Information;Judgment — ECLI:EU:T:2023:721
Date: 2023-11-15
Language of the case: English
Court formation: Seventh Chamber
Subject matter: Economic and monetary policy
Procedure: Action for annulment - unfounded;Action for annulment - inadmissible
Origin: Latvia

summary of the decision concerning it. 34 In accordance with the second paragraph of Article 21 of the Statute of the Court of Justice of the European Union, read in conjunction with Article 78(1) of the Rules of Procedure of the General Court, the application must be accompanied, where appropriate, by the measure the annulment of which is sought. 35 However, neither the Statute of the Court of Justice of the European Union nor the Rules of Procedure of the General Court provide that failure to annex the measure, the annulment of which is sought, to the application automatically renders it inadmissible. 36 In the present case, the SRB does not allege any infringement of its rights or harm or even a mere inconvenience suffered as a result of the fact that the contested decision had not been annexed to the application. The defect pleaded by the SRB is, therefore, not sufficient in the present case to render the application inadmissible (see, to that effect and by analogy, judgments of 24 October 2002, Aéroports de Paris v Commission, C‑82/01 P, EU:C:2002:617, paragraphs 11 and 12; of 5 March 2003, Ineichen v Commission, T‑293/01, EU:T:2003:55, paragraphs 32 to 35; and of 5 November 2008, Avanzata and Others v Commission, F‑48/06, EU:F:2008:137, paragraphs 51 and 52). Indeed, the SRB itself produced the text of the contested decision before the General Court (Annex B.2 to the defence). 37 The present plea of inadmissibility cannot, therefore, be upheld. The plea of inadmissibility alleging that the applicants have no standing to bring proceedings 38 According to the SRB, the applicants do not have standing to bring proceedings in that they are not directly concerned by the contested decision. Moreover, the status of the applicants other than PNB Banka as shareholders has not even been proved, as the ECB also observed in its statement in intervention. PNB Banka’s winding-up was not imposed or caused by the contested decision, but was the result of the actions of the competent national authorities on the basis of national insolvency law. That decision required only that the FCMC, the addressee thereof, refrain from adopting a resolution scheme in respect of PNB Banka. 39 It should be borne in mind that, under the fourth paragraph of Article 263 TFEU, any natural or legal person may institute proceedings against an act addressed to that person or which is of direct and individual concern to them, and against a regulatory act which is of direct concern to them and does not entail implementing measures. It is apparent from paragraph 16 above that, in the present case, the applicants are not addressees of the contested decision. 40 In the first place, as regards the alleged lack of direct concern to the applicants, it should be borne in mind that the condition that a natural or legal person that is not the addressee of the decision forming the subject matter of the proceedings must be directly concerned by that decision, as laid down in the fourth paragraph of Article 263 TFEU, requires two cumulative criteria to be met, namely, first, the contested measure must directly affect its legal situation and, second, it must leave no discretion to its addressees who are entrusted with the task of implementing it, such implementation being purely automatic and resulting from the EU rules alone without the application of other intermediate rules (judgments of 22 March 2007, Regione Siciliana v Commission, C‑15/06 P, EU:C:2007:183, paragraph 31; of 13 October 2011, Deutsche Post and Germany v Commission, C‑463/10 P and C‑475/10 P, EU:C:2011:656, paragraph 66; and of 6 November 2018, Scuola Elementare Maria Montessori v Commission, Commission v Scuola Elementare Maria Montessori and Commission v Ferracci, C‑622/16 P to C‑624/16 P, EU:C:2018:873, paragraph 42). 41 In the present case, a distinction must be drawn between the direct concern to the applicants who are shareholders or potential shareholders, and the direct concern to PNB Banka as a credit institution. 42 As regards the applicants who are shareholders and potential shareholders of PNB Banka, it must be found, in accordance with settled case-law, that the contested decision does not directly affect their legal situation. Indeed, the right of shareholders to receive dividends and participate in the management of PNB Banka has not been affected by that decision (order of 14 May 2020, Bernis and Others v SRB, T‑282/18, not published, EU:T:2020:209, paragraph 40; see also, by analogy, judgment of 5 November 2019, ECB and Others v Trasta Komercbanka and Others, C‑663/17 P, C‑665/17 P and C‑669/17 P, EU:C:2019:923, paragraph 110). 43 It follows that the applicants who are shareholders or potential shareholders of PNB Banka are not directly concerned by the contested decision within the meaning of the fourth paragraph of Article 263 TFEU. 44 As regards, further, the alleged lack of direct concern to PNB Banka, it should be borne in mind that, in accordance with Article 18 of Regulation No 806/2014, if the ECB considers, in its assessment, that the entity concerned is failing or is likely to fail within the meaning of Article 18(1)(a) of that regulation, this results in the initiation of the procedure provided for in that article. By contrast, if the ECB reaches the opposite conclusion, the resolution procedure is not initiated, since the third subparagraph of Article 18(1) of Regulation No 806/2014 provides that the ECB must communicate its assessment to the Commission and the SRB only where it considers that the entity is failing or is likely to fail (see, to that effect, judgment of 6 May 2021, ABLV Bank and Others v ECB, C‑551/19 P and C‑552/19 P, EU:C:2021:369, paragraphs 67 and 70). 45 Thus, first, the SRB’s conclusion, which is based on the ECB’s assessment that PNB Banka is failing or is likely to fail, is an essential prerequisite for the operative part of the contested decision which provides that a resolution scheme is not to be adopted in respect of that bank. Therefore, the conclusion that PNB Banka is failing or is likely to fail constitutes the necessary justification for Article 1 of that decision. Accordingly, in so far as the contested decision states that PNB Banka is failing or is likely to fail, it directly affects that bank’s legal situation within the meaning of the case-law cited in paragraph 40 above. 46 Second, it must be pointed out that the decision to adopt resolution action entails the imposition of resolution tools as referred to in Article 18(6)(b) and (c) and Article 22 of Regulation No 806/2014, such as the sale of business tool, the bridge institution tool, the asset separation tool and the bail-in tool, or even use of the Single Resolution Fund to support resolution action. Accordingly, the decision not to adopt such tools, some of which may enable PNB Banka to continue part of its activities, directly affects its legal situation. 47 As regards the question whether that decision leaves discretion to the addressees entrusted with the task of implementing it within the meaning of the case-law referred to in paragraph 40 above, it must be found that that is not the case here. The decision not to adopt a resolution scheme in respect of PNB Banka leaves no discretion to the addressee entrusted with the task of implementing it, such implementation being purely automatic and resulting from the EU rules alone without the application of other intermediate rules. Indeed, the FCMC has no discretion in relation to the SRB’s decision that no resolution tool is to be adopted with regard to PNB Banka, since that decision does not require the application of any rule or intermediate measure in order to produce its binding legal effects. That conclusion is not called into question by the fact that that the FCMC may find it necessary to adopt measures implementing the contested decision, in accordance with Article 29(1) of Regulation No 806/2014, the wording of which is reiterated in Article 2(2) of that decision, since those measures fall outside the framework of the resolution mechanism (see, to that effect, order of 14 May 2020, Bernis and Others v SRB, T‑282/18, not published, EU:T:2020:209, paragraph 43). 48 In particular, the winding-up of PNB Banka, under normal insolvency proceedings, in accordance with Latvian law, sits outside of any resolution scheme and does not flow from the contested decision. Those proceedings were opened by the Rīgas pilsētas Vidzemes priekšpilsētas tiesa (Riga City Court, (Vidzeme District)) on a proposal from the FCMC after the aforementioned decision, according to which it was not necessary in the public interest to apply such a resolution scheme to PNB Banka in accordance with Regulation No 806/2014 (see, to that effect, judgment of 6 May 2021, ABLV Bank and Others v ECB, C‑551/19 P and C‑552/19 P, EU:C:2021:369, paragraph 49). Thus, the winding-up of PNB Banka under normal insolvency proceedings was not ordered by the contested decision (see, to that effect, order of 14 May 2020, Bernis and Others v SRB, T‑282/18, not published, EU:T:2020:209, paragraphs 39 to 45). 