Chapter 2: The Single Supervisory Mechanism
And The Role Of The ECB |
22. On 12 September 2012, the Commission published
its Proposal for a Council Regulation conferring specific tasks
on the European Central Bank (ECB) concerning policies relating
to the prudential supervision of credit institutions
(referred to as "the ECB Regulation"). The proposal
forms the central plank of the Single Supervisory Mechanism, and
Box 3 sets out its main components.
The main components of the ECB Regulation
|· The conferral on the ECB of specific tasks concerning policies relating to the prudential supervision of all euro area credit institutions.
· A non-euro area Member State and the ECB could enter into 'close cooperation'. The ECB would then carry out its supervisory tasks in relation to credit institutions established in that Member State.
· The ECB would have 'exclusive competence' for a list of prudential supervisory tasks including authorisation and licensing, oversight of compliance with prudential regulatory requirements, conducting stress tests, consolidated supervision of groups, and early intervention. The ECB would be responsible also for coordinating and expressing a common position of the competent authorities of participating Member States in EBA decision-making contexts.
· The ECB and the national prudential supervisors would together form the Single Supervisory Mechanism. National supervisors would be required to assist the ECB and comply with its instructions. National supervisors would remain responsible for supervisory tasks not transferred to the ECB.
· The ECB's supervisory objectives would be the promotion of the safety and soundness of credit institutions and the stability of the financial system, with due regard for the unity and integrity of the single market.
· An ECB Supervisory Board would be set up to achieve due separation between the supervisory and monetary policy functions. The ECB Governing Council would remain ultimately responsible for supervisory decision-making, subject to the possibility of delegation to the Supervisory Board of clearly defined tasks and related decisions.
· The ECB would be required to act independently in carrying out supervisory functions. It would be accountable to the EU Institutions and to the Eurogroup.
Why is a Single Supervisory Mechanism necessary?
23. The June 2012 Towards a Genuine Economic
and Monetary Union report argued that a Single Supervisory
Mechanism was essential to ensure the effective application of
prudential rules, risk control and crisis prevention throughout
the EU, thereby ensuring that the supervision of banks in all
EU Member States was equally effective in reducing the probability
of bank failures and preventing the need for intervention by joint
deposit guarantees or resolution funds.
24. The significance of this proposal was widely
appreciated. Karel Lannoo, Chief Executive Officer, Centre for
European Policy Studies, stressed the importance of eliminating
the "home bias" prevalent in national supervision.
HSBC argued that without a single supervisory framework it would
be difficult to justify the application of European funds to support
25. Mr Enria regarded the proposal as "a
key element of the pathway to restoring viability in the banking
Boomgaarden stressed that many banks would welcome central supervision
as creating a level playing field and reversing the "renationalisation
of banking" that had taken place since the crisis took hold.
26. The introduction of a Single Supervisory
Mechanism is a necessary step if confidence in the EU banking
sector is to be restored. Whilst it does not in and of itself
constitute a full banking union, it is an important first step
in that direction.
27. Given the systemic weaknesses in the euro
area banking sector that the financial crisis has brought to light,
a system of single banking prudential supervision is now urgently
required. The significance of this proposal as a first step towards
a full banking union should not be underestimated. The following
questions need to be addressed:
· Is it appropriate for the ECB, as is
proposed, to take on prudential supervisory tasks and, if so,
what will the impact be on its monetary policy responsibilities?
· What will be the impact on the ECB's
· Which banks should be directly supervised
by the ECB, and what will be the impact on the role of national
· What accountability mechanisms need
to be put in place?
· What will be the impact on non-euro
area Member States?
· What is a realistic timetable for these
reforms to be introduced?
· Do these reforms require treaty change?
A supervisory function for the
28. The key element of the proposal is for the
ECB to take on supervisory powers over euro area banks. Several
witnesses were strongly in favour. Mr Lannoo argued that,
if the ECB was to continue providing liquidity to the market,
then it also had the right to possess the necessary information
on national banking systems. He felt that, of all the institutions
in the euro area, it was the one with the most political credibility.
29. HM Treasury asserted that the ECB was an
appropriate organisation to take on the central supervisory role.
