeasible for the purposes of the provisions of Article 19.1), if found in any of the following circumstances:

A) The entity fails significantly or is reasonably foreseeable that breach significantly in the near future solvency requirements or other requirements to maintain their authorization.

B) The current liabilities of the entity are greater than its assets or are reasonably foreseeable in the near future.

C) An entity may or may not reasonably foreseeable in the near future can not meet its due obligations promptly.

D) The entity needs extraordinary public financial support.

2. Notwithstanding the provisions of paragraph d) of the preceding paragraph, it shall not be deemed that the entity is not feasible if the extraordinary public financial support is given to prevent or remedy a serious disturbance in the economy and preserve financial stability, and takes one of the following forms:

A) State guarantee to back liquidity operations by central banks granted according to the conditions thereof.

B) State guarantee newly issued liabilities.

C) equity injection or acquisition of equity instruments at a price and under conditions that do not confer advantage to the entity, provided they do not occur in the time of the granting of public aid the circumstances provided in points a), b) and c) of the preceding paragraph, or the circumstances under Article 38.2.

Support under this section shall only be granted to creditworthy entities and subject to authorization under the State aid rules. They will precaution, temporary, will be provided to prevent or remedy the serious disturbances and will not be used to offset losses incurred or may incur the entity.

The aid provided in subparagraph c) is limited to that necessary to address the deficit of certain capital in the stress tests, tests in asset quality or equivalent exercises conducted by the European Central Bank, European Banking authority or national authorities with authorization, where appropriate, the competent supervisor.

3. The criteria provided in this article and the conditions under which the resolution of a group will be held will be developed regulations.

Article 21. Opening the resolution process.

1. The competent supervisor, after consulting the competent authority of preventive resolution and FROB will determine whether the entity is not feasible or is reasonably foreseeable that will be in the near future, in accordance with Article 19.1). Following the evaluation, the FROB shall promptly inform the competent authority and preventive resolution.

Notwithstanding the foregoing, the FROB may ask the competent supervisor to make that determination if, from the information and analysis provided by the competent supervisor, believes that there are reasons for this. The competent supervisor must answer within a maximum period of three days justifying their response.

2. The FROB, in close cooperation with the competent supervisor will conduct an assessment of the condition laid down in Article 19.1.b). Similarly, the competent supervisor inform the FROB about when it considers that the conditions laid down in that paragraph is met.

3. Made the above actions, the FROB will check if it meets the other circumstances provided for in Article 19 and, if so, agree on the immediate opening of the procedure for resolution, realizing reasoned decision to the Minister of Economy and Competitiveness, and the supervisor and preventive competent authority resolution.


4. When the board of an entity considers that this is not viable must notify immediately the competent supervisor, who in turn shall promptly inform the authority FROB and resolution preventive manner.

Article 22. Replacing the board and general or treated as a measure of resolution directors.

1. After opening the resolution process as provided in the preceding article, the FROB will agree and publish the replacement of the board of the entity and the general managers or similar and the appointment as administrator of the entity to the person or natural or legal persons who, on their behalf and under their control, shall exercise the functions and powers of that condition, with the scope, limitations and requirements specified in the regulations, if any, understanding that he attributed all the powers legal or could statutorily correspond to the board or general assembly of the entity and that are necessary for the exercise of the powers provided in this Act regarding the resolution tools referred to in it. In case of conflict, the exercise of these powers resolution takes precedence over any other duty or obligation arising from the statutes of the entity or applicable law.

The FROB may not replace the board or general managers or similar, in those exceptional cases in which, in view of the composition of the shareholders or the board of the entity at the time of the opening the resolution process, it is strictly necessary maintenance to ensure proper development of the resolution process and, in particular, when the FROB is in a position to control the board of the entity under political rights available to it.

2. The FROB approved the policy framework of the special administrator, including periodic information to elaborate on his performance in the performance of their duties.

3. The agreement appointment of the special administrator shall be enforceable from the time it is made, and will be subject to immediate publication in the "Official Gazette" and registration in public records. The publication in the "Official Gazette" determine the effectiveness of the agreement to third parties.

4. The replacement measure will remain in force for a period not exceeding one year, although the FROB may, exceptionally, extend this period when deemed necessary to complete the resolution process.

Article 23. Contents of the decision on the initiation of the resolution process.

The decision whether or not a resolution process must have at least the following contents:

A) The reasons for the decision, with a mention of whether the entity meets the conditions for resolution under Article 19.

B) Measures that the FROB has, where appropriate, intend to take, whether the resolution under this Act or other measures as may be applicable under bankruptcy law.

C) The reasons, if any, justify requesting the initiation of an ordinary bankruptcy proceedings.

Article 24. Obligations of notification and publication.

1. The FROB shall promptly notify the full text of the decision which it is decided on the opening of a resolution process, as well as the decision by which resolution measures are adopted, indicating the date from which take effect the measures taken, to the institution under resolution, the authorities provided for in Article 69 and the authorities specified in the regulations.

2. THE FROB also publish the act by which resolution measures or communication summarized the effects of these measures, particularly on retail customers agree, and where appropriate, the modalities and the duration of the suspension or restriction Article 70 refers

3. Regulations and reporting obligations provided for in this article publication will be developed.
CHAPTER V



Resolution instruments


SECTION 1. Instruments resolution



Article 25. Definition of the resolution tools and general rules.

1. The resolution tools are:

A) The sale of the business entity.

B) The transfer of assets or liabilities to a bridge institution.

C) The transfer of assets or liabilities to an asset management company.

D) The internal recapitalization.


2. The FROB may adopt the previous instruments individually or jointly, except for the transfer of assets or liabilities to an asset management company, to be applied in conjunction with other instruments.

3. The buyer, the bridge institution, the management company asset and the entity under resolution may continue to exercise their rights of participation and access to payment systems, clearing and settlement, listing, guarantee fund and investment fund deposit guarantee of the institution under resolution, provided it meets the criteria for participation and regulation to participate in such systems.

Notwithstanding the foregoing, no access will be denied on the ground that the purchaser or bridge institution unrated a credit rating agency, or that the rating does not reach the levels required to access the systems referred in the previous paragraph.

When the purchaser or bridge institution does not meet the criteria for participation or access to a relevant payment system, clearing or settlement, stock exchange, system investor compensation or deposit guarantee systems, the rights to referred to in the first paragraph shall be exercised for a period of time to be determined by the FROB, not exceeding 24 months, renewable at the request of the purchaser or bridge institution.

4. The FROB and any financing mechanism established under Article 53, may recover all reasonable expenses it incurred related to the use of instruments or the exercise of resolution powers under this Act, in the following ways:

A) deducting all equivalent paid by an acquirer to the institution under resolution or, as appropriate, to the owners of shares or other equity instruments.

B) Charged to the institution under resolution, as preferential creditor.

C) Charged to any revenue generated as a result of the cessation of the activities of the bridge institution or asset management company, as a preferred creditor.

5. Any amount paid by the buyer will benefit:

A) The owners of the shares or other equity instruments, in the event that the business sale or transfer to the bridge institution has been effected by transmitting shares or equity instruments issued by the institution under resolution.

B) The institution under resolution, in the event that the business sale or transfer to the bridge institution has been effected by transmitting the acquirer part or all of the assets or liabilities of the institution under resolution.

C) The institution under resolution, in the case of asset management company. The consideration may be paid in the form of debt issued by the company.

6. When the resolution tools referred to in paragraph 1 a) and b) are used, and applied for a partial transfer of assets and liabilities of the entity, the residual entity is subject to insolvency proceedings within a reasonable time taking into account the need for the residual entity collaborate to ensure the continuity of services by the purchaser and the best fulfillment of the objectives and principles of resolution.

7. The transfer of shares or other equity instruments, assets and liabilities to be carried out under the resolution tools referred to in paragraph 1 shall take place without obtaining the consent of the shareholders of the institution under resolution or different third parties buyer without having to meet other procedural requirements required by corporate legislation or values ​​beyond those expressly provided by this Act.

8. Without prejudice to the rules on safeguards provided by law, to apply one of the resolution tools provided in this article, shareholders and creditors of the institution under resolution, as well as third parties whose assets or liabilities have been transferred, they will have no rights to the assets and liabilities have been transferred.

9. Operations by which resolution measures are implemented and, in particular measures arising from the implementation of the instruments listed in this article, will not be cancellable under the provisions of Article 71 of Law 22/2003 of July 9, Insolvency.

Article 26. Sale of business entity.

1. The FROB may agree and implement the transmission to a purchaser that is not a bridge institution, of:


A) shares or contributions to share capital or, in general, convertible instruments representing capital or equivalent of the entity or in them, whatever their owners.

B) All or part of the assets and liabilities of the entity.

2. The legal restrictions or obligations referred to in Article 34.1 will not apply to persons or entities in implementing the provisions of the relevant resolution plan, they have acquired the shares, contributions or instruments.

3. The FROB may apply this instrument resolution on one or more occasions and for one or more acquirers. Once used this instrument, the FROB may, with the consent of the buyer, return the shares or equity instruments, assets and liabilities transferred to the entity under resolution or, in the case of shares or equity instruments, the former owners who will be obliged to accept them.

4. To select the acquirer, the FROB will develop a competitive procedure with the following features:

A) be transparent, taking into account the circumstances of the case and the need to safeguard the stability of the financial system.

B) not favor or discriminate against any potential acquirers.

C) the necessary measures be taken to avoid conflicts of interest.

D) Consider the need to apply the instrument resolution as quickly as possible.

E) will aim to maximize the sale price.

The transfer will take place under market conditions, given the specific circumstances and in accordance with the rules on State aid.
Any requirement
advertising the sale of the entity resolution is required in accordance with paragraph 1 of Article 17 of Regulation (EU) No 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse and by Directive 2003/6 / EC of the European Parliament and repealing Council, and Directives 2003/124 / EC, 2003/125 / EC and 2004/72 / EC may be delayed in the terms provided in paragraphs 4 and 5 of that article.

5. When, under the terms provided in Article 68, the development of the procedure to which the preceding paragraph could hinder achieving any of the objectives listed in Article 3 and in particular, when properly justify that there is a serious threat for the stability of the financial system as a result of, or aggravated by, the situation of the entity or is found that the development of such a process may hinder the effectiveness of the instrument resolution, the selection of the acquirer may be made without compliance with the procedural requirements set out in the preceding paragraph.

6. When the transfer of shares or other equity instrument due to the application of the instrument sales business of the organization, leading to the acquisition or increase of a stake in an entity so that applicable regulations on significant shareholdings, the competent supervisor will conduct the evaluation of the acquisition or increase no later than 5 business days.

7. In the event that has been applied instrument sales business of the entity without having carried out the assessment provided in the preceding paragraph, the following rules apply:

A) The transfer of shares or other equity instruments have legal immediate legal effect.

B) During the evaluation period and during the divestment period referred to in point f), the voting rights of the acquirer of such shares or other equity instruments shall be suspended and shall be granted only to the FROB, you will not have the obligation to exercise any of those voting rights or liability to exercise or refrain from exercising these rights.

C) During the evaluation period and during the divestment period referred to in point f), shall not apply sanctions and other measures for violations of the requirements for acquisitions or disposals of significant shareholdings contemplated in Law 10/2014, of June 26, or the Law 24/1988 of 28 July.

D) The competent supervisor, immediately after having carried out the evaluation, notify in writing the FROB and the buyer whether to approve or oppose the transmission.


E) If the competent supervisor approves the transfer shall be deemed to voting rights on shares or other equity instruments is fully vested in the purchaser from the time the FROB and the buyer receives notice.

F) If the competent authority opposes the transmission:
1st
The FROB will keep the right to vote on such shares or other instruments.

2nd The FROB may require the buyer to return the shares or other equity instruments in the period of disinvestment that the FROB determined by taking into account existing market conditions.

3.º If the purchaser does not carry out such divestiture within the period established by the FROB, the competent supervisor, with the consent of the FROB, the buyer may impose sanctions and other measures for violations of the requirements for procurement or disposals of qualifying holdings referred to in Law 10/2014, of June 26, or the Law 24/1988 of 28 July.

8. For the purpose of exercising the rights of financial services or become established in another Member State in accordance with Law 10/2014, of June 26, and Law 24/1988 of 28 July, shall be deemed the buyer is a continuation of the institution under resolution, and may continue to exercise the rights previously exercised by the latter in relation to the assets and liabilities transferred.

Article 27. bridge institution.

1. The FROB may agree and implement the transmission to a bridge entity:

A) All or part of the shares or capital contributions or, in general, representative of capital or equivalent instruments of the entity or convertible into them, whatever their owners.

B) All or part of the assets and liabilities of an institution under resolution.

2. bridge institution is considered a corporation that may be owned by the FROB or other authority or mechanism of public funding, whose purpose is the total or partial development of the activities of the entity under resolution, and management of shares or other equity instruments or all or part of its assets and liabilities.

The FROB shall exercise control over this instrument resolution or its application in the terms established by regulation.

3. Transmission to a bridge institution is made on behalf and on behalf of the shareholders of the entity, but without obtaining their consent or different third of the bridge institution without having to satisfy the procedural requirements required for modification structural of the companies or by the rules on the market.

4. The total value of the liabilities transferred to the bridge institution shall not exceed the value of the rights and assets transferred from the institution under resolution or any other source.

5. The FROB may apply this instrument in one or more occasions and for one or more bridge entities and transfer assets and liabilities of a bridge institution to the institution under resolution or a third party.

6. The FROB may decide to return the shares or other equity instruments, or assets or liabilities of a bridge to the institution under resolution entity, where the following conditions:

A) If this possibility is expressly stated in the act by which the transmission has been ordered.

B) If the shares or other equity instruments, or assets or liabilities are not part or do not meet the conditions for the transmission specified in the act by which the transmission has been ordered.

7. For the purpose of exercising the rights to provide services or become established in another Member State in accordance with Law 10/2014, of June 26, and Law 24/1988 of 28 July, shall be deemed to bridge institution is a continuation of the institution under resolution, and may continue to exercise the rights previously exercised by the latter in relation to the assets and liabilities transferred. For purposes other than the FROB will need to ask the competent supervisory recognition of such continuity.


8. The bridge institution will obtain the appropriate authorization to perform the activities or services acquired in accordance with the provisions of Law 10/2014 of 26 June, and the Law 24/1988 of 28 July, as appropriate, and shall be subject the supervision of the European Central Bank, the Bank of Spain or the Comisión Nacional del Mercado de Valores. Also the bridge institution must adjust its operation to the rules on state aid and to that end, the resolution authority may set restrictions on its activities.

Nevertheless, at the beginning of its operation and during the time strictly necessary, it may establish and authorize the bridge institution without fulfilling the requirements for access to the activity, where necessary to achieve the objectives of the resolution. To this end, the FROB shall submit an application to the competent supervisor who, if authorized, indicate the period of time during which the entity is exempt to meet those requirements.

9. The tasks of the bridge institution shall not imply any obligation or responsibility for shareholders and creditors of the institution under resolution, and the board or management shall have no liability to those shareholders and creditors for acts or omissions in fulfilling their obligations unless such act or omission involving a misdemeanor or serious violation directly affecting the rights of shareholders and creditors.

10. The bridge institution will be administered and managed in order to maintain access to essential functions and sell, or sell its assets and liabilities, when conditions are appropriate and in any case within a maximum period and in accordance with the assumptions established by regulation.

11. The sale of the bridge institution or its assets or liabilities will be developed in the context of competitive, transparent and non-discriminatory procedures and shall be effected at market conditions, taking into account the specific circumstances and in accordance with the rules on aid State.

12. When finally put to the activities of the bridge institution, this will be subject to a bankruptcy proceeding. Any income generated by the cessation of the activities of the entity bridge will benefit the shareholders of the entity.

13. When the bridge institution is used for the purpose of transferring the assets and liabilities of more than one entity resolution, settlement will be made individually for assets and liabilities of each of the entities, whose effect will be previously segregated from the bridge institution.

Article 28. Asset Management Company.

1. Under the terms provided in this Law, the FROB may, as an administrative act, force an institution under resolution or a bridge institution to transmit to one or more companies asset management categories of assets listed in the balance the entity. You can also take the necessary measures to transmission assets listed on the balance of any entity over which the entity exercises control within the meaning of Article 42 of the Commercial Code, in the case of particularly damaged assets or whose stay in these balances it is considered detrimental to their viability or for the purposes of the resolution to unsubscribe from such assets balances and allow independent management of its realization.

The FROB shall exercise such powers only in the following cases:

A) if the market of the assets of the institution under resolution or the bridge institution is such that its liquidation under normal insolvency proceedings with could adversely affect financial markets,

B) if the transfer is necessary to ensure the proper functioning of the institution under resolution or the bridge institution or

C) if a transmission is necessary to maximize revenue from liquidation.

2. determine the criteria to define the categories of assets that may be transferred depending on, among others, the activity to which they were tied, their seniority in balance and accounting classification. Based on these criteria, the FROB will require for each entity the assets to be transmitted.

3. Each management company assets will be a corporation that may be owned by the FROB or other authority or mechanism of public funding, formed for the purpose of receiving all or part of the assets and liabilities of one or more entities under resolution or a bridge entity.


The FROB shall exercise control over this instrument resolution or its application in the terms established by regulation.

4. The implementation of actions in accordance with the objectives of the management company assets not entail any obligation or liability to shareholders and creditors of the institution under resolution, and the board or management shall have no liability for such shareholders and creditors for acts or omissions in fulfilling its obligations unless resulting from a fault or serious violation directly affecting the rights of shareholders and creditors.

5. The asset management company is subject to corporate governance obligations to guarantee the exercise of their functions in accordance with the objectives and principles set out in Articles 3 and 4, in the terms laid down by regulation.

6. The company may issue bonds and securities that recognize or create debt without it is applicable limit laid down in Article 405 of the Consolidated Capital Companies Act, approved by Royal Legislative Decree 1/2010 of July 2 .

7. For the purposes of the provisions regarding asset management company, the reference to assets also include the liabilities necessary to convey.

8. Regulation provisions will be developed in this article.

Article 29. Regime of transfer of assets.

1. They will not be enforceable against the transfer of the assets to one or more companies asset management statutory or contractual clauses exist that restrict the transferability of shares and may not be required any responsibility or claimed any compensation based on breach of such clauses .

2. Prior to the transmission character, the institution shall perform the valuation adjustments of assets to be transferred according to the criteria specified in the regulations. Also, with the same prior to transmission character, the FROB will determine the value of the assets transferred to the management company of assets in accordance with the principles set out in Article 5 and, where appropriate, within the framework of aid rules of State.

For the purposes of the provisions of Consolidated Capital Companies Act, approved by Legislative Royal Decree 1/2010, of July 2, replace the previous valuation by an independent expert.

3. The FROB may require that, prior to transmission to the society character, assets are grouped in a society or perform on them any kind of operation that facilitates transmission.

4. The transfer of assets is subject to the following special conditions:

A) The transmission may not be, in any case, subject to termination by application of reintegration actions under bankruptcy law.

B) For the transmission of credit that are considered litigious not be applicable to the provisions of Article 1535 of the Civil Code.

C) The acquiring company shall not be obliged to make a takeover bid under the rules on securities markets.

D) The transfer of assets will not constitute an event of succession or extension of tax liability or Social Security, except as provided in Article 44 of the Consolidated Law Workers' Statute, approved by Royal Legislative Decree 1/1995 of 24 March.

E) The asset management company shall not be liable in the event that the transmission of tax obligations accrued prior to such transfer resulting from ownership, operation or management thereof by the transferor occur .

F) If credit rights management company assets are contributed, the entity is not liable for the solvency of the debtor, and if the transmission is carried out by operations division or segregation not be applicable to the provisions of Article 80 of Law 3/2009 of 3 April on structural modifications of commercial companies.

5. The FROB may transfer the assets of the institution under resolution to one or more entities asset management on more than one occasion and agree on the return of assets from one or more companies asset management to the institution under resolution must this last accept such return, when one of the following circumstances:


A) When the possibility of returning the rights, assets or liabilities expressly stated in the act by which it has been ordered transmission.

B) Where the rights, assets or liabilities not part or do not comply with the conditions for the transfer of rights, assets or liabilities specified in the instrument by which the transmission has been ordered.

The return may be made within the period prescribed in the act by which ordered the transfer, subject to the conditions set out therein, and in accordance with the assessment that had been made under Article 5 to the original transmission .

Article 30. Regime supervision of asset management companies.

1. It will be the FROB monitoring compliance:

A) the sole purpose of asset management company in order to identify deviations from it that jeopardize the achievement of the overall objectives legally established for her.

B) the specific requirements established for assets and, where applicable, liabilities have been transferred to the asset management company.

C) the rules relating to transparency and the constitution and composition of the governing bodies and control of the asset management company under its regulations, as well as those relating to the requirements of commercial and professional members of its board of directors.

2. For the purposes of the supervisory functions assigned in the previous paragraph, the FROB may:

A) perform the inspections and verifications it deems appropriate in the context of the functions mentioned in the previous section, and

B) require the asset management company all the information necessary to perform their functions, including collecting it the reports of independent experts might be accurate.

Access to the information and data required by the competent supervisor shall be deemed covered by Article 11.2.a) of Law 15/1999, of December 13, Protection of Personal Data.



Section 2 Operations recapitalization



Article 31. Operations recapitalization resource utilization National Resolution Fund.

1. In the event that, according to Article 50.1.b), the application of resolution tools involves the use by the FROB of resources from the National Fund to recapitalize an entity Resolution, it will be carried out in accordance with the provisions of this Section, without prejudice to other applicable rules under this Act.

2. The FROB will perform the actions of acquisition and disposal of assets or liabilities depending on the value of the entity as provided in Article 5, and in accordance with the rules of the EU competition and state aid.

3. The instruments acquired by the FROB will be eligible, subject to compliance with the applicable requirements, as Common Equity Tier 1 Additional Tier 1 capital or Tier 2 capital, as provided for in Regulation (EU) No 575/2013 the European Parliament and of the Council of 26 June 2013.

4. When the FROB holds shares recapitalization under the provisions of Articles 20.2.c) and 51 shall apply the provisions of this Section.

5. For the purposes of the application of Law 22/2003 of July 9, Insolvency, FROB credits will be considered credits with general privilege.

Article 32. Ordinary shares or capital contributions.

1. Prior to the acquisition by the FROB of ordinary shares or making capital contributions, the entity that is subject to a resolution procedure shall take the necessary measures to ensure that such acquisition or contribution involving a stake in its capital that setting the value of the resulting entity of the valuation process.

2. The legal regime of the FROB not extend to entities affiliated by him in accordance with the provisions of this article, to be governed by private law that is applicable.


3. The subscription or purchase of these instruments shall, in any event, by itself and without any other act or agreement, except for the Commercial Register of the votes that correspond notification, the allocation to the FROB of the corresponding political rights and It is joining the board of the issuer. The FROB shall appoint the person or persons who hold their representation to this effect and have on the board of many votes as those resulting from applying the total number of votes its stake in the entity, rounded to the nearest integer .

4. To ensure greater efficiency in the use of public resources and fulfilling the purpose with the Spanish legislation and EU competition and state aid, divestment by the FROB of instruments to respect this section will be made through their sale through procedures that ensure competition.

The FROB may adopt any of the instruments to which Article 53.2 refers to support the competitive process of disinvestment.

The FROB may attend together with one or more of the other partners or shareholders of the entity to process any sale of securities in the same terms that they can arrange.

5. Alienation report of the General Intervention of the State Administration regarding compliance with the rules of procedure for execution will take place. In addition, the divestment of significant shareholdings held by credit institutions controlled by the FROB, in accordance with the relevant resolution plans, through direct or indirect interests, and regardless of whether such entities are subject to private law will be the subject of report of the Ministry of Finance and Public Administration with regard to their compliance with the principles of advertising and competition. It is for the Governing Committee of the FROB the delimitation of the concept of meaningful participation.

Article 33. Instruments convertible into ordinary shares or contributions to share capital.

1. At the time of the adoption of the resolution to issue these instruments, the issuer must approve the agreements necessary for the capital or subscription capital contributions in the amount necessary.

2. Unless the FROB determine conditions different disinvestment, the entity must purchase or redeem the instruments signed or acquired by the FROB, through the National Fund of resolution as soon as you are able to do so under the terms provided, and all case in terms compatible with State aid rules.

Article 34. Special arrangements for the subscription or acquisition by the FROB recapitalization instruments.

1. When the FROB subscribes or acquires any recapitalization instruments mentioned in this Section, shall not be applicable to:

A) The statutory limitations on the right of attendance at meetings or general meetings or the right to vote.

B) Restrictions on the acquisition of capital contributions of credit unions.

C) The obligation to submit tender offer under the rules on securities markets.

2. When the FROB subscribes or acquires contributions to the share capital of a credit union, the quorum for the meeting and for the adoption of agreements majorities are calculated, and the voting rights shall be allocated in proportion to the amount of contributions regarding the capital of the cooperative.

