Where a national banking resolution authority performs several functions, it must take the necessary measures to ensure that its resolution decisions are protected against any external influence, the Court of Justice of the European Union (CJEU) emphasised in a judgment delivered on Thursday 12 December (Case C-118/23).
In Poland, the Bank Guarantee Fund (BGF) acts as the Polish resolution authority and is also responsible for guaranteeing bank deposits. At the end of 2021, it was also appointed a temporary administrator to Getin Noble Bank, which was experiencing difficulties.
As the bank was facing a risk of insolvency, the BGF took a crisis management measure in September 2022, placing the failing financial institution under a resolution procedure in order to initiate a sale of assets to a buyer while ensuring the continuity of essential banking activities.
Referred to the CJEU for a preliminary ruling, the CJEU observes that where a national resolution authority performs several functions, the Bank Recovery and Resolution Directive (2014/59) provides that, when performing the resolution task, that authority must act in a manner protected from any influence external to that task.
The authority must therefore make structural arrangements to guarantee its operational independence and avoid any conflict of interest. In the absence of written internal rules designed to ensure this independence, it may take organisational measures.
Moreover, the Court emphasises, the failure to publish internal rules on independence does not automatically invalidate the resolution decision. However, the onus is on the resolution authority to establish that these rules have been complied with, so that its decision has been taken exclusively in order to achieve the objectives of the resolution (Article 31 BRRD).
Finally, in order to respect the right of every person to have their case heard, the Court asks the national court not to apply Polish provisions which would prohibit it from disjoining the numerous actions brought in this case. The national court will then have to act to settle the dispute within a reasonable time, while avoiding the risk of irreconcilable judgments.
See the Court’s judgment: https://aeur.eu/f/ese (Original version in French by Mathieu Bion)