Summary
This briefing is one in a series of ‘implementation appraisals’, produced by the European Parliamentary Research Service (EPRS), on the operation of existing EU legislation in practice. Each briefing focuses on a specific EU law which is likely to be amended or reviewed, as foreseen in the European Commission’s annual work programme. ‘Implementation appraisals’ aim at providing a succinct overview of publicly available material on the implementation, application and effectiveness to date of specific EU law, drawing on input from EU institutions and bodies, as well as external organisations. They are provided by the Ex-Post Evaluation Unit of EPRS, to assist parliamentary committees in their consideration of new European Commission proposals, once tabled.
SUMMARY
Initially announced in the Commission work programme for 2021, the European Commission postponed its proposals for the review of the bank crisis management and deposit insurance framework to 2023. As a central element of banking union, this framework consists of the Bank Recovery and Resolution Directive (BRRD), the Deposit Guarantee Schemes Directive (DGSD) and the Single Resolution Mechanism Regulation (SRMR).
The BRRD lays down rules and procedures for the recovery and resolution of banks at national level andcooperationarrangementstotacklecross-borderbankingfailures.Itaimstoavoidbailouts,i.e. the use of taxpayers’ money in the event of the resolution of a failing bank. The SRMR sets uniform rules and procedures for the resolution of banks and certain investment firms in the framework of a single resolution mechanism and a single resolution fund. The DGSD aims to protect depositors of all banks and the stability of the EU banking system.
The Commission’s review process involved public and targeted consultations and a high-level conference. During this review, the Commission planned to carry out an evaluation and impact assessment, the results of which are expected to be published together with the forthcoming proposed legislative changes.
The Commission announced in 2020 that the review would address existing problems in (i) the framework’sincentivestousetoolsoutsidetheresolutionframework,(ii)thevaryingavailabilityand use of tools in national insolvency proceedings, (iii) the legal certainty and predictability of the framework in a cross-border context, (iv) market integration within banking union, and (v) discrepancies in depositor protection across Member States.
Bankwatch 