Delegation to private entities

(1) The Federal Ministry of Finance is authorised, by statutory instrument issued in agreement with the Federal Ministry of Justice and Consumer Protection and without the consent of the Bundesrat, to transfer the tasks and powers of one or both protection funds to a legal person governed by private law, where that person is willing to assume the tasks of the protection fund and offers sufficient guarantee for the satisfaction of the claims of the compensation-insured. A legal person offers sufficient guarantee where 1. the persons who, under law or the articles of association, exercise the management and representation of the legal person are reliable and suitable, 2. it has the equipment and organisation necessary to fulfil its tasks, in particular for collecting contributions, handling benefits, and administering the funds, and maintains its own funds equivalent to at least 1 million euros for this purpose, and 3. it demonstrates that it is capable of organising, in particular, the collection of contributions, the handling of benefits, and the administration of the funds at the time of the portfolio transfer under section 222(2). An undertaking authorised under section 8 may also be delegated these powers. By the statutory instrument under the first sentence, the Federal Ministry of Finance may reserve the right to approve the legal person's articles of association and any amendments to them.
(2) In the case of delegation under subsection (1), the legal person governed by private law assumes the rights and obligations of the protection fund concerned. Section 223(4) applies correspondingly. No transfer of the pool of assets takes place. The following provisions apply correspondingly to a legal person governed by private law to whom the rights and obligations of a protection fund have been delegated: 1. section 23(1) and (2) to (6); 2. section 24, with the proviso that the rule under subsection (1), first sentence, relates only to the members of the supervisory board and to the person performing the internal audit function; 3. section 25; 4. section 26(1) and (2), (5), and (6), with the proviso that the risks to which the undertaking is actually or possibly exposed must be adequately documented on a regular basis; 5. section 28(2); 6. section 29(1), with the proviso that no compliance function need be maintained; 7. section 30; 8. section 32; 9. section 47, points 1 and 2, with the proviso that the rule relates only to the persons named in subsection (1), second sentence, point 1, and to the appointment of a member of the supervisory board or of the person performing the internal audit function, and the departure of one of these persons; and 10. section 47, points 5 to 7.