Summary;Judgment — ECLI:EU:C:2019:810
Date: 2019-10-02
Language of the case: French
Court formation: First Chamber
Subject matter: Economic and monetary policy
Procedure: Action for annulment;Appeal - unfounded
Origin: France

summary of the General Court’s reasoning 34. In the judgments under appeal, the General Court conducted a literal, teleological and contextual interpretation of Article 2(21)(c) of the SSM Framework Regulation. (14) 35. As regards, in the first place, the literal interpretation, the General Court pointed out that the wording of the provision at issue does not mention that the central body must have credit institution status. (15) 36. As regards, in the second place, the teleological interpretation, the General Court took as its basis the two aims pursued by the prudential supervision of groups of credit institutions on a consolidated basis which it had previously identified, (16) namely: first, to enable the ECB to determine the risks likely to affect a credit institution which derive not from the institution itself, but from the group of which it forms part; and, second, to ensure that the prudential supervision of the entities making up those groups is not fragmented between different supervisory authorities, more specifically the ECB and the national authorities. 37. From those two aims, the General Court inferred, first, that satisfaction of the conditions laid down in Article 10(1) of Regulation No 575/2013 implies a sufficient proximity between the institutions affiliated to a central body for the existence of a group to be established. (17) 38. In addition, it drew the inference, secondly, that the approach taken by CMA, whereby consolidated prudential supervision cannot be exercised through a central body that does not have credit institution status, would, if endorsed, mean that ‘the different institutions affiliated to a central body that does not have credit institution status but satisfies the conditions laid down in Article 10(1) of Regulation No 575/2013 would, depending on their individual significance, fall under the sole supervision of the ECB or the direct supervision of the national competent authorities, within the framework of the SSM, which would result in the fragmentation of prudential supervision contrary to the aims of both the [SSM] Regulation and the SSM Framework Regulation’. (18) 39. As regards, in the third place, the contextual interpretation, the General Court pointed out that the relevant provisions of the SSM Regulation do not allow the ECB to impose penalties on central bodies per se. The General Court took the view, however, that, since prudential supervision on a consolidated basis is additional to prudential supervision on an individual basis, the fact that the ECB cannot impose penalties on central bodies that do not have credit institution status is not an impediment to the conduct of appropriate prudential supervision, since the ECB is able to use its powers in relation to the entities affiliated to that central body. (19) 40. Under the first limb of the first ground of each appeal, CMA puts forward three arguments against the interpretation thus adopted by the General Court. (b) Consistency of the interpretation adopted by the General Court with Article 127(6) TFEU 41. By its first argument, CMA claims that the General Court committed an error of law in not having interpreted Article 2(21)(c) of the SSM Framework Regulation in a manner consistent with the higher-ranking provision to which that provision gives effect, namely Article 127(6) TFEU. It follows, according to CMA, from the latter provision that the ECB is to perform its tasks connected with prudential supervision in relation only to credit institutions and finance companies. On an interpretation of Article 2(21)(c) of the SSM Framework Regulation that is consistent with that higher-ranking provision of the TFEU, the General Court should have formed the view that the central body referred to in that provision had of necessity to be a credit institution in order for the ECB to be able to exercise consolidated prudential supervision through that central body. CMA is not claiming that Article 2(21)(c) of the SSM Framework Regulation is unlawful but is rather raising simply a question of interpretation: the provision of secondary law should be interpreted in a manner consistent with the higher-ranking provision of the FEU Treaty. 42. CMA further argues that, contrary to what the ECB submits, a central body of a cooperative group such as the CNCM cannot be classified as ‘[an]other financial institution’ within the meaning of Article 127(6) TFEU. The CNCM, after all, is simply an association that performs a purely administrative activity but does not engage in any economic activities. 43. The ECB and the Commission submit that that argument should be rejected. 44. As a preliminary point, it is important to recall that Article 127(6) TFEU (20) provides that the Council of the European Union ‘may …confer specific tasks on the [ECB] concerning policies relating to the prudential supervision of credit institutions and other financial institutions with the exception of insurance undertakings’. (21) 45. That provision of the FEU Treaty constitutes the legal basis on which the Council adopted the SSM Regulation, which is itself the basis on which the ECB subsequently adopted the SSM Framework Regulation. 46. First of all, it should be noted that the fact, highlighted by the ECB and the Commission, (22) that CMA did not raise an objection as to the illegality of Article 2(21)(c) of the SSM Framework Regulation in the light of Article 127(6) TFEU or the SSM Regulation cannot have any bearing on the argument put forward by CMA. After all, as CMA has clearly stated, its argument alleges an error in the General Court’s interpretation of Article 2(21)(c) of the SSM Framework Regulation, inasmuch as that interpretation is not consistent with the higher-ranking provision of law contained in the FEU Treaty. CMA has not, however, argued that Article 2(21)(c) of the SSM Framework Regulation is incompatible with that higher-ranking provision of law. Its argument is thus quite clearly concerned with the interpretation of Article 2(21)(c) of the SSM Framework Regulation, not with the validity of that provision. The feasibility of putting forward such an argument is not in any way conditional upon the raising of an objection of illegality. 47. In essence, CMA argues that the General Court’s interpretation of Article 2(21)(c) of the SSM Framework Regulation is wrong inasmuch as it necessarily follows from the fact that Article 127(6) TFEU refers exclusively to the prudential supervision of credit institutions and other financial institutions that a central body as referred to in that provision of secondary law must of necessity have credit institution status in order for the ECB to be able to exercise consolidated prudential supervision through that central body. 48. To my mind, such an argument presupposes a restrictive interpretation of Article 127(6) TFEU itself and of the terms ‘credit institutions’ and ‘other financial institutions’ contained in that provision. According to the approach advocated by CMA, that provision of primary law should be interpreted as meaning that the Council cannot give the ECB, as one of the tasks relating to prudential supervision which the former may confer on the latter, the power to exercise prudential supervision on a consolidated basis over a banking group because the central body to which the various credit institutions within that group are affiliated does not itself have credit institution status. 