They pointed out that 11 out of 17 central banks in the euro area
already perform microprudential supervision. They made the comparison
with the proposal in the UK to transfer supervision to the Bank
of England, and said that the crisis had highlighted the importance
of uniting monetary policy and supervisory functions in one body.
30. Others had significant concerns. Kern Alexander,
Professor of Law and Finance, University of Zurich, felt
that the ECB was ill-suited to the role because of the restrictions
on its function under the EU Treaty. In his view, it would be
more logical for the EBA, ESMA and insurance authorities to work
together to undertake surveillance of the whole system.
Mats Persson, Director, Open Europe, feared that, given that many
euro area banks rely on cheap ECB liquidity to stay afloat, the
proposals could in fact reinforce the link between sovereign states
and the banks.
31. Mrs Bowles told us that many in the
European Parliament would have preferred the EBA to take on this
role, although she
and Mr Lannoo acknowledged that this could be problematic
because of the Meroni Doctrine.
Thomas Wieser, President, Euro Working Group, was more pragmatic,
arguing that central banks taking on supervisory functions was
"a second-best solution" but that, in the current circumstances,
it was the best way forward.
32. The Vice-President of the ECB, Vitor Constâncio,
told us that the ECB had long believed that it should be involved
in supervision. He argued that there was a "global tendency
to shift supervision ... towards central banks", citing recent
developments in the US (through the Dodd-Frank Act) and the UK.
In his view, it was no longer possible to distinguish the microsupervision
of individual institutions from what was going on in the financial
sector as a whole. Although he conceded that there was a potential
risk to the central bank's reputation and the potential for conflict
with its monetary policy role, he believed the risks were exaggerated,
at least in the ECB's case, because its mandate made clear that
"price stability comes first".
33. While we acknowledge that there are arguments
on both sides of the debate, it is our view that the ECB is best
placed to take on supervisory responsibilities. The ECB retains
greater credibility than other EU institutions and, as the current
global trend in this direction shows, the financial crisis demonstrated
the importance of drawing together responsibility for supervision
and monetary policy within one institution. However, it should
be noted that some, for instance in Germany, argue that the ECB's
'one country, one vote' decision-making rules are ill-suited for
the supervision of national banking sectors of widely differing
size. Ambassador Boomgaarden told us that there was no such proposal
"on the table at the moment".
However, Mr Rathi said that this was a "live discussion"
and that the larger euro area Member States were arguing for greater
recognition of the size of their financial sector.
34. There is an active debate about the appropriateness
of a central bank taking on supervisory functions alongside its
core monetary policy role. The US and the UK themselves are moving
towards drawing such functions together in one organisation, and
the majority of national central banks within the euro area already
do so. A Single Supervisory Mechanism is vital if confidence in
the euro area is to be restored. Giving this responsibility to
the ECB is the only viable option. However this would represent
a momentous step, creating a significant concentration of power
in one institution, with huge implications for the ECB's role.
Given the ECB's overriding focus on the euro area as opposed to
the EU-27, it would also have consequences for the shape of the
EU as a whole.
Supervisory powers, monetary
policy and the ECB governance structure
35. Drawing together supervisory and monetary
policy functions in one organisation is transparently fraught
with difficulties. Both Mr Persson and Professor Alexander
warned that the ECB might be tempted to use monetary policy inappropriately,
by lowering interest rates or loosening liquidity conditions,
in order to stabilise the banking sector.
Mr Wieser said that the firewalls between the two functions
needed to be as "tall, thick and impenetrable" as possible.
36. The Commission's proposal acknowledged the
danger of a conflict of interest. It proposed that, in relation
to supervisory tasks, "all preparatory and executing activities
within the ECB will be carried out by bodies and administrative
divisions separated from those responsible for monetary policy.
To this end a supervisory board will be set up that will prepare
decisions on supervisory matters. The Governing Council will be
ultimately responsible for taking decisions but may decide to
delegate certain tasks or decision-making power to the supervisory
37. Ahead of the October 2012 Summit, it was
reported that the European Council's legal service had concluded
that the proposal went beyond the powers permitted under law to
change governance rules at the ECB. The legal service found that,
without altering EU treaties, it would be impossible to give the
Supervisory Board any formal decision-making powers, since such
powers are vested in the ECB Governing Council. It was reported
that the legal service had sketched out a possible legal compromise
whereby the Supervisory Board could prepare draft supervision
decisions, so long as the final say remained with the Governing
38. The October 2012 Summit Conclusions stressed
the "need to ensure a clear separation between ECB monetary
policy and supervision functions".
