EBA Publishes Final Draft Technical Standards On Impracticability Of Contractual Recognition Under The BRRD Framework
Date
23/12/2020
The European Banking Authority (EBA) published today its final draft Regulatory Technical Standards (RTS) and final draft Implementing Technical Standards (ITS) on impracticability of contractual recognition of bail-in powers under the Bank Recovery and Resolution Directive (BRRD). These standards, which aim at ensuring the harmonised application of instances of impracticability of contractual recognition of bail-in powers, are part of the EBA's work to implement the BRRD.
Where contracts are governed by the law of a third country, the BRRD requires that these contracts include a contractual recognition term by which the parties acknowledge that the contract may be subject to bail-in powers and agree to be bound by their effect. In certain situations, it might be legally or otherwise impracticable to achieve contractual recognition of the bail-in powers.