49. In those circumstances, it falls to be ascertained whether this is indeed the interpretation that must be given to Article 127(6) TFEU, with the result that the General Court’s interpretation of Article 2(21)(c) of the SSM Framework Regulation is incompatible with the meaning of the higher-ranking legal provision in the FEU Treaty. 50. To my mind, however, this is not a correct interpretation of Article 127(6) TFEU. 51. From a literal point of view, it is true that Article 127(6) TFEU explicitly allows the Council to confer on the ECB specific tasks relating to the prudential supervision of only two types of entity: credit institutions and other financial institutions (with the exception of insurance firms). The two terms ‘credit institutions’ and ‘financial institution’ have, moreover, been defined at EU secondary law level in Regulation No 575/2013. (23) 52. However, the scope of Article 127(6) TFEU and the Council’s power thereunder to confer on the ECB specific tasks relating to prudential supervision in the banking sector must necessarily be determined in the light of the scheme of which that provision of primary law forms part and the objectives which it pursues. 53. In this regard, it is to be noted first of all that, from a schematic point of view, the FEU Treaty provision in question, which was introduced into primary law by the Treaty of Maastricht, (24) is located in the first article of the chapter devoted to monetary policy (Chapter 2 of Title VIII of the Third Part of the FEU Treaty). That article contains the fundamental provisions laying down the objectives of, and tasks to be performed by, the European System of Central Banks and the ECB. (25) The provision in question, placed as it is within the context of the other provisions contained in Article 127 TFEU, to which it is supplementary, (26) is schematically important. 54. To my mind, however, it is the analysis of the aims pursued by Article 127(6) TFEU which militates against a restrictive interpretation of the terms ‘credit institutions’ and ‘other institutions’ contained therein that would have the effect of making it impossible for the Council to confer on the ECB tasks relating to the prudential supervision of a banking group solely because the central group to which the credit institutions forming part of the banking group in question are affiliated does not have credit institution status. 55. In this regard, it should be noted that, in general, the performance of tasks relating to prudential banking supervision is aimed at protecting the safety and soundness of credit institutions, those qualities being an essential condition of guaranteeing the stability of the financial system in general. (27) As the 2008 financial crisis (28) clearly showed, there is a direct link between the stability of the financial system, on the one hand, and the safety and soundness of the major credit institutions and major banking groups, on the other. (29) 56. Article 127(6) must therefore be understood as pursuing the aim of allowing the Council, if and when it deems it necessary to do so, to confer on the ECB specific tasks relating to the prudential supervision of the banking sector so as to ensure the safety and soundness of that sector and thus to guarantee the stability of the financial system (to which Article 127(5) TFEU explicitly refers) and, ultimately, the integrity of the single currency and the single market. 57. In this regard, it should be noted that, for a long period of time, that is to say, from the introduction into primary law of the provision contained in Article 127(6) TFEU by the Maastricht Treaty in 1992 (and the establishment of the ECB in 1998) to the adoption of the SSM Regulation in 2013, the Council did not deem it necessary to avail itself of the power available to it under that provision to confer specific tasks relating to prudential banking supervision on the ECB. 58. However, the 2008 financial crisis, which quickly turned into a banking crisis, highlighted the shortcomings of the non-integrated system of prudential supervision in operation in the European Union and revealed clear regulatory deficiencies that only served to make the crisis much worse. 59. In such circumstances, it became readily apparent that only prudential supervision exercised in an integrated fashion across Europe was capable of guaranteeing appropriate scrutiny in a context in which an internal market in banking services had emerged in the European Union and in which that market was now populated by several groups operating at European level and active in various Member States. It was in that context that the Council adopted the SSM Regulation. 60. In order to be able to achieve the objectives mentioned in points 55 and 56 above and to enable the ECB to perform in full its tasks relating to prudential supervision, that institution must have powers to exercise supervision not only on an individual basis, at the level of credit institutions considered in isolation, but also on a consolidated basis, at the level of banking groups formed of one or more credit institutions. 61. Giving the ECB the power to exercise prudential supervision over banking groups on a consolidated basis serves the two aims rightly identified by the General Court in the judgments under appeal (and mentioned in point 36 above), that is to say to allow the ECB to determine the risks liable to affect a credit institution that stem from within the group to which that institution belongs, (30) and to ensure that there is no fragmentation of the prudential supervision of the entities comprising that group. I would point out, moreover, that CMA has not challenged that analysis in its appeals. 62. In the light of those objectives, it must be concluded that, in order to be able to perform effectively the tasks relating to prudential supervision that are entrusted to it, the ECB must be able, when exercising supervision over a group on a consolidated basis, to extend its supervisory powers to entities not having the status of a credit institution or a financial institution where those entities form part of the banking group in question. In such circumstances, as the Commission has rightly noted, the supervisory powers conferred on the ECB in relation to non-banking entities are warranted not by the characteristics or activities of the entities themselves, but by the fact that those entities form part of a group comprising credit institutions and those institutions can be effectively supervised only on a consolidated basis at group level. 