What changed between the plenary report and the adopted text

Removed:(a) in paragraph 2, the second and third subparagraphs are deleted;

Removed:(b) the following paragraph 2a is inserted:

Removed:‘2a. Resolution authorities shall not determine the requirement referred to in Article 45(1) for liquidation entities.

Removed:By way of derogation from the first subparagraph, ▌the ▌resolution authority may assess whether it is justified to determine the requirement referred to in Article 45(1) for a liquidation entity on an individual basis in an amount exceeding the amount sufficient to absorb losses, taking into account, in particular, any possible impact on financial stability and on the risk of contagion to the financial system ▌. In those cases, liquidation entities shall meet the requirement referred to in Article 45(1) by using one or more of the following:

Removed:(a) own funds;

Removed:(b) liabilities that fulfil the eligibility criteria referred to in Article 72a of Regulation (EU) No 575/2013, with the exception of Article 72b(2), points (b) and (d), of that Regulation;

Removed:(c) the liabilities referred to in Article 45b(2).

Removed:Articles 77(2) and 78a of Regulation (EU) No 575/2013 shall not apply to liquidation entities for which the resolution authority has not determined the requirement referred to in Article 45(1) of this Directive.

Removed:Holdings of own funds instruments or holdings of liabilities issued by subsidiaries which are liquidation entities for which the resolution authority has not determined the requirement referred to in Article 45(1) shall not be deducted under Article 72e(5) of Regulation (EU) No 575/2013.’;

Removed:(3) Article 45f is amended as follows:

Removed:(a) in paragraph 1, the following ▌subparagraph is inserted after the third subparagraph:

Removed:‘By way of derogation from the first and second subparagraphs, where intermediate entities would be disproportionately affected by the deduction rules set out in Article 72e(5) of Regulation (EU) No 575/2013, resolution authorities may decide to determine the requirement laid down in Article 45c on a consolidated basis for a subsidiary as referred to in this paragraph where the resolution authority confirms that all of the following conditions are met:

Removed:(a) the subsidiary meets one of the following conditions:

Removed:(i) the subsidiary is held directly by the resolution entity and:

Removed:- the resolution entity is a Union parent financial holding company or a Union parent mixed financial holding company;

Removed:- both the subsidiary and the resolution entity are established in the same Member State and are part of the same resolution group;

Removed:- the resolution entity does not hold directly any subsidiary institution or entity as referred to in Article 1(1), points (b), (c) or (d), other than the subsidiary concerned;

Removed:(ii) the subsidiary is subject to the requirement referred to in Article 104a of Directive 2013/36/EU ▌on a consolidated basis only;

Removed:(b) compliance with the requirement laid down in Article 45c on a consolidated basis as a substitute for compliance with that requirement on an individual basis does not negatively affect in a significant way:

Removed:(i) the resolvability of the resolution group;

Removed:(ii) the subsidiary’s capacity to comply with its own funds requirement after the exercise of the write-down and conversion powers;

Removed:(iii) the internal loss transfer and recapitalisation mechanism, including the write down or conversion, in accordance with Article 59, of relevant capital instruments and eligible liabilities of the subsidiary concerned or of other entities in the resolution group.’;

Removed:(b) the following paragraph 2a is inserted:

Removed:‘2a. Where an entity as referred to in paragraph 1 complies with the requirement referred to in Article 45(1) on a consolidated basis, the amount of own funds and eligible liabilities of that entity shall include the following liabilities issued in accordance with paragraph 2, point (a), of this Article by a subsidiary established in the Union included in the consolidation of that entity:

Removed:(a) liabilities issued to and bought by the resolution entity, either directly, or indirectly through other entities in the same resolution group that are not included in the consolidation of the entity complying with the requirement referred to in Article 45(1) on a consolidated basis;

Removed:(b) liabilities issued to an existing shareholder that is not part of the same resolution group.

Removed:The liabilities referred to in the first subparagraph, points (a) and (b), shall not exceed the amount determined by subtracting from the amount of the requirement referred to in Article 45(1) applicable to the subsidiary included in the consolidation the sum of all of the following:

Removed:(a) the liabilities issued to and bought by the entity complying with the requirement referred to in Article 45(1) on a consolidated basis, either directly, or indirectly through other entities in the same resolution group that are included in the consolidation of that entity;

Removed:(b) the amount of own funds that are issued in accordance with paragraph 2, point (b), of this Article.’;

Removed:(4) in Article 45i, paragraph 4 is replaced by the following:

