Joint decision on the minimum requirement for own funds and eligible liabilities

(1) The resolution authority responsible for the resolution entity, the resolution authority responsible for group resolution, where these are not the same, and the resolution authorities responsible for the subsidiary undertakings of a resolution group that are subject to the requirements under section 49f on an individual basis, endeavour to reach a joint decision on
1. the amount of the requirement applicable to the resolution entity on a consolidated basis at the level of the resolution group, and
2. the amount of the requirement applicable, on an individual basis, to an undertaking of a resolution group that is not a resolution entity. The joint decision must take into account the requirements under sections 49e and 49f, must be reasoned, and must be transmitted
1. by the competent resolution authority to the resolution entity;
2. by the respective competent resolution authorities to the undertakings of a resolution group that are not resolution entities;
3. by the resolution authority responsible for the resolution entity to the EU parent undertaking of the group, where that parent undertaking is not itself a resolution entity of the same resolution group. The joint decision may provide that the requirements under section 49c(7) to (9) may be met by the subsidiary undertaking in part, in accordance with section 49f(2), with instruments issued to, and acquired by, undertakings that are not part of the resolution group. Compliance in this manner must be consistent with the resolution strategy, and the resolution entity must not have acquired, directly or indirectly, sufficient instruments satisfying the requirements of section 49f(2). Where no joint decision is reached within four months, the decision is taken under subsections (3) to (5).
(2) Where more than one undertaking that is part of the same global systemically important institution is a resolution entity, or a third-country entity that would be a resolution entity if it were established in the Union, the resolution authorities referred to in subsection (1) discuss and agree, insofar as appropriate and consistent with the resolution strategy of the global systemically important institution, on
1. the application of Article 72e of Regulation (EU) No 575/2013, and
2. any adjustment to reduce or eliminate, as far as possible, the difference between the sum of the amounts referred to in section 49d(4), point 1, and in Article 12a(a) of Regulation (EU) No 575/2013 for individual resolution entities or third-country entities, and the sum of the amounts referred to in section 49d(4), point 2, and in Article 12a(b) of Regulation (EU) No 575/2013. An adjustment to the level of the requirement may be made having regard to differences in the calculation of the total risk exposure amounts in the Member States or third countries concerned. No adjustment may be made to offset differences arising from exposures between resolution groups. The sum of the amounts referred to in section 49d(4), point 1, and in Article 12a(a) of Regulation (EU) No 575/2013, for individual resolution entities or third-country entities that would be resolution entities if they were established in the Union, may not be lower than the sum of the amounts referred to in section 49d(4), point 2, and in Article 12a(b) of Regulation (EU) No 575/2013. Where no joint decision is reached within four months, the decision is taken under subsections (3) to (5).
(3) Where, on account of a disagreement over a consolidated requirement for the resolution group under section 49e, no joint decision is reached within four months, the resolution authority responsible for the resolution entity decides on that requirement, taking into account
1. the assessment carried out by the competent resolution authorities of the undertakings of the resolution group that are not resolution entities, and
2. the opinion of the authority responsible for group resolution, where that authority is not the same as the resolution authority responsible for the resolution entity. Where, before the end of the four-month period, one of the resolution authorities concerned has referred the matter to the European Banking Authority under Article 19 of Regulation (EU) No 1093/2010, the resolution authority responsible for the resolution entity defers its decision pending a decision of the European Banking Authority under Article 19(3) of that Regulation, and thereafter takes its decision in accordance with the decision of the European Banking Authority. The four-month period is to be regarded as a mediation phase within the meaning of Regulation (EU) No 1093/2010. After the end of the four-month period, or once a joint decision has been reached, the matter may no longer be referred to the European Banking Authority. Where the European Banking Authority does not take a decision within one month of being seized of the matter, the decision of the resolution authority responsible for the resolution entity applies.
(4) Where, on account of a disagreement over the level of the requirement applicable under section 49f, on an individual basis, to an undertaking of a resolution group, no joint decision is reached within four months, the resolution authority responsible for that undertaking decides, provided that
1. the views and reservations expressed in writing by the resolution authority of the resolution entity have been duly taken into account, and
2. where the authority responsible for group resolution is not the same as the resolution authority of the resolution entity, the views and reservations expressed in writing by the authority responsible for group resolution have been duly taken into account. The resolution authority of the resolution entity or the authority responsible for group resolution does not refer the matter to the European Banking Authority for binding mediation under Article 19 of Regulation (EU) No 1093/2010, where the threshold set by the resolution authority responsible for the subsidiary undertaking, as regards the requirement under section 49e, is no more than 2 per cent of the total risk exposure amount under Article 92(3) of Regulation (EU) No 575/2013, and the conditions under section 49c(7) to (9) are satisfied. Subsection (3), second to fifth sentences, applies correspondingly. Where the European Banking Authority does not take a decision within one month, the decisions of the resolution authorities of the subsidiary undertakings apply.
(5) Where, on account of a disagreement over both the level of the consolidated requirement for the resolution group and the level of the requirement applicable to the undertakings of the resolution group on an individual basis, no joint decision is reached within four months, a decision on the level
1. applicable to the subsidiary undertakings of the resolution group on an individual basis is taken under subsection (4), and
2. of the consolidated requirement for the resolution group is taken under subsection (3).
(6) The joint decision, or, in the absence of a joint decision, the decisions taken by the resolution authorities under subsections (3) to (5), are binding on the resolution authorities that took them. The joint decision, and the decisions taken in the absence of a joint decision, are reviewed regularly and updated where necessary.
(7) The resolution authorities require, and review, in coordination with the respective competent supervisory authorities, whether and how undertakings comply with the requirement under section 49(1), and take any decisions in parallel with the preparation and updating of resolution plans.