Article 1 — Amendments to Regulation (EU) No 806/2014

Regulation (EU) No 806/2014 is amended as follows: (1) Article 3(1) is amended as follows: (a) point (21) is replaced by the following: (21) subsidiary means a subsidiary as defined in Article 4(1), point (16), of Regulation (EU) No 575/2013, and for the purpose of applying Article 8, Article 10(10), Articles 12 to 12k, 21 and 53 of this Regulation to resolution groups referred to in point (24b)(b) of this paragraph, includes, where and as appropriate, credit institutions or financial institutions that are permanently affiliated to a central body, the central body itself, and their respective subsidiaries, taking into account the way in which such resolution groups comply with Article 12f(3) of this Regulation; ; (b) point (24a) is replaced by the following: (24a) resolution entity means a legal person established in a participating Member State, which the Board or the national resolution authority, in accordance with Article 8 of this Regulation, has identified as an entity in respect of which the resolution plan provides for resolution action; ; (c) in point (24b), point (b) is replaced by the following: (b) credit institutions or financial institutions that are permanently affiliated to a central body, and the central body itself when at least one of those credit institutions or financial institutions or the central body is a resolution entity, and their respective subsidiaries; ; (d) the following points are inserted: (24d) non-EU G-SII means a non-EU G-SII as defined in Article 4(1), point (134), of Regulation (EU) No 575/2013; (24e) G-SII entity means a G-SII entity as defined in Article 4(1), point (136), of Regulation (EU) No 575/2013; ; (e) point (49) is replaced by the following: (49) bail-inable liabilities means the liabilities, including liabilities of uncertain timing or amount, and capital instruments that do not qualify as Common Equity Tier 1, Additional Tier 1 or Tier 2 instruments of an entity as referred to in Article 2 and that are not excluded from the scope of the bail-in tool pursuant to Article 27(3); ; (f) the following point is inserted: (49aa) liabilities of uncertain timing or amount means liabilities based on present obligations arising from past events which will result in a loss and the timing or amount of which is uncertain; ; (g) point (49b) is replaced by the following: (49b) subordinated eligible instruments means instruments that meet all of the conditions referred to in Article 72a of Regulation (EU) No 575/2013 other than Article 72b(3), (4) and (5), of that Regulation, and, where applicable, in Article 12c(1a) of this Regulation; ; (h) the following point is inserted: (50a) designated authority means a designated authority as defined in Article 2(1), point (18), of Directive 2014/49/EU; ; (2) in Article 4, the following paragraph is inserted: 1a. Member States shall inform the Board as soon as possible where they request to enter into a close cooperation with the ECB pursuant to Article 7 of Regulation (EU) No 1024/2013. Following the notification made pursuant to Article 7 of Regulation (EU) No 1024/2013 and before close cooperation is established, Member States shall provide all information about the entities and groups established in their territory that the Board may require to prepare for the tasks conferred on it by this Regulation and the Agreement. ; (3) in Article 5, the following paragraph is inserted: 1a. Any references to authorities designated in accordance with Article 3 of Directive 2014/59/EU in Article 7(6), point (e), Article 10(3), Article 63(3), point (j), Article 65(2), point (k), and Article 70(4) of Directive (EU) 2025/1 of the European Parliament and of the Council, shall be read as references to the Board with regard to the entities and groups referred to in Article 7(2) of this Regulation, and to the entities and groups referred to in Article 7(4), point (b), and Article 7(5) of this Regulation where the conditions for the application of those provisions are met. (4) Article 7 is amended as follows: (a) in paragraph 3, the fourth subparagraph is replaced by the following: When performing the tasks referred to in this paragraph, the national resolution authorities shall apply the relevant provisions of this Regulation. Any references to the Board in Article 5(2), Article 6(5), Article 8(6), (8), (10), third subparagraph, (11a), (12) and (13), Article 10(1) to (10), Article 10a, Articles 11 to 14, Article 15(1), (2) and (3), Article 16, Article 18(1), (1a), (2), (5) and (6), Article 20, Article 21(1) to (7), Article 21(8), second subparagraph, Article 21(9) and (10), Article 22(1), (3), (5) and (6), Articles 23 and 24, Article 25(3), Article 27(1) to (15), Article 27(16), second subparagraph, second sentence, third subparagraph, and fourth subparagraph, first, third and fourth sentences, Article 30(2b) and (2c), Article 30a(1) and (2), Article 32 and Article 79(1), (2), (7) and (8), shall be read as references to the national resolution authorities with regard to groups and entities referred to in the first subparagraph of this paragraph. For that purpose the national resolution authorities shall exercise the powers conferred on them under national law transposing Directive 2014/59/EU in accordance with the conditions laid down in national law. ; (b) paragraph 5 is replaced by the following: 5. Notwithstanding paragraph 3 of this Article, participating Member States may decide that the Board exercise all of the relevant powers and responsibilities conferred on it by this Regulation in relation to entities and groups established in their territory, other than those referred to in paragraph 2 of this Article. If so, paragraphs 3 and 4 of this Article, Article 9, Article 12(3), and Article 31(1) shall not apply. Member States that intend to make use of that option shall notify the Board and the Commission thereof. The notification shall take effect from the day of its publication in the Official Journal of the European Union. After the notification referred to in the first subparagraph of this paragraph has taken effect, participating Member States may decide that the responsibility for performing the tasks in relation to