63. In such a context, it follows, in the light of the objectives pursued in giving powers of prudential supervision to the ECB, that Article 127(6) TFEU cannot be interpreted restrictively so as to prevent the Council from being able to confer on the ECB powers to exercise prudential supervision on a consolidated basis over banking groups which, while fulfilling the conditions laid down in Article 10(1) of Regulation No 575/2013, have at their highest level of consolidation an entity which does not have credit institution status, irrespective of the legal form chosen for that entity. Such an interpretation would, after all, run counter to the aims pursued by Article 127(6) TFEU, as mentioned in point 56 above. For it would allow a banking group to evade prudential supervision on a consolidated basis by reason solely of the legal form, such as the form of an association, chosen for the entity acting as the central body, and this would carry a risk of jeopardising the effectiveness of group supervision on a consolidated basis. 64. It follows from the foregoing that Article 127(6) TFEU does not preclude the ECB from exercising prudential supervision on a consolidated basis over a banking group through a central body which does not have credit institution status, and, in that connection, that, so long as the conditions laid down in Article 10(1) of Regulation No 575/2013 are fulfilled, it makes no difference whether that body has a particular legal form or whether or not it carries on an economic activity. 65. It is clear from all the foregoing that the interpretation of Article 2(21)(c) of the SSM Framework Regulation adopted by the General Court in the judgments under appeal is not contrary to Article 127(6) TFEU, and, consequently, that the first argument under the first limb of the first ground of each appeal must be rejected. (c) The risk that prudential supervision will become fragmented 66. By the second argument put forward under the first limb of the first ground of each of its appeals, CMA contests the General Court’s assessment, set out in point 38 of this Opinion, to the effect that endorsing the approach which CMA has advocated would have the effect of fragmenting prudential supervision in a manner contrary to the aims both of the SSM Regulation and of the SSM Framework Regulation. (31) 67. CMA submits, first, that the General Court distorts the terms of the provisions of Article 2(21)(c) of the SSM Framework Regulation and Article 10 of Regulation No 575/2013 in maintaining that affiliated institutions could not have credit institution status yet still meet the conditions laid down in Article 10 and thus be an entity belonging to a ‘supervised group’. 68. Secondly, CMA argues that, in the present case, the CNCM is an association that does not engage in any economic activity, performs a purely administrative function and, as such, does not carry any inherent risk liable to impact on the situation of the credit institutions which are affiliated to it. Its inclusion within the members of the group subject to prudential supervision by the ECB is not therefore justified by the aims pursued by the legislation at issue. 69. The ECB and the Commission contend that this argument should be rejected. 70. In this regard, it should be recalled, first, that, in accordance with settled case-law, arguments directed against grounds included in a decision of the General Court purely for the sake of completeness cannot lead to the decision being set aside and are therefore ineffective. (32) 71. As the ECB and the Commission have correctly pointed out, that argument is directed against a ground included in the judgment under appeal purely for the sake of completeness and must thus be regarded as being ineffective. 72. First, it is apparent that the ground referred to by CMA in the context of that argument was included purely for the sake of completeness from the fact that, in the previous paragraph of the two judgments under appeal, the General Court had already arrived at the conclusion, based on the reasoning set out in that paragraph, that it is ‘consistent with the aims of the [SSM] Regulation and the SSM Framework Regulation for a group to be classified as a ‘supervised group’ within the meaning of Article 2(21)(c) of the SSM Framework Regulation irrespective of whether or not the group’s central body has the status of credit institution’. (33) Second, the fact that that ground was included purely for the sake of completeness is confirmed by the use of ‘furthermore’ at the beginning of the paragraphs from the judgments under appeal that are referred to in CMA’s argument. 73. In any event, the argument is not only ineffective but also manifestly unfounded. 74. Thus, as regards, in the first place, the submission that the General Court distorted the terms of the relevant provisions, this is based on what is clearly a misreading of the judgments under appeal. After all, in the aforementioned paragraphs of those judgments, the General Court does not in any way say that affiliated institutions could not have credit institution status yet still meet the conditions laid down in Article 10 of Regulation No 575/2013. 75. As regards, in the second place, the submission that, because of its nature as an association that does not carry on an economic activity and whose function is purely administrative, the CNC’s inclusion within the members of the group subject to prudential supervision by the ECB is not warranted by the aims pursued by the legislation at issue, it follows from the considerations in points 61 to 64 above that this submission must be rejected. 76. It follows that the second argument put forward by CMA under the first limb of the first ground of each appeal must, in my opinion, be rejected. (d) Task of exercising supervision and power to impose penalties 77. By the third argument put forward under the first limb of the first ground of each of its appeals, CMA claims that the General Court committed an error of law in the interpretation of Article 2(21)(c) of the SSM Framework Regulation inasmuch as, although the General Court found that the ECB cannot impose penalties on the central bodies referred to in that provision, it nonetheless did not draw the inference dictated by that finding, which is to say the need for a central body to have credit institution status. 78. There is, after all, a close link between the ability to supervise a credit institution and the ability to penalise it in the event of non-compliance. Effective supervision cannot be guaranteed if no penalty can be imposed. It would therefore be inconsistent to give the ECB the power to supervise a body while at the same time depriving it of the means of enforcing it. Since the power to impose penalties guarantees effective supervision and that power can be applied only to credit institutions and finance companies, the General Court should have interpreted the provisions of Article 2(21)(c) of the SSM Framework Regulation as being applicable only to central bodies having the status of credit institution or finance company. 79. The fact, mentioned by the General Court, that the ECB has the power to impose penalties on entities affiliated to the central body (34) is irrelevant. After all, non-compliance with the prudential requirements laid down in Regulation No 575/2013 on the basis of the consolidated situation might follow simply from the central body’s failure to perform its tasks in relation to the affiliates rather than from the conduct of one of the affiliated credit institutions. Consequently, the ECB is not entitled to penalise a credit institution if that institution cannot be held responsible for the non-compliance in question. 80. The ECB and the Commission submit that this argument should be dismissed. 