49 It must be concluded that PNB Banka is directly concerned by the contested decision within the meaning of the fourth paragraph of Article 263 TFEU. 50 In the second place, it should be noted that the individual concern to PNB Banka, within the meaning of the fourth paragraph of Article 263 TFEU, has not been called into question by the SRB. The contested decision concerns PNB Banka as a credit institution in respect of which the SRB does not adopt a resolution scheme and, thus, it distinguishes PNB Banka individually just as in the case of the addressee of that decision, in this instance the FCMC. PNB Banka is, therefore, individually concerned by the contested decision. 51 Consequently, the applicants who are shareholders or potential shareholders do not have standing to bring proceedings against the contested decision. Accordingly, the action, in so far as it was brought by them, is inadmissible. 52 By contrast, PNB Banka demonstrates such standing to bring proceedings against that decision. The plea of inadmissibility alleging that PNB Banka has no legal interest in bringing proceedings 53 The SRB contends that PNB Banka has not established that it has a vested and present interest in bringing proceedings. First, it has not shown how it would benefit from the annulment of the contested decision. Second, the fact that that decision confirms that PNB Banka was, according to the ECB’s assessment, failing or was likely to fail, within the meaning of Article 18(1)(a) of Regulation No 806/2014, is not sufficient to conclude that PNB Banka has a legal interest in bringing proceedings, since that consideration does not concern the operative part of that decision. Furthermore, according to the case-law, the FOLTF assessment has no legal effect for the credit institution concerned. Third, in view of subsequent events, any interest that PNB Banka may have is in any event neither vested nor present. Fourth, PNB Banka has not established the existence of a relationship between the contested decision and the deterioration of its subsequent financial situation. 54 The General Court points out that, according to the Court of Justice’s settled case-law, an action for annulment brought by a natural or legal person is admissible only in so far as that person has an interest in having the contested act annulled. Such an interest requires that the annulment of that act must be capable, in itself, of having legal consequences and that the action may therefore, through its outcome, procure an advantage to the party which brought it (see judgment of 17 September 2015, Mory and Others v Commission, C‑33/14 P, EU:C:2015:609, paragraph 55 and the case-law cited). 55 It is common ground that, while seeking the annulment in full of the contested decision, PNB Banka does not take issue with the refusal to put in place a resolution scheme, but disputes, in essence, the SRB’s conclusions that it was failing or was likely to fail and that there was no reasonable prospect that alternative measures would prevent that failure. 56 However, particular aspects of the present case mean that it is impossible to deny that PNB Banka does have a legal interest in bringing proceedings. 57 First, as is also apparent from paragraphs 44 and 45 above, either the ECB considers, in its assessment, that the entity is failing or is likely to fail, which results in the initiation of the procedure provided for in Article 18 of Regulation No 806/2014, or it considers that that is not the case, with the result that the procedure is not initiated (see, to that effect, judgment of 6 May 2021, ABLV Bank and Others v ECB, C‑551/19 P and C‑552/19 P, EU:C:2021:369, paragraph 67). The FOLTF assessment, once adopted by the SRB, is therefore an essential prerequisite for triggering the resolution procedure provided for in Article 18 of Regulation No 806/2014 and, therefore, for a formal decision as to whether or not to adopt a resolution scheme. 58 Thus, the grounds of the contested decision, in particular the ECB’s assessment of whether PNB Banka was failing or was likely to fail, adopted by the SRB, constitute the necessary justification for the operative part of that decision. If the Court were to conclude that that assessment was incorrect, the procedure which gave rise to that decision should not have been triggered in respect of PNB Banka. 59 Second, with a view to carrying on its banking activities, the entity concerned has a legitimate interest in not being subject to an assessment which makes it clear that it is failing or is likely to fail, irrespective of the events that took place after the adoption of the contested decision, in particular the winding-up under normal insolvency proceedings against PNB Banka. 60 Consequently, it must be concluded that PNB Banka has established that it has a legal interest in bringing proceedings. 61 In the light of the foregoing, the action is admissible in so far as it is brought by PNB Banka. Substance 62 PNB Banka raises 14 pleas in law in support of its action, alleging that (i) the SRB lacks competence, (ii) PNB Banka’s rights have been infringed in that the SRB took a formal decision not to adopt a resolution scheme, (iii) Article 18(1)(a) of Regulation No 806/2014 has been infringed, (iv) Article 18(1)(b) and (c) of that regulation has been infringed, (v) the contested decision is procedurally vitiated because it is based on an unlawful on-site inspection, (vi) the principle of proportionality has been infringed, (vii) there has been a failure to state reasons, (viii) the right to be heard has been infringed, (ix) the contested decision is based on the unlawful decision of 21 March 2019 by which the ECB opposed PNB Banka’s acquisition of qualifying holdings in another credit institution, (x) the principle of equal treatment has been infringed, (xi) the principles of legal certainty and the protection of legitimate expectations have been infringed, (xii) the nemo auditur principle has been infringed, (xiii) the ECB lacked impartiality and (xiv) there has been a misuse of powers. The admissibility of the pleas in law 63 The SRB contends that a number of pleas in law are inadmissible, in essence, on the ground of infringement of Article 21(1) of the Statute of the Court of Justice of the European Union and of Article 76(d) of the Rules of Procedure of the General Court. According to the latter provision, ‘an application of the kind referred to in Article 21 of the Statute shall contain … the subject matter of the proceedings, the pleas in law and arguments relied on and a summary of those pleas in law’. 64 It should be noted, in that regard, that the SRB contends, without providing any specific reasons other than the general claim essentially that PNB Banka’s arguments are unclear or insufficiently substantiated, that the first, third, and fifth to fourteenth pleas in law are inadmissible. 65 In that regard, it should be borne in mind that an application must state the subject matter of the proceedings and a summary of the pleas in law, and that that statement must be sufficiently clear and precise as to enable the defendant to prepare its defence and the Court to rule on the application, if necessary without any other supporting information (see, to that effect, judgment of 7 March 2017, United Parcel Service v Commission, T‑194/13, EU:T:2017:144, paragraph 191). 66 It should also be borne in mind that, in particular, it is necessary, for an action before the Court to be admissible, that the basic matters of fact and law relied on be indicated, at least in summary form, coherently and intelligibly in the application itself (judgment of 7 March 2017, United Parcel Service v Commission, T‑194/13, EU:T:2017:144, paragraph 192). 67 In the present case, as is apparent from paragraphs 69 to 76, 94, 102 to 128, 130 to 139, 141 to 148, 150 to 163, 165 to 168, 170 to 173, 175 to 185 and 187 to 198 below, the matters of fact and law on which PNB Banka bases its arguments are immediately intelligible from reading the relevant pleas in the application. Indeed, the SRB has been able, in the defence, to respond to those arguments. 68 It follows from the foregoing considerations that the first, third, and fifth to fourteenth pleas in law are admissible. The first plea in law, alleging that the SRB lacked competence 69 PNB Banka submits, in essence, that the ECB’s decision of 1 March 2019 by which the ECB classified it as a significant entity subject to its direct prudential supervision (see paragraph 4 above) was unlawful. For that reason, the SRB did not become the competent resolution authority and was not entitled to take a decision concerning the adoption of a resolution scheme in respect of PNB Banka. 70 The SRB, supported by the ECB, disputes those arguments. 71 It is apparent from Article 7(2)(a) of Regulation No 806/2014 that the SRB is to be responsible for drawing up the resolution plans and adopting all decisions relating to resolution for the entities referred to in Article 2 of that regulation that are not part of a group and for groups which are considered to be significant in accordance with Article 6(4) of Regulation No 1024/2013 or in relation to which the ECB has decided in accordance with Article 6(5)(b) of that regulation to exercise directly all of the relevant powers. 72 In addition, Article 39(5) of Regulation No 468/2014 provides that ‘the ECB shall also directly supervise a less significant supervised entity or a less significant supervised group under an ECB decision adopted pursuant to Article 6(5)(b) of [Regulation No 1024/2013] to the effect that the ECB will exercise directly all relevant powers referred to in Article 6(4) of [that regulation]’ and that ‘for the purposes of the [Single Supervisory Mechanism (SSM)], such a less significant supervised entity or less significant supervised group shall be classified as significant’. 