entities and groups established in their territory, other than those referred to in paragraph 2, shall be returned to the national resolution authorities, in which case the first subparagraph of this paragraph shall no longer apply. Member States that intend to make use of that option shall notify the Board and the Commission thereof. That notification shall take effect from the day of its publication in the Official Journal of the European Union. ; (5) Article 8 is amended as follows: (a) in paragraph 2, the following subparagraph is added: The Board may instruct the national resolution authorities to exercise the powers referred to in Article 10(8) of Directive 2014/59/EU. The national resolution authorities shall implement the instructions of the Board in accordance with Article 29 of this Regulation. ; (b) paragraph 10 is amended as follows: (i) the second subparagraph is replaced by the following: In accordance with the measures referred to in the first subparagraph, the resolution plan shall identify for each group the resolution entities and the resolution groups and, where appropriate, the liquidation entities. ; (ii) the following subparagraph is added: When identifying the measures to be taken in respect of the subsidiaries referred to in the first subparagraph, point (b), that are not resolution entities, the Board may follow a commensurate approach if such approach does not negatively affect the resolvability of the group, taking into account the size of the subsidiary, its risk profile, its role in the provision of critical functions and of core business lines, its importance for the operational continuity of the group after resolution and the group resolution strategy. The Board shall duly consider the importance of the subsidiary in the Member State where it is established, including its potential systemic importance, and its potential impact on the available financial means of the deposit guarantee scheme in the case of winding up under normal insolvency proceedings. ; (c) the following paragraph is inserted: 11a. Where proceedings have been initiated to wind up an entity in accordance with applicable national law pursuant to Article 32b of Directive 2014/59/EU, or where Article 22(5) of this Regulation applies, the Board shall not adopt a resolution plan for that entity or shall no longer include that entity in the group resolution plan. ; (6) Article 10 is amended as follows: (a) in paragraph 4, the fourth subparagraph is replaced by the following: The assessment referred to in the third subparagraph shall be performed in addition to the assessment of the resolvability of the entire group. ; (b) paragraph 7 is replaced by the following: 7. If, pursuant to an assessment of the resolvability of an entity or a group carried out in accordance with paragraph 3 or 4, the Board, after consulting the competent authorities, including the ECB, determines that there are substantive impediments to the resolvability of that entity or group, the Board shall prepare a report, in cooperation with the competent authorities, addressed to the entity or the parent undertaking analysing the substantive impediments to the effective application of resolution tools and the exercise of resolution powers. That report shall consider the impact on the entity’s or the group’s business model and recommend any proportionate and targeted measures that, in the Board’s view, are necessary or appropriate to remove those impediments in accordance with paragraph 10. ; (c) the following paragraph is inserted: 9a. Where the Board finds that the measures proposed by the entity or the parent undertaking concerned effectively reduce or remove the substantive impediments to resolvability, the Board, after having consulted the ECB or the relevant national competent authority and, where appropriate, the designated macro-prudential authority, shall take a decision. That decision shall indicate that the Board has assessed the measures proposed as adequate for effectively reducing or removing the substantive impediments to resolvability and shall instruct the national resolution authorities to require the entity, the parent undertaking, or any subsidiary of the group concerned to implement the measures proposed. ; (d) paragraph 10 is replaced by the following: 10. Where the Board finds that the measures proposed by the entity or the parent undertaking concerned do not effectively reduce or remove the substantive impediments to resolvability, the Board, after having consulted the competent authorities and, where appropriate, the designated macro-prudential authority, shall take a decision. That decision shall indicate that the Board has assessed that the measures proposed do not effectively reduce or remove the substantive impediments to resolvability and shall instruct the national resolution authorities to require the entity, the parent undertaking, or any subsidiary of the group concerned to take any of the measures listed in paragraph 11. In identifying alternative measures, the Board shall demonstrate how the measures proposed by the entity or the parent undertaking concerned would not be able to remove the substantive impediments to resolvability and how the alternative measures proposed are proportionate in removing them. The Board shall take into account the threat to financial stability of those impediments to resolvability and the effect of the measures on the business of the entity or the parent undertaking concerned, its stability and its ability to contribute to the economy, on the internal market for financial services and on the financial stability in other Member States and the Union as a whole. The Board shall also take into account the need to avoid any impact on the entity or the group concerned which would go beyond what is necessary to remove the impediment to resolvability or which would be disproportionate. ; (7) Article 10a is amended as follows: (a) in paragraph 1, the introductory wording is replaced by the following: Where an entity is in a situation where it meets the combined buffer requirement when considered in addition to each of the requirements referred to in Article 141a(1), points (a), (b) and (c), of Directive 2013/36/EU, but fails to