81. In this regard, it should be noted that, in general, Article 132(3) TFEU (35) empowers the ECB to impose, within the limits and under the conditions adopted by the Council, fines and periodic penalty payments for failure to comply with its regulations and decisions. On the basis of that provision, the ECB adopted Council Regulation (EC) No 2532/98 of 23 November 1998 concerning the powers of the ECB to impose sanctions. (36) 82. However, as regards more specifically the performance of tasks relating to policies in connection with the prudential supervision of credit institutions, the power to impose penalties is entrusted to the ECB by Article 18 of the SSM Regulation, in particular paragraph 1 thereof. The procedures for imposing penalties in that context are laid down in Article 120 et seq. of the SSM Framework Regulation, which, in accordance with Article 18(7) of the SSM Regulation, also governs the relationship with the provisions of Regulation No 2532/98. 83. As the General Court held in the judgments under appeal, (37) Article 18(1) of the SSM Regulation confers on the ECB the power to impose penalties for the purposes of the performance of its tasks of prudential supervision in relation exclusively to credit institutions, financial holding companies or mixed financial holding companies. That provision does not, however, allow the ECB to penalise central bodies that do not fall within one of those categories, as defined in paragraphs 3, 4 and 5 respectively of Article 2 of the SSM Regulation. After all, as the Commission has rightly noted, the principle of legality as it applies to penalties precludes the power to impose penalties which has been entrusted to the ECB from being extended beyond the situations specifically referred to in the relevant provisions. 84. That said, it should nonetheless be noted that none of the aforementioned texts relating to penalties, nor any other provision of the SSM Regulation, contains any normative support for the view that the power to impose penalties on entities is a necessary condition of any power on the part of the ECB to exercise prudential supervision over those entities, with the result that such entities, where there is no power to impose penalties, are exempt from prudential supervision by the ECB. 85. The fact that the ECB has the power to impose penalties on a certain type of entity, such as a central body, is not therefore a condition of its being recognised as competent to perform functions connected with the prudential supervision on a consolidated basis of the group of which that entity forms part. It follows that the General Court cannot be accused of having committed an error of law in failing to draw, from the fact that the ECB does not have the power to impose penalties on the central bodies referred to in Article 2(21)(c) of the SSM Framework, the supposed inference that those central bodies must necessarily have credit institution status in order to be subject to prudential supervision by the ECB. 86. Furthermore, the General Court cannot in any way be accused of having committed an error of law in referring to the possibility available to the ECB, where appropriate, of penalising credit institutions affiliated to the central body concerned as grounds for the view that, notwithstanding that the ECB lacks the power to impose penalties on central bodies per se, it nonetheless had rights permitting it to exercise appropriate prudential supervision and, therefore, to ensure that that supervision was effective. 87. In this regard, I note that, as the Commission has observed, it is important to add to the possibility mentioned by the General Court that provided for in Article 18(5) of the SSM Regulation. That provision states that, under certain conditions, the ECB may, where necessary for the purposes of carrying out tasks connected with prudential supervision, require national competent authorities to open proceedings with a view to taking action in order to ensure that appropriate penalties are imposed in accordance, in particular, with any relevant national legislation which confers specific powers not currently provided for under EU law. 88. It follows from all the foregoing that, in my view, the third argument raised by CMA under the first limb of the first ground of each appeal must also be rejected, and that, consequently, the first limb must be rejected in its entirety. 2. The second limb of the first ground of each appeal: misinterpretation of Article 10 of Regulation No 575/2013 89. In the second limb of the first ground of each of its appeals, CMA claims that, contrary to what the General Court held, (38) the requirement that the central body should have credit institution status for the purposes of use of the term ‘supervised group’ within the meaning of Article 2(21)(c) of the SSM Framework Regulation is dictated by Article 10 of Regulation No 575/2013. Under this limb, CMA puts forward two arguments. 90. In its first argument, CMA refers to Article 11(4) of Regulation No 575/2013, which states that, ‘where Article 10 is applied, the central body referred to in that article shall comply with the requirements of Parts Two to Eight on the basis of the consolidated situation of the whole as constituted by the central body together with its affiliated institutions’. 91. CMA submits that, in so far as the requirements mentioned in that provision are capable of being met only by a credit institution, a central body as referred to in Article 10(1) of Regulation No 575/2013 must necessarily have credit institution status in order to be the subject of prudential supervision. Thus, Article 11 of Regulation No 575/2013 implicitly but necessarily presupposes that a central body as referred to in Article 10 is a credit institution. The General Court should therefore have assessed the relationship between those two provisions and favoured a meaning that allowed them to be applied coherently. 92. The ECB and the Commission submit that this argument should be rejected. 93. In this regard, it is important to make the point, first of all, that, as such, Articles 10(1) and 11(4) of Regulation No 575/2013 are concerned with any exemption from compliance with the prudential requirements laid down in that regulation which a competent authority may grant on an individual basis to credit institutions affiliated to a central body. The issue in the present appeals, on the other hand, has to do with the existence of a supervised group within the meaning of Article 2(21)(c) of the SSM Framework Regulation, which refers exclusively to Article 10 of Regulation No 575/2013 and not to Article 11 of that regulation. 94. This having been clarified, I subscribe entirely to the General Court’s reasoning (39) to the effect that the logic of the relationship between Article 10(1) and Article 11(4) of Regulation No 575/2013 requires the implementation of the second provision to be a consequence of, not a condition for, the application of the first provision. After all, it is only where the competent authority agrees, on the basis of Article 10 of Regulation No 575/2013, to exempt entities affiliated to a central body from compliance with prudential requirements on an individual basis that Article 11(4) of Regulation No 575/2013 applies. 