3.2.3 The development of the Crisis Communications

Between 2008 and 2011, the Commission published six communications (the Crisis Communications) containing a tailored framework for State aid control for banks in difficulty based on the 2004 R&R Guidelines.1 The Crisis Communications included the 2008 Banking Communication, the Recapitalisation Communication, the Impaired Assets Communication, the Restructuring Communication, the 2010 Prolongation Communication and the 2011 Prolongation Communication. The Crisis Communications provided for the conditions for assessment of rescue aid and restructuring aid in the banking sector during the GFC. The conditions for approval followed the general principles laid down in the 2004 R&R Guidelines, but allowed adjustment and sharpening of the Commission’s practice under these guidelines.2

While the contours of the European Banking Union were given shape, the Commission started with its review of the Crisis Communications.3 With this review, the Commission intended to ensure that future State interventions were consistent with the principles of the European Banking Union (or rather, the resolution framework).4 On 30 July 2013, the Commission published the 2013 Banking Communication.5 The 2013 Banking Communication replaces the 2008 Banking Communication, adapts and complements the Recapitalisation and Impaired Assets Communications and supplements the Restructuring Communication. The Commission applies the principles set out in the 2013 Banking Communication from 1 August 2013.6 The 2013 Banking Communication, for example, provides more detailed guidance on burden-sharing by shareholders and subordinated creditors, establishes the principle that no recapitalisation or asset relief measure can be granted without prior authorisation of a restructuring plan (except in the case that financial stability considerations require otherwise), proposes a procedure for the permanent authorisation of these measures and provides guidance on the compatibility requirements for liquidation aid.7

Although the 2013 Banking Communication has a temporary nature as it is justified “as long as the crisis situation persists, creating genuinely exceptional circumstances where financial stability at large is at risk”, it still applies today.8