73 By decision of 1 March 2019, the ECB classified PNB Banka as a significant entity subject to its direct prudential supervision, pursuant to Article 6(5)(b) of Regulation No 1024/2013. That decision took effect on 4 April 2019. Consequently, as from that date the SRB was responsible for drawing up the resolution plans and adopting all decisions relating to resolution in respect of PNB Banka. 74 First, as the SRB correctly states, measures of the EU institutions are in principle presumed to be lawful and accordingly produce legal effects until such time as they are withdrawn, annulled in an action for annulment or declared invalid following a reference for a preliminary ruling or a plea of illegality (see judgment of 5 October 2004, Commission v Greece, C‑475/01, EU:C:2004:585, paragraph 18 and the case-law cited). Accordingly, the SRB was required to comply with the content of the ECB’s decision of 1 March 2019 by which it classified PNB Banka as a significant entity. In that context, it was responsible for adopting all the decisions relating to resolution in respect of PNB Banka until such time as that decision may have been withdrawn or annulled. 75 Second, it must be stated that the ECB’s decision of 1 March 2019 was the subject of a separate action for annulment, which the Court dismissed by judgment of 7 December 2022, PNB Banka v ECB (T‑301/19, under appeal, EU:T:2022:774). Even if the alleged unlawfulness of that decision could vitiate the lawfulness of the contested decision, its unlawfulness has not, therefore, been established. 76 Accordingly, the SRB was the resolution authority responsible for taking a decision on the basis of Article 18 of Regulation No 806/2014. 77 The first plea in law must, therefore, be rejected. The second and fourth pleas in law, alleging infringement of PNB Banka’s rights on the ground that the SRB took a formal decision not to adopt a resolution scheme 78 PNB Banka submits, in essence, that the SRB did not have the power to take a formal decision not to adopt a resolution scheme within the meaning of Article 18(1) of Regulation No 806/2014, to the effect that, although PNB Banka may have been failing or may have been likely to fail and there may have been no reasonable prospect that alternative measures would prevent its failure within a reasonable timeframe, a resolution scheme was not necessary in the public interest. The SRB’s power is strictly limited to adopting decisions to adopt a resolution scheme, subject to approval by the European Commission and the European Council. If the conditions laid down by the aforementioned provision were not met, the SRB would be expected to refrain from taking any action. In addition, the contested decision was at the origin of the winding-up under normal insolvency proceedings brought against PNB Banka, whereas the SRB lacked the power to take a decision aimed at the winding-up of that bank. The SRB therefore acted ultra vires and the adoption of that decision was very detrimental to PNB Banka. 79 By its fourth plea in law, PNB Banka submits, in essence, that the SRB also had no power to conclude, in the contested decision, that there was no reasonable prospect that alternative measures taken in respect of that bank would prevent its failure within a reasonable timeframe within the meaning of Article 18(1)(b) of Regulation No 806/2014, or that a resolution action was not necessary in the public interest within the meaning of Article 18(1)(c) of that regulation. 80 The SRB, supported by the ECB, disputes those arguments. 81 It is appropriate to examine the second and fourth pleas in law together. 82 In the first place, as the Court of Justice held in paragraph 70 of the judgment of 6 May 2021, ABLV Bank and Others v ECB (C‑551/19 P and C‑552/19 P, EU:C:2021:369), if the ECB comes to the conclusion that the entity concerned is failing or is likely to fail, its assessment is sent to the SRB and the resolution procedure is initiated. At that time, it is for the SRB to verify whether the conditions referred to in Article 18(1) of Regulation No 806/2014 are met in order to decide whether to adopt a resolution scheme. 83 It should also be noted that the Court of Justice found, in paragraph 56 of the judgment of 6 May 2021, ABLV Bank and Others v ECB (C‑551/19 P and C‑552/19 P, EU:C:2021:369), that the FOLTF assessment carried out by the SRB could be subject to judicial review in the context of an action before the Courts of the European Union against the adoption by the SRB of a resolution scheme or against the decision not to adopt such a scheme. It follows that the SRB is required to take a positive or negative decision once it has examined the three conditions laid down in Article 18(1) of Regulation No 806/2014, if only to prevent a lacuna in the judicial protection of an entity, especially with regard to the ECB’s FOLTF assessment of it. 84 Furthermore, as the SRB also points out, that conclusion is supported by the broader regulatory context of Article 18 of Regulation No 806/2014. It is apparent from Article 82(2) of Directive 2014/59/EU of the European Parliament and of the Council of 15 May 2014 establishing a framework for the recovery and resolution of credit institutions and investment firms and amending Council Directive 82/891/EEC, and Directives 2001/24/EC, 2002/47/EC, 2004/25/EC, 2005/56/EC, 2007/36/EC, 2011/35/EU, 2012/30/EU and 2013/36/EU, and Regulations (EU) No 1093/2010 and (EU) No 648/2012, of the European Parliament and of the Council (OJ 2014 L 173, p. 190), as amended by Commission Delegated Regulation (EU) 2016/1434 of 14 December 2015 (OJ 2016 L 233, p. 1), that ‘a decision whether or not to take resolution action in relation to an institution or an entity … shall contain the following information’. That provision thus expressly provides for the possibility of adopting a decision not to take resolution action. That provision may be regarded as the equivalent of Article 18 of Regulation No 806/2014, which applies to smaller credit institutions which are not subject to direct supervision by the ECB but which are subject to supervision by national resolution authorities (NRAs). 85 Moreover, once the ECB has taken the view that a credit institution is failing or is likely to fail, it is for the SRB to decide whether that assessment is correct and, if so, whether or not the credit institution in question will be the subject of a resolution, depending on whether the other conditions laid down in Article 18(1) of Regulation No 806/2014 are met. Moreover, the alleged lack of power on the part of the SRB to adopt a decision not to put in place a resolution scheme could jeopardise the stability of the institution concerned and potentially that of the financial markets, by giving rise to doubts as to the follow-up action to be taken in respect of that institution in the light of the ECB’s assessment. 86 Consequently, following the initiation of the procedure by the ECB, the SRB was required to examine the criteria set out in Article 18(1) of Regulation No 806/2014 and to take a decision at the end of that examination. 87 The second plea in law cannot, therefore, be upheld. 88 It also follows from the foregoing that, contrary to PNB Banka’s assertions in support of the fourth plea in law, it was for the SRB to ascertain whether the conditions referred to in Article 18(1)(b) and (c) of Regulation No 806/2014 were met in order to decide whether it was necessary to adopt a resolution scheme. Admittedly, the SRB could, theoretically, have examined first whether the condition laid down in Article 18(1)(c) of Regulation No 806/2014, according to which a resolution action is necessary in the public interest, was met and, provided that that was not the case, it could have refrained from examining the condition laid down in Article 18(1)(b) of that regulation, namely the existence of alternative measures capable of preventing the entity’s failure within a reasonable timeframe. However, the SRB did not err in law in examining each of the three conditions laid down in Article 18(1) of that regulation. That is all the more so given that the conditions laid down by Article 18(1)(a) and (b) of the regulation in question are closely linked. 89 Indeed, the FOLTF assessment of an entity generally takes into account the existence of alternative measures to prevent its failure. In the present case, it follows from the ECB’s FOLTF assessment of PNB Banka and from the SRB’s examination in that regard that PNB Banka had been given an opportunity to restore its risk management and capital position. The ECB also considered that there were no further supervisory or early intervention measures that could still restore PNB Banka’s capital position. In that context, the SRB cannot be criticised for taking into account the ECB’s assessment in order to answer the question whether there were alternative measures to resolution, which means that the conditions laid down in Article 18(1)(a) and (b) of Regulation No 806/2014 overlap. 