Removed:‘4. Paragraphs 1 and 3 shall not apply to liquidation entities unless the resolution authority has determined the requirement referred to in Article 45(1) for such entity in accordance with Article 45c(2a), second subparagraph. In that case, the resolution authority shall determine the content and frequency of the reporting and disclosure obligations referred to in paragraphs 5 and 6 of this Article for that entity. The resolution authority shall communicate those reporting and disclosure obligations to the liquidation entity concerned. Those reporting and disclosure obligations shall not go beyond what is necessary to monitor compliance with the requirement determined pursuant to Article 45c(2a), second subparagraph.’;

Removed:Amendments to Regulation (EU) No 806/2014

Removed:Regulation (EU) No 806/2014 is amended as follows:

Removed:(1) in Article 3(1), the following point (24aa) is inserted:

Removed:‘(24aa) ‘liquidation entity’ means a legal person established in a participating Member State in respect of which the group resolution plan or, for entities that are not part of a group, the resolution plan, provides that the entity is to be wound up under normal insolvency proceedings; or with regard to an entity within a resolution group other than a resolution entity, the group resolution plan does not envisage the exercise of the write-down and conversion powers with respect to that entity;’;

Removed:(2) Article 12d is amended as follows:

Removed:(a) in paragraph 2, the second and third subparagraphs are deleted;

Removed:(b) the following paragraph 2a is inserted:

Removed:‘2a. The Board shall not determine the requirement referred to in Article 12a(1) for liquidation entities.

Removed:By way of derogation from the first subparagraph, ▌the Board may assess whether it is justified to determine the requirement referred to in Article 12a(1) for a liquidation entity on an individual basis in an amount exceeding the amount sufficient to absorb losses, taking into account, in particular, any possible impact on financial stability and on the risk of contagion to the financial system ▌. In those cases, liquidation entities shall meet the requirement referred to in Article 12a(1) by using one or more of the following:

Removed:(a) own funds;

Removed:(b) liabilities that fulfil the eligibility criteria referred to in Article 72a of Regulation (EU) No 575/2013, with the exception of Article 72b(2), points (b) and (d), of that Regulation;

Removed:(c) the liabilities referred to in Article 12c(2).

Removed:Articles 77(2) and 78a of Regulation (EU) No 575/2013 shall not apply to liquidation entities for which the resolution authority has not determined the requirement referred to in Article 12a(1) of this Regulation.

Removed:Holdings of own funds instruments or holdings of liabilities issued by subsidiaries which are liquidation entities for which the resolution authority has not determined the requirement referred to in Article 12a(1) shall not be deducted under Article 72e(5) of Regulation (EU) No 575/2013.’;

Removed:(3) Article 12g is amended as follows:

Removed:(a) in paragraph 1, the following ▌subparagraph is inserted after the third subparagarph:

Removed:‘By way of derogation from the first and second subparagraphs, where intermediate entities would be disproportionately affected by the deduction rules set out in Article 72e(5) of Regulation (EU) No 575/2013, the Board may decide to determine the requirement laid down in Article 12d on a consolidated basis for a subsidiary as referred to in this paragraph where the resolution authority confirms that all of the following conditions are met:

Removed:(a) the subsidiary meets one of the following conditions:

Removed:(i) the subsidiary is held directly by the resolution entity and:

Removed:- the resolution entity is a Union parent financial holding company or a Union parent mixed financial holding company;

Removed:- both the subsidiary and the resolution entity are established in the same participating Member State and are part of the same resolution group;

Removed:- the resolution entity does not hold directly any subsidiary as referred to in Article 2 other than the subsidiary concerned;

Removed:(ii) the subsidiary is subject to the requirement referred to in Article 104a of Directive 2013/36/EU ▌on a consolidated basis only;

Removed:(b) compliance with the requirement laid down in Article 12d on a consolidated basis as a substitute for compliance with that requirement on an individual basis does not negatively affect in a significant way:

Removed:(i) the resolvability of the resolution group,

Removed:(ii) the subsidiary’s capacity to comply with its own funds requirement after the exercise of the write-down and conversion powers; and

Removed:(iii) the internal loss transfer and recapitalisation mechanism, including the write down or conversion, in accordance with Article 21, of relevant capital instruments and eligible liabilities of the institution or subsidiary concerned or of other entities in the resolution group.’;

Removed:(b) the following paragraph 2a is inserted:

Removed:‘2a. Where an entity as referred to in paragraph 1 complies with the requirement referred to in Article 12a(1) on a consolidated basis, the amount of own funds and eligible liabilities of that entity shall include the following liabilities issued in accordance with paragraph 2, point (a), of this Article by a subsidiary established in the Union included in the consolidation of that entity: