It is necessary to subject a DGS contribution to alternative measures to adequate safeguards in order to ensure a level playing field and the effectiveness and cost-efficiency of such measures. The DGS can only be used to finance the transfer of non-covered deposits and other unsecured liabilities to a recipient if the transfer is strictly necessary and proportionate to avoid contagion, if the transfer would maximise the value of the assets upon sale, or if the preservation of client relationships would maintain confidence. The DGS should not be used to transfer own funds or liabilities ranking below ordinary unsecured liabilities in the national laws governing normal insolvency proceedings.
Text as published in the Official Journal, reproduced verbatim (including any typographical quirks of the source). For the authentic version, see EUR-Lex.
