Determination of the conditions for applying the instrument for the participation of holders of relevant capital instruments and eligible liabilities at group entities

(1) Where the resolution authority intends, in respect of a subsidiary undertaking that issues relevant capital instruments recognised on both an individual and a consolidated basis for the purposes of meeting own funds requirements, or that issues eligible liabilities under section 65(4) to meet the requirement under section 49f on an individual basis, to determine that the conditions referred to in section 62(1), first sentence, points 1 and 3, are satisfied, provided that the participation of holders of relevant capital instruments under section 89 would be sufficient to achieve the resolution objectives, or to make the determination under section 65(1), point 3, it notifies that intention, after consulting the resolution authority responsible for the resolution entity concerned, to the consolidating supervisory authority within 24 hours. Where the consolidating supervisory authority is not responsible for the determination in respect of the superordinate undertaking, the resolution authority also notifies its intention to the authority of the Member State responsible for the determination. The resolution authority also notifies its intention, after consulting the resolution authority responsible for the resolution entity concerned, within 24 hours, to the resolution authorities responsible for other undertakings within the same resolution group that have, directly or indirectly, acquired liabilities referred to in section 49f(2) from the undertaking subject to section 49f(1).
(2) Where the resolution authority intends, in respect of a subsidiary undertaking that issues relevant capital instruments recognised on an individual or consolidated basis for the purposes of meeting own funds requirements, or that issues eligible liabilities under section 65(4) to meet the requirement under section 49f on an individual basis, to determine that the conditions referred to in section 65(1), point 1, are satisfied, it notifies that intention without delay to the supervisory authority of the subsidiary undertaking whose relevant capital instruments and eligible liabilities under section 65(4) are to be subject to the instrument for the participation of holders of relevant capital instruments.
(3) The resolution authority attaches to a notification under subsection (1) or (2) a statement of reasons explaining why it is considering the determination concerned.
(4) The resolution authority assesses, after consulting the authorities to which a notification under subsection (1) or (2) has been made, whether one or more alternative measures are available capable of ensuring the resolution objectives without the participation of holders of relevant capital instruments and of eligible liabilities under section 65(4). Alternative measures to be considered include, in particular, early intervention measures under section 36, the measures referred to in Article 104(1) of Directive 2013/36/EU, or a transfer of funds or capital from the parent undertaking.
(5) Where the resolution authority, after consulting the notified authorities, concludes under subsection (4) that alternative measures are available, it applies them.
(6) Where the resolution authority, in the case under subsection (1), concludes, after consulting the notified authorities, under subsection (4), that no alternative measures are available, the resolution authority decides whether the determination considered under subsection (1) is appropriate.
(7) In the case under subsection (2), the determination takes the form of a joint decision of the authorities of the Member States in which subsidiary undertakings are located, selected for that determination, in accordance with sections 161 to 165. In the absence of a joint decision, no determination is made under section 65(1), point 1.
(8) The resolution authority takes a decision on the participation of holders of relevant capital instruments and eligible liabilities under section 65(4) in accordance with this provision, and implements it without delay, having due regard to the urgency of the circumstances.