95. In that event, that provision requires the central body in question to comply with the prudential requirements on the basis of the consolidated situation of the whole entity constituted by it and the affiliated institutions. 96. It is thus clear that, when it submits that Article 11(4) of Regulation No 575/2013 is capable of being complied with only by a credit institution, CMA is confusing the prudential requirements that may be applicable to a central body on an individual basis with those applicable on a consolidated basis under that provision. CMA’s argument is therefore founded on what is manifestly a misreading of Article 11(4) of Regulation No 575/2013, which states that, where Article 10 is applied, the central body must comply with the prudential requirements not on an individual basis but on a consolidated basis. 97. It follows that, to my mind, the first argument under the second limb of the first ground of each appeal is manifestly unfounded. 98. By the second argument under the second limb of the first ground of each appeal, CMA claims that the requirement that a central body should have credit institution status in order for the ECB to be able to exercise consolidated supervision through that central body flows from Article 10(1)(b) of Regulation No 575/2013. According to CMA, since that provision makes reference to the solvency and liquidity of the central body, it implicitly but necessarily states that that body must have credit institution status. The interpretation which the General Court gives to that provision in the judgment under appeal, (40) which CMA defines as purposive and generalising, disregards, according to CMA, the wording of that provision, which explicitly states that the liquidity and solvency of the central body must be assessed. 99. The ECB and the Commission submit that this argument should be rejected. 100. This argument is based on an entirely erroneous reading of Article 10(1)(b) of Regulation No 575/2013, which lays down the condition that ‘the solvency and liquidity of the central body and of all the affiliated institutions are monitored as a whole on the basis of consolidated accounts of these institutions’. 101. Thus, CMA again confuses the supervision on a consolidated basis of the entities referred to in that provision taken ‘as a whole’ (that is to say, the central body and the affiliated institutions), which forms the subject of that provision, on the one hand, with the supervision on an individual basis of the central body, which does not form the subject of that provision, on the other. 102. It follows that Article 10(1)(b) of Regulation No 575/2013 does not in any way require that the central body should carry on activities warranting the supervision of its solvency and liquidity on an individual basis, or, therefore, that that body should have credit institution status. 103. It follows that the second argument under the second limb of the first ground of each appeal must also be regarded as being manifestly unfounded. 104. It is apparent from all the foregoing that the first ground of each of CMA’s two appeals must, in my view, be rejected. B. The second ground of each appeal: errors in the characterisation of the facts inasmuch as the General Court held that Crédit mutuel met the condition laid down in Article 10(1)(a) of Regulation No 575/2013 105. In the second ground of each of its appeals, CMA claims that the General Court committed errors of law in the legal characterisation of the facts, inasmuch as it held that Crédit mutuel met the condition which Article 10(1)(a) of Regulation No 575/2013 attaches to its classification as a ‘supervised group’ within the meaning of Article 2(21)(c) of the SSM Framework Regulation. 106. This second ground of appeal is divided into two limbs. (a) The first limb, concerning the scope of Article L.511-31 of the CMF and of the CNCM’s decision No 1-1992 of 10 March 1992 107. In the first limb of the second ground of each appeal, CMA contests the analysis by which the General Court held that the CNCM’s decision No 1-1992 of 10 March 1992 demonstrates the existence of an obligation to transfer capital and liquid assets within Crédit mutuel which supports the conclusion that the condition based on the existence of joint and several liabilities between the central body and the affiliated institutions – as laid down in Article 10(1)(a) of Regulation No 575/2013 – was fulfilled. (41) 108. CMA submits that the content of that decision as set out by the General Court is not indicative of the presence of any such an obligation to transfer capital and liquid assets between the various entities within Crédit mutuel. Under the system provided for in that decision, while there is genuine joint and several liability between branches falling within the same regional group, there is, on the other hand, no obligation to transfer capital and liquid assets at national level between the regional groups. Thus, if one regional group were in difficulty, the CNCM would not be able to require another regional group to transfer capital to support it. 109. The fact that the Caisse centrale de Crédit mutuel (Central Branch of the Crédit mutuel group) (CCCM) can use the limited resources entrusted to it by the regional groups (in the form of 2% of the deposits collected by the latter) does not support the identification of an obligation to transfer capital and liquid assets between the regional groups. The regional groups simply make a small part of the deposits they have collected available to the CCCM, which remains in debt to those groups. 110. The decision given by the Conseil d’État (Council of State) on 9 March 2018 in Case No 399413, (42) on which the ECB and the Commission rely in order to endorse the judgments under appeal, is, according to CMA, irrelevant, since it postdates those judgments and is in any event concerned with issues different from those raised in the present appeals. 111. The ECB and the Commission submit that this limb should be rejected. The Commission considers that, contrary to the opinion of the General Court, Article L.511–31 of the CMF is sufficient in itself to support the proposition that the condition laid down in Article 10(1)(a) of Regulation No 575/2013 is fulfilled, there being no need to examine the CNCM’s decision of 10 March 1992. The Commission takes the view that the Court could make a substitution of grounds in this regard. 112. In this connection, it should be noted, as a preliminary point, that, as the ECB and the Commission have observed, CMA is not contesting the interpretation of Article 10(1)(a) of Regulation No 575/2013 which the General Court gave in the judgments under appeal, and by which it concluded that the condition contained in that provision is satisfied where there is an obligation to transfer capital and liquid assets within the group for the purposes of ensuring that the obligations to creditors fulfilled. (43) CMA is simply contesting the application of that provision to the situation at issue here. (44) 113. In the judgments under appeal, the General Court first of all recalled that, in the opinion of 14 September 2015, mentioned in point 16 above, the Board of Review had highlighted a number grounds by way of support for its conclusion that that condition was met, namely the wording of Article L.511-31 of the CMF, the obligation to intervene in aid of branches in difficulty that is incumbent on the CNCM pursuant to the decision of 10 March 1992, the constitutional provisions of the CCCM and the fact that assistance had exceptionally been provided to entities in difficulty in the past. 114. Next, the General Court expressed the view that the wording of Article L.511-31 of the CMF did not in itself support the conclusion that the condition laid down in Article 10(1)(a) of Regulation No 575/2013 was fulfilled. The General Court held, however, that the CNCM’s decision of 10 March 1992 and the joint and several liability mechanism for which it provides, on the other hand, were indicative of the existence of an obligation to transfer capital and liquid assets within Crédit mutuel which is intended to ensure that the obligations to creditors are fulfilled, and, therefore, that the mere fact of the existence of that joint and several liability mechanism supported the view that the condition laid down in Article 10(1)(a) of Regulation No 575/2013 was fulfilled. 