90 In so far as PNB Banka claims, in support of the fourth plea in law, that the examination of the conditions laid down in Article 18(1)(b) and (c) of Regulation No 806/2014 was prejudged by the conclusion that it was failing or likely to fail, it is apparent from the contested decision that, even though the conditions laid down in Article 18(1)(a) and (b) of that regulation partially coincide, the three conditions were examined separately, especially as regards the question whether the adoption of a resolution action was in the public interest within the meaning of Article 18(1)(c) of that regulation. 91 In the second place, in response to the argument that the SRB exceeded its powers by ordering the FCMC to wind up PNB Banka, it must be stated, as is also apparent from paragraph 48 above, that the contested decision does not require the NRA concerned to act in such a way as to ensure that the institution concerned is wound up under normal insolvency proceedings. Accordingly, in the present case, the SRB did not order that PNB Banka be wound up and did not exceed those powers in that respect either. 92 Indeed, Article 2(2) of the contested decision simply provides that, pursuant to Article 29(1) of Regulation No 806/2014, the FCMC is to implement that decision and to ensure that any action it takes complies with it, in line with the considerations provided therein. That article does not specify the nature of the measures which the FCMC must or may take under the applicable national law. In those circumstances, it must be concluded that the contested decision does not require the FCMC to wind up under normal insolvency proceedings (see, by analogy, order of 14 May 2020, Bernis and Others v SRB (T‑282/18, not published, EU:T:2020:209, paragraph 43). 93 The fourth plea in law must, therefore, also be rejected. The third plea in law, alleging infringement of Article 18(1)(a) of Regulation No 806/2014 94 The third plea in law consists, in essence, in two parts. First, PNB Banka submits that the SRB erred, in the contested decision, in relying entirely on the ECB’s FOLTF assessment of PNB Banka without carrying out its own examination in respect of the condition laid down in Article 18(1)(a) of Regulation No 806/2014. Second, the FOLTF assessment contains manifest errors of assessment in that the SRB wrongly concluded that PNB Banka’s assets were less than its liabilities, within the meaning of Article 18(4)(b) of that regulation. 95 The SRB, supported by the ECB, disputes all of those arguments. 96 In that regard, the SRB considered, in point 3.2.1 of the contested decision, relying, inter alia, on the ECB’s FOLTF assessment of PNB Banka, that PNB Banka was deemed to be failing or likely to fail within the meaning of Article 18(1)(a) of Regulation No 806/2014, read in conjunction with Article 18(4)(a) and (b) of that regulation, on the ground that, first, PNB Banka infringed the requirements for continuing authorisation and, second, its assets were less than its liabilities. 97 Before examining the merits of the present plea in law, the following preliminary considerations should be made. – The degree of judicial review of the SRB’s assessment that a credit institution is failing or is likely to fail 98 It is appropriate to recall the scope of the review to be carried out, in the present case, by the Court. 99 It follows from the case-law that the judicial review which the Courts of the European Union must carry out of the merits of the grounds of a decision such as the contested decision, in so far as the decision is based on complex economic assessments, must not lead those courts to substitute their own assessment for that of the SRB, but seeks to ascertain that that decision is not based on materially incorrect facts and that it is not vitiated by a manifest error of assessment or misuse of powers (see, to that effect, judgment of 4 May 2023, ECB v Crédit lyonnais, C‑389/21 P, EU:C:2023:368, paragraph 55 and the case-law cited). 100 It also follows from the case-law that, in order to establish that the institution or administrative body concerned committed a manifest error in assessing the facts such as to justify the annulment of a decision based on complex economic or financial assessments, the evidence adduced by the applicant must be sufficient to make the factual assessments used in that decision implausible (see, by analogy, judgments of 14 June 2018, Lubrizol France v Council, C‑223/17 P, not published, EU:C:2018:442, paragraph 39; of 12 December 1996, AIUFFASS and AKT v Commission, T‑380/94, EU:T:1996:195, paragraph 59; and of 13 December 2018, Comune di Milano v Commission, T‑167/13, EU:T:2018:940, paragraph 108 and the case-law cited). 101 It is in the light of the foregoing considerations that the arguments put forward by PNB Banka in the context of its third plea in law must be examined. – The first part, alleging that the SRB was not entitled to rely solely on the ECB’s FOLTF assessment of PNB Banka 102 PNB Banka submits, in essence, that the SRB could not rely solely on the ECB’s FOLTF assessment in respect of PNB Banka without carrying out its own examination in respect of the condition laid down in Article 18(1)(a) of Regulation No 806/2014. 103 It must be held that, in its examination of the condition laid down in Article 18(1)(a) of Regulation No 806/2014, the SRB endorsed the conclusions drawn by the ECB in the context of the FOLTF assessment in respect of PNB Banka. After summarising the main reasons of that assessment, in point 3.2.1 of the contested decision, the SRB explains that it also mandated an external valuer (see paragraph 9 above) to carry out a valuation in accordance with Article 20(5)(a) of that regulation and Article 36(4)(a) of Directive 2014/59. It states that it received the valuation report on 13 August 2019. Lastly, it states in paragraph 80 of that decision that it also took into consideration all the other facts available to it concerning PNB Banka, which included assessments of the FCMC, the ECB, the external auditor of PNB Banka and the external valuer mandated by the SRB. 104 PNB Banka is, therefore, not justified in asserting that the SRB based its examination solely on the ECB’s FOLTF assessment in respect of PNB Banka. The SRB did indeed carry out its own examination of whether PNB Banka was failing or was likely to fail and took account of all the factors referred to in paragraph 103 above. Moreover, it is apparent from the case-law that the SRB is entitled to rely solely on the ECB’s FOLTF assessment in its examination of the condition laid down in Article 18(1)(a) of Regulation No 806/2014 (see, to that effect, judgment of 6 May 2021, ABLV Bank and Others v ECB, C‑551/19 P and C‑552/19 P, EU:C:2021:369, paragraphs 62 to 65). The SRB is, therefore, all the more justified in not basing its examination solely on the ECB’s assessment, but also on a valuation carried out by an external valuer. 105 Accordingly, the first part of the present plea in law must be rejected. – The second part, alleging that the SRB’s conclusion that PNB Banka was failing or was likely to fail was incorrect 106 PNB Banka submits, in essence, that the conclusion adopted by the ECB and endorsed by the SRB that PNB Banka was failing or was likely to fail, in accordance with Article 18(1)(a) of Regulation No 806/2014, read in conjunction with Article 18(4)(b) of that regulation, is incorrect in that its assets were not less than its liabilities. In that regard, it emphasises that the assessments concerning it dating from before the inspection report, which include PNB Banka’s financial statements for 2018, published on 25 July 2019, and the early intervention decision, do not show a negative net worth. The SRB was, therefore, wrong to base the contested decision primarily on the inspection report and the conclusions drawn by the SRB that that net worth was negative and the financial situation was deteriorating. 107 In the first place, as regards the FOLTF assessment in respect of PNB Banka carried out by the ECB, it should be pointed out that the latter finds several breaches of the applicable prudential provisions committed by PNB Banka during the years preceding that assessment. According to the ECB, PNB Banka did not put an end to those breaches, notwithstanding interventions by the FCMC and the ECB imposing measures aimed at restoring PNB Banka’s financial situation. 108 That assessment includes, inter alia, the following statements. Since 2016, PNB Banka has been in breach of the large exposure limits set out in Article 395 of Regulation (EU) No 575/2013 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). From 2018 onwards, PNB Banca experienced capital depletion, which led to persistent breaches of capital requirements, in particular Pillar 2 capital requirements, relating to additional supervisory action. Since February 2018, PNB Banka has been in breach of the related party lending limits, set out in the Latvian legislation, in particular due to a significant amount lent to its main shareholder. Furthermore, PNB Banka faced an increased credit risk, in particular due to non-performing loans, a structural decrease of its gross operating income and an increase in administrative expenses and the cost of legal services. 109 The ECB noted that, according to the inspection report (see paragraph 12 above), PNB Banka had a negative net worth of – EUR 58.2 million as at 31 December 2018 according to the baseline scenario, whereas even if PNB Banka’s assets were calculated according to the most optimistic scenario, these would have been less than its liabilities. 