3. Should the removal of preferential subscription rights of the shareholders agreed, obtaining the auditor's report required by the revised text of the Capital Companies Act, approved by Royal Legislative Decree 1/2010 not necessary of 2 July.

Also, if the instruments referred to in Article 33 nor the auditor's report required by the revised text of the Capital Companies Act, approved by Royal Legislative Decree 1 shall be issued / 2010, of July 2, on the basis and methods of conversion.
CHAPTER VI


Redemption and conversion of capital instruments and internal recapitalization



SECTION 1. General Provisions



Article 35. Redemption and conversion of capital instruments and internal recapitalization.


1. The FROB shall amortization and conversion of capital instruments of an entity or application of the instrument of internal recapitalization, according the amortization of any of its liabilities or their conversion into shares or other equity instruments of the entity or another entity she participated in the terms provided in this Act. the FROB acts taken pursuant to the provisions of this Chapter shall character of administrative acts.

2. Whenever the FROB adopts resolution measures which the assumption of losses by creditors beforehand, or simultaneous nature arising, shall proceed to the redemption or conversion of capital instruments, under the terms provided in this Act.

Article 36. Amount of recapitalization.

1. Before agreeing to repayment and conversion of capital instruments or internal recapitalization, the FROB will perform a valuation of the assets and liabilities of the entity under Article 5, which will form the basis for calculating the amount that will be necessary to recapitalize the affected entity.

2. For the purposes of the provisions of the preceding paragraph, the FROB calculated, taking into account the assessment in accordance with paragraph 1, the sum aggregate of:

A) the amount by which eligible liabilities must be repaid to ensure that the net asset value of the entity under resolution is zero, and

B) the amount by which eligible liabilities must be converted into shares or other equity instruments to restore the ratio of common equity Tier 1 of the institution under resolution or the bridge institution.

3. The calculation provided in the preceding paragraph shall determine the amount by which eligible liabilities must be written off or converted to restore the ratio of common equity Tier 1 of the institution under resolution or, where appropriate, of the bridge institution, and maintain sufficient market confidence in them, so as to allow these to meet for at least one year, the conditions for authorization and pursue the activities for which are authorized.

4. A calculation shall, where appropriate, the capital contribution by the Fund of National Resolution and, if the FROB intends to use the instrument of transfer of assets or liabilities under Article 29, a conservative estimate of capital needs of the asset management company, as applicable.

5. Once the internal recapitalization, if it is found that the level of amortization based on the preliminary assessment under Article 38 exceeds the requirements compared to the final assessment, a mechanism will be established to compensate creditors and then to shareholders to the extent necessary.

Article 37. Effects of amortization and conversion of capital instruments and internal recapitalization.

1. When the FROB exercising the powers regulated in this Chapter, the reduction of principal or outstanding amount due, conversion or cancellation of liabilities, will be immediately executive.

2. In the event that the principal amount of relevant capital instrument is amortized, the following effects occur:

A) The reduction of the principal amount will be permanent, without prejudice to the mechanism of compensation, if any, can be applied in accordance with the provisions of Article 36.5.

B) In relation to the holder of the affected person, would not subsist any obligation with respect to the amount of the instrument has been amortized, except in the case of an already accrued obligation or an obligation resulting from damages arising as a result of the judgment ruling the appeal against the exercise of jurisdiction redemption and conversion of capital instruments or internal recapitalization, all without prejudice to the application to the holder of the provisions of Article 39.3.

C) no compensation will be paid to the holder of the persons concerned, unless it complies with Article 39.3.

3. The FROB is entitled to carry out or require to be carried out procedures to implement the exercise of those powers.

4. When the FROB reduce to zero the principal amount or the outstanding amount of a liability, he or obligations or rights hereunder unexpired at the time of the reduction shall be considered extinguished for all purposes and may not be counted in a any subsequent liquidation of the entity or another company that succeeds.


5. When the FROB reduce only partially the principal amount or the outstanding amount of an eligible liabilities, the extinction of this and the instrument or agreement which they have been created will occur only to the same extent that the amount is decreased without prejudice to any modification of the conditions thereof which could take the FROB under the powers granted to it.

6. When the redemption or conversion of capital instruments or the implementation of the recapitalization instrument lead to the acquisition or increase of a qualifying holding in an entity, the evaluation required by Law 10/2014 of 26 June, and the law 24/1988 of July 28, will be held no later than 5 business days.



Section 2 Amortization and conversion of capital instruments



Article 38. Redemption and conversion of capital instruments.

1. The FROB, after consulting the competent supervisor, can make the redemption or conversion of relevant capital instruments of an entity:

A) Notwithstanding any measure of resolution, including internal recapitalization.

B) In conjunction with any measure of resolution, when the circumstances provided for in Article 19.

2. The FROB, after consulting the competent supervisor, shall immediately amortization and conversion of capital instruments when any of the following circumstances:

A) the institution meets the conditions for resolution under Article 19.

B), unless this jurisdiction is exercised, the company will become unviable. In the case of Spanish subsidiaries belonging to consolidated groups, appreciation of this fact should be carried out jointly with the appropriate authority of the Member State of the consolidating supervisor according to the procedure established in the regulations base.

C) The entity needs extraordinary public financial support except when it takes decisions as provided in Article 20.2.c).

D) In ​​the case of equity instruments issued by a Spanish subsidiary and whether such capital instruments are recognized for the purposes of compliance with the requirements of own funds on solo and consolidated basis, the appropriate authority of the Member State the consolidating supervisor and the FROB, based on its own initiative or supervisor or authority of competent preventive decision, made after fulfilling the requirements for information and consultation established in this Act, the joint assessment that, unless it is competition exercise or conversion amortization in relation to such instruments, the group would become unviable.

E) In the case of equity instruments issued by a Spanish parent and whether these instruments are recognized for the purposes of meeting the own funds requirements on an individual basis at the level of the parent company or on a consolidated basis, which the FROB, on its own initiative or supervisor or the competent authority preventive resolution, appreciate that, unless the redemption or conversion competition in relation to these instruments is exercised, the group would become unviable.

3. For the purposes of the provisions of this Article shall mean that an entity is unfeasible if found in any of the circumstances set out in Article 20 and also the condition laid down in Article 19.1.b) is fulfilled.

In the case of groups of entities, it is understood that complies with the provisions of Article 20 if the group violates, or there are objective elements that make likely to infringe in the near future, its solvency requirements at the consolidated level of such so as to justify the adoption of measures by the competent supervisor, even if the group incurred losses that deplete all or a significant portion of their own resources.

4. Equity instruments issued by a subsidiary not be redeemed or converted to a greater extent or more unfavorable terms in the case provided for in paragraph 2.d), which other equity instruments of equal rank issued by the parent.

5. Competent supervisory and resolution, at the individual or consolidated level, authorities cooperate and carry out appropriate to proceed to a determination that the circumstances and conditions under this Article are met notifications.

6. The redemption and conversion of capital instruments must be preceded by the timely assessment, under the terms provided in Article 5, which also serve as the basis for applying the depreciation rates and conversion.


Article 39. Rules for the redemption or conversion of capital instruments.

1. The FROB shall exercise the jurisdiction of redemption or conversion of capital instruments under the terms established in this Act and its implementing regulations, according to the ranking of claims applicable to insolvency proceedings, so that the following results occur :

A) First the Common Equity Tier 1 in proportion to the losses will be amortized and as far as possible, adopting the measures foreseen in Article 47.1.

B) If the above amount was not enough for the recapitalization, the principal amount of the instruments of Additional Tier 1 instruments or become common equity Tier 1, or both will be repaid, to the extent necessary to achieve the objectives of resolution, or if the amount is less, as far as possible.

C) If the above amounts will result not enough for the recapitalization, the principal amount of the instruments or Tier 2 capital instruments will become common equity Tier 1, or both shall be repaid, to the extent that necessary to achieve the objectives of resolution or, if the amount is less, as far as possible.

The FROB not become amortize capital or a class of equity instruments while another subordinate class has not been converted into capital or fully amortized.

2. When carrying out the redemption or conversion of the principal of equity instruments:

A) The principal reduction will be permanent, without prejudice to the mechanism to compensate creditors under Article 36.5.

B) not stand any obligation against the holder of equity instruments regarding the amortized amount, excluding accrued or obligations and liability arising as a result of an appeal against the legality of the exercise of jurisdiction amortization.

The provisions of this letter shall not preclude the provision of instruments of Common Equity Tier 1 for a holder of equity instruments in accordance with paragraph 3

C) no compensation will not be paid to the holder of equity instruments, subject to the provisions of paragraph 3

3. In order to effect the conversion of relevant capital instruments in accordance with paragraph 1.b) above, the FROB, under the conditions specified by regulation, may require the affected entities issuing instruments Common Equity Tier 1 for holders instruments additional tier 1 and tier 2. for this purpose, the FROB may require such entities to maintain at all times prior authorization required for the issue.



SECTION 3. Internal Recapitalization



Article 40. Internal Recapitalization.

1. Under the terms provided in this Law, the FROB may exercise the powers necessary and in particular those specified in Article 35 and in Section 2 of Chapter VII, internally in order to recapitalize the institution under resolution in compliance with the objectives of the resolution and in accordance with the principles set out in articles 3 and 4.

2. Internal recapitalization measures may be adopted for:

A) to recapitalize the entity so that it can return to fulfill the conditions to continue their activities, maintaining market confidence.

B) convert to equity or reduce the principal of loans or debt instruments transmitted by applying the resolution tools involving the establishment of a bridge institution, selling business or asset segregation.

3. Internal recapitalization of the bank will be held as provided in subparagraph a) of the preceding paragraph, in the event that there are reasonable prospects that the application of this instrument, in conjunction with other appropriate measures, including measures undertaken in accordance with the reorganization plan of activities provided for in Article 49, in addition to achieving relevant resolution objectives, restore financial strength and long-term viability of the entity.

Otherwise, internal recapitalization of the bank will be held as provided in subparagraph b) of the preceding paragraph, in conjunction with the resolution tools provided for in Article 25.

4. Internal recapitalization will be done respecting the legal form of the entity affected except when deemed necessary alter the FROB.




Section 4.ª eligible liabilities for internal recapitalization



Article 41. Eligible for internal recapitalization liabilities.

1. All liabilities that are not expressly excluded or that have not been excluded by decision of the FROB, in accordance with the provisions of this Act shall be subject to redemption or conversion into capital for internal recapitalization of the affected entity. Reglamentariamente the eligibility criteria of the liabilities are determined, taking into account, in particular, the maturity of the instrument, its nature, its level of priority, the guarantees that could have, and always concerned of an instrument issued it is fully paid up.

2. The authority of preventive resolution on the report of FROB, may limit the possession, by other entities eligible for internal recapitalization of an entity liabilities, unless both entities are part of the same group and subject to the rules on large exhibitions that are applicable.
Article 42. Liabilities
necessarily excluded from the internal recapitalization.

1. Excluded from the internal recapitalization, the following liabilities:

A) guaranteed deposits until the guaranteed level by the rules of the Deposit Guarantee Fund.

B) secured liabilities, including covered bonds in particular and mortgage bonds, territorial and internationalization bonds, and liabilities of financial instruments used for hedging purposes, which form an integral part of the portfolio of coverage and which, under national legislation, they are guaranteed by the assets of the portfolio of covered bond coverage.

C) liabilities resulting from holding entity affected by the asset or money of clients, including those deposited on behalf of collective investment schemes, venture capital entities or entities of collective investment schemes closed when the client is protected under the insolvency rules.

D) liabilities resulting from a fiduciary relationship between the entity or company affected, as trustee, and another person, as beneficiary, when the client is protected under insolvency legislation.

E) Liabilities of entities, excluding companies belonging to the same group, whose original maturity is less than seven days.

F) liabilities with a maturity of less than seven days remaining maturity, with respect to systems or operators of designated systems in accordance with Law 41/1999, of 12 November, on payment systems and securities settlement, or participants, and resulting from participation in one of these systems.

G) Liabilities contracted:

1st Employees in wages, pensions or other fixed remuneration paid. This exclusion shall not apply in the case of variable component of remuneration that is not regulated by collective agreements or agreements or collective agreements.

2nd Trade payables, for supply to the affected entity of goods and services that are essential to the daily development of its activities, including services of information technology, public supplies of basic character, and rent maintenance and cleaning services.

3rd Tax Administration or Social Security.

4th assurance systems arising from contributions due pursuant to Royal Decree-Law 16/2011 of 14 October, the Deposit Guarantee Fund of Credit Institutions create deposits, and with its implementing regulations.

2. The assets related to a portfolio of bonds guaranteed coverage should remain unchanged and segregated and have adequate funding. This rule and the exclusion provided in subparagraph b) of the preceding paragraph shall not affect the part of the guaranteed bonus that exceeds the value of the assets that guarantee.

Article 43. Liabilities subject to exclusion of internal FROB recapitalization decision.

1. In exceptional circumstances and after notifying the European Commission, the FROB, on the terms and conditions provided in this Act and in accordance with the procedure determined by regulation, exclude domestic wholly or partly recapitalization, certain liabilities or categories of eligible liabilities when any of the following circumstances:

A) not possible repay or convert such liabilities within a reasonable time.

B) The exclusion is strictly necessary and proportionate for:


1st Ensuring continuity of essential functions and branches of major activity so that the capacity of the institution under resolution to continue operations remain, services and major transactions, or

2nd Preventing a widespread contagion arising, particularly in respect of eligible deposits held by small and medium enterprises individuals, small businesses and seriously disrupting the functioning of financial markets, including infrastructure, so such as to cause serious difficulties to the economy of a member State or disorder of the European Union.

C) Where the application of internal recapitalization instrument such liabilities would result in a destruction of value such that the losses suffered by other creditors would be higher than if such liabilities had been excluded from the internal recapitalization.

2. In exercising its discretion under paragraph 1, the FROB shall duly consider the following elements:

A) The principle that losses must be taken first by the shareholders and then generally by creditors of the institution under resolution, in order of preference.

B) The level of loss absorption capacity that would still have the institution under resolution if the liability or the liability category is excluded.

C) The need to maintain sufficient funding for resolution resources.

3. When the FROB decides to exclude wholly or partly an eligible liability or class of eligible liabilities under this article, the level of redemption or conversion applied to other eligible liabilities may be increased to take account of these exclusions, provided that the level of amortization and conversion applied to other eligible liabilities respects the principle laid down in Article 4.1.d).

4. When losses that could have been excluded liabilities decision by the FROB under this article have not been fully impacted on other creditors, the Fund of National Resolution may make a contribution to the institution under resolution in the terms and conditions set out in Section 6th

Article 44. Determination of the minimum requirement of eligible own funds and liabilities.

1. The authority of preventive resolution on the report of FROB and the competent supervisor shall fix the minimum requirement of own and liabilities payable to each entity funds admissible and verify that the entities fulfill this requirement at all times. Such determination and verification shall be conducted during the preparation, evaluation and maintenance of resolution plans and communicated to the European Banking Authority. When the level resolution authority responsible for group or individual basis subsidiary belonging to another Member State, a joint decision on the terms provided in the regulations will be adopted.

The minimum requirement is calculated as the amount of own funds and eligible liabilities expressed in percentage terms, compared to total liabilities and equity of the entity. Reglamentariamente the form of calculating this requirement will be determined.

Derivatives will be included in the total liabilities on the basis of full recognition of the rights of contractual netting.

2. The minimum requirement shall be determined in accordance with the following criteria:

A) The need to ensure the resolution of the entity by applying any of the resolution tools.

B) The need to ensure that, where appropriate, the institution has sufficient eligible liabilities for effective implementation of internal recapitalization instrument.

C) The need to ensure that if the resolution plan anticipates that certain categories of eligible liabilities might be excluded from the internal recapitalization under the provisions of Article 43, or may be fully transmitted to a purchaser under a partial transfer, the institution has other liabilities enough for the internal recapitalization instrument can be applied effectively admissible.

D) The size, type of business, financing model and risk profile of the entity.

E) The extent to which the deposit guarantee system can contribute to the financing of the resolution.

F) The extent to which the non-viability of the entity would have an adverse effect on financial stability due to, among others, the phenomenon of contagion as a result of their interconnection with other institutions or with the rest of the financial system.


3. Eligible liabilities may be counted for the purposes of complying with the minimum requirement, when the conditions specified in the regulations.

4. When a liability is regulated by the legislation of a third country, the competent authority may require preventive resolution demonstrating that the entity consisting repay all or convert the liability decision would be effective under the rules of such third country. If the authority of preventive resolution, after consulting the FROB, harbored doubts about its admissibility, such liability shall not be counted for the minimum requirement of eligible own funds and liabilities.

5. The institutions shall meet the minimum requirement set out in this article on an individual basis. In addition, the matrices of the European Union, shall meet the minimum requirement in this article also on a consolidated basis under the terms established by regulation.

The resolution preventive authority, after consulting the FROB and the competent supervisor, may decide to apply the minimum requirement to entities under Article 1.2.b), c) and d).

The minimum requirement at the consolidated level will be determined at least on the basis of the criteria set out in paragraph 2, and taking into account whether the group's subsidiaries in third countries are subject to separate or disagree with the plan resolution resolution.

6. Preventive resolution authority, after consulting the FROB may completely waive the minimum requirement regulated in this article to parent companies and subsidiaries of the European Union in the cases and conditions specified in the regulations.

7. The authority may authorize preventive decision after consulting the FROB, under the conditions statutorily determined that the minimum requirement for own funds and eligible liabilities partially achieved, with consolidated or individual, through contractual instruments of internal recapitalization. These instruments are determined, verify and communicate to the European Banking Authority in the same way as the rest of the minimum requirement.

Article 45. Removal of obstacles to internal recapitalization.

1. The authority of preventive resolution on the report of FROB and the competent supervisor, and as a result of analysis of the development and maintenance of the resolution plan may require institutions to maintain at all times the amount of authorized capital sufficient, or other instrument Common equity tier 1, so that in the event to be exercised the powers of internal recapitalization respect to such entity or any of its subsidiaries, it can emit a sufficient amount of new shares or other equity instruments in order to ensure that the conversion of liabilities into shares or other equity instruments is carried out effectively.

2. In any case, if the resolution plan provides for a possible application of the instrument internal recapitalization, the authorized capital or other instrument of common equity tier 1 shall be sufficient to cover the sum of the amounts that Article 36.2 refers to.

If the maximum amount of authorized capital provided for in Article 297.b) of the Consolidated Text of the Capital Companies Act, approved by Royal Legislative Decree 1/2010 of July 2, becomes insufficient, this limit may be exceeded at the request of the authority of preventive resolution made in exercise of the powers provided in the preceding paragraph. In exercising these powers, it may also require that the maximum period set in that article is exceeded. Nor will it apply the requirement that contributions should be monetary.

Article 46. Recognition of contractual internal recapitalization.

1. Entities shall include in the contracts entered into a clause securing liabilities that they believe the exercise of the power of redemption and conversion of the FROB and compliance by the creditor or part of the contract giving rise to the liabilities, any reduction of principal or amount due and any conversion or cancellation resulting from such exercise, provided that the concerned liabilities:

A) are not excluded in accordance with Article 42.

B) do not constitute a deposit those referred to in the fourteenth additional provision, paragraph 1, point b).

C) are governed by the law of a State outside the European Union.


D) are issued or contracted after the entry into force of the rules on amortization of capital instruments and internal recapitalization contained in this Chapter.

The FROB may require the entity to send it a report of an independent expert on the validity of the clauses in this section.

2. Failure to comply with the obligation under the preceding paragraph by the entity shall not preclude the exercise of jurisdiction amortization and conversion on a given liability. This obligation may be excluded by the authority of preventive resolution on the report of FROB, when, or under the law of the State concerned, or under an agreement concluded with the same, shall be guaranteed the aforementioned submission and compliance.



Section 5th Implementation of internal recapitalization instruments



Article 47 Treatment of shareholders.

1. The FROB, in the exercise of its powers to implement the instrument internal recapitalization, taking into account the outcome of the assessment of the entity and once the amount of the recapitalization in accordance with the provisions of this Act set, take some, or both of the following measures:

A) redeem the shares or other instruments existing capital or transmission to the creditors subject to internal recapitalization.

B) Provided that, according to the assessment made in accordance with Article 5, the institution under resolution has a positive value, dilute the participation of shareholders and holders of other instruments existing capital by conversion into shares or other capital instruments:
1st
equity instruments issued by the entity, or

2nd eligible liabilities issued by the entity.

The conversion is carried out so that substantially reduce the nominal value of the shares or other instruments of existing capital.

2. The measures outlined in the previous section to shareholders and holders of other equity instruments issued or granted under the following conditions shall apply:

A) On the occasion of the conversion of debt into shares or other equity instruments, according to the contractual terms of the original debt instruments, to a previous or simultaneous event occurs at the time determined that the FROB the conditions for resolution were met.

B) Upon conversion of capital instruments into instruments of Common Equity Tier 1 In accordance with the provisions of this Act.

3. The FROB decide to adopt concrete actions taking into account:

A) The assessment carried out in accordance with Article 5.

B) The amount deemed by the Common Equity Tier 1 must be amortized or equity instruments must be redeemed or converted.

C) Evaluation of assets and liabilities under Article 36.

4. When applying the instrument internal recapitalization or conversion of capital instruments will lead to the acquisition or increase of a stake in an entity so that the regulations on significant shareholdings applicable, the competent supervisor carry out the assessment the acquisition or increase in a period not to delay, obstruct or impede the implementation of the measures adopted by the FROB.

In the event that the instrument internal recapitalization or conversion of capital instruments without having carried out the assessment provided for in the preceding paragraph applies, shall apply the rules provided in Article 26.7.

Article 48. Sequence and special rules of internal recapitalization.

1. The FROB apply the instrument internal recapitalization to absorb losses and to cover the amount of the particular recapitalization under the provisions of this Act, amortizing or reducing the amount of shares, equity instruments or liabilities admissible in the following sequence: | ||
A) Common Equity Tier 1 in proportion to the losses and as far as possible.

B) The principal amount of the instruments of additional Tier 1 capital as necessary and as far as possible.

C) The principal amount of the instruments of Tier 2 capital to the extent necessary and as far as possible.

D) The principal amount of subordinated debt that is not Additional Tier 1 or 2, according to the priority of the credit rights under Law 22/2003 of July 9, Insolvency, in the as necessary and as far as possible.


E) The outstanding principal amount or the amount of eligible liabilities, according to the priority of the credit rights under Law 22/2003 of July 9, including deposits referred to in paragraph 1 fourteenth additional provision.

2. In exercising the powers of redemption or conversion, the FROB will allocate losses equitably among shares, other equity instruments and eligible liabilities of the same rank by reducing the principal amount or the outstanding amount of such shares, other equity instruments and liabilities admissible in a degree proportional to their value, except when using the option provided in Article 43.3 is made.

This is not an obstacle to the excluded liabilities as provided in this Act receive more favorable than eligible liabilities of the same rank in ordinary bankruptcy proceedings deal.

3. The FROB not become amortize capital or a class of subordinated debt liabilities while another has not been converted into equity or amortized in full, unless it is excluded liabilities recapitalization.

4. The redemption and conversion of derivative liabilities arising will be made only at the time they are discharged or after the liquidation. To this end, agreed the resolution of an entity, the FROB may declare the early termination and settlement of any derivative contract.

If derivative transactions are conducted within the framework of a contractual netting agreement, the FROB or an independent expert will determine, in the context of the assessment under Article 5, the net balance of liabilities arising from the liquidation of transactions, according to the terms provided in the agreement.

The FROB will determine the value of liabilities arising from derivatives in accordance with the rules and principles established by regulation.

5. The FROB, in exercising the powers provided in Articles 38 and 40 may apply different conversion coefficients for different types of equity instruments and liabilities, taking into account the following principles:

A) The conversion ratio will appropriate compensation for the losses incurred by the creditor because of the redemption or conversion.

B) Creditors will have a higher ranking coefficient higher than lower-ranking creditors conversion.

Article 49. Reorganization plan of activities.

1. Applying the measure of internal recapitalization, the FROB require the management body of the entity, or the person designated for this purpose present a reorganization plan of activities containing the measures, taking into account the situation of the economy and the markets in which the company operates, aimed at restoring the long term viability of the company, or part of its activities, over a reasonable period of time.

2. Among other measures, the reorganization plan of activities may include:

A) The reorganization of activities of the entity.

B) Changes in operating and infrastructure of the entity systems.

C) Termination of loss-making activities.

D) Restructuring of activities that can be competitive.

E) The sale of assets or business lines.

3. Corresponds to the FROB, after consulting the preventive resolution authority and the competent supervisor, the approval of the reorganization plan and any amendments thereto.

If the FROB, after consulting the preventive resolution authority and the competent supervisor, believes the plan will not achieve the objectives set out in paragraph 1 shall notify the manager of the entity body or persons designated in that paragraph, and require the plan in such a way that allows achieve these goals change.