115. In this regard, before we examine the complaints put forward by CMA as against the foregoing reasoning, it is important to analyse the request for substitution of grounds made by the Commission, this being a preliminary issue. 116. According to the Court’s settled case-law, for a request for substitution of grounds to be admissible, there must be an interest in bringing proceedings, in so far as the request must be capable, if successful, of procuring an advantage to the party making it. That may be the case where the request for substitution of grounds amounts to a defence to one of an applicant’s pleas. (45) 117. In the present case, if it were to be concluded that, contrary to what the General Court held, Article L.511-31 of the CMF is sufficient in itself to support the conclusion that the condition laid down in Article 10(1)(a) of Regulation No 575/2013 is fulfilled by Crédit mutuel, the first limb of the second ground of each appeal raised by CMA would become ineffective. After all, in such an event, there would no longer be any need to analyse CMA’s arguments alleging an error by the General Court in the assessment of the CNCM’s decision No 1-1992 of 10 March 1992. Consequently, since the Commission has an interest in making the request for substitution of grounds, the request must, in my opinion, be regarded as admissible. 118. With regard to the scope of Article L.511-31 of the CMF, in the judgments under appeal, the General Court, first of all, considered that, in the absence of a decision by the national courts with jurisdiction, it fell to it to give a ruling on the scope of that provision. The General Court thus held that Article L.511-31 of the CMF did not in itself support the conclusion that the condition laid down in Article 10(1)(a) of Regulation No 575/2013 was met, on account of the excessively general nature of the latter’s wording, which refers to the taking of ‘measures necessary’ to ‘ensure the liquidity and solvency of each of those institutions and companies and of the network as a whole’. The General Court held that it was not possible to infer from such a general provision the existence of an obligation to transfer capital and liquid assets within the group to ensure that the obligations to creditors are fulfilled. (46) 119. The Commission submits that the General Court’s interpretation of Article L.511-31 is too restrictive. In order to substantiate its position, it mentions the interpretation of that provision that is contained in decision No 399413 of the Conseil d’État (Council of State) of 9 March 2018. The ECB also refers to that decision, but it also bases its line of argument on decision No 403418 of the Conseil d’État (Council of State) of 13 December 2016. (47) 120. In this regard, it is important to state, as the General Court does, that, in accordance with settled case-law, the scope of national laws, regulations or administrative provisions must be assessed in the light of the interpretation given to them by national courts. (48) 121. The fact, cited by CMA, that the decision of the Conseil d’État Council of State) of 9 March 2018 post-dated the judgments under appeal does not preclude it from being taken into account for the purposes of interpreting Article L.511-31 of the CMF, since the parties have had an opportunity to present their observations to the Court. (49) 122. In recital 5 of the decision of the Conseil d’État (Council of State) of 13 December 2016, that court stated that, ‘in adopting the provisions of Articles L.511-31 …, [t]he legislature … entrusted [to the CNCM] the tasks of ensuring the cohesion of the [Crédit Mutuel] network[,] exercising administrative, technical and financial scrutiny over the organisation and management of each branch and taking any the measures necessary for the smooth running of that network. … Furthermore, pursuant to Article L.511-31 of the same Code, the CNCM can, where the financial situation of the institutions concerned so warrants, and notwithstanding any provisions or stipulations to the contrary, decide to merge two or more branches affiliated to the network, transfer their business assets or wind them up. It follows from this framework of laws and regulations that, whatever the nature of the relationship between the groupings formed within the Crédit Mutuel network, the CNCM is statutorily responsible for preparing and implementing measures connected with the systemic regulation of the banking system on behalf of the whole of the Crédit Mutuel group and must, as a “parent undertaking within the Union”, have a recovery plan for that group’. 123. Similar findings are contained in recital 7 of the decision of the Conseil d’État (Council of State) of 9 March 2018, which further states that, ‘by dint of performing those tasks connected with the regulation of credit institutions, the [CNCM] is necessarily competent to issue binding instructions to branches to ensure that they comply with the provisions applicable to them and to impose the appropriate penalties on them should they fail to comply with those provisions’. 124. Furthermore, in point 20 of the latter decision, the Conseil d’État (Council of State) held that, ‘in order to “ensure the liquidity and solvency of the network” for which they are responsible, the central bodies are empowered under Article L.511-31 of the Code monétaire et financier (Monetary and Financial Code) to take “any necessary measures ”, and, in particular, to introduce as between the members of the network binding joint and several liability mechanisms that must not be confined to the mere establishment of pre-financed schemes such as guarantee funds’. 125. It follows from that case-law of the Conseil d’État (Council of State) that the obligation laid down in Article L.511-31 of the CMF to ‘take any measures necessary, in particular, to ensure the liquidity and solvency of each of those institutions and companies and of the network as a whole’ confers on the CNCM very extensive powers of administrative, technical and financial scrutiny over the entire Crédit mutuel network that allow it to introduce at any time binding joint and several liability mechanisms, such as obligations to transfer capital and liquidity, that members of the network may be required to apply. Those powers are described by the Conseil d’État (Council of State) as extending so far as to allow the CNCM, in circumstances in which an institution gets into financial difficulty, to decide to merge two or more branches affiliated to the network, notwithstanding any provisions or stipulations to the contrary. Requiring a member of the network to merge with an institution in financial difficulty is tantamount to requiring the member in question to take over that institution’s liabilities, the potential effect of which on that member may be more onerous than the effect of simply requiring it to transfer capital and liquidity. 