Question
On the basis of Article 39(1) and 38(4)(b) of Directive 2014/59/EU (BRRD), where assets of the holding company are transferred, should the consideration paid by the purchaser benefit the holding, and not the institution under resolution?
Background on the question
According to Article 39(1) of the BRRD, the sale of business tool can be applied to a holding as well (an entity referred to in point (b), (c) or (d) of Article 1(1)). Article 38(4)(b) reads that any consideration paid by the purchaser shall benefit the institution under resolution.
Answer
Article 38(4)(b) of Directive 2014/59/EU also covers the sale of assets or liabilities of an entity mentioned in point (b), (c) or (d) of Article 1(1). The term "institution under resolution" is defined in Article 2(1)(83) and includes institutions as well as all of the aforementioned entities. Then, with regard to the original question, the consideration paid by the purchaser could also benefit the holding. The same is also applicable for Article 40(4)(b) (bridge institution tool) and 42(7) (asset separation tool). Disclaimer: This question goes beyond matters of consistent and effective application of the regulatory framework. A Directorate General of the Commission (Directorate General Financial Stability, Financial Services and Capital Markets Union) has prepared the answer, albeit that only the Court of Justice of the European Union can provide definitive interpretations of EU legislation. This is an unofficial opinion of that Directorate General, which the European Banking Authority publishes on its behalf. The answers are not binding on the European Commission as an institution. You should be aware that the European Commission could adopt a position different from the one expressed in such Q&As, for instance in infringement proceedings or after a detailed examination of a specific case or on the basis of any new legal or factual elements that may have been brought to its attention.