meet the combined buffer requirement when considered in addition to the requirements referred to in Articles 12d and 12e of this Regulation when calculated in accordance with Article 12a(2), point (a), of this Regulation, the Board shall have the power, in accordance with paragraphs 2 and 3 of this Article, to instruct the national resolution authority to prohibit an entity from distributing more than the Maximum Distributable Amount related to the minimum requirement for own funds and eligible liabilities (M-MDA), calculated in accordance with paragraph 4 of this Article, through any of the following actions: ; (b) the following paragraph is added: 7. Where a resolution entity or an entity that is not itself a resolution entity is not subject to the combined buffer requirement on the same basis as the basis on which it is required to comply with the requirements referred to in Articles 12d and 12e of this Regulation, the Board shall apply paragraphs 1 to 6 of this Article on the basis of the estimated combined buffer requirement resulting from the methodology set out in the delegated act adopted pursuant to Article 45c(4) of Directive 2014/59/EU. Article 128, fourth paragraph, of Directive 2013/36/EU shall apply. The Board shall include the estimated combined buffer requirement referred to in the first subparagraph of this paragraph in the decision determining the requirements referred to in Articles 12d and 12e of this Regulation. The entity shall make the estimated combined buffer requirement publicly available together with the information referred to in Article 45i(3) of Directive 2014/59/EU. ; (8) in Article 12, the following paragraph is added: 8. The Board shall be responsible for granting the permissions referred to in Article 77(2) and Article 78a of Regulation (EU) No 575/2013 to the entities referred to in paragraph 1 of this Article. The Board shall address a decision to the entity concerned. ; (9) in Article 12a, paragraph 1 is replaced by the following: 1. The Board and national resolution authorities shall ensure that the entities referred to in Article 12(1) and (3) meet, at all times, the requirements for own funds and eligible liabilities where required and as determined by the Board in accordance with this Article and Articles 12b to 12i. ; (10) Article 12c is amended as follows: (a) the following paragraphs are inserted: 1a. Resolution entities shall only include deposits in the amount of own funds and eligible liabilities where such inclusion has been authorised by the Board in accordance with paragraph 1b and where those deposits meet all of the following conditions: (a) the deposits meet all of the conditions set out in paragraph 1, first subparagraph; (b) the deposits are not held by natural persons and micro, small and medium-sized enterprises; (c) the deposits are term deposits with an original maturity of at least one year and do not confer upon the owner a right to early reimbursement even where the early reimbursement is subject to the payment of a penalty; (d) the relevant contractual documentation explicitly refers to: (i) the resolution entity’s intention to include the deposits in the amount of own funds and eligible liabilities; (ii) the exclusion of the deposits from any repayment by a deposit guarantee scheme pursuant to Article 5(1), point (l), of Directive 2014/49/EU. 1b. The Board may authorise the resolution entity to fully or partially include deposits in the amount of own funds and eligible liabilities if it is satisfied that all of the following conditions are met: (a) the Board expects that those deposits would not be fully or partially excluded from bail-in pursuant to Article 27(5) or would not be transferred in full to a recipient under a partial transfer; (b) the Board has concluded that the inclusion is not, or is not likely to be, a substantive impediment to resolvability, in particular due to the impact on the feasibility of using resolution tools in a way that achieves the resolution objectives. The Board shall withdraw the authorisation where it concludes that one of the conditions referred to in the first subparagraph is no longer met. In that case, the resolution entity shall cease to include deposits in the amount of own funds and eligible liabilities. ; (b) in paragraphs 4 and 5, the term G-SIIs is replaced by the term G-SII entities; (c) in paragraph 7, the introductory wording is replaced by the following: By derogation from paragraph 4 of this Article, the Board may decide that the requirement referred to in Article 12f of this Regulation shall be met by resolution entities that are G-SII entities or resolution entities that are subject to Article 12d(4) or (5) of this Regulation using own funds, subordinated eligible instruments, or liabilities as referred to in paragraph 3 of this Article, to the extent that, due to the obligation of the resolution entity to comply with the combined buffer requirement and the requirements referred to in Article 92a of Regulation (EU) No 575/2013, Article 12d(4) and Article 12f of this Regulation, the sum of those own funds, instruments and liabilities does not exceed the greater of: ; (d) paragraph 8 is amended as follows: (i) in the first subparagraph, the term G-SIIs is replaced by the term G-SII entities; (ii) in the second subparagraph, point (c), the term G-SII is replaced by the term G-SII entity; (e) the following paragraph is added: 10. The Board may permit the resolution entity to comply with the requirements referred to in paragraphs 4, 5 and 7 using own funds or liabilities as referred to in paragraphs 1 and 3 where all of the following conditions are met: (a) for entities that are G-SII entities or resolution entities that are subject to Article 12d(4) or (5), the Board has not reduced the requirement referred to in paragraph 4 of this Article, pursuant to the first subparagraph of that paragraph; (b) the liabilities referred to in paragraph 1 of this Article that do not meet the condition referred to in Article 72b(2), point (d), of Regulation (EU) No 575/2013 comply with the conditions set out in Article 72b(4), points (b) to (e), of that Regulation. ; (11) Article 12d is amended as follows: (a) in paragraph 2a, second subparagraph, point (b) is replaced by the following: (b) liabilities that fulfil the eligibility criteria referred to in Article 72a of Regulation (EU) No 575/2013, except for Article 72b(2), points (b) and (d), of that Regulation, and, where applicable, in Article 12c(1a) of this Regulation; ; (b) in paragraph 3, eighth subparagraph, the words critical economic functions are replaced by the term critical functions; (c) the following paragraph is inserted: 5a. For resolution entities the preferred resolution strategy of which envisages primarily the application of the sale of business tool or the bridge institution tool and its exit from the market, the level of the requirement referred to in paragraph 3 of this Article shall be at least equal to: (a) 16 % when calculated in accordance with Article 12a(2), point (a); and (b) 4,75 % when calculated in accordance with Article 12a(2), point (b). The first subparagraph of this paragraph shall not apply to resolution entities the preferred resolution strategy of which envisages the application of the bail-in tool for the purpose of Article 27(1), point (a), independently or in combination with other resolution tools. ; (d) in paragraph 6, eighth subparagraph, the words critical economic functions are replaced by the term critical functions; (12) in Article 12e(1), the introductory wording is replaced by the following: The requirement referred to in Article 12a(1) for a resolution entity that is a G-SII entity shall consist of the following: ; (13) Article 12g is amended as follows: (a) paragraph 1 is amended as follows: (i) the second subparagraph is replaced by the following: The Board, after having consulted the competent authorities, including the ECB, may decide to apply the requirement laid down in this Article to an entity as referred to in Article 2, point (b), or to a financial institution as referred to in Article 2, point (c), that is a subsidiary of a resolution entity but is not itself a resolution entity. ; (ii) the third subparagraph is replaced by the following: By way of derogation from the first and second subparagraphs of this paragraph, Union parent undertakings that are not themselves resolution entities, but are subsidiaries of third-country entities, shall comply with the requirements laid down in Articles 12d and 12e on a consolidated basis. ; (iii) the fifth subparagraph is replaced by the following: For resolution groups identified in accordance with Article 3(1), point (24b)(b), those credit institutions or financial institutions that are permanently affiliated to a central body, but are not themselves resolution entities, a central body which is not itself a resolution entity, and any resolution entities that are not subject to a requirement under Article 12f(3), shall comply with Article 12d(6) on an individual basis. ; (b) in paragraph 2, point (a), point (ii) is replaced by the following: (ii) that fulfil the eligibility criteria referred to in Article 72a of Regulation (EU) No 575/2013, except for Article 72b(2), points (b), (c), (k), (l) and (m), and Article 72b(3), (4) and (5) of that Regulation, and, where applicable, in Article 12c(1a) of this Regulation; ; (c) the following paragraph is added: 4. Where in accordance with the global resolution strategy subsidiaries established in the Union, or a Union parent undertaking and its subsidiary institutions, are not resolution entities and the members of the European resolution college, where established pursuant to Article 89 of Directive 2014/59/EU, agree with that strategy, subsidiaries established in the Union or, on a consolidated basis, the Union parent undertaking shall comply with the requirement of Article 12a(1) of this Regulation by issuing the instruments referred to in paragraph 2, points (a) and (b), of this Article, to any of the following: (a) their ultimate parent undertaking established in a third country; (b) the subsidiaries of that ultimate parent undertaking that are established in the same third country; (c) other entities under the conditions set out in paragraph 2, points (a)(i) and (b)(ii), of this Article. ; (14) Article 12i is replaced by the following: Article 12i Waiver for a central body, or for credit institutions or financial institutions permanently affiliated to a central body The Board may partially or fully waive the application of Article 12g in respect of a central body, or of a credit institution or a financial institution that is permanently affiliated to a central body, where all of the following conditions are met: (a) the credit institution or the financial institution and the central body are subject to supervision by the same competent authority, are established in the same participating Member State and are part of the same resolution group; (b) the commitments of the central body and its permanently affiliated credit institutions or financial institutions are joint and several liabilities, or the commitments of its permanently affiliated credit institutions or financial institutions are entirely guaranteed by the central body; (c) the minimum requirement for own funds and eligible liabilities, and the solvency and liquidity of the central body and of all the permanently affiliated credit institutions or financial institutions are monitored as a whole on the basis of the consolidated accounts of those institutions; (d) in the case of a waiver for a credit institution or a financial institution that is permanently affiliated to a central body, the management of the central body is empowered to issue instructions to the management of the permanently affiliated institutions; (e) the relevant resolution group complies with the requirement referred to in Article 12f(3); and (f) there is no current or foreseen material practical or legal impediment to the prompt transfer of own funds or repayment of liabilities between the central body and the permanently affiliated credit institutions or financial institutions in the event of resolution. ; (15) Article 12k is amended as follows: (a) paragraphs 1 and 2 are replaced by the following: 1. The Board may determine appropriate transitional periods, not longer than three years, for entities to comply with the requirements laid down in Article 12f or 12g or with the requirements that result from the application of Article 12c(4), (5) or (7), as appropriate, where compliance with those requirements without a transitional period would not be proportionate. The Board may determine intermediate target levels for the requirements laid down in Article 12f or 12g or for the requirements that result from the application of Article 12c(4), (5) or (7), as appropriate, that entities shall comply with at a date set by the Board. The intermediate target levels shall, as a rule, ensure a linear build-up of own funds and eligible liabilities towards the requirement. 2. By way of derogation from paragraph 1, the transitional period determined by the Board for entities for which the preferred resolution strategy changes from winding up under normal insolvency proceedings to the application of resolution action shall not exceed four years. Where duly justified and appropriate on the basis of the criteria referred to in paragraph 7, the Board may determine a longer transitional period of up to six years. The Board may determine intermediate target levels for the requirement referred to in Article 12d or for the requirements that result from the application of Article 12c(4), (5) or (7), as appropriate, that entities shall comply with at a date set by the Board. The intermediate target levels shall, as a rule, ensure a linear build-up of own funds and eligible liabilities towards the requirement. ; (b) in paragraph 3, point (a) is replaced by the following: (a) on which the Board has applied the bail-in tool; or ; (c) paragraph 4 is replaced by the following: 4. The requirements referred to in Article 12c(4) and (7) and in Article 12d(4) and (5), as applicable, shall not apply within the three-year period following the date on which the resolution entity or the group of which the resolution entity is part has been identified as a G-SII or a non-EU G-SII, or the resolution entity starts to be in the situation referred to in Article 12d(4) or (5). ; (d) paragraphs 5 and 6 are replaced by the following: 5. By way of derogation from Article 12a(1), the Board shall determine an appropriate transitional period within which to comply with the requirements of Article 12f or 12g, or a requirement resulting from the application of Article 12c(4), (5) or (7), as appropriate, for entities to which resolution tools or the write-down or conversion power referred to in Article 21 have been applied. 6. For the purposes of paragraphs 1 to 5 of this Article, the Board shall communicate to the entity a planned minimum requirement for own funds and eligible liabilities for each 12-month period during the transitional period, with a view to facilitating a gradual build-up of its loss-absorption and recapitalisation capacity. At the end of the transitional period, the minimum requirement for own funds and eligible liabilities shall be equal to the amount determined under Article 12c(4), (5) or (7), Article 12d(4) or (5), Article 12f or Article 12g, as applicable. ; (16) Article 13 is replaced by the following: Article 13 Early intervention measures 1. The ECB shall consider without undue delay and, if appropriate, apply early intervention measures where an entity referred to in Article 7(2), point (a): (a) meets the conditions referred to in Article 102 of Directive 2013/36/EU or in Article 16(1) of Regulation (EU) No 1024/2013 and either of the following applies: (i) the entity has not taken the remedial actions required by the ECB, including the measures referred to in Article 104 of Directive 2013/36/EU or in Article 16(2) of Regulation (EU) No 1024/2013; (ii) the ECB deems that remedial actions other than early intervention measures are insufficient to address the problems of that entity; (b) breaches the requirements laid down in Article 12f or 12g; or (c) infringes or is likely to infringe, in the 12 months following the assessment of the ECB, any of the requirements laid down in Title II of Directive 2014/65/EU or in Articles 3 to 7, 14 to 17 or 24, 25 and 26 of Regulation (EU) No 600/2014 of the European Parliament and of the Council. The ECB may determine that the condition referred to in the first subparagraph, point (a)(ii), of this paragraph is met without having previously taken other remedial actions, including the exercise of the powers referred to in Article 104 of Directive 2013/36/EU or in Article 16(2) of Regulation (EU) No 1024/2013. For the purposes of the first subparagraph, points (b) and (c), of this paragraph, the Board or the competent authority as defined in Article 4(1), point (26), of Directive 2014/65/EU shall inform the ECB without delay of the infringement or likely infringement. 2. For the purposes of paragraph 1, early intervention measures shall include the following: (a) the requirement for the management body of the entity to either: (i) implement one or more of the arrangements or measures set out in the recovery plan; or (ii) update the recovery plan in accordance with Article 5(2) of Directive 2014/59/EU, where the circumstances that led to the early intervention are different from the assumptions set out in the initial recovery plan, and implement one or more of the arrangements or measures set out in the updated recovery plan within a specific timeframe; (b) the requirement for the management body of the entity to convene or, if the management body fails to comply with that requirement, the direct convening by the ECB of, a meeting of shareholders of the entity, and in both cases set the agenda and require certain decisions to be considered for adoption by the shareholders; (c) the requirement for the management body of the entity to draw up a plan, in accordance with the recovery plan where applicable, for negotiation on restructuring of debt with some or all of its creditors; (d) the requirement to change the legal structure of the entity; (e) the requirement to remove, or replace in accordance with Article 13a, the senior management or management body of the entity in its entirety or with regard to individuals; (f) the appointment of one or more temporary administrators to the entity in accordance with Article 13b; (g) the requirement for the management body of the entity to draw up a plan that the entity can implement in the event that it decides to initiate a voluntary wind-down of its activities. 