4. The FROB, in collaboration with the preventive resolution authority and the competent supervisor, evaluate and ensure compliance with the approved reorganization plan.

5. Regulations, deadline and procedure for submission of such plans and their minimum content, implementation and possible revision, and the rules applicable to groups of entities will be determined.



Section 6th Other contributions to the internal recapitalization



Article 50. Conditions for the contribution of the National Resolution Fund.

1. In the case referred to in Article 43.4, the National Resolution Fund under Article 53.1) may make a contribution to the institution under resolution for the purpose of:


A) cover any loss that has not been absorbed by eligible liabilities and restore the net value of the assets of the institution under resolution equating it to zero, or

B) to acquire shares or other equity instruments of the entity under resolution, in order to recapitalize.

2. National Resolution Fund can only make a contribution referred to in the preceding paragraph when the following conditions are met:

A) by reducing capital, conversion or otherwise, has been made by the shareholders and holders of other equity instruments and other liabilities eligible, a contribution to the absorption of losses and internal recapitalization for an amount equivalent to at least 8 percent of total liabilities, including the equity of the entity determined at the time of the resolution according to the assessment provided for in Article 5, and

B) the contribution of the funding mechanism of the resolution does not exceed 5 percent of total liabilities including own funds of the institution under resolution, calculated in accordance with the assessment provided for in Article 5, at the time that the resolution action is taken.

3. Compliance with the condition set out in paragraph a) of the preceding paragraph may be replaced by compliance with the following conditions:

A) the contribution to the absorption of losses and internal recapitalization under point a) cited above is of an amount not less than 20 percent of risk-weighted assets of the entity concerned, | ||
B) the National Fund Resolution at its disposal an amount which is at least equal to 3 percent of the amount of deposits guaranteed by the Deposit Guarantee Fund of Credit Institutions of all entities authorized in Spain obtained by ex ante in accordance with Article 53.1) contributions, among which will not be included contributions made to a deposit guarantee system, and

C) the entity that owns less than 900,000 million on a consolidated basis assets concerned.

4. Alternatively or in addition to the provisions of Article 51 is the National Resolution Fund may make a contribution from resources obtained through ex ante under Article 53.1) and which had not been used yet contributions, provided that the following conditions are met:

A) it has reached the limit of 5 per cent established in section 2.b).

B) have been redeemed or converted in full all unsecured liabilities not preferred, other than eligible deposits.

Article 51. Alternative sources of funding.

1. In extraordinary circumstances, the FROB may obtain financing from alternative sources of funding, once you have given the circumstances provided for in paragraph 4.a) and b) of the preceding article.

2. If the action of the FROB has an impact on the State Budget, the FROB will raise the Minister of Finance and Public Administration and the Minister of Economy and Competitiveness a financial report on the financial impact of such support detail on the FROB funds provided under the General State Budget.

3. The actions carried out by the FROB under this Article may be made in cash, by delivering securities representing government bonds, or securities issued by the FROB itself. the FROB may also meet that price by offsetting credits his claim against the corresponding entities.

The granting of guarantees by the FROB shall be subject to the limits established for such purpose in the annual laws of the State Budget.
CHAPTER VII

FROB




SECTION 1. Nature, composition and legal status



Article 52. FROB.

1. The FROB will aim to manage resolution processes of the entities in the executive phase and, in any case, exercise the powers under this Act, the rest of the national law and European Union law.

2. The FROB is a public law entity with legal personality and full public and private capacity for the development of its purposes, it shall be governed by the provisions of this Act.


3. The FROB will be subject to legal-private unless order that acting in the exercise of administrative powers conferred by this Act, the European Union law or other rules with the force of law. Measures entity resolution adopted by the FROB will communicate, where appropriate, the European Commission or the National Commission Markets and Competition, for the purposes of the provisions of the rules on state aid and defense competition.

4. The FROB not be subject to the provisions contained in Law 6/1997 of 14 April, Organization and Functioning of the General State Administration, in the exercise of their functions as resolution authority, being applicable in the rest we provisions of additional provision tenth.

5. The FROB, for the purposes of its budgetary, apply in matters not provided in this Act, the provisions of Articles 64 to 68 of Law 47/2003, of November 26, General Budget.

Notwithstanding the foregoing, the FROB will not be subject to the general rules governing the economic-financial, accounting and control of dependent or linked to the central government public bodies regime, except as regards the external audit by the Court of Auditors, in accordance with the provisions of the Organic Law 2/1982, of 12 May, the Court of Auditors and the submission of the internal system of management in the economic and financial field to permanent financial control the General Comptroller of the State Administration as provided in Chapter III of Title VI of Law 47/2003, of November 26, General Budget.

6. The FROB not be subject to the provisions of Law 33/2003, of November 3, the Assets of Public Administrations, in the exercise of their functions resolution. In any case, the FROB will not be subject to the provisions contained in Title VII of Law 33/2003, of November 3, based on the business assets of the General State Administration.

Will not be part of the Patrimony of Public Administrations shares, shares, securities and other instruments that the FROB may acquire in the exercise of its powers resolution.

7. FROB staff will be selected respecting the principles of equality, merit, ability and publicity, and this will be linked by a relationship of employment law. Notwithstanding the foregoing, the official personnel who are to serve on the FROB may do so in the situation of special services. Staff costs FROB and their managers are subject to the limits provided for entities in the state sector.

8. The FROB will, for tax purposes, the same treatment as the Deposit Guarantee Fund of Credit Institutions.

9. Exceptionally, the FROB may contract with third parties performing any activities of material, technical or instrumental, when necessary for the proper development of their skills as resolution authority under this Act, in line with the principles of advertising and competition except in emergency or urgent. For other contracts, the arrangements applicable procurement is set out in Royal Legislative Decree 3/2011 of 14 November, approving the revised text of the Law on Public Sector Contracts approved for contracting authorities not having the character of government.

Article 53. Financing mechanisms and budget.

1. To finance the measures provided for in this Law, the FROB will have the following funding mechanisms:

A) A "National Resolution Fund" without legal personality, managed by the FROB and established as separate assets, whose financial resources should reach at least 1 percent of the amount of the guaranteed deposits of all entities .

In order to achieve this level, the FROB will raise at least annually, regular contributions of entities, including its branches in the European Union in accordance with the following criteria:
1st
The contribution of each entity corresponds to the proportion this represents of the total aggregate of the entities, the following concept: total liabilities of the entity, excluding own funds and deposits guaranteed amount in accordance with provisions of Royal Decree-Law 16/2011 of 14 October.

2nd contributions will be adjusted risk profile of each entity in accordance with the criteria specified in the regulations al.


The available financial resources to be taken into account to achieve the target level may include irrevocable payment commitments fully backed by collateral of risk assets under free of charge, freely available and allocated for the exclusive use of the FROB for the purposes specified in the following section. The share of irrevocable payment commitments shall not exceed 30 percent of the total amount collected under this Article.

When the regular contributions of institutions are insufficient to finance the measures provided for in this Law, the FROB may raise extraordinary contributions.

B) The ability to borrow to finance mechanisms other Member States of the European Union, in accordance with the procedure foreseen regulations.
Only
may request a loan to other funding mechanisms in the event that regular contributions are not sufficient to cover the costs of resolution, extraordinary contributions are not immediately accessible and alternative funding mechanisms referred to in paragraph 5 can not be used on reasonable terms.

The FROB may also lend to other financing mechanisms Member States of the European Union under the National Resolution Fund.

2. The FROB may only use the funding mechanisms provided in this article to the extent necessary to ensure the effective implementation of resolution tools, in order to meet the objectives and constraints that have regulations. In particular, funding mechanisms may be one expression in one or more of the following measures:

A) The provision of guarantees.

B) The granting of loans or credits.

C) The acquisition of assets or liabilities may maintain or entrust its management to a third party.

D) The making of contributions to a bridge institution or asset management company.

E) Payment of compensation to shareholders and creditors.

F) The making of contributions to the entity when deciding to exclude certain liabilities of domestic recapitalization.

G) loans to other funding mechanisms.

H) The recapitalization of an entity under the terms and limitations provided in this Law.

The use by the FROB of financial support instruments will not reduce the losses arising from the resolution corresponding support to shareholders and subordinated creditors in accordance with the provisions of this Act and, in particular, taking into account the principles listed in letters a) and b) of Article 4.1.

The use by the FROB of financial support instruments will be subject to the procedure laid down in the second paragraph of Article 54.6 in the event that has an impact on the State Budget.

3. In the event of termination of a group in which Spanish companies are integrated with other European Union, the FROB contribute to the financing of resolution in accordance with the criteria and procedures foreseen in the regulations.

4. To cover their operating costs FROB entities require a fee, under the terms established in the sixteenth additional provision.

Also it may increase the FROB equity through the capitalization of loans, credits or other debt operation FROB in which the General State Administration listed as a creditor.

5. The FROB may also, for the fulfillment of its purposes, seek alternative means of financing such as issuing debt securities, receive loans, apply to open credit facilities and undertake other borrowing transactions, provided regular contributions are not sufficient to cover the costs of the resolution and the extraordinary contributions are not immediately available or sufficient.

Borrowings FROB, whatever the mode of its implementation, shall not exceed the limit established for that purpose in the annual laws of the State Budget.

6. The uncommitted assets of the Fund of National Resolution should be materialized in government bonds or other assets of high liquidity and low risk. Subject to the provisions of this Act and, in particular, the provisions of Chapter V concerning the application of resolution tools, any accrued and recorded in its financial statements benefit will become part of the fund assets.


7. When the FROB undertake a measure of resolution, the deposit guarantee system which is affiliated entity, in addition to the responsibilities set by regulation, in accordance with the limits laid down in Article 11 of Royal Decree-Law 16/2011, of assume October 14, the following costs:

A) When the internal recapitalization instrument applies, the amount which should have been amortized guaranteed deposits to absorb losses of the entity in accordance with Article 48 if they had guaranteed deposits included in the scope of internal recapitalization instrument and they had depreciated in the same degree as the claims of creditors with the same rank in the hierarchy of creditors under bankruptcy law.

B) When applying one or more resolution tools other than internal recapitalization, the amount of losses that had been secured depositors, if they had suffered losses in proportion to those suffered by the creditors with the same rank in the hierarchy of creditors under bankruptcy law.

Article 54. Governing Commission.

1. The FROB is governed and administered by a Governing Committee composed of 11 members:

A) The President.

B) Four members appointed by the Bank of Spain, one of which will be the Deputy Governor who shall hold the first Vice President of the Governing Committee, and replace the President in his duties in case of vacancy, absence or illness.

C) Three representatives of the Ministry of Economy and Competitiveness, appointed by the Minister, with at least the rank of Director General.

D) The Vice President of the Comisión Nacional del Mercado de Valores.

E) Two representatives of the Ministry of Finance and Public Administration, appointed by the Minister, with at least the rank of Director General.
They
be attended also the meetings of the Governing Committee, with voice but no vote, a representative appointed by the General Comptroller of the State Administration and another by the Attorney General of the State Director of the State Legal Service.

The Executive Committee of the Bank of Spain will appoint the members of the Governing Committee of the Deputy Governor different.

In addition, the Governing Commission may authorize participation in its meetings as observers, provided that such participation does not create potential conflicts of interest that may interfere with the development by the FROB of the functions under this Act. The Commission itself establish Rectora terms it has to function the participation of these observers, in any case, will have no vote and be subject to the duty of secrecy.

2. The functions of the Secretary of the Governing Committee shall be exercised by the person who is designated under the provisions of the internal regulations of the FROB.

3. Without prejudice to the provisions for the President in the following article, members of the Governing Committee shall leave their status as such for the following reasons:

A) Cease in their respective offices.

B) Cease agreed by the Executive Committee of the Bank of Spain, in the case of the Commission designated by the member different from the Deputy Governor.

4. The Governing Committee shall meet whenever it is convened by its Chairman, on his own initiative or at the request of any of its members. It is also empowered to establish its own regime of calls.

5. The Governing Committee is responsible to take decisions on the powers and functions assigned to the FROB, without prejudice to the delegations or powers that wish to adopt for the proper exercise thereof. In any case, not be delegated the following functions:

A) The adjudicative functions attributed to the FROB in relation to bank resolution plans and actions amortization of capital instruments and internal recapitalization.

B) Approval of the decision to conduct financing operations under Article 53.1.

C) Approval of the annual accounts of the FROB to be submitted annually to the Minister of Economy and Competitiveness and the General Comptroller of the State Administration for integration into the General Account of the State and its transfer to the Court of Auditors as the report to be elevated to the Minister of Economy and Competitiveness for submission to the Commission of Economy and Competitiveness of the Congress of Deputies.

D) The adoption of measures necessary for the use of the National Resolution Fund in accordance with the provisions of this Act decisions.


E) Decisions by the FROB agreed the sale or divestment of an entity of the instruments provided in Article 32.4.

6. For the valid constitution of the Governing Committee for the purpose of holding meetings, discussions and adoption of resolutions, assistance will be needed at least half of the members entitled to vote. Its resolutions are adopted by a majority of the members present, with the Chairman casting vote in case of tie in the number of votes.

Notwithstanding the foregoing, for taking decisions affecting the State Budget, the Governing Committee shall take its decisions with the following composition:

A) The President.

B) The three representatives of the Ministry of Economy and Competitiveness.

C) The two representatives of the Ministry of Finance and Public Administration.

7. The Governing Committee shall approve internal regulations of the FROB where the essential rules of his performance in the economic, financial, property, budget, accounting, organizational and procedural field will be collected. The rules will collect the basic lines of its policy of ownership of the entities to which it has made public financial support and include internal control mechanisms FROB government. These standards will stand on the principles of good governance, objectivity, transparency, competition and advertising.

Article 55. President.

1. The President of the FROB will develop the functions of representation, management and ordinary management of the Fund of National Resolution, and as many other delegated by the Governing Committee. It will be appointed from among persons with skills, technical knowledge and experience to develop the characteristics of this office functions.

Will be appointed and dismissed by royal decree of the Council of Ministers, on a proposal by the Minister of Economy and Competitiveness, after hearing the supervisory authorities, and following a hearing of the nominee for the position before the Commission of Economy and Competitiveness Conference Deputies in order to account for the conditions of experience, training and capacity make it suitable for office.

2. The President shall have exclusive dedication, will be subject to the regime of incompatibilities of senior officials of the Central Government, and will be incompatible with the exercise of any public or private occupation, whether gainful or not, unless they are inherent in his capacity as Chairman FROB.

3. The mandate of the President will last for 5 years and renewable. The President shall cease only for the following reasons:

A) end of the period for which it was named.

B) Resignation accepted by the Government.

C) infringement of any cause of incompatibility.

D) incapacity for the exercise of their functions.

E) conviction of a felony.

F) material breach of its obligations. In this case the separation will be agreed by the Government, after investigation of the case by the Ministry of Economy and Competitiveness who shall inform the Commission of Economy and Competitiveness of the Congress of Deputies, and which shall address the remaining members of the Governing Committee.

4. the President shall exercise the following functions:

A) Chairing the Governing Committee and to promote and monitor all operations under this Act must run the FROB.

B) Direct the ordinary, economic and administrative management of the FROB, including the administration of the Fund of National Resolution, and bear the legal representation.

C) Make, subject to verification by auditors and raise for approval by the Governing Committee of the FROB annual accounts.

D) propose to the Governing Committee of the adoption of decisions correspond to this as provided in this Act, notwithstanding that the Governing Committee also can adopt its own motion.

E) To execute the agreements of the Governing Committee and delegated many functions that, in accordance with the provisions of Article 54.5.

F) accountable to the Governing Committee of the exercise of their functions.

G) To represent the FROB in institutions and international bodies in which it is intended for participation and in particular the Single Single Resolution Board Resolution Mechanism.

Article 56. Parliamentary control.


1. At least once a semester, the President of the FROB will appear before the Committee on Economy and Competitiveness of the Congress of Deputies, in order to report on the progress of activities of the FROB and on key elements of its economic and financial performance and the management of financial mechanisms under this Act.

2. In addition, the Chairman of the Governing Committee of the FROB will appear under the conditions determined by the Commission of Economy and Competitiveness of the Congress of Deputies to report specifically on resolution measures implemented by the Fund.

3. The Governing Committee will Ministers of Finance and Public Administration and Economy and Competitiveness a quarterly report on the management and performance of the FROB, which will be given due consideration, among other things, the actions of economic and budgetary nature of greater rush impact by the FROB during that period. The Minister of Economy and Competitiveness shall transmit the report to the Committee on Economy and Competitiveness of the Congress of Deputies.

Article 57. Cooperation and coordination with other relevant national authorities.

1. The FROB will collaborate with the authorities having assigned functions related to monitoring or resolution of entities and in particular with organizations or supervisory authorities and preventive resolution of the entities within the scope of this Act. We also work with the Direccion General de Seguros, the authorities designated by the Autonomous Communities to perform any of the above functions, the Consortium of Insurance Compensation Fund Deposit Guarantee Credit Institutions and Fund Investment Guarantee. For this purpose it may conclude with all appropriate collaboration agreements and request any information necessary for the exercise of the powers granted to it.

In particular, the supervisor and the competent authority shall cooperate with resolution preventive FROB in the preparation, planning and implementation of resolution measures provided for in this Act.

Also, the FROB will provide the authorities referred to in the preceding paragraph the information necessary for the exercise of its powers under current legislation is concerned.

2. If resolution of entities belonging to a group or financial conglomerate:

A) The FROB, in adopting the measures and exercise the powers, the effect conferred by this Act, minimize the impact that such measures and powers may be appropriate in the rest of the group entities or conglomerate and the group or conglomerate as a whole.

B) The FROB will assume the role of coordinator of the resolution when the Spanish competent supervisor is entrusted with the functions of monitoring and oversight of the consolidated group in which the parent company of the conglomerate is integrated or, failing that, of the entity dominant considered individually.

Article 58. Cooperation and coordination with other international authorities.

1. In the exercise of its powers and in particular, in the event of termination of entities belonging to international groups, the FROB and authority of preventive resolution cooperate with the institutions of the European Union, including the Single Adjudication Board, the Central Bank Europe, the European Banking Authority, and foreign authorities having assigned functions related to monitoring or entity resolution, which purpose they may conclude with them the appropriate collaboration agreements and seek and exchange information to the extent necessary for the exercise of the powers that have it in relation to the planning and execution of measures early action or resolution.

In any case, the FROB and authority of preventive resolution participate in colleges resolution authorities may be established to ensure the necessary cooperation and coordination with foreign resolution authorities.

Overall, the FROB will contact the Spanish authorities and coordination for all purposes of cooperation with relevant international authorities and in particular, those of the other Member States of the European Union.


2. If the competent foreign authorities not belong to a Member State of the European Union, the exchange of information will require reciprocity, the competent authorities are subject to duty of secrecy in conditions at least are comparable to those established by Spanish law and that the information necessary for the exercise by the foreign authority of functions related to monitoring, recovery or resolution of financial institutions under their national law, is comparable to that established by the Spanish laws.

The transmission of classified information to the authorities mentioned in the preceding paragraph shall be subject, where the information originated in another Member State of the European Union, the express agreement of the authority that had been revealed, and the information may be communicated only for the purposes for which that authority has given its agreement. This conformity is also required when requested to FROB or competent authority of preventive resolution information that has been provided by a resolution authority of a third country.

Relations with the competent authorities not members of the European Union states may be further specified in bilateral agreements and will include rules for mutual recognition and enforcement of procedures for the resolution of these countries, as well as the resolution of branches third countries in Spain.

3. In the event of termination of entities belonging to a group or financial conglomerate that also operates in other Member States of the European Union and whose consolidated supervision does not correspond to Spanish authorities, before declaring the opening of a resolution process, the FROB or competent supervisory authority shall consult the group level resolution, the authority of the European Union responsible for consolidated supervision of the group to which the entity and members of the school group resolution authorities.

If resolution of a parent entity of the European Union which is established in Spain, the FROB will act as executive authority at the group level resolution.

4. The FROB, the competent authority of preventive resolution or competent supervisor promote the necessary actions to facilitate the adoption of a joint decision with the resolution authorities of other Member States of the European Union.

5. In the event of termination of entities belonging to a group or financial conglomerate that also operates in other Member States of the European Union, the FROB, the authority of preventive resolution competent and competent supervisor to take action and exercise the powers that purpose , conferred by this Act, minimize the harmful effects of such measures and powers may be appropriate in the stability of the financial system of the European Union, and in particular the Member States of the European Union where the group or conglomerate operates.

6. Reglamentariamente the regime of coordination and cooperation regulated in this article as well as the assumptions corresponding to the FROB practice as resolution authority in connection with a branch located in Spain will take place.

Article 59. Duty of secrecy.

1. Data, documents and information held by the FROB under the functions under this Act shall be confidential and, except as provided in current regulations, will not be disclosed to any person or authority, or used for purposes other than those for which they were obtained. This confidential cease from the time that those interested make public the facts to which data, documents and information relate.

2. The authorities and persons who, in accordance with the provisions of the previous articles, can receive information from the FROB or access restricted information and auditors, legal advisors and other independent experts to be appointed by the FROB in relation to the implementation of resolution measures will also sworn to secrecy no longer use the information received for purposes other than that for which they were supplied. They will also be required to adopt internal rules on confidentiality, with the scope and under the terms established by regulation.


3. Without prejudice to the provisions of Article 58 of this Act shall apply to the FROB in a supplementary provisions on confidentiality and secrecy applicable to the Bank of Spain and in particular those set out in Article 82 of Law 10/2014, of 26 June.

4. Notwithstanding the provisions of the preceding paragraphs:

A) employees and experts from agencies or entities that paragraph 2 referred to may exchange information within each agency or entity, and

B) resolution authorities and competent supervisors, including its employees and experts can exchange information with each other and with other resolution authorities of the European Union, other supervisory authorities of the Union, ministries, central banks, systems deposit guarantee, compensation schemes of investors, authorities responsible for insolvency proceedings, responsible for maintaining the stability of the financial system by using macroprudential standards authorities, persons responsible for carrying out statutory audits as well as with the Authority European bank or, in accordance with Article 58.2, authorities of third countries who perform equivalent to those of resolution authorities functions or, subject to strict confidentiality requirements, to a potential purchaser, in order to plan or implement a measure of resolution.

5. Also it is authorized information exchange:

A) conditioned on strict confidentiality requirements, with anyone when necessary for the purposes of planning or execution of a measure of resolution;

B) with the parliamentary committees, the Court of Auditors or other public authorities in charge of investigations under conditions appropriate confidentiality.

6. This article is without prejudice to the rules on the exchange of information for the purposes of court proceedings.

Article 60. Application of competition law.

In the exercise of its powers, the FROB and authority of preventive competent supervisory resolution and minimize distortions that their actions will result in the conditions of competition, fulfilling the purpose with the Spanish legislation and the European Union competition and state aid. To this end, the resolution authorities and competent supervision cooperate with the European Commission providing the necessary information in the context of the authorization procedures provided for in the rules of the EU competition and state aid.

Article 61. Adoption of international recommendations.

In the exercise of its powers and that are not always inconsistent with the provisions of this Act and the regulations in force, the FROB and preventive resolution authorities and competent supervision may take into account the recommendations and other initiatives developed internationally in the field of bank resolution.

Notwithstanding the foregoing, the Minister of Economy and Competitiveness, or with its authorization express resolution authorities and competent preventive monitoring, the legal system may incorporate the recommendations and guidelines on issue resolution bodies, committees or international authorities. In the case of authorization, the circular shall be informed by the other authorities.



Section 2 Powers of the FROB



Article 62. Powers of the FROB.

The FROB shall exercise the necessary for the implementation of instruments and measures under this Act powers. These powers will be of commercial or administrative nature.
Article 63. Powers
commercial.

The FROB shall exercise the powers conferred corporate law generally:

A) The board of the entity, when it assumes such a condition.

B) To the shareholders or holders of any securities or financial instruments, where the FROB has subscribed or acquired such securities or instruments.


C) A board or general meeting in the cases in which this would impede or reject the adoption of the necessary arrangements to effect resolution measures, as well as in cases for reasons of urgency is not extraordinary possible to meet the requirements of the regulations in force for the valid constitution and adoption of resolutions by the board or general assembly. In such cases, shall be construed attributed to the FROB, directly or through natural or legal persons appointed, all the powers legally or statutorily may correspond to the board or general assembly of the entity and that are necessary for the exercise of functions under this Act in relation to the resolution of entities.

Article 64. General administrative powers.

1. The FROB will have the following general powers of an administrative nature, in addition to the other under this Act:

A) approve the value of the assets and liabilities of the entity, for the purpose of implementing the measures and instruments provided for in this Act.

B) require any person any information necessary to prepare and implement a measure or instrument resolution.

C) transmit or order the transfer of shares, capital contributions or, in general, representative of capital or instruments convertible into them, whatever their holders, as well as other financial instruments, assets and liabilities the entity.