Following the Summit, Mr Constâncio revealed that a
compromise had been agreed to reinforce the separation by minimising
as much as possible the role of the Governing Council in supervision.
Ambassador Boomgaarden confirmed that "we are on the way
to doing this inside the ECB but with a separate supervisory body."
39. There should be neither a conflict of
interest, nor a perception of a conflict of interest, between
the ECB's supervisory and monetary policy tasks. We recognise
the difficulties in designing a structure that overcomes this
dilemma whilst at the same time complying with the legal requirements
of the Treaty on the Functioning of the European Union (TFEU)
and the ECB Statute. As negotiations progress, the following principles
should be observed:
· The need for full separation of personnel
between the supervisory and monetary policy tasks;
· The need to grant the proposed Supervisory
Board wide decision-making autonomy;
· The need to minimise the role of the
Governing Council in relation to supervision as far as is possible
under the Treaty framework;
· The need to ensure that it is clear
which body within the ECB has ultimate responsibility in a crisis.
Without such principles the credibility of the
Single Supervisory Mechanism will be significantly undermined.
Whether these principles can be observed without recourse to treaty
change is open to question.
Which banks should the ECB supervise
and how should its relationship with national regulators work?
40. The effectiveness of the SSM will be determined
by the extent and nature of the supervisory regime. In other words
which banks will be supervised, and to what degree? We were told
that there were some 6000 banks in the euro area (and 8000 banks
across the EU as a whole).
The majority of witnesses argued that all 6000 euro area banks
should be brought within the Single Supervisory Mechanism,
although Rosa Lastra, Professor in International Financial
and Monetary Law, Queen Mary University of London, suggested a
'Champions League model' with only the larger institutions subject
to European supervision.
41. There are sound reasons for an inclusive
approach. Smaller and medium-sized EU banks, such as Northern
Rock in the UK, or the cajas (regional savings banks) in
Spain, found themselves at the centre of the financial crisis.
Barclays pointed to the dangers created by the significant interdependence
of banks that had come to light during the financial crisis.
Others stressed the need for supervisory consistency across all
banks. Mr Enria
told us that, if banks of all sizes were not included, in a moment
of distress there might be a flight of deposits from one set of
banks to the other.
42. Given the resource implications and the need
for expertise in national banking cultures, most acknowledged
that it would not be possible for the ECB to be engaged in intensive
supervision of all 6000 banks.
Mr Pisani-Ferry suggested that a reasonable compromise would
be for the ECB to have the necessary authority to cover all banks
whilst delegating supervision where appropriate.
Barclays described this as a 'hub and spoke' model, relying on
national supervisors acting in effect as a branch of the ECB.
43. Such a system would require close and effective
cooperation between the ECB and national supervisors.
However, some witnesses foresaw tensions.
Philip Whyte, Senior Research Fellow, Centre for European Reform,
suggested that the ECB would have fewer qualms about closing down
an insolvent German Landesbank than German authorities
would have. Prior
to the October 2012 Summit there had been much reporting of German
objections to an inclusive model because of the impact on Landesbanken
(regionally organised state-owned institutions specialising in
wholesale banking). Ambassador Boomgaarden stressed that European
supervision should concentrate on the systemically important banks,
with the majority remaining under the national supervisory authorities.
44. The Summit Conclusions stated that "the
ECB will be able, in a differentiated way, to carry out direct
Mr Constâncio confirmed that the ECB would directly
supervise the 25 or 30 most significant banks, and that supervision
would be decentralised to national supervisors for other banks.
However, national supervisors would act in accordance with approved
guidelines and would be required to follow the ECB's instructions.
In addition, the ECB would have authority to call in any banks
that required more direct attention.
45. Mr Whyte was not clear how this compromise
would work in practice. He was concerned that there would continue
to be "policies of forbearance driven by local political
46. The Financial Secretary to the Treasury agreed
that, initially, the ECB would be supervising the supervisors,
but emphasised that this was an important first step.
He also stressed that it was not proposed to create a set of institutions
divorced from national supervisory authorities requiring "a
whole set of people to be magicked up from nowhere."