3. The ECB shall choose the appropriate early intervention measures referred to in paragraph 2 on the basis of what is proportionate to the objectives pursued, having regard to the seriousness of the infringement or likely infringement and the speed of the deterioration of the financial situation of the entity, among other relevant information. 4. For each of the early intervention measures referred to in paragraph 2, the ECB shall set an implementation deadline which shall be strictly limited to the time necessary to implement the measure concerned under reasonable conditions. The ECB shall conduct an evaluation of the effectiveness of the measure immediately after expiry of the deadline and shall share that evaluation with the Board. Where the evaluation concludes that the early intervention measures have not been fully implemented or are not effective, the ECB may carry out an assessment of whether the condition referred to in Article 18(1), point (a), is met. 5. Where a group as referred to in Article 7(2), point (a), of this Regulation includes entities established in participating Member States as well as in non-participating Member States, the ECB shall represent the national competent authorities of the participating Member States for the purposes of consultation and cooperation with non-participating Member States in accordance with Article 30 of Directive 2014/59/EU. Where a group as referred to in Article 7(2), point (a), includes entities established in participating Member States and subsidiaries established, or significant branches located, in non-participating Member States, the ECB shall communicate, in a timely manner, any decisions or measures referred to in Articles 13 to 13c relevant to the group to the competent authorities or the resolution authorities of the non-participating Member States, as appropriate. (17) the following articles are inserted in Chapter 2: Article 13a Replacement of the senior management or management body For the purposes of Article 13(2), point (e), the new senior management or management body, or individual members thereof, shall be appointed in accordance with Union and national law and such appointments shall be subject to the approval of the ECB. Article 13b Temporary administrator 1. For the purposes of Article 13(2), point (f), the ECB may, on the basis of what is proportionate in the circumstances, appoint one or more temporary administrators to either: (a) temporarily replace the management body of the entity; or (b) work temporarily with the management body of the entity. At the time of appointment of the temporary administrator, the ECB shall specify whether that appointment is for the purposes of the first subparagraph, point (a) or (b). For the purposes of the first subparagraph, point (b), the ECB shall further specify at the time of appointment the role, duties and powers of the temporary administrator and any requirements for the management body of the entity to consult or to obtain the consent of the temporary administrator prior to taking specific decisions or actions. The ECB shall make public the appointment of any temporary administrator, except where the temporary administrator does not have the power to represent the entity. Any temporary administrator shall possess sufficient knowledge, skills and experience to perform his or her duties and shall fulfil the requirements set out in Article 91(2) and (2a) of Directive 2013/36/EU. The assessment by the ECB of whether the temporary administrator possesses such knowledge, skills and experience and complies with those requirements shall be an integral part of the decision to appoint that temporary administrator. 2. The ECB shall specify the powers of the temporary administrator at the time of his or her appointment, on the basis of what is proportionate in the circumstances. Such powers may include some or all of the powers of the management body of the entity, under the statutes of the entity and under national law, including the power to exercise some or all of the administrative functions of the management body of the entity. The powers of the temporary administrator in relation to the entity shall comply with the applicable company law. The ECB may adjust those powers in the event of a change in circumstances. 3. The ECB shall specify the role and functions of the temporary administrator at the time of his or her appointment. Such role and functions may include: (a) ascertaining the financial position of the entity; (b) managing the business or part of the business of the entity to preserve or restore its financial position; (c) taking measures to restore the sound and prudent management of the business of the entity; (d) ensuring compliance by the entity with any requirements pursuant to Article 13c(3), second subparagraph, (4), first subparagraph, or (5). The ECB shall specify any limits on the role and functions of the temporary administrator at the time of his or her appointment. 4. The ECB shall have the exclusive power to appoint and remove any temporary administrator. The ECB may remove a temporary administrator at any time and for any reason. The ECB may vary the terms of appointment of a temporary administrator at any time subject to this Article. 5. The ECB may require that certain acts of a temporary administrator be subject to the prior consent of the ECB. The ECB shall specify any such requirements at the time of appointment of the temporary administrator or at the time of any variation of the terms of appointment of the temporary administrator. In any case, the temporary administrator may exercise the power to convene a general meeting of the shareholders of the entity and to set the agenda of such a meeting only with the prior consent of the ECB. 6. At the request of the ECB, the temporary administrator shall draw up reports on the financial position of the entity and on the acts performed during his or her mandate, at intervals set by the ECB. The temporary administrator shall, in any case, draw up such a report at the end of his or her mandate. 