D) Perform operations increase or reduction of capital, and issue and total or partial repayment of bonds, including convertible instruments, and any other securities or financial instruments as well as the bylaw amendments related to these transactions and can determine the exclusion of preferential subscription rights in capital increases and the issue of convertible bonds even in the cases provided for in Article 343 of the Consolidated Capital Companies Act, approved by Royal Legislative Decree 1/2010 of 2 of July.

E) Carry out redemption or conversion of capital instruments or internal recapitalization, and adopt all measures necessary accessory to carry them out.

F) Determine the instruments that resolution measures are realized, including, in particular those involving structural modifications of the entity, the dissolution and liquidation of the entity.

G) Have immediately on the report of the Comisión Nacional del Mercado de Valores, the transfer of the securities deposited in the entity to another entity empowered to develop this activity, even if such assets are deposited with third parties to name of the entity providing the service tank.

For this purpose, the FROB, or natural or legal persons acting in its capacity as administrator of the entity, take the necessary measures to facilitate access of the entity to be divested 'deposits values ​​or custody documentation and accounting and computer records necessary to effect the transfer.

H) Exercise, in connection with the transfer of securities, financial instruments, assets or liabilities of the entity, some or all of the following powers:

1st Forcing the entity and the purchaser to provide the necessary information and assistance.

2nd Require any entity of the group to which the entity to provide the purchaser operational services necessary to enable this effectively operate the broadcast business. When the group entity already providing such services come to the bank will continue lending them under the same terms and conditions, and otherwise in the given market conditions.

I) Defer, suspend, remove or modify certain rights, obligations, terms and conditions of all or some of the issues of debt instruments and other eligible liabilities issued by the institution under resolution.

J) require the entity to repurchase securities issued by the same price and under conditions determined by the FROB.

K) Sort transmissions of shares or contributions to share capital or, in general, financial instruments, assets and liabilities of the entity are carried free of any liens or encumbrances; and suppress the rights of option and pre-emption, without being opposable existing statutory or contractual provisions.


L) require the Comisión Nacional del Mercado de Valores suspend admission to trading on a regulated market or admission to official listing of financial instruments under the Law 24/1988 of 28 July, and the rest applicable regulations.

M) cancel or modify the terms of a contract entered into by the institution under resolution, or instead become part of the purchaser.

N) adopt the necessary measures to ensure business continuity transmitted and contracts concluded by the entity so that the acquirer assumes the rights and obligations of the institution under resolution measures.

Ñ) Revising any operation or action carried out by the entity in resolution of potential liabilities that may arise facing the exercise corresponding actions under Article 4.1.g), whose effects will be entitled to exercise of any action that may correspond to ensure compensation for damages.

O) Forcing the company to take the necessary measures to ensure that the resolution adopted take effect in relation to the shares or other equity instruments, assets and liabilities actions in third countries.

When the FROB considers that the measures taken will not take effect on certain assets located in a third country or certain shares or other equity instruments, assets or liabilities governed by the law of that country, will paralyze the adoption of measures repealing taken in relation to the shares or other equity instruments, assets or liabilities.

2. For the FROB to achieve the objectives and principles of the resolution set out in Articles 3 and 4, in the exercise of general administrative powers contained in the previous section and the other under this Act shall not be applicable the limitations and other requirements in the revised text of the Capital Companies Act, approved by Royal Legislative Decree 1/2010 of July 2, nor in the legislation applicable to credit unions in relation to operations increase and capital reduction, conversion of capital instruments or internal recapitalization. Neither the preparation of the required reports that those rules can provide will be necessary.

Article 65. Enforceability of measures.

1. Administrative acts issued by the FROB for the implementation of the instruments provided for in Chapter V, as well as the resolutions adopted under Article 63.C) will be immediately effective since its adoption without complying with any formalities or requirement established, regulation or contract, subject to the requirements of this Act and the formal obligations of constancy, registration or advertising required by current regulations, whose effects will be sufficient certification of the administrative act or the relevant agreement without have reports from independent experts or auditors.

2. The implementation of such acts can not be affected by the rules on banking secrecy.

Article 66. Exclusion of certain contract conditions on early action and resolution.

1. The adoption of any measure early action or resolution and any fact that is directly related to the implementation of such a measure, not in itself constitute an event of default or permit itself to any counterparty declare the expiration, modification, suspension or early termination of operations or contracts with the bank, foreclose a lien on any assets of the entity or compensation of any rights or obligations arising out of the transaction or contract, or affect in any other way to it, taking not put clauses so provide.

In particular, the application by the resolution authorities or competent supervisor of the measures and powers under this Act shall not have the status of insolvency proceedings for the purposes of the provisions of Law 41/1999 of November 12, on payment systems and securities settlement or for the purposes of the provisions of Section 3rd of Chapter II of Royal Decree-Law 5/2005 of 11 March, on urgent reforms to boost productivity and improving public procurement.


Notwithstanding the provisions above, the counterparty may, under the terms and conditions set forth in the contract, the expiration or early termination of the contract or the corresponding transaction following an event preceding or subsequent breach to the adoption or exercise of the corresponding measure or faculty and not necessarily linked to this.

2. The provisions of the preceding paragraph shall apply in relation to the subsidiaries of a group whose obligations are guaranteed or endorsed in any way by the group entity, or in relation to any group entity in relation to contracts containing crusades provisions breach.

Article 67. Partial transfer of assets and liabilities.

1. In cases where it is transmitted only part of the assets and liabilities of the entity, the FROB will take the necessary measures to achieve the following purposes:

A) Prevent resolution, novation or transfer of only part of the assets and liabilities can be offset under a financial collateral arrangement with change of ownership or a contractual netting agreement that the Chapter concerns II of Title I of Royal Decree-Law 5/2005 of 11 March, or a compensation agreement.

B) Allow obligations against security and guarantee assets that are transmitted together or remain both in the state.

C) Avoid the resolution or novation agreement collateral if this means that the corresponding obligation no longer be guaranteed.

D) Avoid the resolution, novation or transfer of only part of the assets and liabilities covered by structured finance agreement, except when they affect only assets or liabilities related to the deposits of the institution.

Notwithstanding the foregoing, the FROB, in order to facilitate the resolution and give adequate protection to depositors, may transfer the insured deposits that are part of the agreements referred to in previous letters, without transmitting assets and liabilities They are forming part of the same agreement, or transmit, modify or terminate those assets and liabilities without transmitting guaranteed deposits.

2. The implementation of any measure or faculty or early resolution performance does not affect the performance of Spanish payment systems and clearing and settlement of securities and financial instruments recognized under Law 41/1999, of 12 November, nor the designated by other Member States for the purposes of the provisions of Directive 98/26 / EC of the European Parliament and of the Council of 19 May 1998, on settlement finality in payment systems and securities settlement, including schemes managed by central counterparties, when the FROB:

A) transmit portion of the assets or liabilities of an institution under resolution, or

B) cancel or modify the conditions of a contract entered into by the entity under resolution or replace a buyer as part.

In particular it will not affect the irrevocability, firmness and validity of orders settlement or compensation, nor the funds, securities or commitments that Law 41/1999, of November 12 refers, nor the guarantees constituted for system managers or participating entities. Nor did it affect the exercise of the right of compensation or the enforcement of collateral provided to the Bank of Spain, the European Central Bank or national central bank of the European Union.

Article 68. Emergency measures.

For reasons of urgency and to ensure the objectives set out in Article 3, the FROB may:

A) Adopt, prior to the adoption of the corresponding resolution plan, the instruments provided in Article 25.1.a) and b) and, under the provisions of the Spanish legislation and the European Union competition and state aid and taking into account the principle of the most efficient use of public resources and the minimization of public financial support, provide the aid provided for in Article 20.1.d).

B) Use a method of estimating the value of the entity in which no independent expert reports are collected, to make provisional assessment that Article 5.3, in order to implement the measures of resolution or exercise jurisdiction to redeem or convert capital instruments.

Article 69. Advertising.


1. Without prejudice to Article 24, the FROB will take the necessary actions to publicize the measures taken under Chapter IV and in particular the implementation of the resolution tools and the exercise of the relevant powers, with in order that these can be known by shareholders, creditors or third parties that may be affected by the appropriate measures.

2. Without prejudice to the provisions of the preceding paragraph, the FROB shall notify the measures taken to the entity, the Ministry of Economy and Competitiveness and the supervisory authority competent preventive and resolution.

Also, when appropriate, the FROB informed of the measures taken to the European Banking Authority and the authority of the European Union responsible for the supervision of the possibly affected group.

3. During the preparation of the measures of early action and resolution and, in particular, while carrying out the valuation to which Article 5 refers to and during the phases of studying or negotiating any operation that can materialize the application of any of the resolution tools, the company will be exempt from the obligation to make public and disseminate any information that may be regarded as relevant information for the purposes of Article 82 of Law 24/1988 of July 28 .

Article 70. Powers of suspension of contracts and guarantees.

1. The FROB may suspend, as an administrative act, any payment obligation or delivery arising out of any contract entered into by the entity for a period that begins with the publication of the exercise of this power until midnight the next business day.

2. When an obligation of payment or delivery should have been executed during the suspension period, payment or delivery will be made immediately after expiry of this period.

When payment or delivery obligations arising from a contract concluded by the entity are suspended under the first paragraph, the payment or delivery obligations of the counterparties of the entity under this contract will also be suspended by the same time period.

3. The provisions of paragraph 1 shall not be applicable:

A) deposits guaranteed under the terms provided for in Royal Decree-Law 16/2011, of 14 October;

B) obligations of payment or delivery in respect of:
1st
systems or operators designated by Law 41/1999 of 12 November systems or designated by other Member States for the purposes of the provisions of Directive 98/26 / EC of the European Parliament and of the Council of 19 May 1998 on settlement finality in payment systems and securities settlement

2nd CCPs, and

3rd central banks.

C) the appropriations included in the Investment Guarantee Fund pursuant to Article 77 of Law 24/1988 of July 28 and its implementing regulations.

4. Notwithstanding the provisions of Chapter VI, the FROB may, as an administrative act, prevent or limit the enforcement of security over any of the assets of the entity for a period that begins with the publication of the exercise of this power until midnight the next business day.

The FROB not exercise such jurisdiction with regard to guarantees on assets pledged or concept presented in coverage or guarantee by the entity resolution:

A) systems or system operators designated by Law 41/1999 of 12 November, on payment systems and securities settlement, or designated by other Member States for the purposes of the provisions of Directive 98 / 26 / EC of the European Parliament and of the Council of 19 May 1998,

B) the CCPs, and

C) central banks.

5. The FROB may suspend, as an administrative act, the right of a party to declare early maturity, resolution or termination of a contract with an entity in resolution for a period that begins with the publication of the exercise of this faculty until midnight the next business day.

The FROB will not exercise such jurisdiction with regard to:

A) systems or operators designated by Law 41/1999 of 12 November, on payment systems and securities settlement systems, or those designated by other Member States for the purposes of the provisions of Directive 98 / 26 / EC of the European Parliament and of the Council of 19 May 1998,

B) the CCPs and

C) central banks.


6. The provisions of the preceding paragraph also apply to those resulting from contracts with a subsidiary of the institution under resolution when:

A) The obligations created by the contract are guaranteed or endorsed by the entity under resolution.

B) The rights of early termination, termination or rescission of the contract have the sole reason the insolvency or financial condition of the entity resolution.

C) In the event that it has exercised or may exercise the power to transfer shares or other equity instruments, assets or liabilities when assets and liabilities of the subsidiary on the contract have been transferred or will be transferred to a buyer or when the FROB any way confer protection to these obligations.

7. Notwithstanding paragraph 5, a person may exercise the right to declare the early maturity, resolution or termination of the contract before the end of the suspension period, provided that the FROB first notifies you that the assets and liabilities hedged the contract will not be transmitted to another entity or subject to internal recapitalization instrument.

In the event that the right of suspension is not exercised and not the notification provided for in the preceding paragraph is made, it may exercise the right to declare the early maturity, resolution or termination of the contract:

A) If the assets and liabilities have been transferred to another entity, only if an event giving rise to the early termination occurs, resolution or termination of the contract by the receiving entity continuously or later.

B) If the entity under resolution maintains the assets and liabilities and the FROB does not apply to them the instrument internal recapitalization, when the suspension period ends.
CHAPTER VIII



Procedural regime
Article 71. Actions against the decisions and resolutions of the FROB adopted in the exercise of their commercial powers provided for in Article 63.

1. The decisions and resolutions adopted by the FROB under Article 63 shall only be challenged in accordance with the rules and procedures for the challenging of agreements capital companies that are contrary to the law. The action contesting expire in any case, within fifteen days from the time when the FROB appropriate to publicize said actions in accordance with Article 69.

2. Shareholders, partners, bondholders, creditors or any other third parties who consider their legitimate rights and interests have been injured by the decisions taken by the FROB, directly or through natural or legal persons acting in its capacity as administrator they may request, in accordance with Article 241 of the Consolidated Capital Companies Act, approved by Royal Legislative Decree 1/2010 of July 2, that they compensate the damages suffered. No action may exercise social responsibility regarding the actions taken by the supervisory authorities, the preventive resolution or FROB as part of a process of early action or decision of the entity.

3. If, in accordance with Article 72, had filed an administrative appeal against any of the acts that can dictate the FROB under this law, the competent court shall suspend the procedure initiated under this Article to resolution of administrative appeal when the administrative contested measure would cover the decisions taken by the FROB under Article 63. In this case, the competent court shall be bound by the decision of the administrative disputes court on the issue preliminary.

Article 72. Specialties of appeal against decisions and administrative acts within the framework of processes of early action and resolution.

1. The approval of the recovery plans and resolution, by the competent supervisor or the competent authority for preventive resolution, shall terminate the administrative proceedings and can be appealed before the Board of Administrative Litigation of the National Court.

2. The acts and decisions of the supervisor and the authorities competent resolution dictated in the context of processes of early action and preventive phases and executive of the resolution, shall terminate the administrative proceedings and may be appealed before the Board of Administrative Litigation of the National Court.


The assessment accompanying the acts and decisions of the supervisor and the competent authorities of resolution mentioned in the preceding paragraph may not be the subject of separate action, with only challengeable resources that arise against those actions and decisions. If not contested, it will be used by the court as the basis of its own assessment of the acts or decisions subject of administrative appeal.

3. Processing procedures for challenging decisions of the authorities competent resolution shall take priority, except regarding the special procedure for the protection of fundamental rights and the preference given to direct actions against general provisions laid down in Article 66 of the Law 29/1998 of 13 July, governing Administrative Jurisdiction.

4. In exercising tools and powers resolution, the authorities competent resolution may request and the competent court shall suspend, during the period of time necessary to guarantee the effectiveness of the object pursued, any action or proceeding entered into by the institution under resolution.

Article 73. Specialties of appeal against decisions and administrative acts issued on redemption or conversion of capital instruments and internal recapitalization.

1. They will be entitled to lodge an administrative appeal against acts and decisions of the FROB to depreciation or conversion of capital instruments and internal recapitalization:

A) The shareholders or members of the issuer of equity instruments and liabilities admissible representing at least 5 percent of the share capital and, where appropriate, the wholly-owned subsidiary through which has been instrumented emission.

B) Holders of securities included in the scope of action of redemption or conversion of capital instruments and internal recapitalization.

C) The Commissioner or union representative or assembly bringing together the holders of the securities of any one issue affected by the action, provided it is empowered to do so under the terms and conditions of such issuance and rules governing the operation of the union or assembly.

D) Depositors and creditors of the institution.

2. An order which, if any, the adoption of precautionary measures agreed should be published in the "Official Gazette" and the entity and the FROB will give the same publicity to that order that the action of redemption or conversion of instruments internal capital and recapitalization.

3. In the event that the administrative appeal brought by holders of securities included in the scope of the action of redemption or conversion of capital instruments and internal recapitalization or the commissioner or union representative or assembly that groups be estimated, the decision will only effects regarding the issue or issues in which they had invested.

4. The entity and the FROB will give the same publicity to the judgment that the action of redemption or conversion of capital instruments and internal recapitalization.

Article 74. Impossibility of execution of judgment in the administrative-law referred to Articles 72 and 73. resources

1. The supervisor and the competent authorities may rely resolution before the judicial authority to determine the causes the material impossibility of executing a judgment declaring contrary to any law of the decisions or actions provided for in Articles 72 and 73. The judge or court appreciate the existence or not of such cases and shall, where appropriate, the compensation to be satisfied. The amount of the allowance shall amount to a maximum, the difference between the damage actually suffered by the applicant and the loss that would have incurred if, at the time of adoption of the decision or agreement, there had been the liquidation of the entity under bankruptcy proceedings.

2. In assessing the causes that determine the material impossibility of implementing a judgment, in accordance with the provisions of the preceding paragraph, the judge or court shall take particular account of:

A) The particularly significant volume or complexity of the operations affected or could be affected.

B) The existence of damages, which the judgment in its strict terms, would result for the company and for the stability of the financial system.


C) The existence of any rights or legitimate interests of other shareholders, partners, bondholders, creditors or any other third party, protected by law.
CHAPTER IX



Penalties


SECTION 1. General Provisions



Article 75. General provisions.

1. The entities and persons who hold administrative or management positions in them, which infringe the rules laid down in this Act shall incur administrative liability punishable under the provisions of this Chapter.

2. The liability attributable to an entity and the administrative or management thereof shall be independent. The failure to initiate disciplinary proceedings or the file or dismissal of proceedings against an entity not necessarily affect the liability they may incur charges administrative or management thereof, and vice versa.

3. When infringements relate to obligations of consolidated groups of entities, it shall be punished to the parent entity and, if applicable, its directors and executives.

Article 76. Competition for the instruction of records.

1. The conduct of disciplinary proceedings and the imposition of sanctions arising from infringements typified by this Act corresponds to the following authorities:

A) When FROB in the case of offenses relating to his duties as executive authority resolution and in particular those involving the infringement of the rules laid down in Chapters IV to VII.

B) The Bank of Spain in the case of offenses relating to his duties as preventive supervisory authority and resolution, in particular those involving the infringement of the rules laid down in Chapters II and III.

C) In the Comisión Nacional del Mercado de Valores in the case of offenses relating to his duties as preventive supervisory authority and resolution, in particular those involving the infringement of the rules laid down in Chapters II and III.

2. The Bank of Spain, the Comisión Nacional del Mercado de Valores and the FROB cooperate with each other in all those disciplinary procedures which, by their nature, may affect concurrently to different authorities.

3. The supervisor and the authorities of relevant resolution will realize reasoned the Minister of Economy and Competitiveness sanctions for very serious offenses and, in any case, will be sent on a quarterly basis the essential information on procedures in handling and resolutions adopted.

Article 77. Prescription of offenses and penalties.

1. Very serious infringements shall lapse after five years, four years severe and mild to two years.

2. The limitation period shall be counted from the date the offense was committed. In the infringements resulting from an activity or continuing omission, the starting date of computation will be the end of the activity or the last act by which the infringement is consumed.

3. Prescription is interrupted by the initiation, with the knowledge of the person concerned, the disciplinary procedure resumed within the dossier remained paralyzed for six months for reasons not attributable to those against whom is directed.

Shall not be deemed to exist stoppage for the purpose of the provisions of the preceding paragraph, in the event that it occurs as a result of the adoption of an agreement to suspend the proceedings by competition with criminal proceedings.

4. The statute of limitations for sanctions will be the provisions of Law 30/1992 of 26 November on the Legal Regime of Public Administrations and Common Administrative Procedure.



Infractions Section 2



Article 78. Classes of infringements.

Administrative offenses under this Act shall be classified as very serious, serious and minor.

Article 79. Very serious offenses.

Shall constitute very serious infringements the following:

A) Refusing or resisting the action of the supervisor or resolution competent authorities in the exercise of the functions conferred by this Act, provided it is not merely occasional or isolated.

B) Lack of the required cooperation or obstruction by the entity for early action measures that have decided to apply the appropriate supervisor, they do not have occasional or isolated.


C) Lack of necessary cooperation by the entity with the authority of competent preventive resolution, for the purposes of the preparation of resolution plans, when you are not occasional or isolated.

D) Lack of the required cooperation or obstruction by the entity in the implementation of resolution measures decided by the FROB, when you are not occasional or isolated.

E) Any action that impedes or seriously hinder the economic valuation of the entity entrusted to independent experts, provided it is not occasional or isolated.

F) not forward the supervisor or the competent authorities or documents resolution whatever data submitted should be interested or require to carry out their duties, or refer incomplete or inaccurately, thereby when assessing the viability is difficult the entity or consolidated group or financial conglomerate to which it belongs. For the purposes of this letter, it is also understood as lack of remission, remission after the deadline in the relevant standard or the period granted by the competent body to carry out, if necessary, the appropriate requirement.

In particular, they are considered as listed in this letter:

1st Lack of referral to the competent supervisor of the recovery plan and the lack of referral plan revisions that have been required by the competent supervisor.

2nd Lack of referral to the competent supervisor by the entity the report on the degree of compliance with the measures outlined in the action plan and other measures of early action.

3.º The lack of reference to the competent authority for preventive resolution by the entity of the information necessary for the preparation of the settlement plan.

G) Failure to comply with the duty to provide true information to the supervisor and the competent authorities of resolution, provided that the number of people affected or the importance of information, was particularly relevant breach.

H) Breach of the duty of confidentiality on data obtained in the context of a process of early action or resolution, or used for purposes other than those provided for in the law, provided that the number of affected or the importance of information, was particularly relevant breach.

I) Lack of communication or communication clearly delayed, by an entity or consolidated group or subgroup of entities that are in any of the circumstances of early action, when it was known or, under the circumstances objective, should be known by the board; provided that the gravity of the circumstances in which the entity or the period of elapsed time is found, should be considered a very serious offense.

J) Lack of communication or communication is manifestly delayed by the board to the supervisor or the competent authorities ruling that the entity is in a situation of infeasibility, when it was known or, given the objective circumstances, should be known by the board; provided that the gravity of the circumstances in which the entity or the period of elapsed time is found, should be considered a very serious offense.

K) not to propose to the competent authority appropriate preventive resolution to reduce or eliminate obstacles to the solvability and the non-application of alternative measures proposed by the competent authority of preventive resolution to reduce or eliminate barriers measures, when not have occasional or isolated.

L) Do not keep the recovery plan updated annually or after a change have occurred in the legal or organizational structure of the entity that requires changes therein, provided that the circumstances of the entity have changed significantly and justify a substantial alteration of the plan.


M) Failure to comply with the obligations, requirements and limitations set forth in this Act in relation to the intra-group financial support. In particular, having given the group financial support without the authorization of the competent supervisor or having obtained such authorization distortion of the circumstances and applicable requirements; have entered into an agreement intra-group financial support when a party is in a case of early action; not having published the entities belonging to a group information from regarding whether or have not signed an agreement financial aid; and lack of communication to the competent supervisor of the resolutions adopted to provide financial support group; when, in all cases, do not be occasional or isolated.

N) Non-payment of contributions to which Article 53.1) or outside the required payment term refers.

O) Perform acts or operations without authorization when it is mandatory, without observing the basic conditions thereof, or having obtained the authorization through false statements or other irregular means, when you are not occasional or isolated.

O) Serious offenses to commit them when they had made fraudulent acts, or used natural or legal intermediaries.

P) Regarding the asset management company, without prejudice to the application of other letters:

1st Conducting beyond its corporate purpose jeopardize the achievement of the overall objectives legally established for it in this Act and its implementing regulations, unless you have an occasional or isolated activities.

2nd Lack of accounting legally required or take it with essential irregularities preventing know their financial position.

3rd Failure of the obligation to submit its annual accounts to audit accounts in accordance with current legislation on the subject.

4th Refusal or resistance to inspection activities, provided that an express request written about it.

5th The breach of its obligations of transparency, unless you have a merely occasional or isolated.

6th Lack of referral to the FROB, whatever data or documents be remitted or required in the exercise of their duties, or lack of veracity, when thus assessing the financial position of is difficult society. For the purposes of this number, it is understood that there is a lack of remission when this does not occur within the time allowed for that purpose by the competent authority in writing recalling the obligation or reiterating the request.

Article 80. Serious offenses.

Constitute serious infringements the following:

A) Refusing or resisting the action of the supervisor or resolution competent authorities in the exercise of the functions conferred by this Act, unless, not having merely occasional or isolated, constitute a very serious infringement.

B) Lack of the required cooperation or obstruction by the entity early action measures that have decided to apply the appropriate supervisor when I have merely occasional or isolated.

C) Lack of necessary cooperation by the entity with the authority of competent preventive resolution, for the purposes of the preparation of resolution plans, when you merely occasional or isolated.

D) Lack of the required cooperation or obstruction by the entity resolution measures you have decided to apply the FROB, when you merely occasional or isolated.

E) Any action that impedes or hinders the economic valuation of the entity entrusted to independent, except experts, not having merely occasional or isolated, constitute a very serious infringement.

