This book provides an in-depth analysis of the effectiveness of legal protection in the composite procedures in place within the Single Supervisory Mechanism (SSM), established to ensure an effective prudential banking supervision within the euro area. This system, in which the European Central Bank and national prudential banking supervisors closely cooperate, results in a far-reaching shared administration entailing supervisory decisions based on complex composite administrative procedures which involve both EU and national legal orders. The current system of legal protection seems not yet fully-fledged to the reality of increasingly far-reaching forms of shared administration for the implementation of EU law. This book addresses the tension between ensuring effective supervision, by means of a shared administration, and ensuring effective legal protection in composite administrative procedures. To arrive at a meaningful discussion of the SSM’s far-reaching shared administration, it categorizes the composite procedures in place within the SSM in such a way that other shared administrations in fields of law such as the European Structural Funds, fisheries, and the Single Resolution Mechanism may also benefit from its insights. The book not only discusses the challenges for the effectiveness of legal protection within the SSM, but also seeks to provide solutions within the current EU system of legal remedies and procedures as well as possible long-term solutions.
Laura Wissink started her career as a lawyer in a large Dutch law firm specializing in the fields of corporate law and European and competition law. From 2010 to 2017 she worked at De Nederlandsche Bank (the Dutch central bank), holding various positions in the policy and legal departments. Since 2017 she has been focusing on her PhD research, resulting in this publication. Laura Wissink authors several blogs on EU banking supervision and her papers on the subject have been published in both Dutch and international journals.
Contents vii
List of Abbreviations and Terminology xii
About the author xvi
chapter 1 Introduction
1 Effective supervision through a shared administration 2
2 Effective legal protection in case of a shared administration? 5
3 Research question 8
4 Methodology, approach & relevance 8
4.1 Broad interpretation of effective legal protection 8
4.2 Supervisory versus investigatory phase 10
4.3 Categorization of composite procedures 11
4.4 Demarcation 14
4.5 Relevance 15
5 Structure 16
chapter 2 The Single Supervisory Mechanism
1 Introduction 20
2 Genesis of prudential banking supervision in the European Union 20
3 Division of responsibilities within the SSM 23
4 Prudential banking supervision in a nutshell 25
5 Close cooperation between the ECB and NCAs 29
6 Powers and sanctions 33
6.1 Terminology 33
6.1.1 Sanctions not of a criminal nature & sanctions of a criminal nature 34
6.1.2 Supervisory and enforcement measures 37
6.1.3 Administrative penalties 37
6.2 Powers of the ECB as competent authority 39
6.3 ECB powers laid down in Articles 10-13 of the SSM Regulation 39
6.4 ECB supervisory measures 42
6.5 NCA powers 43
6.6 ECB sanctioning powers 46
6.7 NCA sanctioning powers 51
7 Due process for adopting supervisory decisions 54
8 Governance of supervisory tasks within the ECB 58
9 The Single Rulebook 60
10 Recapitulation 62
chapter 3 Assessment Framework
1 Introduction 66
2 Judicial control and the rule of law 67
effective legal protection in banking supervision
3 Sources 69
4 Effective legal protection 73
4.1 Defining effective legal protection 73
4.2 Effective legal protection from a safeguard perspective 78
4.2.1 Good administration 80
4.2.2 The right of respect for private and family life 88
4.2.3 The right not to incriminate oneself 90
4.2.4 The principle of effective judicial protection 93
4.3 Effective legal protection from an instrumental perspective 100
4.3.1 The principle of effectiveness 101
4.3.2 Other elements of the instrumental perspective 105
4.4 Legal certainty and legality 106
5 A complete system of legal remedies and procedures 109
5.1 The Court’s competence 110
5.2 Appealable decisions 114
5.3 Standing criteria 124
5.4 National courts 126
5.5 The preliminary ruling procedure 128
6 Recapitulation 131
chapter 4 Common Procedures
1 Introduction 140
2 A two-step procedure 140
3 Legal protection before court 144
3.1 The reviewability of national draft decisions 145
3.2 The intensity of judicial review of national draft decisions 151
4 Legal protection in the administrative procedure 157
4.1 The implementation of administrative standards 157
4.2 Applicable administrative standards 162
5 Interim evaluation: the effectiveness of legal protection in common procedures 170
chapter 5 Bottom-up Procedures in Ongoing Supervision
1 Introduction 180
2 Formal and informal cooperation in bottom-up procedures 180
3 Legal protection before court 183
3.1 The reviewability of ECB preparatory measures 184
3.2 The reviewability of national preparatory measures 193
4 Legal protection in the administrative procedure 197
4.1 Adherence to the principle of legality 198
4.2 The implementation of administrative standards 204
4.2 Applicable administrative standards 206
5 Interim evaluation: the effectiveness of legal protection in
bottom-up procedures 208
chapter 6 Top-down Procedures in Ongoing Supervision
1 Introduction 218
2 Forms of cooperation in top-down procedures in ongoing
supervision 218
3 Legal protection before court 221
3.1 Reviewability and standing in top-down procedures 222
3.2 Judicial review of ECB regulations, guidelines, general instructions and non-binding instruments to NCAs 227
3.3 Judicial review of ECB preparatory measures in LSI supervision 229
3.4 Judicial review of ECB preparatory measures in case of material supervisory procedures and decisions in LSI supervision 231
3.5 Judicial review of ECB instructions to NCAs with respect to SI supervision 233
4 Legal protection in the administrative procedure 235
4.1 Applicable administrative standards 235
4.2 The implementation of administrative standards 240
5 Interim evaluation: the effectiveness of legal protection in top-down procedures 244
chapter 7 Investigations and Sanctions of a Criminal Nature
1 Introduction 252
2 Types of cooperation procedures & the ECB’s independent
Investigating Unit 253
3 Bottom-up procedures: sanctions directly imposed
by the ECB 256
3.1 Legal protection before court 256
3.2 Legal protection in the administrative procedure 257
4 Top-down procedures: sanctions imposed by NCAs at the ECB’s request 260
4.1 Legal protection before court 260
5 Interim evaluation: the effectiveness of legal protection in case of investigations and sanctions of a criminal nature 264
chapter 8 Observations, Findings and Recommendations
1 Introduction 268
2 The SSM and the Court’s first judgments 270
3 Assessment Framework 273
4 The effectiveness of legal protection in case of bottom-up
procedures 276
4.1 The competent court 277
4.2 Applicable administrative standards 285
4.3 The implementation of administrative standards 290 effective legal protection in banking supervision
4.4 Judicial review by the EU Courts 292
5 The effectiveness of legal protection in case of top-down procedures 299
5.1 The competent court 301
5.2 Applicable administrative standards 302
5.3 The implementation of administrative standards 304
5.4 Judicial review by the national courts 305
6 Long-term recommendations 307
6.1 Strengthening the cooperation between the CJEU and national courts 308
6.2 Using the legislator’s tools 310
6.3 Aligning EU and national judicial proceedings concerning related cases 313
7 Conclusions 314
chapter 9 Epilogue
1 Proposals for effective legal protection in bottom-up procedures 321
2 Proposals for effective legal protection in top-down procedures 325
3 Final remarks 326
References 328
Table of Cases 348
Nederlandse samenvatting 358