7. The temporary administrator shall be appointed for a maximum of one year. The ECB may exceptionally extend that period once for a duration proportionate to the circumstances if the conditions for appointing the temporary administrator continue to be met. The ECB shall be responsible for determining whether those conditions are met and for justifying any extension of the mandate of the temporary administrator to the shareholders. 8. Subject to this Article, the appointment of a temporary administrator shall not prejudice the rights of the shareholders laid down in Union or national company law. 9. A temporary administrator appointed in accordance with paragraphs 1 to 8 shall not be deemed to be a shadow director or a de facto director of the entity concerned under national law. Article 13c Preparation for resolution 1. For the entities and groups referred to in Article 7(2), and the entities and groups referred to in Article 7(4), point (b), and Article 7(5) where the conditions for the application of those provisions are met, the ECB or national competent authorities shall notify the Board without delay of the following: (a) any of the measures referred to in Article 16(2) of Regulation (EU) No 1024/2013, Article 104(1) of Directive 2013/36/EU or in Article 39(2) of Directive (EU) 2019/2034 that they take or require an entity or group to take; (b) that, as shown by supervisory activity, the conditions laid down in Article 13(1) of this Regulation or Article 27(1) of Directive 2014/59/EU are met in relation to an entity or group, irrespective of the application of any early intervention measure; (c) the application of any of the early intervention measures referred to in Article 13 of this Regulation or Article 27 of Directive 2014/59/EU. The Board shall inform the Commission of any notification it has received pursuant to the first subparagraph. The ECB or the relevant national competent authority shall closely monitor, in close cooperation with the Board, the situation of the entities and groups referred to in the first subparagraph and their compliance with the measures referred to in the first subparagraph, point (a), that aim to address a deterioration of the situation of those entities and groups and with the early intervention measures referred to in the first subparagraph, point (c). 2. The ECB or the relevant national competent authority shall notify the Board as early as possible where they consider that there is a material risk of one or more of the circumstances referred to in Article 18(4) applying in relation to an entity referred to in Article 7(2), or an entity referred to in Article 7(4), point (b), and Article 7(5) where the conditions for the application of those provisions are met. That notification shall contain: (a) the reasons for the notification; (b) an overview of the measures under consideration which would prevent the failure of the entity concerned within a reasonable timeframe, their expected impact on the entity as regards the circumstances referred to in Article 18(4) and the expected timeframe for the implementation of those measures. Following the receipt of the notification referred to in the first subparagraph of this paragraph, the Board shall assess, in close cooperation with the ECB or the relevant national competent authority, what constitutes a reasonable timeframe for the purposes of the assessment of the condition referred to in Article 18(1), point (b), taking into account the speed of the deterioration of the situation of the entity, the need to implement effectively the resolution strategy, and any other considerations relevant to the case. The Board may, at any time, reassess the timeframe and adjust it to the circumstances of the case. The Board shall communicate that assessment or reassessment to the ECB or to the relevant national competent authority as early as possible. Following the receipt of the notification referred to in the first subparagraph, the ECB or the relevant national competent authority and the Board shall, in close cooperation, monitor the situation of the entity, the implementation of relevant measures within their expected timeframe and any other relevant developments. For that purpose, the ECB or the relevant national competent authority and the Board shall meet regularly, with a frequency to be determined by the Board having regard to the circumstances of the case. The ECB or the relevant national competent authority and the Board shall provide each other with any relevant information without delay. The Board shall notify the Commission of any information it has received pursuant to the first subparagraph. 3. The ECB or the relevant national competent authority shall provide the Board with all the information requested by the Board that is necessary for any of the following actions: (a) updating the resolution plan and preparing for the possible resolution of an entity referred to in Article 7(2), or an entity referred to in Article 7(4), point (b), and Article 7(5) where the conditions for the application of those provisions are met; (b) carrying out the valuation referred to in Article 20(1) to (15). Where such information is not already available to the ECB or the national competent authorities, the Board and the ECB and such national competent authorities shall cooperate and coordinate to obtain that information. For that purpose, the ECB, the Board, through the national resolution authorities or directly, after informing them, and the national competent authorities shall have the power to require the entity to provide such information, including through on-site inspections, and to provide each other with that information. 