47. It is unrealistic to expect the ECB to
engage in intensive supervision of all 6000 euro area banks. Yet
the dangers created by the significant interdependence of banks
that came to light during the financial crisis demonstrate that
it is not only large credit institutions that pose a threat to
the financial sector. A sensible compromise would be for the ECB
to direct the conduct of supervision by national supervisors,
and for the ECB itself to focus on day-to-day supervision of only
the largest cross-border and systemically important banks, but
with the power quickly to assume responsibility for the supervision
of smaller banks as required.
48. This model can only work if there is close
and positive cooperation between the ECB and national supervisors.
The ECB must also have the means to eliminate national supervisory
bias where it occurs. The proposed supervisory arrangements must
be stress-tested against conditions of acute crisis, setting out
clearly who is in charge, the relationship between the parties
involved, and how the chain of command will operate. Given that
a banking crisis originating amongst participating Member States
would inevitably spread to London and the single market as a whole,
the Government must ensure that the UK is able to influence decisions
on the design of the supervisory framework.
Accountability of the ECB
49. Article 130 TFEU sets out the independence
of the ECB as follows:
"When exercising the powers and carrying out
the tasks and duties conferred upon them by the Treaties and the
Statute of the ESCB and of the ECB, neither the European Central
Bank, nor a national central bank, nor any member of their decision-making
bodies shall seek or take instructions from Union institutions,
bodies, offices or agencies, from any government of a Member State
or from any other body. The Union institutions, bodies, offices
or agencies and the governments of the Member States undertake
to respect this principle and not to seek to influence the members
of the decision-making bodies of the European Central Bank or
of the national central banks in the performance of their tasks."
50. The Commission proposal stated that the ECB
would be subject to strong accountability mechanisms to the European
Parliament and the Council/Eurogroup, including regular reporting
requirements, answering questions and the presentation of an annual
Van Rompuy stressed that the ECB was more accountable to the European
Parliament than people thought, although he foresaw an evolution
of the European Parliament's role.
51. Others argued that the accountability provisions
did not go far enough. Philippe Lamberts MEP told us that it was
unhealthy in a democracy to concentrate too much power in one
institution. He and Professor Alexander were concerned that
the ECB might find it difficult to adapt from its "corporate
culture of non-accountability".
Mr Enria stressed the need for "parliamentary control
of the use made of European taxpayers' money. It cannot be only
the Council or closed circles of civil servants who oversee the
52. We also considered whether the ECB needed
to be accountable to national parliaments as well as the European
Parliament. Professor Lastra expressed concern about the
lack of sufficient accountability mechanisms in the EU as a whole,
and stressed the need for accountability at a national level.
Ambassador Boomgaarden argued that there was a need for "democratic
legitimisation" at national level for decisions to close
down a bank or change its management.
53. The October 2012 Council conclusions baldly
stated that "accountability takes place at the level at which
decisions are taken and implemented."
However Mr Constâncio acknowledged that the ECB's interaction
with the European Parliament and the Council would have to be
more frequent and open than had been the case with monetary policy,
and that the ECB would need to be "totally open" about
the supervisory decisions that it took.
We also note Mr Constâncio's own appearance before
us as a useful illustration of how an accountability mechanism
of the ECB to national parliaments could operate.
54. HM Treasury highlighted three other issues
that needed to be addressed. First, the lack of any internal appeal
mechanism in the ECB. Second, a system where the only legal redress
was to the European Court of Justice which, given that cases can
take two years to work through the system, would not help credit
institutions under threat of imminent closure. Third, the question
of who was in charge in a crisis when issues of democratic accountability
were at their most profound.