F) not forward the supervisor or the competent authorities resolution data or documents to be forwarded be interested or that it may require in the exercise of their functions, or incomplete or inaccurate, unless remission entailing the commission of a very serious infringement. For the purpose of this paragraph is also understood as lack of remission, remission after the deadline in the relevant standard or the period granted by the competent body to carry out, if necessary, the appropriate requirement.


G) Failure to comply with the duty to provide true information to the supervisor and the competent authorities of resolution and breach of the duty of confidentiality on data obtained in the context of a process of early action or decision, or its use for purposes different from those provided by law; unless a very serious infringement.

H) Lack of communication or delayed communication by an entity or consolidated group or subgroup of credit institutions that are in any of the circumstances of early action, when it was known or, given the objective circumstances, should be known by the board; unless it is due to consider very serious infringement.

I) Lack of communication or communication delayed by the board to the supervisor or the competent authorities ruling that the entity is in a situation of infeasibility, when it was known or, given the objective circumstances, it should be known by the board; unless it is due to consider very serious infringement.

J) not to propose to the competent authority appropriate preventive resolution to reduce or eliminate obstacles to the solvability and the non-application of alternative measures imposed by the competent authority of preventive resolution to reduce or eliminate barriers measures, when have merely occasional or isolated.

K) Do not keep the recovery plan updated annually or after a change have occurred in the legal or organizational structure of the entity that requires updates in it, unless it constitutes a very serious violation.

L) Failure to comply with the obligations, requirements and limitations set forth in this Act in relation to the intra-group financial aid, unless a very serious infringement.

M) To perform acts or operations without authorization when it is mandatory, without observing the basic conditions thereof, or having obtained the authorization through false statements or other irregular means, when I have merely occasional or isolated.

N) The purely occasional or isolated from other enforceable obligations in accordance with the provisions of this Act and its implementing regulations prior request mediating the supervisor or the competent authorities of noncompliance resolution.

O) Incur minor infringements when during the two years prior to his commission had been imposed on the entity at least a firm administrative sanction for the same type of infringement.

O) In connection with the asset management company, without prejudice to the application of other letters:

1st Conducting beyond its corporate purpose jeopardize the achievement of the overall objectives legally established for it in this Act and its implementing regulations, provided they are not considered very serious activities.

2nd purely occasional or isolated from its transparency obligations breach, upon prior request of the supervisory authority.

3.º The lack of reference to FROB data or documents to be remitted or required in the exercise of their functions as well as the lack of truth in them, unless it involves the commission of an offense very serious. For the purposes of this number it means that there is a lack of reference when it does not occur within the time allowed for that purpose by the competent authority in writing recalling the obligation or reiterating the request.

4th Failure to comply with the existing rules on accounting operations and formulating balance sheets, profit and loss accounts and financial statements of mandatory notification to the competent administrative body.

5th Failure to corporate and government obligations relating to the organizational structure of the asset management company imposed by this Act or its implementing regulations.

Article 81. Minor offenses.

Minor infringements shall constitute breaches of those obligations specifically in this Act that do not constitute very serious or serious offenses under the provisions of the two preceding articles.



SECTION 3. Penalties



Article 82. Sanctions.

1. The sanctions imposed by the FROB in the exercise of the duties concerned, in accordance with this Act and those imposed by the Bank of Spain and the Comisión Nacional del Mercado de Valores in the exercise of their functions as authority preventive resolution, shall be as provided in this Section.


2. The sanctions imposed by the Bank of Spain and the Comisión Nacional del Mercado de Valores in exercising the functions referred to in Chapter II shall be as provided in Title IV of Law 10/2014, of June 26, regarding the credit institutions; and Chapter II of Title VIII of Law 24/1988 of 28 July, in relation to investment services companies.

3. Penalties imposed, and any action brought against them and the results of these resources, should be reported to the European Banking Authority, in the case of credit institutions, and the European Securities Authority and Markets, in the case of investment services companies.

Article 83. Penalties for the commission of very serious infringements.

1. For committing very serious offenses will be imposed on the offending entity, one or more of the following sanctions:

A) A fine, which may be deemed by the competent body to resolve:

1st up to twice the benefits derived from the infringement where such benefits can be quantified, or

2nd of up to 10 percent of total annual net turnover including gross income from interest receivable and similar income, income from shares and other securities of fixed or variable income and brokerage commissions or fees to charge you made the entity in the previous year.

When the entity is a subsidiary of a parent company, the relevant turnover shall be the result of the consolidated parent company accounts in the previous year.

B) Withdrawal of authorization of the entity the report of the competent supervisor.

In the case of branches authorized in another Member State of the European Union institutions, the sanction of revocation of the authorization shall be deemed superseded by a ban on commencing new operations within Spanish territory.

C) Suspension or limitation on the type or volume of transactions or activities that can make the offender in the securities market for a period not exceeding five years.

2. In addition to the penalties provided in the preceding paragraph, may impose the following additional measures:

A) Request the infringer to cease their behavior and refrain from repeating it.

B) Public reprimand with publication in the "Official Gazette" of the identity of the offender, the nature of the offense and the penalties imposed.

Article 84. Penalties for serious infringements.

1. For the commission of serious violations of the offending one or more of the following sanctions be imposed entity:

A) A fine, which may be deemed by the competent body to resolve:

1st up to 1.5 times the profits derived from the infringement where such benefits can be quantified, or

2nd of up to 5 percent of total annual net turnover including gross income from interest receivable and similar income, income from shares and other securities of fixed or variable income and brokerage commissions or fees to charge you made the entity in the previous year.

When the entity is a subsidiary of a parent company, the relevant turnover shall be the result of the consolidated parent company accounts in the previous year.

B) Suspension or limitation on the type or volume of transactions or activities that can make the offender in the securities markets, credit or capital, for a period not exceeding one year.

2. In addition to the penalties provided in the preceding paragraph, may impose the following additional measures:

A) Request the infringer to cease their behavior and refrain from repeating it.

B) Public reprimand with publication in the "Official Gazette" of the identity of the offender and the nature of the infringement and accessory sanctions or measures imposed; or private reprimand.

Article 85. Penalties for committing minor offenses.

1. For committing minor offenses will be imposed on the company a fine which may be deemed by the competent body to resolve:

A) up to 1.2 times the amount of profits derived from the infringement where such benefits can be quantified, or

B) up to 1 percent of total annual net turnover including gross income from interest receivable and similar income, income from shares and other fixed income securities or variable and commissions or brokerages to charge you made the entity in the previous year.


When the entity is a subsidiary of a parent company, the relevant turnover shall be the result of the consolidated parent company accounts in the previous year.

2. In addition to the penalties provided in the preceding paragraph, may impose the following additional measures:

A) Request the infringer to cease their behavior and refrain from repeating it.

B) Private warning.

Article 86. Penalties those holding administrative or management by the commission of very serious infringements.

1. Regardless of the sanction, if appropriate, be imposed on the offending entity for committing very serious offenses may be imposed one or more of the following sanctions on those who, exercising administrative or management of fact or law in the same, are responsible for the infringement:

A) A fine for each of them amounting to 5,000,000 euros.

B) Suspension in the exercise of administrative or management position in the company for a period not exceeding three years.

C) Removal from office in the state, with disqualification from holding administrative or management positions in the same entity for a maximum period of five years.

D) Disqualification from holding administrative or management in any credit institution or the financial sector, with separation, if any, of the administrative or management position occupied by the offender in an institution, for a period not exceeding ten years.

2. In addition to the penalties provided in the preceding paragraph, may impose the following additional measures:

A) Request the infringer to cease their behavior and refrain from repeating it.

B) Public reprimand with publication in the "Official Gazette" of the identity of the offender, the nature of the offense and the penalties imposed or ancillary measures.

Article 87. Penalties those holding administrative or management for the commission of grave breaches.

1. Regardless of the sanction, if appropriate, be imposed on the offending entity for committing serious offenses may be placed on one or more of the following sanctions on those who, exercising administrative or management of fact or law in same, are responsible for the infringement:

A) A fine for each of them amounting to 2,500,000 euros.

B) Suspension holding office for a period not exceeding one year.

C) Removal from office, with disqualification from holding administrative or management positions in the same entity for a maximum period of two years.

D) Disqualification from holding administrative or management in any credit institution or the financial sector, with separation, if any, of the administrative or management position occupied by the offender in an institution, for a period not exceeding five years.

2. In addition to the penalties provided in the preceding paragraph, may impose the following additional measures:

A) Request the infringer to cease their behavior and refrain from repeating it.

B) Public reprimand with publication in the "Official Gazette" of the identity of the offender, the nature of the offense and the penalties imposed or ancillary measures.

Article 88. Penalties those holding administrative or management for committing minor offenses.

1. Regardless of the sanction, if appropriate, be imposed on the offending entity for committing minor offenses may be imposed a fine amounting to 500,000 euros who, exercising administrative or management of fact or law in the same, are responsible for the infringement.

2. In addition to the penalties provided in the preceding paragraph, may impose the following additional measures:

A) Request the infringer to cease their behavior and refrain from repeating it.

B) Private warning.

Article 89. Criteria for determining penalties.

1. When the FROB is the competent sanctioning body, or when the Bank of Spain and the Comisión Nacional del Mercado de Valores acting in the exercise of their functions as authority preventive resolution, the sanctions applicable in each case for the commission of very serious infringements, serious or minor will be determined based on the following criteria:

A) The nature and organization of the infringement.

B) The degree of responsibility in the events.

C) The severity and duration of the infringement.


D) The importance of the profits gained or losses avoided, if any, as a result of acts or omissions constituting the offense.

E) The financial soundness of the legal person responsible for the infringement reflected, among other objetivables elements in the total turnover of the legal person responsible.

F) The financial strength of the individual responsible for the infringement reflected, among other objetivables elements, in the annual income of the individual responsible.

G) The adverse consequences of the facts for the financial system or the economy.

H) Eliminating the infringement on their own initiative of the offender.

I) repair the damages caused.

J) Losses caused to third parties for infringement.

K) The level of cooperation with the competent authority.

L) The systemic consequences of the offense.

M) The level of representation in the offender holds the offending entity.

N) In the event of insufficient own resources, the objective difficulties that may have crowded to achieve or maintain the legally required level.

O) The past conduct of the offender in relation to the processes of early action and resolution have affected him, considering the strong sanctions that had been imposed over the last five years.

2. The sanctions imposed by the Bank of Spain and the Comisión Nacional del Mercado de Valores in exercising the functions referred to in Chapter II, shall be determined in accordance with the criteria laid down in Title IV of Law 10/2014 of 26 June, in relation to credit institutions; and Chapter II of Title VIII of Law 24/1988 of 28 July, in relation to investment services companies.

Article 90. Responsibility of the administrative or management positions.

1. Who exercise in the state administration or management is responsible for the infractions when these are attributable to the willful or negligent conduct.

2. They will not be held responsible for infringements its directors or members of their governing bodies, in the following cases:

A) When those who are part of administrative bodies they had voted against or expressly saved his vote on decisions or agreements had led to infringements.

B) When such violations are exclusively attributable to executive committees, board members with executive functions, general managers or similar bodies, or other persons with executive functions in the institution.

Article 91. Temporary Appointment of members of the governing body.

In the event that, by the number and position of the persons affected by the sanctions of suspension or removal, is strictly necessary to ensure continuity in the administration and management of the institution, the supervisor or supervisors and authorities competent resolution may provide for the appointment, provisionally members as appropriate for the board to adopt agreements or one or more administrators, specifying its functions. Such persons shall serve until, by the competent body of the entity, which will convene immediately, the corresponding appointments Inherit provide designated, if necessary, until expiry of the period of suspension.



Section 4th General rules of procedure



Article 92. Procedure for the imposition of sanctions.

1. The investigation and decision by the Bank of Spain and the FROB of disciplinary procedures within their respective competence, will be carried out in accordance with the procedural rules, advertising and notification under Chapter IV of Title IV of Law 10 / 2014, June 26, without prejudice to the particularities of this Act.

2. The investigation and resolution by the Comisión Nacional del Mercado de Valores of disciplinary proceedings within its jurisdiction, shall be conducted in accordance with the procedural rules, advertising and notification provided for in Title VIII of Law 24/1988, July 28, without prejudice to the particularities of this Act.

3. Additionally, the procedure and principles established by Law 30/1992 of November 26 will apply.

4. In any case, the penalties imposed for very serious and serious offenses, will be published in the "Official Gazette", once they have become final in administrative proceedings.


Article 93. Enforceability of sanctions and appeal through administrative channels.

The FROB resolutions end the administrative and restocked potestativamente be appealed under the provisions of Articles 116 and 117 of Law 30/1992.

First additional provision. Structure and functioning of the authorities of preventive resolution.

1. The Bank of Spain and the Comisión Nacional del Mercado de Valores take the necessary measures to ensure that its organizational structure operational independence and conflicts of interest between the functions of supervision and preventive resolution assigned to them this Act are avoided. || |
In the exercise of the functions of preventive resolution, the Bank of Spain and the Comisión Nacional del Mercado de Valores pursue only the fulfillment of the objectives set out in Article 3. The performance of these functions will be functionally and hierarchically separated from exercise of supervisory functions. Both institutions will develop a regulation for management of potential conflicts of interest, so these are properly identified, managed, monitored and, if necessary, eliminated.

2. The provisions of Articles 57 to 59 shall apply to the Bank of Spain and the Comisión Nacional del Mercado de Valores as preventive resolution authorities. In particular, they provide the information that the FROB required for the exercise of the powers provided for in Article 21, and in general, of which holds as executive authority resolution.

Second additional provision. Deadline for National Fund allocation resolution.

The level of financial resources of the National Fund Resolution required in accordance with the provisions of this Act, will begin to be provided during the year 2015 and must be achieved no later than 31 December 2024.

Without prejudice to the provisions of the preceding paragraph, the obligation of institutions to contribute to the Fund of National Resolution only be born when the FROB required, specifying for each entity the corresponding amount, ordinary or extraordinary contributions, without arising general obligations prior to the time of contribution.

The FROB may make all acts necessary to require contributions to the Fund of National Resolution under the terms provided in this Act.

Third additional provision. legal regime applicable to the guarantees provided to the FROB and the Deposit Guarantee Fund of Credit Institutions.

The legal regime established by the sixth additional provision of Law 13/1994 of 1 June, of Autonomy of the Bank of Spain, shall apply also to the guarantees provided to the FROB and the Deposit Guarantee Fund of Credit institutions in the exercise of their functions.

Fourth additional provision. Single Resolution Mechanism and the Single Resolution Fund.

1. This Act shall be applied in a manner consistent with the provisions of Regulation (EU) No 806/2014 of the European Parliament and of the Council of 15 July 2014, as those provisions come into force, in accordance with the provisions Article 99 of the Regulation; in particular as regards the functions of the European authorities under the Single Resolution Mechanism, and the duty of cooperation of national authorities with the European authorities for the proper implementation in Spain of decisions that the European authorities adopted in the exercise of its powers.

2. In accordance with the provisions of Regulation (EU) No 806/2014 of 15 July 2014, the rest of the applicable law of the European Union and the Agreement on the transfer and mutualisation of contributions to the Fund One resolution signed on 21 May 2014, the corresponding National Resolution Fund part will be transferred to the Single Resolution Fund in the amount and manner prescribed by the above rules and agreement.

The provisions of the preceding paragraph will occur within the time limits that apply in accordance with the corresponding entries in force and, in particular, as provided for in Articles 96 and 99.6 of the Regulation 3.3, 11 and 12 of the Agreement.

Fifth additional provision. Recordkeeping of financial contracts by entities.


Supervisors and resolution competent authorities may require institutions to maintain a record that includes detailed information on financial contracts on securities and commodities, futures and futures and swap agreements in which they are parties, and copies of the documents of these. The competent supervisors may determine the minimum to be included in the register for their supervised entities information.

Sixth additional provision. Integration of the Funds Deposit Guarantee Savings Bank, Banking Institutions and Credit Unions.

The provisions of this Act shall not alter any of the effects of integration and subrogation of rights and obligations of existing Deposit Guarantee Funds Savings Bank, Banking Institutions and Credit Cooperatives operated since the entry into force of Royal Decree-Law 16/2011 of 14 October.

Seventh additional provision. References to Law 9/2012 of 14 November on restructuring and resolution of credit institutions.

References in the law are made to Law 9/2012 of 14 November, they shall be construed as made to the corresponding provision of this Act.

Eighth additional provision. Spanish resolution authority in the field of the Single Resolution Mechanism.

The FROB and preventive resolution authorities, in accordance with the powers conferred by this Act, shall Spanish resolution authorities for the purposes of the provisions of Regulation (EU) No 806/2014 of 15 July 2014.

The FROB will represent the Spanish authorities in the Single Resolution Board Resolution Single Resolution Mechanism. The Bank of Spain may participate in it with observer status.

Ninth additional provision. financial institutions and other companies.

This Act shall apply to entities and companies referred to in Article 1.2.b), c) and d) to the extent necessary to give full effect to the resolution objectives and principles set out in Articles 3 and 4, and give strict compliance with the provisions of Directive 2014/59 / EU of 15 May; and in particular, they shall apply the provisions of Articles 3, 4, 5, 6.6, 7, 14, 16, 18, 21, 24, 25, 38-40, 42, 45, 46, 49, 58, 63-65, 67, 70 and 71, the fifth additional provision, the fourteenth additional provision, paragraph 2 and 3 and the fifteenth additional provision, without prejudice to the other provisions of law whose literalness understand or require its application to these entities and societies.

Tenth additional provision. General feasibility plans.

The obligation to develop a comprehensive feasibility plan referred to Article 30 of Law 10/2014, of June 26 and Article 70b 2-g) of Law 24/1988, 28 July, shall be satisfied with the development of recovery plans provided for in Article 6 of this Act.

Eleventh additional provision. Constitution of the Governing Committee of the FROB.

The Governing Committee of the FROB shall be incorporated in the terms provided in Chapter VII within a maximum period of two months from the entry into force of this Act.

While not the Governing Committee in accordance with the provisions of Chapter VII is established, the Governing Committee will be existing at the entry into force of this Act who shall exercise all the functions under this Act.

Twelfth additional provision. Capital authorized for conversion of capital instruments in case of a triggering event occurs.

If the maximum amount of authorized capital under Article 297.1.b) of Consolidated Capital Companies Act, approved by Royal Legislative Decree 1/2010 of July 2, is insufficient to conversion provided for in Article 52, paragraph 1, letter n) of Regulation (EU) No 575/2013 of 26 June 2013, and a triggering circumstance, that limit may be exceeded occurred on the report of auditor. Also it may exceed the maximum period set in that article and will not apply the requirement that contributions should be monetary. At the time of convening the general meeting shall be made available to shareholders at the registered office said report of the auditor in which the need for such exceptions are credited.


This same exceptional arrangements and requirements be applicable to instruments Tier 2 capital including conversion clauses in case of a triggering event occurs.

Thirteenth additional provision. Bank staff Spain in the FROB.

The FROB may incorporate personnel serving in the Bank of Spain, without prejudice to the autonomy in personnel policy of the Bank of Spain and in accordance with the principles of equality, merit, ability and publicity in the terms referred to Article 52.7 should govern the selection of staff FROB. In any case, the incorporation of staff may assume consistent with the necessary operational independence or give rise to conflicts of interest between the functions of supervision and resolution.

When the staff of the Bank of Spain, prior authorization of the institution, be incorporated into the FROB will remain in active status to reserve a place, computándoseles long as you stay in the same old purposes.

Staff who joins the FROB from other authorities or public bodies entitled to receive by this old concept and an equivalent amount to the same concept that came perceiving until joining the same.

Fourteenth additional provision. Regime applicable in the event of insolvency of an entity.

In the event of insolvency of an entity:

1. They are considered credits with general privilege, later in the order of priority to credits with general privilege under Article 91.5.º of Law 22/2003 of July 9:

A) deposits guaranteed by the Deposit Guarantee Fund and the rights that the Fund is subrogated if I had made the guarantee, and

B) the share of deposits of physical and micro, small and medium enterprises persons guaranteed level exceeding the provisions of Royal Decree-Law 16/2011 of 14 October, deposits of individuals physical and micro, small and medium enterprises deposits would be guaranteed if they were not made through branches located outside the European Union institutions established in the European Union.

2. Subordinated claims included in Article 92.2.º of Law 22/2003 of July 9, will, in the event of insolvency of entities included in the scope of this Act, the following priority:

A) The principal amount of the subordinated debt that is not Additional Tier 1 or 2

B) The principal amount of the equity instruments Level 2

C) The principal amount of the instruments of Additional Tier 1

Fifteenth additional provision. Effects of the processes of early action and resolution on the continuity of the activities of an entity.

1. Since the opening of the processes of early action and resolution, judges may not accept applications contest an entity, being null and void the proceedings that violate the provisions of this provision.

2. Entities within the scope of this Act may not submit request for voluntary insolvency without the notification referred to in Articles 9.1 and 21.4 and without the competent supervisor and the FROB decide whether to open a process of action or early resolution of the entity. Within two months provided for in Article 5 of Law 22/2003 of July 9, Insolvency, will be suspended until this decision.

If you go to open any of these processes or if the application for insolvency is not accompanied by the notification referred to in the preceding paragraph, the competent court will not admit to that application process.

3. If he had requested the necessary competition of an entity, the competent court, suspending the processing of the application, it shall notify the competent supervisor and the FROB so that within seven days you communicate if, in the exercise of the powers provided in this Law, they will open a process of early action or decision of the entity. If you go to open any of these processes, the competent court will not admit to that application process.

4. The resolution tools applied by the FROB will be considered reorganization measures within the meaning of provisions of Law 6/2005 of 22 April on the reorganization and winding up of credit institutions.

Sixteenth additional provision. Fee for activities conducted by the FROB as resolution authority.


1. The fee for the activities performed by the FROB as resolution authority shall be governed by the provisions of this Act and, failing that, by Law 8/1989 of 13 April on Public Fees and Prices, and by Law 58 / 2003 of 17 December, General Tax.

2. Taxable. The taxable event of the fee for the activities performed by the FROB as resolution authority exercising the functions of monitoring, reporting and application of resolution tools during the pretrial phase and executive of the resolution.

3. Chargeability. The fee is due on January 1 of each year, except for cases of creation of entities, where the rate will accrue on the date of its constitution.

4. liabilities subject. They will be taxable rate entities under Article 1.2.a) of this Act.

5. Taxable income. The taxable amount is the amount that each entity must provide in respect of annual regular contribution to the Fund of National Resolution or, where appropriate, the Single Resolution Fund.

6. tax liability. The tax rate is the result of applying a tax rate of 2.5 percent on the taxable base.

7. Management, assessment and collection. Competition for management, assessment and collection of the fee shall relate to FROB, in the terms in which it develops regulations.

8. Revenues from the fee for the activities performed by the FROB as resolution authority have the nature of budget revenues FROB.

Seventeenth additional provision. Legal framework of the Official Credit Institute.

In accordance with Article 2.2 of Directive 2014/59 / EU, the Official Credit Institute is excluded from the scope of this Act under Article 1.

First transitional provision. Arrangements for certain restructuring procedures, recovery and resolution.

1. Restructuring procedures and resolution initiated prior to the entry into force of the Law, and all ancillary measures that have accompanied them, including financial support instruments and management of hybrid instruments, continue to be regulated until its conclusion, the rules before the entry into force of this Act application.

2. Recovery procedures and resolution are initiated before 1 January 2016, continue being regulated in relation to the financial support instruments and management of hybrid instruments, by the implementing legislation before the entry into force of this Act, without them not apply the rules on internal recapitalization under Chapter VI.

Second transitional provision. Rules on internal recapitalization.

The rules on internal recapitalization contained in Chapter VII of Law 9/2012, of November 14, remain in force until 31 December 2015.

Third transitory provision. administrative and judicial proceedings initiated prior to the entry into force.

The administrative and judicial proceedings initiated prior to the entry into force of this Act shall be dealt and resolved in accordance with applicable regulations before that entry into force.

Fourth transitional provision. annual contributions to deposit guarantee compartment.

1. The Bank of Spain should develop before May 31, 2016 the methods needed for the annual contributions of entities compartment Deposit Guarantee Fund Deposit Guarantee are commensurate with their risk profiles.

2. Meanwhile the Bank of Spain does not develop such methods, the annual contributions shall be calculated in accordance with, prior to the onslaught amendment by this Act, Royal Decree-Law 16/2011 of 14 October, laying creates the Deposit Guarantee Fund of Credit Institutions.

Fifth transitional provision. Accrual rate for the activities undertaken by the FROB as resolution authority during 2015.

During 2015, the accrual rate for the performance of activities and the provision of services by the FROB as resolution authority, shall be the day of the entry into force of this Act.

Sixth transitional provision. Adaptation to new Directive 2013/50 / EU of the European Parliament and of the Council of 22 October 2013.


