# C_2023329EN.01004101.xml

| 18.9.2023 | EN | Official Journal of the European Union | C 329/41 |
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18.9.2023

EN

Official Journal of the European Union

C 329/41

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Action brought on 28 July 2023 — Norddeutsche Landesbank — Girozentrale v SRB

(Case T-476/23)

(2023/C 329/60)

Language of the case: German

Parties

Applicant: Norddeutsche Landesbank — Girozentrale (represented by: J. Seitz and C. Marx, lawyers)

Defendant: Single Resolution Board

Form of order sought

The applicant claims that the Court should:

| — | annul the decision of the defendant of 2 May 2023 (SRB/ES/2023/23) including the annexes thereto, in particular Annex I concerning the ‘
  Results of the calculation with respect to all institutions falling within the scope of calculation of the 2023 ex-ante contributions set separately (per institution) in the Harmonized Annexes
  ’ in so far as they are each relevant to the applicant; |
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annul the decision of the defendant of 2 May 2023 (SRB/ES/2023/23) including the annexes thereto, in particular Annex I concerning the ‘
  Results of the calculation with respect to all institutions falling within the scope of calculation of the 2023 ex-ante contributions set separately (per institution) in the Harmonized Annexes
  ’ in so far as they are each relevant to the applicant;

| — | order the defendant to pay the costs of the proceedings. |
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order the defendant to pay the costs of the proceedings.

Pleas in law and main arguments

In support of the action, the applicant relies on the following pleas in law:

| 1. | First plea in law, alleging an infringement of the right to be heard
  The defendant failed to hear the applicant before adopting the contested decision, thereby infringing Article 41(1) and (2)(a) of the Charter of Fundamental Rights of the European Union. (1) |
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1.

First plea in law, alleging an infringement of the right to be heard

The defendant failed to hear the applicant before adopting the contested decision, thereby infringing Article 41(1) and (2)(a) of the Charter of Fundamental Rights of the European Union. (1)

| 2. | Second plea in law, alleging a failure to state reasons for the contested decision
  Contrary to Article 296 TFEU, the contested decision does not contain a sufficient statement of reasons; in particular, it lacks a statement of reasons relating to the individual case and a description of the fundamental considerations in the context of proportionality and discretion.
  Moreover, the calculation of the annual contribution is not comprehensible, in particular due to the use of inconsistent terms and the failure to show key intermediate steps.
  The anonymised data of other institutions was also not made available even though the commercial secrets of those institutions would not thereby be infringed. |
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2.

Second plea in law, alleging a failure to state reasons for the contested decision

Contrary to Article 296 TFEU, the contested decision does not contain a sufficient statement of reasons; in particular, it lacks a statement of reasons relating to the individual case and a description of the fundamental considerations in the context of proportionality and discretion.

Moreover, the calculation of the annual contribution is not comprehensible, in particular due to the use of inconsistent terms and the failure to show key intermediate steps.

The anonymised data of other institutions was also not made available even though the commercial secrets of those institutions would not thereby be infringed.

| 3. | Third plea in law, alleging an infringement of the fundamental right to effective judicial protection for lack of verifiability of the contested decision
  The failure to state reasons for the contested decision makes judicial review considerably more difficult.
  In particular, the defendant infringed the principle of audi alteram partem, according to which the parties must be able to discuss both the factual and legal circumstances which are decisive for the outcome of the proceedings. |
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3.

Third plea in law, alleging an infringement of the fundamental right to effective judicial protection for lack of verifiability of the contested decision

The failure to state reasons for the contested decision makes judicial review considerably more difficult.

In particular, the defendant infringed the principle of audi alteram partem, according to which the parties must be able to discuss both the factual and legal circumstances which are decisive for the outcome of the proceedings.

| 4. | Fourth plea in law, alleging that the application of the IPS (Institutional Protection Scheme) indicator infringes Delegated Regulation (EU) 2015/63, (2) which must be interpreted in the light of higher-ranking law
  In the context of the second subparagraph of Article 7(4) of Delegated Regulation (EU) 2015/63, the defendant should have taken into account the fact that the applicant holds derivatives primarily for hedging and risk management purposes.
  In applying the IPS indicator, the significance of the applicant’s membership of the institutional guarantee scheme of the Sparkassen-Finanzgruppe (Savings Banks Finance Group) was misjudged.
  Under the second subparagraph of Article 6(5) of Delegated Regulation (EU) 2015/63, the defendant should also have taken account of the low probability of the institution concerned entering resolution and thus of the use of the Single Resolution Fund and should have observed the principle of proportionality. |
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4.

Fourth plea in law, alleging that the application of the IPS (Institutional Protection Scheme) indicator infringes Delegated Regulation (EU) 2015/63, (2) which must be interpreted in the light of higher-ranking law

In the context of the second subparagraph of Article 7(4) of Delegated Regulation (EU) 2015/63, the defendant should have taken into account the fact that the applicant holds derivatives primarily for hedging and risk management purposes.

In applying the IPS indicator, the significance of the applicant’s membership of the institutional guarantee scheme of the Sparkassen-Finanzgruppe (Savings Banks Finance Group) was misjudged.