55. The principle of ECB independence is a necessary
one in terms of the ECB's core monetary policy role. Effective
banking supervision also requires independence, but independence
in the supervisory context must be balanced by strong accountability
56. The ECB will become an exceptionally powerful
institution if it takes on the proposed supervisory powers. Four
principles of accountability need to be borne in mind:
· That the ECB should be fully answerable
to the Council and European Parliament for the supervisory decisions
that it undertakes;
· That an effective, calibrated and streamlined
mechanism of accountability to national parliaments should be
established, in particular in relation to individual supervision
decisions that have a significant impact on an individual Member
State's banking sector. It must be for national Parliaments to
set out how any new accountability structures and frameworks should
operate in practice;
· That an effective appeals system should
be established within the ECB, with a timely and appropriate system
of external legal challenge;
· That the accountability mechanism should
be able to operate speedily and effectively at moments of acute
57. Judged by these principles, the accountability
provisions in the original proposals are patently weak. The ECB
must retain full independence in the exercise of its monetary
policy role, as well as operational independence in relation to
the supervisory function. We also acknowledge the legal constraints
presented by Article 130 TFEU. Nevertheless, the case for a strong
accountability mechanism is overwhelming. We are heartened by
the ECB's acknowledgement that stronger accountability provisions
The impact of the proposal on
non-euro area Member States
58. The Commission proposal suggested that Member
States that have not adopted the euro but wished to participate
in the banking union would be able to enter into a close supervisory
cooperation agreement with the ECB subject to meeting certain
conditions. Where such a Member State entered into supervisory
cooperation, the ECB would carry out the supervisory tasks conferred
on it as regards the credit institutions established in the Member
State. A representative of the Member State would be able to take
part in the activities of the Supervisory Board.
59. The UK has indicated that it will not participate
in the SSM (see Chapter 5). Thus, for the UK, the only change
should be that its dealings with other supervisors on home-host
issues, consolidated supervision and related matters may be with
the ECB rather than individual national supervisors. Yet concern
has been expressed to us about the danger of competence creep,
whereby the ECB may seek to exert more authority than that presently
held by existing national bank supervisors.
60. Other non-euro Member States are likely to
wish to participate in the SSM.
Mark Harding, Group General Counsel, Barclays, suggested smaller
non-euro Member States would benefit from the credibility that
the ECB would provide. He also suggested that Sweden may prefer
to be involved because of its links with the Finnish banking system.
Mr Whyte cited the example of Nordea, which is headquartered
in Sweden, but is the largest lender in Finland.
We note that German and Austrian-owned banks enjoy a dominant
position in several central European Member States.
61. The main bone of contention for Member States
such as Sweden, Poland and Hungary has been how to ensure that
they would have a full and equal role in the decision-making process.
The ECB statutes make clear that only euro area Member States
have a vote on the Governing Council, which would legally be required
to have the final say in any supervisory decisions under the model
proposed by the Commission. Commissioner Barnier told us that
"legal obstacles" meant that he had not been able to
provide sufficient provisions in the original text. He believed,
however, that there was "a degree of flexibility so that
we might be able to improve this proposal."
62. We have referred to reports that the Council
legal service raised doubts about the legality of the proposed
governance structure. It was also reported that the legal service
concluded that participating non-euro area Member States would
be legally unable to vote on any ECB decisions. However the legal
service's compromise suggestion, referred to above, would have
allowed non-euro area Member States to be given full voting rights
in the drafting of advice in the Supervisory Board for the Governing
Council to act on.
63. The October 2012 Council conclusions referred
to the need for "equitable treatment and representation of
both euro and non-euro area Member States participating in the
the Summit, Mr Constâncio told us it had been agreed
to make amendments, but that the precise proposals had yet to
64. Nikhil Rathi, Director, Financial Regulations
and Market Services, HM Treasury, told us that this remained a
sensitive element of the negotiations.
Following the November 2012 meeting of EU finance ministers, the
Swedish finance minister, Anders Borg, was reported as stating
that "either you must change the treaty so it's clear that
every member is treated equitably or you need to move it outside
of the ECB."
65. Many non-euro area Member States may wish
to participate in the Single Supervisory Mechanism. The UK has
made clear that it will not do so. It is important that those
non-euro area Member States who do wish to participate enjoy de
facto equality with euro area Member States in the
ECB decision-making process. The constraints imposed by TFEU may
mean that this ultimately requires treaty change. Interim arrangements
need to be devised that are satisfactory to those non-euro area
Member States who wish to participate.
66. An explicit link was drawn at the June 2012
European Council between the proposals for a Single Supervisory
Mechanism and any move to allow the ESM to recapitalise banks
directly. This link was made in the context of the dire prospects
of the Spanish banking sector. In order to allow direct recapitalisation
to take place as soon as possible, the SSM was subject to an extremely
ambitious timetable, with final agreement sought by the end of
67. The majority of witnesses criticised the
timetable, variously describing it as "unviable",
"very aggressive", "totally unrealistic",
and "utterly stupid".