110 The ECB also relied on PNB Banka’s audited financial statements for 2018, which contain the opinion of its external auditor. The latter stated, in essence, that the assets of the group to which PNB Banka belonged were overvalued. It could be inferred from this, according to the ECB, that, as at 31 December 2018, PNB Banka was in breach of Tier 1 capital requirements at both company and group level. 111 The ECB also took account of the exchanges between, on the one hand, the FCMC and itself and, on the other hand, PNB Banka, set out in paragraphs 6 to 11 above, dating from the months preceding the adoption of the FOLTF assessment in respect of PNB Banka by the ECB, with a view, inter alia, to restoring PNB Banka’s capital situation. In the ECB’s view, the measures announced by PNB Banka were not capable of preventing the failure in question within a reasonable timeframe. 112 The ECB concluded that PNB Banka infringed the requirements for continuing authorisation, within the meaning of Article 18(4)(a) of Regulation No 806/2014, and that PNB Banka’s assets were less than its liabilities within the meaning of Article 18(4)(b) of that regulation. 113 In the second place, the SRB relied to a large extent on the valuation report, from which it appears, in essence, that the value of PNB Banka’s assets was overstated, that that value had to be adjusted and that the adjusted balance sheet showed a deficit of EUR 52.3 million. 114 As is apparent from paragraph 103 above, it follows that the SRB based the contested decision on several accounting assessments, carried out by different entities and at different times. On the basis of those reports and assessments, the SRB concluded that PNB Banka was failing or was likely to fail in accordance with Article 18(1)(a) of Regulation No 806/2014. 115 It must be stated that PNB Banka does not dispute in a substantiated manner that the facts relied on by the SRB are materially correct, within the meaning of the case-law cited in paragraph 99 above. It submits only that those facts are not capable of substantiating the SRB’s conclusions that PNB Banka’s assets were less than its liabilities, and submits that the SRB distorted the facts and made a manifest error of assessment in that regard, within the meaning of that same case-law. 116 However, the facts adduced by PNB Banka are not sufficient to make the factual assessments used in the contested decision implausible within the meaning of the case-law cited in paragraph 100 above. 117 Thus, first, PNB Banka’s assertion that the FOLTF assessment in respect of that bank is based only on the inspection report has no factual basis, as is apparent from paragraphs 107 to 113 above. 118 Second, PNB Banka’s argument that the conclusions drawn by the ECB’s inspection team following the on-site inspection, on which the contested decision is in part based, were different from the results of previous assessments cannot succeed either. 119 It must be stated, in that regard, that PNB Banka does not call into question the accuracy of the figures or the calculations of the value of its assets and liabilities. It merely asserts that the conclusions in question contradicted the results of previous analyses carried out by the FCMC, by PNB Banka’s auditors and management, and also by the ECB itself in the early intervention decision, which would thereby deprive the inspection report of its credibility. 120 However, that circumstance alone, even assuming that it were established, would not suffice to cast doubt on the conclusions of the inspection report. As the SRB rightly noted, the economic and financial situation of a credit institution may change rapidly, which may justify continuous reassessments and adjustments by the institutions. It was in that context that the on-site inspection identified, inter alia, that the impairments of PNB Banka’s assets were worse than those recognised in its audited financial statements and reporting as at 31 December 2018. The ECB determined that PNB Banka’s assets were less than its liabilities in the three scenarios analysed. The shortfall was EUR 58.2 million under a baseline scenario, EUR 23.6 million under an optimistic scenario and EUR 86.6 million under a pessimistic scenario. In all three scenarios, the total capital ratio of PNB Banka decreased from 12.4% as of 31 December 2018 to negative at the time of the assessment. 121 It should also be noted in that regard that the inspection report is not the only factor taken into account by the SRB in the contested decision. On the contrary, it is clear from that decision that the results of the inspection report are a continuation of other assessments which do not contradict it. Thus, the early intervention decision refers to several breaches, by PNB Banka, of prudential requirements and requires PNB Banka to draw up an action plan, which indicates that PNB Banka ran higher insolvency risks than permitted under the prudential rules. The SRB also notes, in paragraph 73(d) of the contested decision, like the ECB in its FOLTF assessment, that PNB Banka’s external auditor had concluded, in particular, that many of that bank’s assets were overvalued, in part because of impairment of those assets and that losses were underestimated. The auditor expressed doubts about the capacity of PNB Banka and the group to which it belonged to increase their capital to a level of compliance with the minimum prudential requirements and even the possibility of that bank being able to continue as a going concern. 122 Moreover, the SRB relies on the valuation report, from which it appears that the overvaluation of PNB Banka’s assets amounted to EUR 95.5 million and that PNB Banka had a negative net worth of – EUR 52.3 million. The external valuer instructed by the SRB does not, therefore, call into question the conclusions of the inspection report. 123 The fact that the documents cited in paragraph 121 above do not contain any express conclusion that PNB Banka’s assets were less than its liabilities does not invalidate that conclusion. Those documents refer to increasingly serious concerns over a period of several years as regards, in particular, the capital of that bank compared with, inter alia, the overvaluation of a considerable number of assets. Those documents do not, therefore, make implausible the SRB’s factual assessments at the time of the adoption of the contested decision, from which, in accordance with the accounting analysis carried out by the ECB and confirmed by the external valuer, it appears that PNB Banka’s assets were less than its liabilities or that there were objective elements from which it could be concluded that this would occur in the near future. 124 The present part of the third plea in law must be rejected, as must, therefore, the third plea in law in its entirety. The fifth plea in law, alleging that the on-site inspection is unlawful 125 PNB Banka submits that the ECB’s decision notified to it by letter of 14 February 2019 to conduct an on-site inspection was unlawful. Furthermore, the manner in which that inspection was carried out is unlawful. The contested decision is based to a large extent on the results of that inspection. 126 The SRB, supported by the ECB, disputes PNB Banka’s arguments. 127 It should be noted that, in support of the present plea in law, PNB Banka merely refers to its action for annulment of the ECB’s decision to conduct an on-site inspection. However, in the present action, it fails to set out the grounds for the alleged unlawfulness of that decision and, consequently, of the on-site inspection. In addition, it does not specify the reasons for which the on-site inspection was carried out in an unlawful manner. Nor, lastly, does PNB Banka indicate how that alleged unlawfulness is such as to vitiate the lawfulness of the contested decision. 128 Moreover, in the judgment of 7 December 2022, PNB Banka v ECB (T‑275/19, under appeal, EU:T:2022:781), the Court dismissed the action brought against the ECB’s decision to conduct an on-site inspection. 129 In those circumstances, the fifth plea in law must be rejected. The sixth plea in law, alleging infringement of the principle of proportionality 130 PNB Banka argues that the principle of proportionality was infringed with regard to it, given that, instead of adopting the contested decision, it was for the SRB to consult with PNB Banka’s shareholders with a view to implementing the action plan (see paragraph 10 above). 131 The SRB, supported by the ECB, disputes that argument. 132 It should be borne in mind that the principle of proportionality, which is one of the general principles of EU law, requires that acts adopted by EU institutions not exceed the limits of what is appropriate and necessary in order to attain the legitimate objectives pursued by the legislation in question (judgment of 17 May 1984, Denkavit Nederland, 15/83, EU:C:1984:183, paragraph 25); where there is a choice between several appropriate measures, recourse must be had to the least onerous, and the disadvantages caused must not be disproportionate to the aims pursued (judgment of 30 April 2019, Italy v Council (Fishing quota for Mediterranean swordfish), C‑611/17, EU:C:2019:332, paragraph 55). 