4. The Board shall have the power, through the national resolution authorities or directly, after informing them, to market to potential purchasers the entity referred to in Article 7(2), or the entity referred to in Article 7(4), point (b), and Article 7(5) where the conditions for the application of those provisions are met, to make arrangements for such marketing, or to require the entity to do so, for the following purposes: (a) to prepare for the resolution of that entity, subject to the criteria laid down in Article 39(2) of Directive 2014/59/EU and the requirements of professional secrecy laid down in Article 88 of this Regulation; (b) to carry out the assessment by the Board of the condition referred to in Article 18(1), point (b), of this Regulation. Where, in the exercise of the power referred to in the first subparagraph, the Board decides to directly market the entity to potential purchasers, it shall have due regard to the circumstances of the case, in particular any preventive measures that may potentially be taken by a deposit guarantee scheme or any measures that may potentially be taken by an IPS, and to the potential impact of the exercise of that power on the entity’s overall position. 5. The Board shall have the power to require the relevant national resolution authority to: (a) require the entity concerned to put in place the necessary arrangements, including a digital platform, for sharing information with potential purchasers or with advisors and valuers engaged by the Board; (b) draft a preliminary resolution scheme for the entity concerned. Where the Board exercises its power under the first subparagraph, point (a), of this paragraph, Article 88 shall apply. 6. The prior notification by the ECB or the relevant national competent authority in accordance with paragraph 1, first subparagraph, shall not be a necessary condition for the Board to prepare for the resolution of the entity or to exercise the powers referred to in the paragraphs 3, 4 and 5. 7. The Board shall inform the Commission, the ECB, the relevant national competent authorities and the relevant national resolution authorities of any action taken pursuant to paragraphs 3, 4 and 5 without delay. 8. The ECB, the relevant national competent authorities, the Board and the relevant national resolution authorities shall closely cooperate in the following cases: (a) when considering taking the measures referred to in paragraph 1, first subparagraph, point (a), that aim to address a deterioration of the situation of an entity or a group, and the measures referred to in paragraph 1, first subparagraph, point (c); (b) when considering taking any of the actions referred to in paragraphs 3, 4 and 5; (c) during the implementation of the actions referred to in points (a) and (b) of this subparagraph. The ECB, the relevant national competent authorities, the Board and the relevant national resolution authorities shall ensure that those measures and actions are consistent, coordinated and effective. 9. The Board may instruct the national resolution authorities to exercise the powers referred to in Article 84b(1) of Directive 2014/59/EU. The national resolution authorities shall implement the instructions of the Board in accordance with Article 29 of this Regulation. ; (18) in Article 14(2), point (c) is replaced by the following: (c) to protect public funds by minimising reliance on extraordinary public financial support, in particular when provided from the budget of a Member State; ; (19) in Article 16, paragraph 2 is replaced by the following: 2. The Board shall take a resolution action in relation to a parent undertaking referred to in Article 2, point (b), considering the need to implement effectively the resolution strategy, where the conditions laid down in Article 18(1) are met. For the purpose of taking a resolution action, a parent undertaking referred to in Article 2, point (b), shall be deemed to be failing or likely to fail in any of the following circumstances: (a) the parent undertaking meets one or more of the conditions laid down in Article 18(4), point (b), (c) or (d); (b) the parent undertaking infringes materially or there are objective elements that show that the parent undertaking will, in the near future, infringe materially the applicable requirements laid down in Regulation (EU) No 575/2013 or in the national provisions that transpose Directive 2013/36/EU. ; (20) Article 18 is amended as follows: (a) paragraphs 1, 1a, 2 and 3 are replaced by the following: 1. The Board shall adopt a resolution scheme pursuant to paragraph 6 of this Article in relation to the entities referred to in Article 7(2), and to the entities referred to in Article 7(4), point (b), and Article 7(5) where the conditions for the application of those provisions are met, only when it has determined in its executive session, upon receiving a communication pursuant to the second subparagraph of this paragraph, or on its own initiative, and considering the need to implement effectively the resolution strategy, that all of the following conditions are met: (a) the entity is failing or is likely to fail; (b) having regard to the timing and other relevant circumstances, there is no reasonable prospect that any alternative private sector measures, including measures by an IPS, preventive measures as referred to in Article 11(3) of Directive 2014/49/EU, supervisory action, early intervention measures, or the write-down or conversion of relevant capital instruments and eligible liabilities as referred to in Article 21(1) of this Regulation, taken in respect of the entity, would prevent the failure of the entity within a reasonable timeframe; (c) a resolution action is necessary in the public interest pursuant to paragraph 5. The assessment of the condition referred to in the first subparagraph, point (a), of this paragraph shall be made by the ECB for the entities referred to in Article 7(2), point (a), or by the relevant national competent authority for the entities referred to in Article 7(2), point (b), Article 7(3), second subparagraph, Article 7(4), point (b), and Article 7(5), after having consulted the Board. The Board in its executive session may make such an assessment only after having informed the ECB or the relevant national competent authority of its intention to make such an assessment and only if the ECB or the relevant national competent authority, within three calendar days of receipt of that information, does not make such an assessment itself. The ECB or the relevant national competent authority shall, without delay, provide the Board with any relevant information that the Board requests in order to carry out its assessment, before or after being informed by the Board of its intention to make the assessment of the condition referred to in