On 8 September 2021, the European Commission published a webpage containing a Commission Delegated Regulation of 31 May 2021 supplementing the Bank Recovery and Resolution Directive (BRRD) with regard to regulatory technical standards (RTS) for the contractual recognition of write down and conversion powers.
The provisions of the Delegated Regulation specify:
- The conditions under which it would be legally or otherwise impracticable for an institution or entity referred to in point (b), (c) or (d) of Article 1(1) of the BRRD to include the contractual term referred to in paragraph 1 of Article 55 of the BRRD in certain categories of liabilities.
- The conditions for the resolution authority to require the inclusion of the contractual term pursuant to the third subparagraph of paragraph 2 of Article 55 of the BRRD.
- The reasonable timeframe for the resolution authority to require the inclusion of a contractual term pursuant to the third subparagraph of paragraph 2 of Article 55 of the BRRD.
The Delegated Regulation enters into force on the twentieth day following that of its publication in the Official Journal of the European Union.