1. The deadlines that relate the amendments to Articles 35.1 and 35.2, in paragraphs One and Two of the letter B) of the first final provision shall apply to annual financial reports and semi-annual financial reports that must be published within six months after the entry into force of this Act.

2. The amendments made by paragraph Six of the letter B) of the first final provision, Article 53.3 shall not apply until the date determined by the implementing rules of this Act.

Seventh transitional provision. Implementation of the first final provision and Regulation (EU) No 909/2014 of the European Parliament and of the Council of 23 July 2014 on improving securities settlement in the European Union and central securities depositories and Directives 98/26 / EC and 2014/65 / EU and Regulation (EU) No 236/2012 are amended.

1. The changes made by paragraphs four to eight, ten, twelve, thirteen, fifteen, twenty, twenty-two and twenty-nine of the letter A) of the first final provision shall not apply to regulated markets, multilateral trading systems and central securities depositories values ​​that the entry into force of this Act are constituted and operating in Spain until the date determined by the implementing rules of this Act.

2. The obligations of Regulation (EU) No 909/2014 of the European Parliament and of the Council of 23 July 2014 on improving securities settlement in the European Union and central securities depositories and Directives 98/26 / EC and 2014/65 / EU and Regulation (EU) No 236/2012 shall become due in accordance with the provisions of articles 69 and 76 of these Regulations are modified.

3. The securities represented by physical certificates admitted to trading on regulated markets or multilateral trading systems should change its form of representation to entries in accordance with Article 76.2 of Regulation (EU) No 909/2014 of 23 July 2014.

Derogatory provision.

Few rules are repealed equal or lower rank opposing the provisions of this Act and, in particular, Law 9/2012 of 14 November on restructuring and resolution of credit institutions, except its amending provisions other rules and additional provisions second, third, fourth, sixth to thirteenth, fifteenth, seventeenth, eighteenth and twenty-first.

First final provision. Amendment of Law 24/1988 of 28 July on Securities Market.

Law 24/1988 of 28 July, on the Securities Market, is amended as follows:

A) In terms of clearing, settlement and registration of securities:

One. Article 5, which shall read is amended as follows:

"Article 5. Representation of values.

1. Marketable securities may be represented by book entries or by certificates. The form of representation chosen to be applied to all integrated into a single emission values.

2. Admitted to trading on regulated markets or multilateral trading securities they will be necessarily represented by book entries.

As an exception to the provisions of the preceding paragraph, the regulations specialties necessary be established for foreign securities represented by securities can be traded on secondary markets or multilateral systems Spanish negotiation and be registered in the central securities depositories established in Spain.

3. Both the representation of securities by book entries, such as representation by certificates be reversible. The reversal of representation by book-entry securities require prior authorization from the Comisión Nacional del Mercado de Valores, in the terms laid down by regulation. The transition to book-entry system may be made as will holders consenting to transformation. "

Two. Article 6, which shall read as follows amendments:

"Article 6. Document the issue.

1. The representation of securities by book entries require the development by the issuer of a document containing the information necessary for the identification of integrated emission values.

In the case of equity securities, this document will be raised to public deed and may be the indenture.


In the case of non-equity securities, the notarially attested document issuance will be optional. This document may be replaced by:

A) The prospectus approved and registered by the Comisión Nacional del Mercado de Valores, in accordance with the provisions of this Act.

B) The publication of the characteristics of the issue in the corresponding official gazette, in the case of emissions from the State or the Autonomous Communities debt as well as in those other cases in which it is established.

C) The certificate issued by persons qualified in accordance with current regulations, in the case of issues that are to be admitted to trading on a multilateral trading system established in Spain, in accordance with Article 30b 4.

2. The issuer must provide a copy of the issue and its modifications to the entity responsible for accounting and before the Comisión Nacional del Mercado de Valores. In the case of securities admitted to trading on an official secondary market or a multilateral trading system values, you must also deposit a copy to its governing body.

3. The station and the entity responsible for accounting shall be at all times available to the holders and the interested public a copy of that document.

4. Not be precise machining of document issuance for financial instruments traded on official secondary markets for futures and options or other cases, and under the conditions specified in the regulations, where appropriate. "

Three. Article 7, which shall read as follows amendments:

"Article 7. Entities accounting records.

1. Keeping the accounting records of the securities represented by book entries corresponding to a broadcast it shall be assigned to a single entity that will ensure the integrity of it.

2. In the case of securities not admitted to trading on regulated markets or multilateral trading facilities, such entity will be freely designated by the station between firms of investment services and credit institutions authorized to perform the activity under Article 63.2. to). The designation must be entered in the register of the National Securities Market Commission under Article 92, prior to the beginning of the accounting record keeping requirement. The central securities depositories may also assume that function according to the requirements, if any, are established in the applicable rules and regulations.

3. In the case of securities listed on official secondary markets or multilateral trading securities, the entity in charge of keeping the accounting records of the securities will be the central repository of designated values ​​that exercise such function together with its participating entities.

4. The entities referred to in this Article shall be liable to the injured party, by the lack of practice of the corresponding entries for inaccuracies and delays in them and, in general, by the willful default or negligence of its legal obligations . Compensation for damage, to the extent possible, shall be paid in kind. "

Four. A new Article 7a is added as follows:

'Article 7a. Registration system and holding securities.

1. All central securities depository providing services in Spain adopt a registration system consisting of a central register and detail records by participating in such a system entities.

2. The central register shall be borne by the central securities depository and recognize each participating entity that requests the following account types:

A) One or more own accounts where the balances of securities whose ownership corresponds to the participating entity shall be recorded.

B) One or more general accounts of third parties that are recorded, overall, the balances of securities from customers of the participating entity, or customers of a third entity that has instructed the applicant entity custody and detail record values ​​of these customers.

C) One or several individual accounts that are recorded, in secreted form, balances corresponding values ​​to customers of participating entities applying for the keeping of such accounts in the central register.


3. Each participating entity with third general accounts shall record detail, which will reflect what customers are the balances of securities listed on such accounts in the central register.

4. The Government will develop in relation to the various entities to which the keeping of accounting records and the various types of securities, admitted or not on official secondary markets or MTFs, is entrusted the rules of organization and operation of the registers, the legal status of the various accounts of eligible securities, guarantees and other requirements they become due, identification systems and control of the securities represented by book entries, and the relations of those entities with issuers and their involvement in the administration of securities. Regulations may determine the conditions and circumstances under which the central securities depositories may be authorized to make direct keeping of customer securities accounts in the central register. "

Five. Article 12a, which shall read as follows amendments:

"Article 12a. Moving values ​​and rule of proportion.

1. Declared the contest a body responsible for keeping the register of securities represented by book entries or an entity participating in the registration system, holders listed in these registers values ​​shall have the right to separation from the securities registered his favor and they may exercise requesting a transfer to another entity, all without prejudice to the provisions of articles 44 and 70 bis.8 ter.2.f).

2. For the purposes of the provisions of this Article, the bankruptcy judge and organs of the receivers ensure the rights arising from ongoing operations of liquidation at the time the contest any of the entities declare those refers the previous paragraph, in response to it the rules of the corresponding system of clearing, settlement and registration.

3. The central securities depositories and other entities responsible for keeping the register of securities represented by book entries ensure the integrity of securities issues. Registration systems managed by central securities depositories should provide sufficient safeguards so that no descuadres between the central registry and detail records. To this end, in addition to the provisions of this Act, regulation mechanisms of supervision by the central securities depositories and control systems of its participating entities will be established, situations where any impacts will have to be notified to supervisory authorities, as well as mechanisms and deadlines for resolving them.

4. In any case, without prejudice to the provisions of the preceding paragraph, when the balances of securities with the same identification code ISIN (International Securities Identification Number) recorded on the set of general accounts third of an entity participating in the central register no are sufficient to fully satisfy the rights of holders of securities with the same identification code ISIN registered in the detail record held by that participating entity, the balance recorded in said set of general accounts of third parties pro rata will be distributed according to the rights holders on the register of detail. The affected holders shall hold a right of claim against the entity participating for the undelivered securities.

5. Where there is limited real rights or other encumbrance on securities, without prejudice to the agreements between the guarantor and the beneficiary of the guarantee, once applied the rule of proportion, these charges shall be construed as constituted on the outcome of proportion and claims against the participating entity, if any, exist for the unmet part values. "

Six. Letter g) of paragraph 2 and paragraph 7 of Article 31a, which are worded as follows is changed and a new paragraph 8 is added to read as follows:


"G) Develop a draft regulation market contain at least the rules applicable to negotiable financial instruments, issuers, members, system of securities, transaction types, trading rules on clearing, settlement and registration of transactions , dividends and other corporate events, supervision and market discipline and organizational measures concerning, among other matters, conflicts of interest and risk management. In addition, provision should be consultation with issuers of financial instruments admitted to trading on the market and the market members when a substantial change in its regulations proposed.

7. Statutorily determined securities whose operations in the multilateral trading segments of official secondary markets, subject to mechanisms that allow their orderly liquidation and success necessary intervention by a central counterparty.

8. In order to address the settlement of transactions on securities executed on official secondary markets, their management companies will sign agreements with at least one central securities depository and, where appropriate, with one or more central counterparties, without prejudice to the right issuers to provide that its securities are registered in any central securities depository in accordance with Article 49 of Regulation (EU) No 909/2014 and the right of members of the official secondary markets to designate settlement system as established in Article 44d of this Act. "

Seven. A new Article 36a is added, with the following wording:

"Article 36a. Settlement of transactions.

1. Buyers and sellers of securities admitted to trading on regulated markets are bound under the rules of that market to the delivery of cash and marketable securities since their orders are executed, even if their actual settlement is made after .

2. The buyer of securities admitted to trading on an official secondary market acquire ownership when those remaining recorded his name in the securities accounts under the rules of the registration system.

3. Official secondary markets determine in their regulations the theoretical date of settlement of transactions executed may establish different dates depending on the securities to liquidate the trading segments and other criteria, in accordance with applicable European standards and values ​​in coordination , where appropriate, with central counterparties and central securities depositories involved in the settlement processes. "

Eight. a new Article 36b, with the following wording:

"Article 36b. Settlement of rights or obligations associated economic content to values.

1. The issuer shall well in advance of the Governing Body of the official secondary markets where, upon request, be admitted to trading their values ​​as well as the central securities depository registrar thereof, the rights or obligations of economic values ​​generated content as soon as it has taken the corresponding agreement.

2. Given the applicable procurement rules, clearing, settlement and registration of transactions admitted to trading on those markets values, these communications must specify the relevant dates for the establishment, exercise, fulfillment and payment of the corresponding rights and obligations .

3. Notwithstanding the foregoing, benefits, rights or obligations inherent in the ownership of shares and securities equivalent to shares shall be borne and enjoyment of the acquirer from the date of purchase on the corresponding official secondary market, while it will be from the settlement date of the relevant purchase transaction in the case of fixed income securities and other securities equivalent to shares not. In case of delays or other incidents in the settlement process, appropriate adjustments on the liquidation of such rights or obligations may be made. "

Nine. a new article is added 36c with the following wording:

'Article 36c. Guarantees to mitigate settlement risk.


1. The members of the official secondary markets, members of central counterparties and entities participating central securities depositories ex lege enjoy a right of financial collateral than those included in the Royal Decree-Law 5/2005, March 11, on urgent reforms to boost productivity and to improve public procurement, exclusively on securities or cash resulting from the settlement of transactions on behalf of clients individuals or legal entities when those entities have had to anticipate cash or securities required to meet the settlement of such transactions by default or insolvency of its customers.

2. This warranty rights lies exclusively with the securities and cash from operations not satisfied by customers and ensure only the amount that the beneficiary institutions of this right would have had to advance to meet the settlement of such transactions, including, if applicable the price of securities that should have been delivered and possible sanctions and penalties that should have been paid by breach of its customers.

3. The creation and enforcement of that right of pledge guarantee does not require any formality, without prejudice to the duty of the beneficiary entities to retain its customers the data demonstrating the concurrence of the requirements referred to in this section and in previous ones.

4. The members of the official secondary markets, in case of insolvency of one of its customers, may introduce in these markets and on behalf of the bankrupt, orders to buy or sell securities of opposite sign to the transactions entered on his behalf, when insolvency occurs such operations being in course of settlement. Members of central counterparties and entities participating central securities depositories shall have the same right in front of their customers, who exercised asking members of the official secondary markets entering orders contrary to those referred to in this section.

5. The provisions of the preceding paragraphs are without prejudice to disciplinary measures on liquidation to those referred to in Articles 6 and 7 of Regulation (EU) No 909/2014 of 23 July 2014, without prejudice guarantees referred to in this Act in favor of the official secondary markets, central securities depositories and central counterparties, which shall have priority over the rights mentioned in the preceding paragraphs a. "

Ten. Article 44a, which shall read as follows amendments:

"Article 44a. The central securities depositories.

1. Authorisation as a central securities depository, its revocation and its operation when the entity is established in Spain, shall be governed by the provisions of Regulation (EU) No 909/2014 of 23 July 2014, by the provisions of this Act and any other Spanish or European regulations that may be applicable.

The Comisión Nacional del Mercado de Valores is the competent authority responsible for the authorization, supervision and punishment of the central securities depositories in accordance with Regulation (EU) No 909/2014 of 23 July 2014.

The central securities depositories provide the Comisión Nacional del Mercado de Valores and the various public agencies supervisors in the field of their respective competencies, information on the activities of clearing, settlement and registration systems managed by them than those They request them, provided that such information is available and in accordance with applicable regulations.

2. The central securities depositories to be established in Spain take the form of joint stock company. Its bylaws and amendments thereto, except that in his case established by regulation, require the prior approval of the Comisión Nacional del Mercado de Valores. The appointment of the members of the board of directors, general managers and similar central securities depositories shall be subject to the prior approval of the Comisión Nacional del Mercado de Valores.


The direct or indirect participation in the capital of central securities depositories shall be subject to the regime of significant shareholdings under Article 69 for investment services companies, in the terms established by regulation understanding that will in any case, such a character any holding reaching, directly or indirectly, at least one percent of the capital or voting rights of the central securities depository or which, without reaching that percentage, let exercise significant influence in it, in the terms specified in the regulations.

Without prejudice to Article 69.6, the Comisión Nacional del Mercado de Valores may oppose the acquisition or transfer of a significant stake in the capital of the central securities depository if it considers that is necessary to ensure the proper functioning markets or systems clearing, settlement and registration of securities or to avoid distortions in them, and not to be equivalent to the Spanish authorities in the country of origin of the acquirer treatment.

The CSDs will have bodies and committees provided for in Regulation (EU) No 909/2014 of 23 July 2014.

3. The CSDs are also governed by rules whose approval and amendments thereto, with the exceptions, if any, established by regulation, shall be the Comisión Nacional del Mercado de Valores, after a report from Bank Spain. These rules regulate the operating range of CSDs, services provided by them, their economic system, setting procedures and communication tariffs, conditions and principles under which render such services, records relating to the services provided and the legal framework for its participating entities. Also, the regulation will regulate the procedures for managing the delivery of securities and payment, determining the time of finality of settlement instructions, policy risk management and guarantees of any kind that may have to be participating entities depending on the activities they carry.

The rules of procedure it may be developed through circulars issued by the central securities depository itself. These circulars must be communicated to the Comisión Nacional del Mercado de Valores and the Bank of Spain, in the terms legally envisaged. The Comisión Nacional del Mercado de Valores may oppose them and suspend them or leave them without effect if it considers that violate applicable law, or impair the prudent and safe operation of the central depository of securities and securities markets and the protection of investors.

4. The internal rules and statutes have nature of rules of order and discipline of the market, and specify the duties and organizational and procedural requirements necessary to comply with the provisions of Regulation (EU) No 909/2014 of 23 July 2014. the Minister of Economy and Competitiveness or through its express authorization, the Comisión Nacional del Mercado de Valores may develop the structure and minimum content that should have the rules of procedure.

In addition, central securities depositories will develop a memory that will detail how they will fulfill the technical, organizational, operational requirements and risk management required by Regulation (EU) No 909 / 2014 of July 23, 2014, to perform their duties. The Minister of Economy and Competitiveness or through its express authorization, the Comisión Nacional del Mercado de Valores, may regulate the model that should fit that memory. The central securities depository keep updated the said memory, whose modifications will be forwarded to the Comisión Nacional del Mercado de Valores, duly motivated.

5. Regulations shall define the specific functions of monitoring and control exercise the central securities depositories of its participating entities, the requirements applicable to its participating entities solvency, the types of entities that can access the status of participating entity, the requirements will be determined accounting organization, technical, specific obligations of information to the Comisión Nacional del Mercado de Valores and few other aspects deemed necessary for its proper functioning, having regard, inter alia, proportionality criteria based on their level of activity.


In addition, central securities depositories forwarded to the Comisión Nacional del Mercado de Valores, in the terms legally envisaged, its annual budget estimate, which detail the prices and fees that will apply will be expressed, and subsequent changes in this economic regime. The Comisión Nacional del Mercado de Valores may require the central securities depository enlargement of the documentation received and may provide for exceptions or limitations to the maximum prices of such services as may affect the financial soundness of the central securities depository, cause disruptive consequences for the development of the market or the principles that govern it, or introduce unjustified discrimination between different users of the services of the entity.

6. The central securities depositories may outsource basic services, establish agreements with CCPs, regulated markets and multilateral trading facilities or links with other central securities depositories in accordance with the provisions of Regulation (EU) No 909 / 2014 of July 23, 2014, in this Act, its implementing regulations and the rules to which it refers paragraph 3 above.

7. Declared the contest a participating entity managed by central securities depositories systems, the latter shall have absolute right of separation with respect to property or rights that the guarantees provided by such entities participating in the programs managed by the depositaries systems materialize CSDs. Notwithstanding the foregoing, the surplus remaining after the liquidation of secured transactions will join the active mass of the contest participant.

8. Declared the contest a participating entity in the systems referred to in this article, the Comisión Nacional del Mercado de Valores, without prejudice to the powers of the Bank of Spain and the Resolution Fund for Orderly Bank, may establish, immediately and without cost to the investor, the transfer of its securities accounting records to another entity authorized to carry out this activity. If no entity is able to take over the marked records, this activity will be assumed by the central depository corresponding values ​​provisionally until the owners request the transfer of the registration of its securities. For this purpose, both the bankruptcy judge and the bankruptcy administration will facilitate access of the entity to which values ​​are to pierce the documents and accounting and computer records necessary to implement the transfer. The existence of bankruptcy proceedings do not prevent you reach the customer securities purchased in accordance with the rules of the system of clearing, settlement and registration or cash from the exercise of economic rights or sale of securities. "|| |
Once. paragraphs 2 and 3 of Article 44b, which are modified to read as follows:

'2. The CCP should take the form of corporation and should be recognized as a system for the purposes of Law 41/1999 of 12 November, on payment systems and securities settlement.

To facilitate the exercise of their functions, CCPs may access the status of participant of the CSDs that support it as such, of any securities settlement system and financial instruments or market or regulated multilateral trading system, they meet the conditions required for each system and provided that the participation of central counterparty in it does not compromise the safety and solvency of the entity.

3. The CCP shall not be authorized as central securities depository. "

Twelve. Article 44f is added with the following wording:

"Article 44f. Information system for monitoring the trading, clearing, settlement and registration of securities.

1. The CSDs providing services in Spain must establish a system of information transmission and storage of data that serves as a tool for exchange and processing of information for carrying out the activities of clearing, settlement and registration of securities admitted to trading on an official secondary market and that will monitor the correct value of the register, both at the central registry as detail records.


2. The system referred to in the preceding paragraph must collect at least operations, events and annotations likely to lead to changes in balances of securities of each holder in both the central registry and detail records.

3. The information system for monitoring the trading, clearing, settlement and registration of securities shall comply with the following:

A) Ensuring traceability of transactions on securities admitted to trading on an official secondary market from recruitment to his entry in the register values ​​and vice versa values ​​and the status of the same.

B) To facilitate the transmission of information necessary for the clearing, settlement and registration of securities and the status of such operations.

C) Facilitating risk control and guarantees required by the relevant institutions and market infrastructures.

D) report daily to the CAs on the ownership of securities issued by them upon request.

4. The central securities depository, as responsible and manager of the information system, data transmission and storage, must meet the following obligations:

A) Establish the necessary means so that the information is entered into the system in accordance with established standards and complete.

B) Allow the introduction of the necessary information on time.

C) Provide adequate security and confidentiality of the information provided, so that entities enter information into the system access only to the data strictly necessary for its activity or those for which they are authorized.

D) Ensure the maintenance and continuity of the system.

E) To allow non-discriminatory access of market infrastructures and entities involved in the process of clearing and settlement of securities.

5. The information system will draw on the information that will be required to provide, as provided by regulation, the official secondary markets, central counterparties, central securities depositories and their respective members or entities. The aforementioned entities will be responsible for the integrity and accuracy of the information provided by each of them through the system and will retain ownership of such information.

6. The information stored in the system may not be used or transmitted for purposes other than those provided by law, except with the authorization of the respective supplying entity, subject to the reporting obligations against the Comisión Nacional del Mercado de Valores or Bank of Spain in the exercise of their respective powers.

7. The central securities depositories will sign the contracts in which they set out the legal relationships necessary for the proper functioning of the system. They also publish the rules of operation of the information system establishing the rights, obligations and responsibilities of those who manage and who will use the information stored in the system. The Comisión Nacional del Mercado de Valores approve these rules and amendments. Both the rules and amendments thereto shall be previously considered by the committee users central securities depository, who may make to the Comisión Nacional del Mercado de Valores their comments.

8. With full respect for the principles of equal treatment and non-discrimination, central counterparties and central securities depositories of foreign securities with the central securities depositories enter into agreements or establish links may access this system being obliged to provide the information necessary for the purposes thereof, in accordance with the provisions of this article are met. Such infrastructure should ask their members or participants the information needed to properly perform its function. "

Thirteen. Article 44g is added with the following wording:

"Article 44g. Monitoring and controlling the proper functioning of trading systems, clearing, settlement and registration of securities.


1. Without prejudice to the powers of supervision, inspection and sanction corresponding to the Comisión Nacional del Mercado de Valores in accordance with Title VIII, the governing companies of official secondary markets, central counterparties and central securities depositories to provide services in Spain must ensure, within their respective powers, the proper functioning and efficiency of the processes of trading, clearing and settlement of transactions and securities registration.

2. It empowers the Government to develop the content regulation of the function provided in the preceding paragraph, including the obligations and powers for their proper exercise. "

Catorce. Article 54 is deleted
Fifteen
. Article 57, which shall read as follows amendments:

"1. Registration of securities traded on the Public Debt Market Annotations correspond to the Society of Management Systems Registration Services, Clearing and Settlement of Securities to which the seventeenth additional provision refers and its participating entities authorized to do so by virtue of their status as bodies managing the public debt market.

2. They may hold account name in the public debt market in scoring and keep count as participants in their own name in the registration system Systems Society entities, in addition to the Bank of Spain, systems and clearing agencies and liquidators official secondary markets and interbank clearing systems in order to manage the system of guarantees and who meet the requirements established for such purpose in the rules of the market. "

Sixteen. A new paragraph 7 to Article 60 with the following wording is added:

'7. The provisions of this Article shall not be applicable in case of use of the tools, skills and resolution mechanisms established by Law 11/2015, of June 18, recovery and resolution of credit institutions and investment services companies. "

Seventeen. the second paragraph of the letter amending f) of paragraph 2 of Article 70 ter, which reads as follows:

"Initiate bankruptcy proceedings a securities depository entity, the Comisión Nacional del Mercado de Valores, without prejudice to the powers of the Bank of Spain and the Fund for Orderly Bank Resolution may immediately available without cost to the investor transfer to another entity empowered to develop this activity, securities held on behalf of their clients, even if such assets are deposited with third parties on behalf of the entity providing the service tank. For this purpose, both the judge and the organs of the bankruptcy procedure will facilitate access of the entity to which values ​​are to pierce the documents and accounting and computer records necessary to implement the transfer. The existence of insolvency proceedings does not preclude may reach the customer, according to the rules of the system of clearing, settlement and registration, securities purchased or cash from the exercise of economic rights or sale of securities. "
Eighteen
. letters a) and b) of paragraph 1 of Article 84, which are worded as follows modified:

"A) The governing official secondary markets, the governing bodies of multilateral trading systems, the central counterparties and central securities depositories. The Bank of Spain is excluded.

B) The Society Exchanges and companies having ownership of all shares or participation conferring control, direct or indirect, of the entities referred to in the previous letter. "
Nineteen
. the final paragraph of Article 95, which shall read as follows amendments:

"In particular, they shall be considered rules of order and discipline of the market:

1. Regulation (EU) No 648/2012 of the European Parliament and of the Council of 4 July 2012, on OTC derivatives, central counterparties and trade repositories.

2. Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit institutions and investment firms and amending amending Regulation (EU ) No 648/2012.


