Contractual recognition of powers to temporarily suspend termination rights

(1) Institutions and group entities are obliged to include, in financial contracts governed by the law of a third country, a contractual term by which the counterparty acknowledges that the powers to temporarily suspend termination rights and other contractual rights under sections 66a, 82 to 84, and 169(5), points 3 and 4, may be applied to the liability of the institution or group entity, and agrees to a suspension of termination rights and other contractual rights within the meaning of section 144(3), effected in the exercise of the powers under sections 66a and 82 to 84.
(2) EU parent undertakings ensure that their subsidiary undertakings established in a third country include, in financial contracts under subsection (1), terms excluding the possibility that the exercise of the powers under subsection (1) justifies early termination, suspension, modification, netting, the exercise of set-off rights, or the enforcement of security interests under those contracts, insofar as the financial contracts concerned contain obligations the performance of which is guaranteed, or otherwise secured, by a group entity established in Germany. The first sentence applies to subsidiary undertakings that are institutions or financial institutions. Section 10a(8) of the Banking Act applies correspondingly. This obligation applies to credit institutions, investment firms, or undertakings that would be regarded as investment firms if they had their seat in the Member State concerned, or to financial institutions.
(3) Subsection (1) applies to financial contracts that 1. create a new obligation, or materially amend an existing obligation, after this provision enters into force, and 2. provide for the exercise of one or more termination rights or rights to enforce security interests to which sections 66a, 82 to 84 or 144 would apply if the financial contract were governed by the law of a Member State.
(4) Where an undertaking does not comply with the obligations under subsections (1) and (2), this does not prevent the resolution authority from exercising its powers under sections 66a, 82 to 84 or 144 in respect of the financial contract concerned.
(5) The resolution authority may enforce the obligations under subsections (1) and (2) by administrative act. In exercising its discretion, the resolution authority may in particular have regard to: 1. the particularities of the business model, 2. the particularities of the foreign market concerned, 3. the particularities of the type of contract concerned, 4. the systemic importance of the institution or group entity concerned, and 5. the expected effects on the resolvability of the institution or group entity concerned, or, in the case of subsection (2), of the group entity established in Germany.