133 In the present case, the SRB stated, in point 3.2.2 of the contested decision, that there was no reasonable prospect that alternative measures would prevent PNB Banka’s failure within a reasonable timeframe, within the meaning of Article 18(1)(b) of Regulation No 806/2014. Thus, the SRB took the view, without being disproven, that PNB Banka could not benefit from measures provided for by an institutional protection scheme (paragraph 82 of the contested decision), or from the write-down or conversion of relevant capital instruments taken in respect of PNB Banka within the meaning of Article 21(1) of that regulation (paragraph 85 of that decision). In addition, the SRB concurs with the ECB’s assessment in the FOLTF assessment in respect of PNB Banka that there were no further available supervisory measures, including early intervention measures, capable of preventing the failure of PNB Banka (paragraphs 88 and 89 of the contested decision). That assessment has also not been disputed by PNB Banka. 134 Above all, PNB Banka complains that the SRB did not reopen discussions with its shareholders in order to implement the action plan. In that regard, the SRB explained in paragraphs 86 and 87 of the contested decision, in essence, that the ECB had taken the action plan into consideration and had put PNB Banka in a position to complete it, but had considered that the measures proposed by PNB Banka were neither adequate nor credible for the reasons set out in paragraph 135 below. 135 As is apparent from paragraphs 10 to 13 above, on 1 August 2019, PNB Banka submitted the action plan to the ECB. By letter of 6 August 2019, the ECB replied that PNB Banka’s proposals were not sufficiently robust and that more efforts had to be made by its shareholders to restore its capital situation. PNB Banka then submitted other proposals involving the commitment of its shareholders, but the ECB concluded, by letter of 13 August 2019, that those proposals were neither adequate nor credible, because the shareholders had not submitted a formal unconditional underwriting agreement in the context of a capital increase in cash or clear evidence of the availability of the cash funds from the shareholders or other interested investors. The ECB also noted that the measures announced by PNB Banka did not comply with the deadlines imposed by the early intervention decision and that the capital contribution in kind was less appropriate, given the impairment risks, than a cash contribution would have been. On 15 August 2019, the ECB concluded that PNB Banka was failing or was likely to fail. 136 In those circumstances, it cannot be complained that the SRB failed to consult the shareholders with a view to implementing the measures contained in the action plan. 137 It should also be noted that, as is apparent from paragraph 85 above, once the ECB has taken the view that a credit institution is declared to be failing or to be likely to fail, it is for the SRB to decide whether that assessment is correct and, if so, whether or not the credit institution in question will be the subject of resolution. In the interests of the stability of the institution concerned, but also that of the financial markets, that decision-making process requires a degree of diligence. 138 In that context, PNB Banka cannot validly maintain that the SRB still had the choice between several appropriate measures to put an end to its uncertain situation and that the SRB could have had recourse to a less onerous measure than the adoption of the contested decision. 139 PNB Banka has not established to the requisite legal standard that the SRB infringed the principle of proportionality. 140 The sixth plea in law must, therefore, be rejected. The seventh plea in law, alleging a failure to state reasons 141 PNB Banka submits that the SRB infringed its obligation to state reasons. In its view, the statement of reasons for the contested decision is not appropriate and does not disclose in a clear and unequivocal fashion the reasoning followed by the SRB inasmuch as it is based on the results of the ECB’s on-site inspection and does not take account of previous evaluations. In addition, the solutions to prevent a failure of PNB Banka were not even examined. 142 The SRB, supported by the ECB, disputes PNB Banka’s arguments. 143 It is apparent from Article 41(2)(c) of the Charter that the right to good administration includes, inter alia, the obligation of the administration to give reasons for its decisions. 144 Furthermore, it should be noted that the statement of reasons required by Article 296 TFEU must be appropriate to the measure at issue and must disclose in a clear and unequivocal fashion the reasoning followed by the institution which adopted the measure in question in such a way as to enable the persons concerned to ascertain the reasons for the measure and to enable the Courts of the European Union to exercise their power of review. It is not necessary for the reasoning to go into all the relevant facts and points of law, since the question whether the statement of reasons meets the requirements laid down in Article 296 TFEU must be assessed not only with regard to its wording but also to its context and to all the legal rules governing the matter in question (see judgment of 8 September 2011, Commission v Netherlands, C‑279/08 P, EU:C:2011:551, paragraph 125 and the case-law cited; judgment of 8 May 2019, Landeskreditbank Baden-Württemberg v ECB, C‑450/17 P, EU:C:2019:372, paragraph 87). 145 It follows that a statement of reasons need not be exhaustive, but must be regarded as sufficient if it sets out the facts and legal considerations having decisive importance in the context of the decision (see, to that effect, judgments of 10 July 2008, Bertelsmann and Sony Corporation of America v Impala, C‑413/06 P, EU:C:2008:392, paragraph 169, and of 3 March 2010, Freistaat Sachsen v Commission, T‑102/07 and T‑120/07, EU:T:2010:62, paragraph 180). 146 In the present case, it should be noted that, contrary to what is claimed by PNB Banka, the SRB explained unequivocally and with sufficient precision, in the contested decision, the reasons why it considered the following: first, that PNB Banka was deemed to be failing or likely to fail (point 3.2.1 of that decision); second, that having regard to timing and other relevant circumstances, there was no reasonable prospect that any alternative private-sector measures, including measures by an institutional protection scheme, or supervisory action taken in respect of PNB Banka, would have prevented its failure within a reasonable timeframe (point 3.2.2 of that decision); and, third, that the adoption of resolution action was not necessary in the public interest (point 3.2.3 of that same decision). Having considered that the condition laid down in Article 18(1)(c) of Regulation No 806/2014 was, therefore, not met, the SRB thus set out its conclusion that there was no need to adopt a resolution scheme in respect of PNB Banka. 147 In addition, in the light of the considerations set out in paragraphs 118 to 122 above, the SRB was not required to explain specifically why the inspection report, which refers to PNB Banka’s assets as being less than its liabilities, departed from the assessments set out in previous decisions, analyses and reports relating to PNB Banka’s prudential situation and not presenting such a conclusion. 148 It follows, in accordance with the case-law cited in paragraphs 144 and 145 above, that the contested decision discloses in a clear and unequivocal fashion the SRB’s reasoning in such a way as to enable PNB Banka to ascertain the reasons for the measure and to enable the Court to exercise its power of review. 149 The seventh plea in law must, therefore, be rejected. The eighth plea in law, alleging infringement of the right to be heard 150 According to PNB Banka, the SRB did not provide it with any opportunity to present its views on the SRB’s proposed decision. 151 The SRB, supported by the ECB, disputes that argument. 152 Under Article 41(2)(a) of the Charter, the right to good administration includes the right of every person to be heard before any individual measure which would affect him or her adversely is taken. 153 The right to be heard guarantees every person the opportunity to make known his or her views effectively during an administrative procedure and before the adoption of any decision liable to affect his or her interests adversely. Next, it should be stated that the right to be heard pursues a dual objective. First, to enable the case to be examined and the facts to be established in as precise and correct a manner as possible, and, second, to ensure that the person concerned is in fact protected. The right to be heard is intended, inter alia, to guarantee that any decision adversely affecting a person is adopted in full knowledge of the facts, and its purpose is to enable the competent authority to correct an error or to enable the person concerned to submit such information relating to his or her personal circumstances as will argue in favour of the adoption or non-adoption of the decision, or in favour of its having a specific content (see judgment of 4 June 2020, EEAS v De Loecker, C‑187/19 P, EU:C:2020:444, paragraphs 68 and 69 and the case-law cited). 154 The Court of Justice has previously affirmed the importance of the right to be heard and its very broad scope in the EU legal order, considering that that right had to apply in all proceedings which are liable to culminate in an act adversely affecting a person. Observance of the right to be heard is required even where the applicable legislation does not expressly provide for such a procedural requirement (see judgments of 22 November 2012, M., C‑277/11, EU:C:2012:744, paragraphs 85 and 86 and the case-law cited; of 18 June 2020, Commission v RQ, C‑831/18 P, EU:C:2020:481, paragraph 67 and the case-law cited; and of 7 November 2019, ADDE v Parliament, T‑48/17, EU:T:2019:780, paragraph 89 and the case-law cited). 