Mr Whyte said that it was "pie in the sky" to think
of this timetable as part of the solution to the Spanish banking
crisis, and warned
that discussions on the banking union could become an excuse for
not addressing the Spanish problem.
On the other hand, Mr Enria argued that "when you are
in a crisis, policy makers need to get their act together and
deal with the issue on the table fast."
68. Ahead of the October 2012 European Council,
President Van Rompuy told us that he hoped to get much of the
detail agreed by the Spring of 2013.
The European Council subsequently agreed that SSM should be taken
forward as a matter of priority, with the objective of agreeing
on the legislative framework by 1 January 2013. Work on operational
implementation would then follow during 2013.
69. The Summit conclusions were widely seen as
a necessary compromise in light of German concerns, articulated
by Ambassador Boomgaarden, that the SSM "has to be successfully
established and working effectively before any direct recapitalisation
of banks in the euro area by the ESM can take place."
He stressed that "quality goes before speed", and that
direct recapitalisation could only occur once other elements,
including a single rulebook and a legal framework, were in place.
70. Following the Summit, Mr Constâncio
told us that it was intended that effective supervision would
commence in early 2014. He acknowledged that any operation to
directly capitalise banks would be delayed until then.
Mr Rathi warned that there were many different interpretations
as to what the commitment to agreeing a 'legislative framework'
by the end of 2012 actually meant.
71. Following the meeting of EU finance ministers
on 13 November 2012 it was reported that a German-led bloc had
demanded that ministers "concentrate on getting the proposal
right, rather than obsessing with a fixed timetable". Commissioner
Barnier was reported to have conceded that a deal in December
was "possible but difficult" and that, in any case,
establishing the SSM was "a necessary, but not a sufficient
condition" for direct recapitalisation of banks to take place.
The German finance minister, Wolfgang Schäuble, repeated
his concern about moving too quickly at a further meeting of finance
ministers on 4 December.
72. Given the complex and controversial nature
of the Single Supervisory Mechanism proposals, the timetable for
reaching agreement on the proposals by the end of 2012 was wholly
unrealistic. The revised aim of agreeing a legislative framework
by the end of 2012 remains extremely ambitious, and, even if achieved,
will leave significant questions as to how the mechanism will
work in practice still to be addressed. The rushed timetable was
a direct consequence of the political decision to link implementation
of the SSM with the perceived need urgently to recapitalise the
Spanish banking sector. This link is a contentious one which constrains
the ability to assess the SSM proposals on their own merits. The
need to agree legislation quickly does not obviate the requirement
for effective scrutiny. The decline in Spanish bond yields since
the ECB began to intervene in the secondary markets has eased
the immediate pressure for recapitalisation, yet Spain's prospects
remain uncertain. The banking union proposals must not become
an excuse for inaction on that front.
The case for treaty change
73. We have referred a number of times to the
difficulties that the Commission has faced in seeking to keep
its proposal within the constraints of TFEU. In particular, the
fraught negotiations about the governance structure, the role
of the Supervisory Board and the Governing Council, and the voting
provisions for non-euro Member States have been made much more
complex by the desire to avoid necessitating treaty change.
74. Negotiators continue to seek a way to provide
the necessary safeguards within the constraints of the Treaty.
It remains to be seen whether such efforts will bear fruit. We
fear that the overriding imperative of avoiding treaty change
may produce deficient legislation with counterproductive consequences.
75. In its design of the proposals the Commission
has been constrained by the need to avoid necessitating treaty
change. We remain to be convinced that an effective mechanism
can be designed within existing treaty constraints. European legislators
may ultimately have to decide whether treaty change is a price
they are willing to pay in order to bring about banking union.
Adopting deficient and counterproductive legislation by way of
compromise would be the worst of all possible outcomes.
24 Defined as an undertaking whose business is to receive
deposits or other repayable funds from the public and to grant
credits for its own account; or an electronic money institution.