126. In the light of the extent of the powers of supervision and intervention which the CNCM exercises over the entities forming part of the Crédit mutuel network in circumstances in which a network member gets into difficulty, it is, in my opinion, undeniable that the provision contained in Article L.511-31, as described by the case-law of the Conseil d’État (Council of State), entails the existence of an obligation to transfer capital and liquid assets within the Crédit mutuel network. It follows that, contrary to the view taken by the General Court, that article is, to my mind, sufficient in itself to support the proposition that that group fulfils the condition laid down in Article 10(1)(a) of Regulation No 575/2013. 127. Now, in accordance with the Court’s settled case-law, if the grounds of a decision of the General Court contain an infringement of EU law but its operative part is shown to be well founded on other legal grounds, such an infringement is not one that should cause that decision to be set aside, and a substitution of grounds must be made. (50) 128. It is therefore appropriate, in my view, to grant the Commission’s request for substitution of grounds and, consequently, to reject the first limb of the second ground of each appeal as being ineffective. (b) The second limb, concerning the inapplicability of the CNCM’s Decision No 1-1992 of 10 March 1992 to the entire membership of the Crédit mutuel group 129. Under the second limb of the second ground of each appeal, CMA claims that the General Court committed an error of law in its legal characterisation of the facts relating to Article 10(1)(a) of Regulation No 575/2013 inasmuch as, even if the decision of 10 March 1992 did establish the existence of an obligation to transfer capital and liquid assets, that decision does not apply to all members of the Crédit mutuel group that are subject to the prudential supervision of the ECB. 130. After all, the Crédit mutuel group’s members include banking entities, in the form of regional branch subsidiaries, which are not affiliated to the central body. Those subsidiaries fall squarely outside the scope of the decision of 10 March 1992 and are not covered by any joint and several liability mechanism. The CNCM enjoys none of the rights referred to in Article 10 of Regulation No 575/2013 in relation to those subsidiaries. 131. The ECB submits, first of all, that that line of argument, which appeared for the first time at the appeal stage, constitutes a new ground that relates not to the interpretation of Article 10 of Regulation No 575/2013 but to the scope of Article 2(21)(c) of the SSM Framework Regulation, and that this second limb is therefore inadmissible. The Commission essentially endorses the ECB’s position. The ECB and the Commission submit that the second limb of the second ground of each appeal must in any event be rejected as being unfounded. In that connection, the ECB asks the Court to request the production of certain refinancing agreements concluded between the cooperative entities in the Crédit Mutuel group and their subsidiaries as a measure of organisation of procedure under Article 64 of the Rules of Procedure. 132. In this regard, it should be recalled that it follows from settled case-law that, since, in an appeal, the review by the Court of Justice is confined to the findings of law on the pleas and arguments debated before the General Court, a party cannot put forward for the first time before the Court of Justice an argument which it did not raise before the General Court. (51) 133. I am left in no doubt, on reading the documents before the Court, that the line of argument put forward by CMA under the second limb of the second ground of each appeal was not in any way raised before the General Court at first instance. Neither can it be classified as a new argument that simply elaborates or expands upon the line of argument presented to the General Court. (52) 134. Consequently, I consider this limb to be inadmissible. 135. In the alternative, I would make the point that, even if, quod non, this limb were admissible, it is in any event also ineffective. 136. After all, in its decision of 9 March 2018, the Conseil d’État (Council of State) stated that the powers of scrutiny that fall to be exercised by the CNCM, pursuant to Article L.511-31 of the CMF, in connection with the Crédit mutuel network must be regarded as also extending to ‘branch subsidiaries where the financial situation of the former has an impact on the latter’. (53) In those circumstances, in the light of the conclusion at which I arrived in point 125 above, to the effect that that article is sufficient in itself to support the proposition that the condition laid down in Article 10(1)(a) of Regulation No 575/2013 is fulfilled, the fact, if it were the case, that the CNCM’s decision No 1-1992 of 10 March 1992 does not apply to all of the members of the Crédit mutuel group would have no bearing on the finding that that group fulfils that condition. 137. It follows from all the foregoing that, in my view, the second limb of the second ground of each appeal must be rejected, there being no need to rule on the ECB’s request for a measure of organisation of procedure. Consequently, since the second ground of each of the two appeals must be rejected, the two appeals should, in my opinion, be dismissed in their entirety. VI. Costs 138. Under Article 184(2) of the Rules of Procedure of the Court of Justice, where an appeal is unfounded, the Court is to make a decision as to the costs. 139. Under Article 138(1) of those Rules, applicable to appeal proceedings pursuant to Article 184(1) thereof, the unsuccessful party is to be ordered to pay the costs if they have been applied for in the successful party’s pleadings. 140. Since CMA has been unsuccessful, and the ECB, the Commission and the CNCM have applied for costs, CMA should bear its own costs and be ordered to pay those of the ECB, the Commission and the CNCM. VII. Conclusion 141. In the light of the foregoing considerations, I propose that Court rule as follows: (1) The appeals are dismissed. (2) Crédit Mutuel Arkéa shall not only bear its own costs but also pay those of the European Central Bank, the European Commission and the Confédération nationale du Crédit Mutuel. 1 Original language: French. 2 Judgments of the General Court of the European Union of 13 December 2017, Crédit Mutuel Arkéa v ECB (T‑712/15, EU:T:2017:900, ‘first judgment under appeal’), and of 13 December 2017, Crédit Mutuel Arkéa v ECB (T‑52/16, EU:T:2017:902, ‘second judgment under appeal’). Hereafter, I shall refer to the two judgments collectively as ‘the judgments under appeal’. 