4.8.4.2 Suspension of payment and delivery obligations

While the BRRD already contains provisions allowing the suspension of payment obligations, these have been implemented in very different ways at national level and may not provide a sufficiently consistent application with respect to important elements, such as the scope, phase of application, trigger conditions and duration of the suspension. On this basis, it was proposed by the Commission in its BRRD II Proposal to introduce two additional moratorium tools for activation in the early intervention and resolution phase, respectively.6 The Commission proposed to amend Article 27 BRRD to provide for a new moratorium tool to be employed in the pre-resolution phase, and specifically as an early intervention power. Article 29a was introduced outlining the conditions of this moratorium tool. In addition, the Commission proposed the amendment of Article 63 BRRD introducing among the general resolution powers the power to suspend payments when this is needed for a maximum of five working days. The proposed moratorium tools were deemed controversial, since they interfere with creditor rights and have the potential for contagion where creditors anticipate a payments stop.7

Both moratorium tools, as proposed by the Commission, are not included in BRRD II. Instead, Article 33a BRRD II provides for the power for the resolution authorities to suspend payment or delivery obligations pursuant to any contract to which the bank (or a group entity) is a party under the conditions set out in Article 33a. This provides resolution authorities with the power to suspend payment and delivery obligations outside of resolution. The period of suspension should be a short as possible and in any event not longer than two business days. The power can also be exercised in respect of eligible deposits, as long as the resolution authorities ensure that depositors have access to an appropriate daily amount from those deposits.