155 It must be stated that Regulation No 806/2014 has the objective of establishing, in accordance with recital 8 thereof, more efficient resolution mechanisms, which must be an essential instrument to avoid damages that have resulted from failures of banks in the past. As regards the procedure provided for in Article 18 of that regulation, that objective presupposes a speedy decision-making process, which often occurs in emergency circumstances – as the short time limits laid down in that provision illustrate – so that financial stability is not jeopardised (judgment of 6 May 2021, ABLV Bank and Others v ECB, C‑551/19 P and C‑552/19 P, EU:C:2021:369, paragraph 55). 156 However, although it is necessary to take into account the need for speed in the procedure provided for in Article 18 of Regulation No 806/2014, it must also be reconciled with the right to be heard. 157 Recital 26 of Regulation No 806/2014, moreover, confirms both the shared power of the ECB, as the supervisor within the SSM, and the SRB, as resolution authority, to assess whether a credit institution is failing or is likely to fail, and the exclusive power of the SRB to assess whether the other requirements for the adoption of a resolution scheme are met (judgment of 6 May 2021, ABLV Bank and Others v ECB, C‑551/19 P and C‑552/19 P, EU:C:2021:369, paragraph 64). 158 Having regard to the nature of that complex administrative procedure referred to in Article 18 of Regulation No 806/2014, conducted by the ECB and the SRB jointly and successively, neither Article 41 of the Charter nor the provisions of that regulation require that the entity concerned by the decision on the adoption of a resolution scheme be heard at each stage of the procedure by each of those two bodies separately. 159 It is common ground that although PNB Banka was not heard by the SRB before the contested decision was adopted, it was, by contrast, heard on several occasions by the ECB. 160 The applicant was given an opportunity to comment on the relevant elements, in particular in the context of the FOLTF assessment. In addition, as is apparent from paragraph 89 above, the ECB examined the alternative measures which may have been capable of preventing PNB Banka’s failure. In its assessment, which it carried out after hearing PNB Banka, the ECB examined its arguments, summarising them and responding to them. The SRB, to which the ECB’s assessment was subsequently sent, was, therefore, fully aware of PNB Banka’s arguments when it adopted the contested decision, in which it endorsed the ECB’s conclusions concerning the conditions laid down in Article 18(1)(a) and (b) of Regulation No 806/2014. As regards the valuation report, it should be noted that the external valuer instructed by the SRB did not hear PNB Banka’s representatives before formulating its conclusions. That said, the SRB relied on that report without hearing those representatives. However, the report, attached as Annex B.8, contains a list of the sources used by that valuer (see in particular page 276 of the file) and those sources were in principle known to PNB Banka. Moreover, the fact that that evaluation was also based on the inspection report is also important. It must be stated that those representatives were able to respond to the draft inspection report, which they did. 161 Admittedly, in the contested decision, the SRB examined for the first time the condition laid down in Article 18(1)(c) of Regulation No 806/2014 requiring resolution action to be necessary in the public interest and did not hear PNB Banka in that regard. However, none of PNB Banka’s objections is directed against the alleged absence of any public interest. They are all directed against the conclusions that PNB Banka was failing or was likely to fail, in accordance with Article 18(1)(a) of Regulation No 806/2014. Therefore, PNB Banka was heard on the points which it is contesting during the administrative procedure. 162 It should also be noted that no new event occurred and no new data were brought to the attention of the SRB between, first, the ECB’s communication of its FOLTF assessment in respect of PNB Banka and, second, the adoption of the contested decision. 163 In those circumstances, it must be held that PNB Banka’s right to be heard was not infringed. 164 The eighth plea in law must, therefore, be rejected. The ninth plea in law, alleging that the ECB’s decision to oppose PNB Banka’s acquisition of qualifying holdings in another credit institution was unlawful 165 PNB Banka maintains that the ECB’s decision of 21 March 2019 to oppose the acquisition of the target bank was unlawful. The assessment period provided for in Article 22(2) of Directive 2013/36 expired before that decision was adopted. The proposed acquisition was deemed to have been approved if the supervisory authority did not oppose it before the expiry of that period, pursuant to Article 22(6) of that directive. In addition, the ECB opposed the proposed acquisition on the ground that the improvements that would have resulted from that acquisition were insufficient. The ECB’s view means that the proposed acquisition could not take place even if its effects were positive in regulatory terms. 166 The SRB, supported by the ECB, disputes those arguments. 167 It must be stated that PNB Banka has in no way established that the ECB’s decision to oppose its acquisition of the target bank led to the conclusion of the ECB and the SRB that PNB Banka was, on 15 August 2019, failing or was likely to fail. As is apparent from paragraph 26 of the contested decision, the acquisition of a qualifying holding in the target bank was only one of the measures proposed by PNB Banka in its capital conservation plan of 11 April 2019 (see paragraph 6 above). According to paragraph 27 of that decision, none of those measures could be implemented. Similarly, in the action plan, submitted on 1 August 2019 and supplemented on 13 August 2019, PNB Banka refers to a number of other interventions aimed at restoring its capital position. Those measures were considered by the ECB to be insufficiently robust and effective. Accordingly, it has not been established to the requisite legal standard that, had the ECB not opposed such an acquisition, the result would have been different in that PNB Banka would not have been deemed to be failing or likely to fail. 168 In addition and in any event, as is apparent from the judgment of 7 December 2022, PNB Banka v ECB (T‑330/19, under appeal, EU:T:2022:775), the action against the ECB’s decision to oppose the acquisition of a qualifying holding in the target bank was dismissed. 169 The ninth plea in law must, therefore, be rejected. The tenth plea in law, alleging infringement of the principle of equal treatment 170 According to PNB Banka, it was the subject of exceptional and unequal treatment compared with that accorded to the other credit institutions established in the euro area. 171 The SRB, supported by the ECB, disputes those arguments. 172 Under Article 6(1) of Regulation No 806/2014, ‘no action, proposal or policy of the Board, the Council, the Commission or [an NRA] shall discriminate against entities, deposit holders, investors or other creditors established in the Union on grounds of their nationality or place of business’. That provision constitutes a special expression of the principle of equal treatment or non-discrimination, which requires that comparable situations must not be treated differently and that different situations must not be treated in the same way unless such treatment is objectively justified (see, to that effect, judgment of 15 April 2010, Gualtieri v Commission, C‑485/08 P, EU:C:2010:188, paragraph 70). 173 In the present case, it is sufficient to note that PNB Banka has not established in actual fact that another credit institution in a comparable situation would have been treated differently. On the contrary, its allegations remain vague and imprecise. In particular, it does not demonstrate that the ECB’s decision to carry out an on-site inspection, even if the holding of inspections by the ECB is unusual, would lead to a finding of unequal treatment in relation to another credit institution in a comparable factual and legal situation. Since the arguments are not sufficiently substantiated, no breach of the principle of equal treatment can be found. 174 Accordingly, the tenth plea in law must be rejected. The eleventh plea in law, alleging infringement of the principles of legal certainty and the protection of legitimate expectations 175 PNB Banka submits that the contested decision is the result of a new and unexpected approach to it by the SRB and the ECB. The prior treatment of PNB Banka by the ECB and the FCMC was fundamentally different and it could not, therefore, reasonably have expected the content of the contested decision. In PNB Banka’s view, it is of significance that the deadline for the implementation of the action plan, drawn up in response to the early intervention decision, had not yet expired at the time of the adoption of the aforementioned decision. 176 The SRB, supported by the ECB, disputes those arguments. 177 It should be noted that PNB Banka relies on two distinct principles: the principle of the protection of legitimate expectations and the principle of legal certainty. 