See Article 2(3) and Article 4(1) of Directive 2006/48/EC. Back
COM (2012) 511. See EMs 13682/12, 13683/12 and 13854/12. See
also Appendix 5 for more details. Back
Towards a Genuine Economic and Monetary Union, June 2012,
op. cit. Back
Q 65. Back
Q 82. Back
Q 177. Back
QQ 56-9. Back
HM Treasury. Back
QQ 221, 236. Back
QQ 106, 108. ESMA is the European Securities and Markets Authority.
Q 197. Back
Q 23. Back
QQ 23, 61. The 'Meroni Doctrine' is derived from
Case 9/56 Meroni v High Authority [1957-8] ECR 133. The
legal principles set out in Meroni have retained their
vitality notwithstanding that the case was decided in the era
of the European Coal and Steel Community and the EU institutional
architecture and legal framework have moved on very considerably
since then. Under Meroni EU Institutions may not delegate
discretionary power that implies a wide margin of discretion which
may make possible the execution of actual economic policy. Only
clearly defined executive powers the exercise of which can be
subject to strict review in the light of objective criteria can
be delegated. Meroni is not an obstacle to the conferral
of tasks on the ECB because Article 127(6) TFEU provides for the
possibility of delegation. Back
Q 75. Back
See Appendix 6. Back
Q 158. Back
Q 180. Back
Q 217. Back
Q 198, Professor Alexander. Back
Q 75. Back
COM (2012) 511. Back
'Europe banking supervisor plan 'illegal'', by Alex Barker, Financial
Times, 17 October 2012. Back
European Council, 18/19 October 2012, Conclusions: http://www.consilium.europa.eu/uedocs/cms_data/docs/pressdata/en/ec/133004.pdf Back
Q 157. Back
Q 184. Back
Q 155 (Mr Constâncio). Back
See for example Q 25 (Mrs Bowles). Back
Q 106. Back
Q 106 (Professor Lastra); HSBC. Back
QQ 131, 134 (Mr Harding). Back
Q 91. Back
See for instance Q 46 (Mr Pisani-Ferry); Q 134 (Mr Kibble);
Barclays; and Lloyds Banking Group. Back
Q 43. Back
See Q 129 and Barclays. Back
See for instance Q 98 (Commissioner Barnier); Q 181
(Ambassador Boomgaarden). Back
See for instance Q 45 (Mr Pisani-Ferry). Back
Q 197. Back
Q 173. Back
October 2012 European Council conclusions, op. cit. Back
QQ 153, 155. Back
Q 196. Back
Q 213. Back
Q 236. Back
COM (2012) 511, op. cit. Back
Appendix 4. Back
QQ 1, 114. Back
Q 94. Back
Q 114. Back
QQ 181, 184. Back
October 2012 European Council conclusions, op. cit. Back
Q 160. Back
Q 215. On the appeals mechanism, see also Q 23 (Mrs Bowles);
Q 133 (Mr Harding). Back
COM (2012) 511, op. cit. Back
Q 115 (Professor Alexander); Q 199 (Mr Whyte).
See Q 6 (Mr Lamberts); Q 198 (Mr Whyte); QQ 219,
225 (the Financial Secretary to the Treasury) for a discussion
of the positions of non-euro area Member States. Back
Q 139. Back
Q 199. Back
Q 100. Back
'Europe banking supervisor plan 'illegal'', op. cit. See
above, para 37. Back
October 2012 European Council conclusions, op. cit. Back
QQ 157, 159. See also QQ 175, 181 (Ambassador Boomgaarden). Back
Q 217. Back
'Doubts grow on banking union', by Alex Barker, Financial Times,
14 November 2012. Back
Q 28 (Mrs Bowles). Back
QQ 1, 3 (Mr Lamberts). Back
Q 195 (Mr Persson). Back
Q 79 (Mr Wieser). Back
Q 195. Back
Q 197. Back
QQ 82, 94. Back
Appendix 4. Back
October 2012 European Council conclusions, op. cit. Back
QQ 172-3 Back
ibid., Q 176. See Chapter 4 for an examination of the single
Q 152. Back
Q 209. Back
'Doubts grow on banking union', op. cit.; 'Ministers at
odds on banking supervision', by Valentina Pop, EUObserver.com,
14 November 2012. Back
'Banking union plan hits wall', by Alex Barker and Peter Spiegel,
Financial Times, 5 December 2012. Back