3. Regulation (EU) No 909/2014 of the European Parliament and of the Council of 23 July 2014 on improving securities settlement in the European Union and central securities depositories and amending the Directives 98/26 / EC and 2014/65 / EU and Regulation (EU) No 236/2012. "
Twenty
. a new wording in paragraph 3a and 3b and paragraphs 3c Article 98, with the following wording is added:

'3a. The publication of sanctions, both on the website of the Comisión Nacional del Mercado de Valores and in the "Official Gazette", information on the type and nature of the infringement and the identity of the individual will be included or law on which rests the sanction.

3b. In relation to the provisions of the preceding paragraph, the Comisión Nacional del Mercado de Valores, may decide, when in his opinion concurs any of the assumptions contained in paragraph 3 quater:

A) That the application of sanctions applicable to investment services companies contained in paragraphs d) types, e), ea) and b) and c), and d) and e ), k), l), l bis), m), q), u), w), z), z f), z cg) z dh) of Article 99, paragraph c), ca) g), g bis), k), n), o), p), t) z f) of Article 100 and paragraphs 3 to 7 of Article 107c, as well as those imposed under the provisions of the Law 11/2015 of 18 June, recovery and resolution of credit institutions and investment service companies, are published, keeping confidential the identity of the sanctioned subjects.

B) That the sanctions imposed by the application of the types contained in the letters m) and p) of Article 99, letter j) of Article 100 and Article 101.1, relating to breaches of the obligations contained in Articles 35 , 35a, 53 and 53a, are published, keeping confidential the identity of the sanctioned subjects, or their publication be deferred.

C) In connection with the sanctions imposed by the application of the types contained in paragraphs 1 to 4 of Article 107d:

1st Delaying the publication of the sanction imposed so far in the cessation of reasons for the delay of the publication.

2nd Post anonymously penalty imposed if the anonymous publication ensures effective protection of personal data in question. In this case, the publication of relevant data may be deferred for a reasonable period of time if it is anticipated that during that period cease to exist the reasons for a publication with protection of anonymity.

3.º not publish in any way the sanction imposed if the options listed in points a) and b) above are considered insufficient to ensure they do not endanger the stability of financial markets and the proportionality of the publication of the sanctions against measures considered minor.

3 c. The Comisión Nacional del Mercado de Valores may agree on the measures referred to in paragraph 3b when any of the following cases:

A) When an individual sanction is imposed and, in the case of sanctions that the letter c) of paragraph 3b refers to when the penalty imposed on a legal person, and after a preliminary evaluation the publication of personal data is considered disproportionate.

B) Where publication would endanger the stability of financial markets or an official or ongoing criminal investigation in jeopardy.

C) Where the publication would cause disproportionate damage to entities or individuals involved, to the extent that it can assess the damage. This assumption will not apply sanctions to the letter c) of paragraph 3b is concerned. "

Veintiuno. letters c d), ce), f c), cg c), c dh) c decies) are added to Article 99 to read as follows:

"C d) Failure by the central securities depositories and by participating in registration systems, the rules on registration of securities of Chapter II of Title I and Chapter I of Title IV entities when they occur property damage to a number of investors.

Ce) The failure by members of CCPs, their obligations providing guarantees where the breach jeopardizes risk management of central counterparties, except where such failure is a consequence of the insolvency or contest them.


Cf) The failure by members of the official secondary markets and members of multilateral trading systems, the obligations referred to in Article 31 and Article 125.3 bis.7 ​​respectively or inadequate coordination with CCPs and their members, when such behaviors do not have a merely occasional or isolated.

Cg) The failure of the governing companies of official secondary markets, the governing bodies of multilateral trading systems of central counterparties, central securities depositories and organizations providing services investment of its obligations discipline in settlement to those referred to in articles 6 and 7 of Regulation (EU) No 909/2014 of 23 July 2014.

C dh) Failure by the central securities depositories of the obligations set out in Article 44f, when such conduct is not purely occasional or isolated.
Decies
c) The failure of the official secondary markets, multilateral trading systems of central counterparties and central securities depositories and their respective members and participating entities of the obligations Article 44 septies.5, when no question of a purely occasional or isolated failure or when seriously affecting the operation of the information system to which that article. "

Twenty-two. the points are added cg z), z dh), decies z), z aj) z k) to Article 100 as follows:

"Z cg) Failure by the central securities depositories and by participating in registration systems, the rules on registration of securities of Chapter II of Title I and Chapter I of Title IV entities when not constitute very serious infringement.

Z dh) Failure by members of CCPs, their obligations when providing guarantees would not constitute a very serious infringement unless such failure is a result of the insolvency or contest the same.

Z decies) Failure by members of the official secondary markets and members of multilateral trading systems, of the obligations referred to in Articles 31 and 125.3 respectively bis.7 ​​or inadequate coordination with the CCPs and their members, when such behaviors have a purely occasional or isolated.

Z aj) The failure of the official secondary markets, multilateral trading systems of central counterparties, of their respective members and participating entities of central securities depositories, of the obligations Article 44 septies.5, where no case of a very serious infringement.

Z k) Breach by the central securities depositories of the obligations set out in Article 44f when not a very serious offense. "

Twenty-three. two paragraphs to the letter a) of paragraph 1 of Article 102, with the following wording is added:

"In the case of central securities depositories and credit institutions designated to those referred to in Article 54.2.b) of Regulation (EU) No 909/2014 of 23 July 2014, who commit very serious offenses to which Article 107 refers quinquies.1 and 3, the fine shall amount to at least twice the amount of gross profit obtained as a result of acts or omissions which constitute an infringement if it can be determined, and at most, to the greater of the following amounts: five times the gross profit obtained as a result of acts or omissions which constitute an infringement; ten percent of the volume of total annual turnover of the infringing entity, according to the latest available accounts approved by the management body; five percent of the total, own or other funds used in the infringement, or 20,000,000 euros. If the offending entity is a parent or subsidiary of the parent company have to prepare consolidated financial statements, the volume of total annual turnover shall be that contained in the last consolidated financial statements available.

In the case of breaches of the obligations contained in Articles 35, 35a, 53 and 53a, which constitute a very serious infringement the fine to be imposed is:


I) In the case of legal persons, the amount will be up to the greater of the following amounts:

- 10,000,000 euros or five percent of its total annual turnover, according to the latest available financial statements approved. If the legal person is a parent undertaking or a subsidiary of a parent company, have to prepare consolidated under commercial law financial accounts, the total turnover to be taken into account is the volume of total annual turnover or type for membership in conformity with applicable accounting regulations, according to the annual consolidated account latest available approved of the ultimate parent.

- Twice the amount of the profits gained or losses avoided because of the breach if they can be determined.

Ii) In the case of individuals, the amount will be up to the greater of the following amounts: 2,000,000 euros, or twice the amount of the profits gained or losses avoided because of the breach, if that can be determined. "

Twenty-four. a fourth paragraph be added to the letter a) of paragraph 1 of Article 103, with the following wording:

"In the case of central securities depositories and credit institutions designated to those referred to in Article 54.2.b) of Regulation (EU) No 909/2014 of 23 July 2014, who commit serious offenses to which Article 107 refers quinquies.2 and 4, the fine shall amount to at least twice the amount of gross profit obtained as a result of acts or omissions which constitute an infringement, if it can be determined, and at most, to the greater of the following amounts: twice the benefit obtained as a result of acts or omissions which constitute an infringement; five percent of the volume of total annual turnover of the infringing entity, according to the latest available accounts approved by the management body; two percent of the total, own or other funds used in the infringement, or 10,000,000 euros. If the offending entity is a parent or subsidiary of the parent company have to prepare consolidated financial statements, the volume of total annual turnover shall be that contained in the latest available consolidated financial statements. "
Twenty
. a third paragraph to the letter a) of paragraph 1 of Article 105, with the following wording:

"In the case of central securities depositories and credit institutions designated to those referred to in Article 54.2.b) of Regulation (EU) No 909/2014 of 23 July 2014, who commit very serious infringements referred to in Article 107 quinquies.1 and 3, the fine to be imposed amounting to 5,000,000 euros refers. "

Twenty-six. a third paragraph to the letter a) of paragraph 1 of Article 106, with the following wording:

"In the case of central securities depositories and credit institutions designated to those referred to in Article 54.2.b) of Regulation (EU) No 909/2014 of 23 July 2014, who commit serious offenses to which Article 107 quinquies.2 and 4, the fine to be imposed amounting to 2,500,000 euros refers. "

Veintisiete. letters f) and j) of paragraph 1 of Article 106b, which are worded as follows modified:

«F) gains or, where applicable, losses avoided as a result of the acts or omissions constituting the offense, so far as can be determined.

J) Collaboration with the Comisión Nacional del Mercado de Valores, provided that the natural or legal person has provided relevant data elements or clarifying the facts under investigation, without prejudice to the need to ensure disgorgement of profits obtained or losses avoided by it. "

Twenty-eight. Article 107d is added with the following wording:

"Article 107d. Infringements of Regulation (EU) No 909/2014 of the European Parliament and of the Council of 23 July 2014

1. Without prejudice to the offenses provided for in Article 99, constitute very serious infringement of CSDs, as well as those who hold administrative or management positions in these entities, the following breaches of Regulation (EU) No 909/2014 of July 23, 2014:

A) The provision of services set forth in Sections A, B, and C of the Annex to Regulation, in breach of the provisions of Articles 16, 25 and 54 unless you have a merely occasional or isolated.


B) Obtaining authorization set out in Articles 16 and 54 by making false statements or any other unlawful means.

C) Failure to comply with the capital requirements contained in Article 47.1, when doing so will jeopardize the solvency or viability of the offending company or its group.

D) Failure to comply with not merely occasional or isolated, or substantial irregularities, organizational requirements contained in Articles 26 to 30.

E) Failure to comply with not merely occasional or isolated, or substantial irregularities, the rules of conduct included in Articles 32 to 35.

F) Failure to comply with the requirements to be met by the services provided, contained in Articles 37 to 41, where it would be put at serious risk the integrity of the settlement system or registry, or seriously harm interests participants or holders of securities, or put at serious risk the values ​​of the participants or their clients.

G) Failure to comply with the prudential requirements contained in Articles 43 to 47, where it would put at risk the solvency or viability of the offending company or its group.

H) Failure to comply with the requirements to be met by the links between central securities depositories contained in Article 48, where it would be put at serious risk the integrity and functioning of the settlement system or registry.

I) Breach of the duty to grant access after having been required by the Comisión Nacional del Mercado de Valores in accordance with Articles 49 to 53.

2. Without prejudice to the offenses under Article 100, constitute grave breaches of the central securities depositories as well as those who hold administrative or management positions in these entities, breach of the obligations referred in paragraph 1a) ah), except the letter b), they do not constitute a very serious offense.

3. They constitute very serious infringement of designated credit institutions as well as those who hold administrative or management positions in these entities, the following breaches of Regulation (EU) No 909/2014 of 23 July 2014:

A) Failure to comply with specific prudential requirements for credit risk contained in Article 59.3, when doing so will jeopardize the solvency or viability of the offending company or its group.

B) Failure to comply with specific prudential requirements for liquidity risk contained in Article 59.4, when doing so will jeopardize the solvency or viability of the offending company or its group.

4. Constitutes a serious infringement of designated credit institutions as well as those who hold administrative or management positions in these entities, breach of the requirements referred to in paragraph refers 3rd) and b), if not a very serious infringement.

5. The offenses under this article shall be punished in accordance with the rules provided in this Act. "

Veintinueve. Article 125, which happens to have the following wording is amended:

"Article 125. Agreements central counterparty and clearing and settlement.

1. In order to address the settlement of transactions on securities executed on MTFs, its governing bodies will sign agreements with at least one central securities depository and, where appropriate, with one or more central counterparties, subject right of issuers to have their securities are registered in any central securities depository in accordance with Article 49 of Regulation (EU) No 909/2014.

The governing bodies of a multilateral trading system may subscribe, prior notification to the Comisión Nacional del Mercado de Valores, agreements with CCPs and CSDs of another Member State for the clearing or settlement of some or all transactions are concluded with market members of their respective systems. The Comisión Nacional del Mercado de Valores may oppose the conclusion of these agreements when it deems likely to impair the orderly functioning of the multilateral trading system or, in the case of a settlement system, technical conditions do not ensure the effective liquidation and economic operations.

2. It shall apply to multilateral trading systems set out in Articles 36a, 36b, 36c and 44f for official secondary markets.


3. Statutorily determined securities whose operations in the multilateral trading segments of multilateral trading systems, are subject to mechanisms that allow their orderly liquidation and success necessary intervention by a central counterparty.

4. The Comisión Nacional del Mercado de Valores take into account the work system monitoring clearing and settlement carried out by the Bank of Spain or other authorities with jurisdiction in the matter, in order to avoid unnecessary duplication of control. "
Thirty
. Seventeenth additional provision introduced by Law 24/2001 of 27 December on Fiscal, Administrative and Social Order, which read as follows amending Measures:

"Seventeenth additional provision. The Society of Management Systems Registration, Clearing and Settlement and companies owning CCPs, CSDs and Spanish official secondary markets.

1. The "Society of Management Systems Registration, Clearing and Settlement ', hereinafter, the Systems Company, will act as a central securities depository in accordance with Article 44a and shall perform such other duties entrusted to him the Government, following a report by the Comisión Nacional del Mercado de Valores.

2. References in this Act or other provisions to the "Society of Management Systems Registration, Clearing and Settlement" to "Systems Company" to "Compensation and Settlement of Securities" shall be construed as the central securities depositories except as provided in articles 57 and 58.

3. Without prejudice to the powers of the Autonomous Communities on systems clearing, settlement and registration of securities and secondary markets, the Government may authorize the report of the Comisión Nacional del Mercado de Valores, after hearing the Autonomous Communities competence in the matter and the proposal of the Minister of Economy and Competitiveness, that one or more entities acquire, directly or indirectly, the entire capital or a share granting to or acquirers controlled, directly or indirectly, all or some of the companies that administer CCPs, CSDs and Spanish official secondary markets and that, after such acquisition, corresponds to that or those entities cited the ownership of capital.

Participation will be considered to control that, in accordance with Chapter V of Title IV and its implementing rules require to make a takeover bid on the entire share capital of the relevant company.

Be up to the Comisión Nacional del Mercado de Valores authorize the bylaws that governed those acquirers amended, with the exceptions established by regulation, and authorize the appointment of the members of its board of directors and their CEOs, which must meet the requirements of Article 67.2.f). If the acquirers do not have their registered offices in Spain and his statutes and modifications and requirements of members of the board of directors and CEOs have been verified by the competent authority of another Member State of the European Union or by the supervisory authority a non-member of the European Union whose regime of organization and operation is similar to the Comisión Nacional del Mercado de Valores, it is for the latter to check such checks.

The Government, by royal decree, determine the rules for tender offers for the shares representing the capital of the aforementioned entities, the advertising regime to be submitted their shareholdings, the rate at which are secured; these entities to collect in their bylaws any limitations or specialty of rights arising out of their actions and any other aspect necessary for the application of this provision and to ensure adequate supervision of these entities.


It will be necessary government authorization for the entity or, where appropriate, entities that own, directly or indirectly, the entire capital or a controlling all or, where appropriate, some of the companies to which referred to in the first paragraph of this section may carry out any device act by which no longer hold, directly or indirectly, of the entire share capital held in each of these companies or by losing control, direct or indirect, of the latter. Such authorization will be granted after hearing the Autonomous Communities with competence in the matter, the report of the Comisión Nacional del Mercado de Valores proposal of the Minister of Economy and Competitiveness.

The regime of significant shareholdings under Articles 31.6 and 44 bis.2 transmissions subject to administrative authorizations under this provision shall not apply.

The supervision of these entities correspond to the Comisión Nacional del Mercado de Valores. "

Thirty-one. duplicate seventeenth additional provision introduced by Law 44/2002 of 22 November on Measures to Reform the Financial System is deleted.

Thirty-two. an additional provision twenty second with the following wording is added:

"Additional provision twenty-second. Proper functioning of the systems clearing, settlement and registration of securities.

1. In accordance with international standards and with the European Union law concerning central counterparties, central securities depositories and other financial market infrastructures, the Comisión Nacional del Mercado de Valores and the Bank of Spain will ensure that the operation systems of clearing, settlement and registration of national values ​​preserve the stability of the financial system as a whole. To this end, they shall evaluate the degree of adaptation of the procedures of the Spanish market infrastructure best practices and recommendations, and draw up and publish a biennial report.

2. The Comisión Nacional del Mercado de Valores and the Bank of Spain, within 18 months from the entry into force of this Act, will sign a cooperation agreement in order to develop the work provided for in the preceding paragraph. This agreement will determine their respective roles and responsibilities in this area, as well as the system of exchange of information between the two authorities.

3. The provisions of this provision will not alter the respective powers granted to each of these authorities by its regulations. "

B) To improve the transparency of securities issuers:

One. a new wording in the first paragraph of paragraph 1 of Article 35 as follows:

"1. When Spain is a Member State of origin, issuers whose securities are admitted to trading on an official secondary market or on another regulated market domiciled in the European Union, they make public and disseminate its annual financial report within four months from the end of each year and must ensure that it remains publicly available for at least ten years. They also submit their annual accounts to audit. The audit report will be made public together with the annual financial report. "

Two. a new wording in the first paragraph of paragraph 2 of Article 35 as follows:

'2. When Spain is a Member State of origin, issuers whose shares or debt securities are admitted to trading on an official secondary market or on another regulated market domiciled in the European Union, make public and disseminate a half-yearly financial report covering the first six months exercise, within a maximum period of three months from the end of the relevant period. Issuers should ensure that the report remains publicly available for at least ten years. "

Three. letter a) of paragraph 5 of Article 35, which read as follows amendments:


"A) The Member States of the European Union, the autonomous communities, local authorities and other similar bodies of the Member States of the European Union, international public bodies of which is a member of at least one Member State the European Union, the European Central Bank, the European financial stability Facility (EFSF) set by the Framework Agreement EFSF and any other mechanism established with the aim of preserving the financial stability of the European monetary union by providing temporary financial assistance to Member States whose currency is the euro and the national central banks of the Member States of the European Union or not they issue shares or other securities; and "

Four. the first paragraph of paragraph 1 of Article 35a is amended to read as follows:

"1. Issuers whose securities are admitted to trading on an official secondary market or on another regulated market domiciled in the European Union, where Spain is the home Member State, make public and disseminate of any change in the rights attaching to such securities. Issuers sent to the Comisión Nacional del Mercado de Valores this information for inclusion in the official record regulated in Article 92.g). "

Five. paragraph 3 of Article 35a is deleted.

Six. a new wording in paragraph 3 of Article 53 as follows:

'3. Likewise the provisions shall apply in the preceding paragraphs who possess, acquire or transfer, directly or indirectly, other securities and financial instruments conferring an unconditional right or discretion to acquire shares which confer voting rights or financial instruments that are indexed to actions that confer voting rights and have similar values ​​and above, whether entitled or not a settlement by physical delivery of the underlying securities in the terms and with the breakdown as specified in the regulations financial instruments economic effect. "

Seven. A new paragraph is added to paragraph 1 of Article 91, with the following wording:

"In exercising their sanctioning and investigative powers, the Comisión Nacional del Mercado de Valores cooperate with other competent authorities of the European Union to ensure that sanctions or measures produce the desired results and coordinate their actions with other authorities when dealing cross-border cases. "

Second final provision. Amendment of Law 6/1997 of 14 April, Organization and Functioning of the General State Administration.

The first section of the tenth additional provision of Law 6/1997 of 14 April, Organization and Functioning of the General State Administration, is amended as follows:

"1. The Comisión Nacional del Mercado de Valores, the Nuclear Safety Council, universities not transferred, the Spanish Data Protection Agency, the Consortium of the ZEC, the National Commission Markets and Competition, the Board of Transparency and good Governance, the Prado Museum, the National Art Museum Reina Sofia and the FROB is governed by specific legislation and additionally by this Act.

The Government and the Central Government in respect of such agencies exercise the powers that the rules of each assigned, if necessary, with strict respect for their respective areas of autonomy. "

Final disposition third. Amendment of Law 29/1998 of July 13, regulating the Administrative Jurisdiction.

Letter g) of paragraph 1 of Article 11 of Law 29/1998 of 13 July, governing Administrative Jurisdiction, with the following wording is amended:

"G) Appeals against acts of the Bank of Spain, the Comisión Nacional del Mercado de Valores and the FROB adopted in accordance with the provisions of Law 11/2015 of 18 June, recovery and resolution credit institutions and investment services companies. "

Fourth final provision. Amendment of Law 41/1999 of 12 November, on payment systems and securities settlement.

The first paragraph of Article 6 of Law 41/1999 of 12 November, on payment systems and securities settlement follows amendments:


"The Bank of Spain and the Comisión Nacional del Mercado de Valores notify the European Securities and Markets Authority systems recognized under this Act that are managed by them or by entities under its supervision or oversight, and are the bodies responsible for receiving or sending communications Article 6.2 and 3 of Directive 98/26 / EC of the European Parliament and of the Council of 19 May 1998 on the settlement finality refers in systems payment and securities settlement. They also provide without delay the European Securities and Markets Authority, upon request, all information necessary for the performance of its functions in accordance with Article 35 of Regulation (EU) No 1095/2010 of Parliament European Parliament and of the Council of 24 November 2010 establishing a European Supervisory Authority (European Securities and Markets Authority) is created, Decision No 716/2009 / EC amending and repealing Decision 2009 / 77 / EC. "

Final provision fifth. Amendment of Law 22/2003 of July 9, Insolvency.

The second additional provision of Law 22/2003 of July 9, Insolvency, who happens to have the following wording is amended:

"Second additional provision. Special scheme for credit institutions, investment services companies and insurance companies.

1. In contests credit institutions or entities legally assimilated to them, companies of investment services and insurance companies, as well as members entities official securities markets and participants in the clearing and settlement of securities entities, specialties apply to for insolvency situations they are established in their specific legislation, except those relating to composition, appointment and functioning of the bankruptcy administration.

2. special legislation for the purposes of applying paragraph 1 regulated in the following rules are considered:

A) Articles 10, 14 and 15 of Law 2/1981 of 25 March, regulating the Mortgage Market and the rules governing other securities or instruments that legally the same solvency regime attributed that applicable to mortgage bonds.

B) Article 16 of Royal Decree Law 3/1993 of 26 February, on urgent measures in budgetary, tax, financial and employment matters.

C) Law 24/1988 of 28 July, on the Securities Market, as regards the arrangements applicable to the system of clearing, settlement and registration on it regulated and entities participating in such systems and in particular articles 12a, 36c, 44a, 44b, 58 and 70 ter.2.f).

D) Additional provision five of Act 3/1994 of 14 April, adaptation of Spanish legislation on credit institutions to the Second Banking Directive.

E) Law 13/1994 of 1 June, of Autonomy of the Bank of Spain, as regards the arrangements applicable to the guarantees provided to the Bank of Spain, the European Central Bank or national central banks of other the European Union, in the exercise of their functions.

F) The third additional provision of Law 1/1999, dated 5 January, regulating venture capital entities and their management companies.

G) Law 41/1999 of 12 November, on payment systems and securities settlement.

H) Articles 26 to 37 inclusive, 39 and 59 of the Consolidated Law and Supervision of Private Insurance, approved by Royal Legislative Decree 6/2004 of 29 October, and Text consolidated Legal Status Insurance Compensation Consortium, approved by Royal Legislative Decree 7/2004 of 29 October.

I) Chapter II of Title I of Royal Decree Law 5/2005 of 11 March, on urgent measures for boosting productivity and improving public contracting.

J) Law 6/2005 of 22 April, on Sanitation and Liquidation of Credit Institutions.

K) Law 11/2015, of June 18, recovery and resolution of credit institutions and investment services companies.

L) Article 34 of Law 14/2013 of 27 September, supporting entrepreneurs and their internationalization.


3. The laws mentioned in the preceding paragraph shall apply to the subjective scope and objective set in the same operations or contracts contemplated in those laws and in particular those relating to operations relating to payment systems and settlement and securities clearing, double transactions, repurchase transactions or in the case of financial transactions related to derivative instruments. "

Sixth final provision. Amendment of Law 35/2003 of 4 November on collective investment schemes.

Paragraphs 1 and 2 of Article 54a are worded as follows:

"Article 54a. Conditions for cross-border management of IIC by management companies authorized in Spain in accordance with Directive 2011/61 / EU of the European Parliament and of the Council of 8 June 2011 and for the provision of services in other Member States.

1. UCITS authorized in Spain in accordance with Directive 2011/61 / EU of the European Parliament and of the Council of 8 June 2011, may manage UCITS established in another Member State, either directly or by establishing a branch, provided SGIIC that is authorized to manage that type of fund. Additionally you can pay in another Member State the services to which Article 40.2 for which it has been authorized concerns.