3 Decision ECB/SSM/2015 – 9695000CG7B84NLR5984/28 of the European Central Bank (ECB) of 5 October 2015 setting out the prudential requirements for the Crédit mutuel group (‘the first contested decision’), and Decision ECB/SSM/2015 – 9695000CG7B84NLR5984/40 of the European Central Bank of 4 December 2015 setting out the prudential requirements for the Crédit mutuel group (‘the second contested decision’) (collectively, ‘the contested decisions’), respectively. 4 OJ 2013 L 287, p. 63. 5 So far as concerns the participation of Member States whose currency is not the euro, see Article 7 of the SSM Regulation. 6 OJ 2014 L 141, p. 1. 7 Regulation of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit institutions and investment firms and amending Regulation (EU) No 648/2012 (OJ 2013 L 176, p. 1). 8 See paragraphs 1 to 13 of the first judgment under appeal and paragraphs 1 to 14 of the second judgment under appeal. 9 Decision ECB/SSM/2015/10 – 9695000CG7B84NLR5984/14 of the European Central Bank of 17 June 2015 setting out the prudential requirements for the Crédit Mutuel group. 10 This Board is provided for in Article 24 of the SSM Regulation. 11 In accordance with Article 24(7) of the SSM Regulation. 12 The third pleas, by which CMA, in support of its two actions, essentially contested the imposition of additional capital are not affected by these appeals. 13 See to this effect, by analogy, judgment of 11 September 2014, MasterCard and Others v Commission (C‑382/12 P, EU:C:2014:2201, paragraphs 38 to 41 and the case-law cited), as well as the Opinion of Advocate General Mengozzi in the same case, MasterCard and Others v Commission (C‑382/12 P, EU:C:2014:42, point 19). See also, by analogy, judgment of 25 April 2013, Commission v Slovak Republic (C‑331/11, not published, EU:C:2013:271, paragraph 28), and Order of 7 August 2018, Campailla v European Union (C‑256/18 P, not published, EU:C:2018:655, paragraph 34). 14 Paragraph 84 et seq. of the first judgment under appeal and paragraph 83 et seq. of the second judgment under appeal. 15 Paragraph 86 of the first judgment under appeal and paragraph 85 of the second judgment under appeal. 16 Paragraphs 58 to 64 of the first judgment under appeal and paragraphs 57 to 63 of the second judgment under appeal. 17 Paragraph 88 of the first judgment under appeal and paragraph 87 of the second judgment under appeal. 18 Paragraph 89 of the first judgment under appeal and paragraph 88 of the second judgment under appeal. 19 Paragraphs 90 to 93 of the first judgment under appeal and paragraphs 89 to 92 of the second judgment under appeal. 20 The text of Article 127(6) TFEU is reproduced in Article 25(2) of the Protocol on the Statute of the European System of Central Banks and of the European Central Bank. 21 To that end, the Council is to act by means of regulations in accordance with a special legislative procedure, unanimously and after consulting the European Parliament and the ECB. 22 In the judgments under appeal, the General Court itself pointed out that CMA had not raised an objection of illegality. See paragraph 81 of the first judgment under appeal and paragraph 80 of the second judgment under appeal. 23 See Article 4(1)(1) and Article 4(1)(26) of Regulation No 575/2013. 24 Article 105(6) of the Treaty of Maastricht. 25 In this regard, see the judgments of 27 November 2012, Pringle (C‑370/12, EU:C:2012:756); of 16 June 2015, Gauweiler and Others (C‑62/14, EU:C:2015:400); and of 11 December 2018, Weiss and Others (C‑493/17, EU:C:2018:1000). 26 However, on the requirement that the performance of tasks relating to prudential supervision by the ECB should be separate from that of tasks relating to monetary policy, see recital 65 of the SSM Regulation. 27 See in this regard recital 65 of the SSM Regulation. 28 For reflections on the 2008 financial crisis and the creation of the SSM, see the Opinions of Advocate General Hogan in Landeskreditbank Baden-Württemberg v ECB (C‑450/17 P, EU:C:2018:982 points 1 and 2), and of Advocate General Campos Sánchez-Bordona in Berlusconi and Fininvest (C‑219/17, EU:C:2018:502, points 1 and 2). 29 See in this regard recital 16 of the SSM Regulation. 30 See in this regard recital 26 of the SSM Regulation, to which the General Court also referred in paragraph 60 of the first judgment under appeal and in paragraph 59 of the second judgment under appeal. 31 Paragraph 89 of the first judgment under appeal and paragraph 88 of the second judgment under appeal. 32 See, inter alia, judgment of 14 March 2019, Meta Group v Commission (C‑428/17 P, not published, EU:C:2019:201, paragraph 40 and the case-law cited). 33 See paragraphs 88 and 89 of the first judgment under appeal and paragraphs 87 and 88 of the second judgment under appeal. 34 Paragraph 93 of the first judgment under appeal and paragraph 92 of the second judgment under appeal. 35 The text of that provision is reproduced in Article 34(3) of the Protocol on the Statute of the European System of Central Banks and of the European Central Bank. 36 OJ 1998 L 318, p. 4. 37 Paragraph 91 of the first judgment under appeal and paragraph 90 of the second judgment under appeal. 38 That limb refers to paragraphs 95 to 108 of the first judgment under appeal and paragraphs 94 to 107 of the second judgment under appeal. 39 See paragraph 99 et seq. of the first judgment under appeal and paragraph 98 et seq. of the second judgment under appeal. 40 This argument relates to paragraphs 106 and 107 of the first judgment under appeal and paragraphs 105 and 106 of the second judgment under appeal. 41 Paragraphs 135 to 137 of the first judgment under appeal and paragraphs 134 to 136 of the second judgment under appeal. 42 ECLI:FR:CECHR:2018:399413.20180309. 43 Paragraphs 118 to 130 of the first judgment under appeal and paragraphs 117 to 129 of the second judgment under appeal. 44 Paragraphs 131 to 139 of the first judgment under appeal and paragraphs 130 to 138 of the second judgment under appeal. 45 See, inter alia, judgment of 11 July 2013, Ziegler v Commission (C‑439/11 P, EU:C:2013:513, paragraph 42 and the case-law cited). 46 Paragraph 134 of the first judgment under appeal and paragraph 133 of the second judgment under appeal. 47 ECLI:FR:CECHR:2016:403418.20161213. 48 See, inter alia, judgment of 16 September 2015, Commission v Slovak Republic (C‑433/13, EU:C:2015:602, paragraph 81 and the case-law cited). 49 See to this effect, by analogy, judgment of 5 April 2017, EUIPO v Szajner (C‑598/14 P, EU:C:2017:265, paragraphs 44 to 46 and the case-law cited). To this effect, see also judgment of 24 April 2018, Caisse régionale de crédit agricole mutuel Alpes Provence and Others v ECB (T‑133/16 to T‑136/16, EU:T:2018:219, paragraph 87). In particular, CMA took a stance on the decision of the Conseil d’État (Council of State) of 9 March 2018 in its reply. 50 See to this effect, inter alia, judgment of 23 January 2019, Deza v ECHA (C‑419/17 P, EU:C:2019:52, paragraph 87 and the case-law cited). 51 See, inter alia, judgment of 20 September 2018, Agria Polska and Others v Commission (C‑373/17 P, EU:C:2018:756, paragraph 99 and the case-law cited). 52 An argument that elaborates or expands upon a line of argument presented to the General Court is admissible. See judgment of 10 September 2009, Akzo Nobel and Others v Commission (C‑97/08 P, EU:C:2009:536, paragraph 39). 53 See recitals 10 and 11 of the decision of the Conseil d’État (Council of State) of 9 March 2018.