The European Banking Union in action

Abstract

The European Banking Union is complex—and arguably more complex than the other two paradigms of full integration—for at least three reasons. Firstly, the basis of its operation is formed only in part by the EU Treaties and in (larger) part by EU secondary legislation, contested in part, and not leaving complete freedom of design. Hence, it constitutes a somehow ‘twisted’ regime, standing on a somehow ‘shaky’ basis. Secondly, the European Banking Union consists of several pillars. While the discussions in the papers would probably have been more compact if the focus had been solely on the ongoing supervision by the European Central Bank (ECB, Frankfurt), the current supervision of banks as a going concern, within the Single Supervisory Mechanism (SSM), at least a second pillar could not possibly be left aside. It does seem to be so closely connected to the first pillar and so important also in the legal discussion and legal practice that it had to be included. This is the Single Resolution Mechanism (SRM), with the Single Resolution Board (SRB, Brussels) serving as the central agency/institution. Thirdly, the European Banking Union is complex because it by no means constitutes a fully centralized regime—probably much less than competition law was originally (today, of course, also more decentralized) and certainly much less than the European Monetary Union both of which were based on provisions in the Treaties.