2. Any manager who intends to manage UCITS established in another Member State for the first time, notify the Comisión Nacional del Mercado de Valores the following information:

A) The Member State in which it intends to manage the IIC directly or by establishing a branch or whether to provide services in Article 40.2 for which it has been authorized concerns, and

B) a program of activities indicating, in particular, the services intends to perform and the CIS it intends to manage identified. "

Seventh final provision. Amendment of Royal Decree-Law 5/2005 of 11 March, on urgent measures for boosting productivity and improving public contracting.

One.
: The second article of Royal Decree-Law 5/2005 of 11 March, on urgent measures for boosting productivity and improving public procurement, which happens to have the following wording amending reforms
"Article second. Object.

The purpose of this chapter is to incorporate into Spanish law the provisions of Directive 2002/47 / EC of the European Parliament and of the Council of 6 June 2002 on financial collateral arrangements as well as sort and systematize current regulations applicable to the contractual netting agreements and guarantees financial. It is further establish the effects of the opening of insolvency proceedings or administrative liquidation proceedings on such agreements and guarantees.

Items sixth paragraph 2; ninth paragraphs 2 to 5; eleventh; fifteenth paragraph 4; and sixteenth paragraph 1 shall not apply in cases where it prevents or restricts the implementation of the agreements on financial guarantees or effectiveness of agreements on pledged assets is limited, the settlement arrangements for compensation or compensation arrangements in the terms set out in Chapters VI and VII of Law 11/2015, of June 18, recovery and resolution of credit institutions and investment services companies and its implementing regulations, or in the terms provided in another applicable legislation pursuing purposes and count equivalent to those contained in the Act safeguards.

The provisions of this Chapter shall be without prejudice to the applicable rules on consumer credit and regulations on recovery and resolution of credit institutions and investment services companies. "

Two. Letter d) of paragraph 1 of article four, which happens to be modified as follows:

"D) The governing bodies of official secondary markets or multilateral trading systems and the companies that manage clearing systems, settlement and registration of securities and financial instruments, as well as central counterparties agents settlement or clearing houses that Law 41/1999 of 12 November, on payment systems and securities settlement, and similar entities acting on the options markets, futures and derivatives refers to, as well as members and participating entities of all previous infrastructure when acting in their capacity as such. "

Three. Letter f) is added to paragraph 2 of Article fifth, with the following wording:


'F) cash transactions on the securities referred to in Article 2, first paragraph, of Law 24/1988, of 28 July, the Securities Market admitted to trading on an official secondary market or on another market regulated domiciled in the European Union or in a multilateral trading system. "

Eighth final provision. Amendment of Law 6/2005 of 22 April on the reorganization and winding up of credit institutions.

Law 6/2005 of 22 April on the reorganization and winding up of credit institutions is amended as follows:

One. In Article 2 the following paragraphs are added:

"1.d) Companies providing investment services, as defined in Article 4.1 of Royal Decree 217/2008, and their branches established in Member States other than those in which they are based.

2. In case of application of resolution tools and exercise of resolution powers provided by Law 11/2015, of June 18, recovery and resolution of credit institutions and investment service companies, the provisions of this Act also apply to financial institutions, companies and parent companies included in the scope of Law 11/2015 of 18 June.

3. Articles 6 and 13 of this Act shall not apply when Article 21 of Law 11/2015, of June 18 applies.

4. Article 4 of this Act shall not apply when Article 59 of Law 11/2015, of June 18 applies. "

Two. In Article 3 the following paragraphs are added:

'7. Among reorganization measures implementing instruments and the exercise of the powers of resolution contemplated by Law 11/2015, of June 18 are included.

8. For the purposes provided in this Act it means branch a place of business which forms a part, devoid of legal personality, of an entity which carries out directly all or some of the operations inherent in the business of an entity.

9. For the purposes provided in this Act it is meant by financial instrument:

A) a contract that gives rise to both a financial asset of one party and a financial liability or equity instrument for the other party,

B) I specified in Annex I, Section C instrument of Directive 2014/65 / EU, the Parliament and the Council of 15 May 2014 on markets in financial instruments and laying amending Directive 2002/92 / EC and Directive 2011/61 / EU.

C) a derivative financial instrument,

D) a primary financial instrument or

E) a cash instrument.

The instruments referred to in a), b) and c) are considered financial instruments only when their value is derived from the price of an underlying financial instrument, underlying other item, a type or index. "

Three. The letters d) and e) of paragraph 1 of Article 8, are worded as follows:

"D) The exercise of property rights or other rights on financial instruments whose existence or transfer presupposes entry in a register, an account or a centralized deposit system held or located in a Member State European Union, shall be governed by the law of the member State in which it is established or registration is located, account or centralized deposit system in which those rights are recorded. For this purpose, it is understood by financial instruments all those listed in Section C of Annex I to Directive 2014/65 / EU of the Parliament and of the Council of 15 May 2014 on markets in financial instruments and the Regulation (EU) No 648/2012 is modified.

Notwithstanding the foregoing and the provisions of Articles 66 and 70 of Law 11/2015, of June 18, transactions and repurchase transactions within a regulated market or an organized system multilateral trading shall be governed solely by the law applicable to the contract governing such agreements or transactions.

E) Notwithstanding the provisions of Articles 66 and 70 of Law 11/2015 of 18 June, contractual agreements Netting shall be governed solely by the law applicable to the contract which governs such agreements. "

Ninth final provision. Amendment of Royal Decree Law 1/2010, of July 2, approving the Consolidated Capital Companies Act is approved.

An additional provision tenth the revised text of the Capital Companies Act, approved by Royal Legislative Decree 1/2010 of July 2, with the following wording:

"Additional provision tenth.


1. For the purposes of Law 11/2015 of 18 June, recovery and resolution of credit institutions and investment service companies, the general meeting of the subject to this Act listed companies may, by a two-thirds majority of the valid votes cast, to approve or amend the bylaws stating that the general meeting which is to decide on a capital increase is convened in a period shorter than that prescribed in Article 176 of this Law, provided that the meeting not be held in less than ten days of the notice period, the conditions of articles 8 to 10 of Law 11/2015, of June 18 are met, and the capital increase is necessary to avoid the conditions for resolution laid down in articles 19 to 21 of the Act.

2. For the purposes of the provisions of the preceding paragraph, the deadlines provided for in Articles 179.3 and 519.2 of this Act shall not apply. "

Final Disposition tenth. Amendment of Royal Decree-Law 16/2011 of 14 October, the Deposit Guarantee Fund of Credit Institutions is created.

The Royal Decree-Law 16/2011 of 14 October, the Deposit Guarantee Fund of Credit Institutions is created, it is amended as follows:

One. Article 5 shall read as follows:

"Article 5. Entities attached.

1. All Spanish credit institutions compulsorily belong to the Deposit Guarantee Fund of Credit Institutions under this Royal Decree-Law.

The obligation in the preceding paragraph shall not apply to the Official Credit Institute.

The Bank of Spain shall inform the European Banking Authority, as soon as possible, the accession of a credit institution to the Fund.

2. The branches of credit institutions not members of the European Union operating in Spain States will join the Fund in the circumstances and manner prescribed by regulation. Notwithstanding the foregoing, when these entities provide a level of protection to depositors or above the provisions of this Royal Decree-Law and its implementing regulations, it may have its non-adherence to the Fund.

3. Failure to comply with the obligations of a credit institution to the Deposit Guarantee Fund of Credit Institutions will be classified as a serious offense in accordance with the provisions of Law 10/2014 of 26 June, management supervision and solvency of entities credit, unless such failure has an occasional or isolated or is cured within a reasonable period of time.

These violations shall be communicated by the Deposit Guarantee Fund of Credit Institutions of the Bank of Spain, who, after consultation with the Fund, impose the necessary measures to return the company to fulfill its obligations.

Credit institutions may be excluded from the Fund once the measures taken have failed under the previous paragraph. It is competent to decide to exclude the head of the Ministry of Economy and Competitiveness, proposed by the Bank of Spain and the report of the Management Committee of the Fund.

4. Credit institutions that wish to transfer their business to another Member State of the European Union must inform the Fund at least six months in advance. During the period until the transfer, the entity will contribute to the deposit guarantee compartment under the terms provided in this Royal Decree-Law and its implementing regulations.

Compartment Contributions to Deposit Guarantee Fund by credit institutions to transfer their activities to other Member States of the European Union and remain therefore subject to another deposit insurance system will be transferred to the system in the terms established by regulation.

In no event shall be reimbursed contributions paid before the 12 months prior to transfer and those made under Article 6.2.b) the entity concerned must, before transferring its activity, satisfy the amounts pending disbursement exist for contributions approved under that Article. "

Two. Article 6, which shall read as follows amendments:

"Article 6. Heritage.

1. To fulfill its functions the Fund shall be the following resources:

A) Annual contributions provided in the following sections.

B) claims which make the Fund among the member institutions the same distribution as the basis for calculating contributions and limits established by regulation. These apportionments are recorded as assets once they are agreed.


C) The funds raised in the equity markets, loan or any other debt operations.

In any case, when the assets of the Fund is insufficient for the development of its functions, the Fund will make the necessary actions to restore its sufficiency.

In addition, the deposit guarantee compartment may draw on the payment obligations of the entities to the Fund provided that such commitments:

A) they are fully backed by collateral of low risk assets, unencumbered and freely available to the Fund.

B) not exceed 30% of the total resources available compartment.

2. The resources obtained under the previous paragraph shall be assigned to one of the following accounting separate compartments in which the Fund will be divided:

A) Sub deposit guarantee

B) collateralised compartment.

Each compartment respond exclusively costs, expenses and obligations expressly attributed this Royal Decree-Law and its implementing regulations.

In any case, the Fund will allocate to each compartment the obligations arising from the uptake of the funds obtained under subparagraph c) of paragraph basis of the intended use of the funds raised.

In addition, the contribution of each compartment to the costs, expenses and liabilities not expressly attributed to any compartment is calculated based on the amount of deposits or securities that guarantees each compartment, under the terms established by regulation .

3. The Management Committee shall determine the amount of annual contributions from the entities to deposit guarantee compartment.

Annual contributions are calculated based on the amount of deposits guaranteed by each bank and its risk profile.

The Bank of Spain will develop the necessary methods that contributions are proportional risk profile of the entities. For this purpose, shall take into account, among others, the following factors:

A) The difference between the legal level provided for the main indicators derived from the solvency regulations and effectively maintained by the entity.

B) The difference between the amount of own funds and eligible liabilities to the minimum requirement of own funds and eligible liabilities, the entity required under Law 11/2015, of June 18, recovery and resolution credit institutions and investment service companies, and effectively maintained by the entity.

C) guidelines, if any, have set about the European Banking Authority under Article 13.3 of Directive 2014/49 / EU of the European Parliament and of the Council of 16 April 2014 on the deposit guarantee systems.

D) The phase of the economic cycle and the impact of procyclical contributions.

4. The available financial resources of the deposit guarantee compartment must attain at least 0.8 percent of the amount of guaranteed deposits.

However, the Fund may request the European Commission to reduce this level to 0.5 percent in response to factors such as:

A) The unlikelihood of a significant part of the resources of the deposit guarantee compartment used for measures to protect depositors different resolution procedures.

B) The likelihood that credit institutions subject to look resolution procedures in case of bankruptcy due to the high degree of concentration in the banking sector and the large volume of assets of the main entities.

5. Annual contributions provided for in paragraph 1 a) to guarantee securities compartment may not exceed 0.3 percent of the amount of guaranteed values.

6. Contributions to a compartment shall be suspended when the endowment fund not engaged in own operations object that equals or exceeds 1 percent of the total amounts guaranteed by the compartment compartment. "

Three. Paragraphs 1 and 2 of Article 8 are amended as follows:

"1. The Fund only under the deposit guarantee compartment, satisfy their holders the amount of deposits guaranteed under the terms established by regulation when any of the following events occurs:

A) the institution has been judicially declared or has requested the declaration for bankruptcy.


B) that, having produced unpaid deposits, the Bank of Spain determines that the entity is unable to return them immediately for reasons directly related to its financial situation. The Bank of Spain will make that determination as soon as possible and in any case must be resolved within a maximum period determined by regulation, after verifying that the institution has failed to repay deposits due and payable.

2. The Fund, charged compartment only to guarantee securities satisfy holders of securities or other financial instruments entrusted to a credit institution guaranteed amounts when any of the following events occurs:

A) the credit institution has been declared or judicially has requested the declaration by bankruptcy, and those situations involving the suspension of the return of the securities or financial instruments; however, shall not pay these amounts if, within the period prescribed by regulation to start disbursement, the above mentioned contest should rise.

B), there having been no restitution of the securities or financial instruments, the Bank of Spain determines that the credit institution is unable to restore them in the immediate future for reasons directly related to its financial situation. The Bank of Spain will make that determination as soon as possible and in any case, shall decide on the appropriateness of compensation within a maximum period determined by regulation. "

Four. A new paragraph is added at the end of paragraph 1 of Article 10 to read as follows:

"In addition, the following deposits will be guaranteed regardless of the amount for three months from the time the amount has been credited or from the moment when such deposits have become legally transferable:

A) are from transactions with residential property and private nature.

B) arising from payments received by the depositor hoc basis and relating to marriage, divorce, retirement, dismissal, invalidity or death.

C) which are based on the payment of insurance benefits or compensation for damages resulting from a crime or a miscarriage of justice. "

Five. Article 11 shall read as follows:

"Article 11. Measures to support the resolution of a credit institution.

1. To fulfill the role envisaged in Article 4 and in defense of depositors whose funds are guaranteed and the Fund itself, this may take measures to support the resolution of a credit institution under the deposit guarantee compartment.

For this purpose, a credit institution when it is in a process of resolution in accordance with the provisions of Law 11/2015, of June 18, the Fund, within the framework of resolution approved plan, participate in the financing the resolution of credit institutions under Article 53.7 of that law.

2. The Fund may request the Governing Committee of the FROB information concerning the resolution process necessary to facilitate their participation as provided in this article. With the transfer of this information, the Fund will be subject to duty of secrecy regime provided for in Article 59 of Law 11/2015 of 18 June.

3. The FROB shall, after consultation with the Fund, the amount of which this is responsible. In any case, the Deposit Guarantee Fund of Credit Institutions may not take more than the lesser of the following amounts financial cost:

A) The amount of the payment that would have had to make to choose, at the time of opening the resolution process, by making payment of the amounts secured in case of liquidation of the entity. In the event that, according to the subsequent assessment under Article 5.3 of Law 11/2015, of June 18, it is concluded that the Fund's contribution to the resolution was greater than net losses that it incurred in case of liquidation under the insolvency law, the National Resolution Fund will pay the Deposit Guarantee Fund of Credit Institutions difference between the two amounts.

B) 50 percent of the target for the deposit guarantee compartment under Article 6.4 level.


4. When the Fund makes payments in the context of a bank resolution process shall be entitled to claim the credit institution an amount equal to their payments concerned.

5. Exceptionally, as long as they did not initiate a resolution process, the Fund may use its resources to prevent the liquidation of a credit institution when:

A) the cost of this intervention is less than the payment of the amounts secured should they materialize liquidation.

B) be imposed on the credit institution specific measures to return to compliance solvency, management and discipline.

C) intervention to the commitment of the entity to ensure access to guaranteed deposits is conditional.

D) the fund deemed acceptable cost under ordinary or extraordinary contributions of member entities.

In regulations may specify the above conditions. "

Six. A new Article 12 with the following wording:

"Article 12. Tests of resistance.

1. The Bank of Spain submitted to the Fund, at least every 3 years, testing the strength of its ability to meet its payment obligations under stress.

2. The Fund shall provide the Bank of Spain the information needed to perform the tests. The Bank of Spain may only use this information for conducting such tests and not kept longer than necessary for such purposes. "

Seven. an additional provision with the following wording:

"First additional provision. Compartmentalization of the assets of the Fund Deposit Guarantee Credit Institutions.

The acquired rights and obligations of the Deposit Guarantee Fund of Credit Institutions before the date of entry into force of Law 11/2015, of June 18, recovery and resolution of credit institutions and investment services firms, shall be allocated exclusively to the deposit guarantee compartment. "

Eight. an additional provision with the following wording:

"Second additional provision. Deadline for provision of the Guarantee Fund of Deposits with credit institutions.

1. The level of financial resources of the Fund Deposit Guarantee Credit institutions required under Article 6.4 must be achieved no later than July 3, 2024.

Without prejudice to the provisions of the preceding paragraph, the obligation of institutions to contribute only born when the Fund required, specifying for each entity the corresponding amount, ordinary or extraordinary contributions, not general obligations arising from previous contribution at that time.

2. In the event that in the period since the entry into force of Law 11/2015, of June 18, recovery and resolution of credit institutions and investment service companies, and July 3, 2024 the financial resources available alcanzasen the level provided in the preceding paragraph, but later were reduced below two thirds of that level, the annual contributions to the compartment deposit guarantee will be set at a level such that to recover the target level within a maximum period of six years.

3. Also, the period referred to in paragraph 1 may be extended until July 3, 2028 if between the entry into force of Law 11/2015, dated 18 June and 3 July 2024 the payments made by the compartment guarantee deposits exceed 0.8 percent of the guaranteed deposits to July 3, 2024. "

Eleventh final provision. Amendment of Law 3/2012, of 6 July, on urgent measures to reform the labor market.

The seventh additional provision of Law 3/2012, of 6 July, on urgent measures to reform the labor market, should read as follows:

"Seventh additional provision. Rules applicable to credit institutions.

One. Compensation for termination of contract.


1. The majority owned or financially supported by the Fund for Orderly Bank Restructuring entities (hereinafter FROB), or those which, being the subject of resolution measures require funding from the National Resolution or the Single Fund European resolution may not satisfy in any case compensation for termination of contract in excess of the lesser of the following amounts: a) twice the resulting maximum bases, respectively, of the rules 3rd and 4th Article 5.3 a) of Royal Decree-Law 2 / 2012, of 3 February, restructuring of the financial sector; b) two years of the fixed remuneration stipulated.

2. An exception to the above rule the case of those directors and executives who had joined the entity or its group after or simultaneously with the acquisition of ownership or financial support from the FROB or funding from National Resolution or the Fund single European resolution, in which case the Bank of Spain, in view of the contractually stipulated conditions and results of the recovery plan, may authorize higher amounts than those resulting from applying the bases resulting from the rules 3rd and 4 -SIXTH Article 5.3 a) of Royal Decree-Law 2/2012, of 3 February, but always with a limit of two years of fixed remuneration originally stipulated.

Two. Termination of employment of persons exercising administrative or management positions in a credit institution because of sanctions.

1. The imposition of sanctions referred to Articles 100 and 101 of Law 10/2014 of 26 June, management, supervision and solvency of credit institutions and Articles 86 and 87 of Law 11/2015, June 18, recovery and resolution of credit institutions and companies providing investment services, to persons holding administrative or management positions in a credit institution under an employment contract, including labor relations of special character senior management personnel shall be deemed, for the purposes of labor law, as serious and willful breach of contract and therefore because of disciplinary dismissal, and may result in termination of the contract by the employer.

2. In addition, the imposition of such sanctions shall be deemed as just cause for termination or termination of contracts that have a different kind of work.

3. In the event of termination of the contract in accordance with the provisions of the preceding paragraphs, persons holding administrative or management positions in a credit institution shall not be entitled to any compensation for such termination, whatever its amount or form, and regardless of the legal rule, contract, agreement or individual employment agreement or collective origin and contract, agreement or covenant of civil or commercial nature where payment of compensation is provided.

Three. Suspension of the contract of persons exercising administrative or management positions in a credit institution.

1. The contract or any other kind of persons exercising administrative or management positions in a credit institution may be suspended for the following reasons:

A) Where, in accordance with Article 112 of Law 10/2014, of June 26, the temporary suspension of people, holding administrative or management positions in the credit institution are available and appear as alleged responsible for very serious infringements.

B) Where, in the cases provided for in Law 10/2014, of June 26, or the Law 11/2015, of June 18, the supervisor or the competent authorities agree to the provisional resolution replacing administrative or management bodies of the credit institution.

2. The suspension of the contract to which the preceding paragraph shall have the same duration as the provisional suspension or temporary replacement agreed and will involve the reciprocal waiver of the obligations of work or deliver services and compensate for work or for providing those. "

Final provision twelfth. Amendment of Law 10/2014 of 26 June, management, supervision and solvency of credit institutions.

Law 10/2014 of 26 June, management, supervision and solvency of credit institutions, is amended as follows:

One. Article 70 reads as follows:

"Article 70. Causes of intervention and replacement of directors.


1. It shall intervention of a credit institution or the provisional replacement of its board or one or more of its members in the following cases:

A) In accordance with the provisions of the Law 11/2015, of 18 June, resolution of credit institutions and investment services companies.

B) Where there are indications grounds that the credit institution is in a situation other than those provided for in the scope of Law 11/2015 of 18 June, but exceptionally serious and can put in threatening stability, liquidity or solvency.

C) When a significant stake in a credit institution without respecting the rules provided by this Act or where there are substantial grounds and credited to consider that the influence exercised by persons who possess it can be detrimental to acquire management sound and prudent thereof, which seriously damage your financial situation.

2. The intervention measures or replacement referred to in this article may be adopted during the pendency of disciplinary or independently of the exercise of sanctioning powers record. "

Two. Article 73 reads as follows:

"Article 73. Content of the agreement intervention and replacement.

1. The agreement shall designate the person or persons who exercise the functions of intervention or to be acting as interim managers, and indicate whether such persons must act jointly, jointly or severally. Designees shall have the ability, professional qualifications and knowledge appropriate to the performance of these functions and not be incursas conflict of interest.

agreement also determine whether such intervention will involve the replacement of its board or one or more of its members and if the provisional administrator may exercise its functions in collaboration with the board.

2. The agreement, executive character from the moment that is made, will be subject to immediate publication in the "Official Gazette" and registration in public records. The publication in the "Official Gazette" determine the effectiveness of the agreement to third parties.

3. When necessary for the execution of the agreement intervention or replacement of managers can be reached direct compulsion for the inauguration of the offices, books and corresponding or for the examination of those documents, subject to the provisions of Article 96.3 of Law 30/1992 of 26 November.

4. The Bank of Spain can modify, reasoned and proceedings under this Chapter the intervention measure or replacement if required by the circumstances. "

Thirteenth final provision. Amendment of Law 22/2014, of 12 November, by which the venture capital entities, other collective investment entities closed-end management companies and collective investment entities regulated closed type, and why Law 35/2003 of 4 November on Collective Investment Institutions changes.

Paragraphs 1 and 2 of Article 81, which are worded as follows are modified:

"Article 81. Conditions for border management and ECR EICC by management companies authorized in Spain in accordance with Directive 2011/61 / EU of the European Parliament and of the Council of 8 June 2011 and for the provision of services in other Member States.

1. The SGEIC authorized in Spain in accordance with Directive 2011/61 / EU of the European Parliament and of the Council of 8 June 2011, will manage ECR and EICC established in another Member State, either directly or by establishing a branch provided that the SGEIC is authorized to manage that type of investment entities. Additionally you can pay in another Member State the services to which Article 42.4 for which it has been authorized concerns.

2. Any manager who intends to manage an ECR or EICC established in another Member State for the first time, notify the Comisión Nacional del Mercado de Valores the following information:

A) The Member State in which it intends to manage the ECR or EICC,

B) if the management is to be performed directly or by establishing a branch, or whether to provide services in Article 42.4 for which it has been authorized concerns, and

C) a program of activity setting stating in particular the services intending to ECR or EICC and it intends to manage identified. "


Final provision fourteenth. competence titles.

This Act is issued under the provisions of Article 149.1.6.ª, 11th and 13th of the Spanish Constitution, which they attribute to the State competition on commercial and procedural law, management bases credit, banking and insurance, and bases and coordination of general planning of economic activity, respectively.

The first to thirteenth final provisions are issued under powers title expressed in the rules are subject to modification by these provisions.

Final provision fifteenth. Incorporation of European Union law.

This law is partially incorporated into Spanish law Directive 2014/49 / EU of the European Parliament and of the Council of 16 April 2014, Directive 2014/59 / EU of the European Parliament and of the Council of 15 May 2014 and Directive 2013/50 / EU of the European Parliament and of the Council of 22 October 2013.

Sixteenth final provision. Faculty development.

The Government may issue the regulations necessary for the development of the provisions of this Act.

Seventeenth final provision. Entry into force.

1. This Act shall take effect on the day following its publication in the "Official Gazette" day.

2. Without prejudice to the provisions of the preceding paragraph:

A) The rules on internal recapitalization contained in Chapter VI shall enter into force on 1 January 2016.

B) The provisions of the new Article 12.1 introduced by the tenth final provision of Royal Decree-Law 16/2011, of October 14 will not enter into force until 3 July 2017.

Therefore

Command all Spaniards, individuals and authorities to observe and enforce this law.

Madrid, June 18, 2015.
FELIPE R.


The Prime Minister,
MARIANO
Rajoy Brey