Under the second subparagraph of Article 6(5) of Delegated Regulation (EU) 2015/63, the defendant should also have taken account of the low probability of the institution concerned entering resolution and thus of the use of the Single Resolution Fund and should have observed the principle of proportionality.

| 5. | Fifth plea in law, alleging that the consideration of the overall risk position of derivatives in the context of the risk indicators
  ‘trading activities, off-balance sheet exposures, derivatives and complexity and resolvability’
  infringes higher-ranking law
  Moreover, the defendant should have taken into account in accordance with the principle of orientation towards the risk profile, while considering the overall risk position of derivatives in the context of point a of the first subparagraph of Article 6(5), Article 6(6) and point a of the first subparagraph of Article 7(4) of Delegated Regulation (EU) 2015/63, that in the applicant’s case, derivatives are assigned primarily to the non-trading portfolio and are concluded primarily for hedging purposes. |
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5.

Fifth plea in law, alleging that the consideration of the overall risk position of derivatives in the context of the risk indicators
  ‘trading activities, off-balance sheet exposures, derivatives and complexity and resolvability’
  infringes higher-ranking law

Moreover, the defendant should have taken into account in accordance with the principle of orientation towards the risk profile, while considering the overall risk position of derivatives in the context of point a of the first subparagraph of Article 6(5), Article 6(6) and point a of the first subparagraph of Article 7(4) of Delegated Regulation (EU) 2015/63, that in the applicant’s case, derivatives are assigned primarily to the non-trading portfolio and are concluded primarily for hedging purposes.

| 6. | Sixth plea in law, alleging that the failure to take account of the MREL (Minimum Requirements for Own Funds and Eligible Liabilities) within the framework of the
  ‘risk exposure’
  pillar infringes Delegated Regulation (EU) 2015/63
  Furthermore, the defendant did not take account of the MREL ratios of the institutions in the final year of the initial period, despite that having been possible.
  In accordance with Article 6(1)(a) and (2)(a) of the Delegated Regulation, the defendant should have taken account of the applicant’s higher-than-average MREL ratio of the eligible liabilities and own funds of 51,54 %, which significantly exceeded the minimum ratio of 8 % set by the Single Resolution Board. |
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6.

Sixth plea in law, alleging that the failure to take account of the MREL (Minimum Requirements for Own Funds and Eligible Liabilities) within the framework of the
  ‘risk exposure’
  pillar infringes Delegated Regulation (EU) 2015/63

Furthermore, the defendant did not take account of the MREL ratios of the institutions in the final year of the initial period, despite that having been possible.

In accordance with Article 6(1)(a) and (2)(a) of the Delegated Regulation, the defendant should have taken account of the applicant’s higher-than-average MREL ratio of the eligible liabilities and own funds of 51,54 %, which significantly exceeded the minimum ratio of 8 % set by the Single Resolution Board.

| 7. | Seventh plea in law, alleging that the application of the risk-adjustment multiplier infringes Delegated Regulation (EU) 2015/63, which must be interpreted in the light of higher-ranking law
  When setting the risk-adjustment multiplier, the defendant should have taken into account the applicant’s low probability of default and higher-than-average MREL ratio in accordance with the principle of orientation towards the risk profile and the fundamental right to entrepreneurial freedom under Article 16 of the Charter. |
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7.

Seventh plea in law, alleging that the application of the risk-adjustment multiplier infringes Delegated Regulation (EU) 2015/63, which must be interpreted in the light of higher-ranking law

When setting the risk-adjustment multiplier, the defendant should have taken into account the applicant’s low probability of default and higher-than-average MREL ratio in accordance with the principle of orientation towards the risk profile and the fundamental right to entrepreneurial freedom under Article 16 of the Charter.

| 8. | Eighth plea in law, alleging, in the alternative, that the second subparagraph of Article 7(4) of Delegated Regulation (EU) 2015/63 infringes higher-ranking law
  By providing for a relativisation of the IPS indicator, the second subparagraph of Article 7(4) of Delegated Regulation (EU) 2015/63 infringes the general principle of equality under Article 20 of the Charter and the principle of proportionality, since institutions which are subject to the same institutional guarantee and thus have the same probability of default may be treated differently. |
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8.

Eighth plea in law, alleging, in the alternative, that the second subparagraph of Article 7(4) of Delegated Regulation (EU) 2015/63 infringes higher-ranking law

By providing for a relativisation of the IPS indicator, the second subparagraph of Article 7(4) of Delegated Regulation (EU) 2015/63 infringes the general principle of equality under Article 20 of the Charter and the principle of proportionality, since institutions which are subject to the same institutional guarantee and thus have the same probability of default may be treated differently.

| 9. | Ninth plea in law, alleging that the classification mechanism of Delegated Regulation (EU) 2015/63 infringes higher-ranking law
  The assignment of institutions to risk classes under Annex I, Step 2 of Delegated Regulation (EU) 2015/63 leads to clearly unfair results and therefore infringes the principle of orientation towards the risk profile and the general principle of equal treatment. The defendant should have included a manual verification of the calculation formula used in respect of the risk class assignment in order to prevent that. |
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9.

Ninth plea in law, alleging that the classification mechanism of Delegated Regulation (EU) 2015/63 infringes higher-ranking law

The assignment of institutions to risk classes under Annex I, Step 2 of Delegated Regulation (EU) 2015/63 leads to clearly unfair results and therefore infringes the principle of orientation towards the risk profile and the general principle of equal treatment. The defendant should have included a manual verification of the calculation formula used in respect of the risk class assignment in order to prevent that.

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(1)  
  OJ 2012 C 326, p. 391.

(2)  Commission Delegated Regulation (EU) 2015/63 of 21 October 2014 supplementing Directive 2014/59/EU of the European Parliament and of the Council with regard to ex ante contributions to resolution financing arrangements (OJ 2015 L 11, p. 44).

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