178 In the first place, as regards the principle of the protection of legitimate expectations, in accordance with settled case-law, the right to rely on that principle presupposes that precise, unconditional and consistent assurances, originating from authorised, reliable sources, have been given to the person concerned by the competent authorities of the European Union. That right applies to any individual in a situation in which an institution, body or agency of the European Union, by giving that person precise assurances, has led him or her to entertain well-founded expectations (see judgment of 19 July 2016, Kotnik and Others, C‑526/14, EU:C:2016:570, paragraph 62 and the case-law cited). 179 While the principle of the protection of legitimate expectations is one of the fundamental principles of the European Union, economic operators are not justified in having a legitimate expectation that an existing situation which is capable of being altered by the EU institutions in the exercise of their discretion will be maintained, particularly in an area which requires intervention by public authorities in the banking sector, whose subject matter involves constant adjustment to reflect changes in the economic situation (see, to that effect and by analogy, judgment of 19 July 2016, Kotnik and Others, C‑526/14, EU:C:2016:570, paragraph 66 and the case-law cited). 180 In the present case, PNB Banka cannot rely on an alleged prior practice of the SRB and the ECB (and FCMC) towards it, since they did not provide it with precise, unconditional and consistent assurances. In paragraphs 17 and 20 of the contested decision, the SRB merely stated that PNB Banka ran risks concerning its capital, the management of its loan portfolio and its large exposures. The situation deteriorated between 2017 and mid-2019. The SRB relied on several assessments, on the figures provided by PNB Banka and on the fact that PNB Banka had not been able – even after various corrective measures had been imposed by the FCMC and the ECB – to establish and implement sufficiently concrete and effective actions to reduce those risks and ensure compliance with prudential requirements within a reasonable time. Even if the prior practice in question had changed, that change cannot be dissociated from the new facts and the new circumstances which led to the adoption of the contested decision. 181 Admittedly, PNB Banka rightly observes that the early intervention decision (see paragraph 7 above) required it, in essence, to restore sustainable compliance with certain prudential requirements, relating to the total SREP capital requirement (by 1 September 2019), the OCR (before 1 November 2019), the large exposure limits, at both consolidated and individual level (before 1 October 2019), and the limits on transactions with related parties under Latvian regulations (before 15 August 2019). Nor is it disputed that certain time limits were still running at the date of adoption of the contested decision. 182 That said, nor does the ECB’s granting of time limits in order for PNB Banka to comply with certain prudential requirements constitute precise, unconditional and consistent assurances such as to give rise to well-founded expectations on the part of PNB Banka to the effect that, during those time limits, the ECB would refrain from concluding that PNB Banka was failing or was likely to fail. As the SRB correctly states in the defence, the early intervention decision did not indicate in any way that PNB Banka would under all circumstances not face further supervisory measures until expiry of the deadlines for the implementation of the requested action plan. PNB Banka also does not specify any passage or wording in that decision which could be interpreted to that effect. 183 It must be noted that, between the adoption of the early intervention decision and the adoption of the contested decision, there were a number of exchanges between the ECB and PNB Banka, in the course of which the ECB stated that the measures proposed by PNB Banka in its action plan (see paragraphs 10 to 13 above) were not sufficiently specific and robust and that all the measures could not be implemented within the time limits laid down. In those circumstances, the SRB cannot validly be criticised for not having awaited the expiry of the last time limit laid down in the early intervention decision. The SRB did not, therefore, infringe the principle of the protection of legitimate expectations. 184 In the second place, according to settled case-law, the principle of legal certainty requires that rules should be clear and precise, so that individuals may be able to ascertain unequivocally what their rights and obligations are, and that their application should be predictable for those subject to them (see, to that effect, judgments of 14 April 2005, Belgium v Commission, C‑110/03, EU:C:2005:223, paragraph 30, and of 12 December 2013, Test Claimants in the Franked Investment Income Group Litigation, C‑362/12, EU:C:2013:834, paragraph 44). 185 PNB Banka does not contend that the rules at issue are imprecise and unclear. It does not, therefore, establish the existence of an infringement of the principle of legal certainty. 186 Consequently, the eleventh plea in law must be rejected. The twelfth to fourteenth pleas in law, alleging, respectively, infringement of the nemo auditur principle, a lack of impartiality on the part of the ECB and misuse of powers 187 PNB Banka submits that the ECB infringed the maxim nemo auditur propriam turpitudinem allegans, according to which no one may rely on his or her own wrong. It also submits that the ECB failed to observe the principle nemo potest venire contra factum proprium, according to which no one may dispute what he or she has previously accepted. Lastly, PNB Banka submits that the contested decision was motivated by illegitimate non-prudential considerations. The SRB therefore misused its powers. 188 In the context of the twelfth plea in law, PNB Banka asserts that the ECB, on the one hand, required the attraction of investments and, on the other hand, by its practices, discouraged potential investors. Thus, the ECB penalised PNB Banka and its shareholders for their critical attitude towards a number of ECB officials and on account of arbitration proceedings initiated by PNB Banka and some shareholders (see, to that effect, judgment of 7 December 2022, PNB Banka v ECB, T‑275/19, under appeal, EU:T:2022:781, paragraphs 10 to 19). PNB Banka states, in the context of the thirteenth plea in law, that the ECB did not take steps to ensure the credibility of the regulatory process or measures to put an end to the allegedly corrupt conduct of B. The same applies to C, Chair of the FCMC. 189 The situation in which PNB Banka found itself at the time of adoption of the contested decision was, in its view, the result of the ECB’s reproachable conduct. 190 The SRB, supported by the ECB, disputes those arguments. 191 It should be noted that, by its arguments in support of the twelfth to fourteenth pleas in law, PNB Banka criticises, in essence, the conduct of the ECB and that of the SRB, which, it is alleged, adversely affected its prudential situation. 192 In order to be able to rely on the maxim nemo auditur propriam turpitudinem allegans, wrongful conduct attributable to the SRB must be established, which is not the case here. It is true that B was charged with corruption and criminal proceedings were brought against him for that reason in Latvia. In addition, the matter was also referred to the Court of Justice in that context (judgments of 26 February 2019, Rimšēvičs and ECB v Latvia, C‑202/18 and C‑238/18, EU:C:2019:139, and of 30 November 2021, LR Ģenerālprokuratūra, C‑3/20, EU:C:2021:969). However, PNB Banka has in no way established that that circumstance negatively influenced its prudential situation or that its alleged conflicts with the ECB resulted in unfavourable treatment of it, which would have discouraged potential investors. 193 PNB Banka cannot, therefore, validly claim that wrongful acts by the ECB benefited the latter and led to the adoption of the FOLTF assessment in respect of PNB Banka and to the adoption of the contested decision by the SRB. 194 Nor has PNB Banka established or explained how the ECB infringed the principle nemo potest venire contra factum proprium. 195 The twelfth plea in law cannot, therefore, be upheld any more than the thirteenth plea in law, which has no real independent content and is an illustration of the arguments put forward in the context of the twelfth plea in law. 196 As regards the misuse of powers pleaded by PNB Banka in the fourteenth plea in law, it must be borne in mind that a measure is only vitiated by misuse of powers if it appears, on the basis of objective, relevant and consistent evidence to have been taken with the exclusive or main purpose of achieving an end other than that stated or evading a procedure specifically prescribed by the Treaty for dealing with the circumstances of the case (judgment of 10 March 2005, Spain v Council, C‑342/03, EU:C:2005:151, paragraph 64). 197 In the present case, PNB Banka has, however, failed to adduce evidence such as to support its arguments. 198 Accordingly, the fourteenth plea in law must be rejected. 199 It follows from all of the foregoing that the action must be dismissed in its entirety as unfounded. Costs 200 Under Article 134(1) of the Rules of Procedure, the unsuccessful party is to be ordered to pay the costs if they have been applied for in the successful party’s pleadings. Since the applicants have been unsuccessful, they must be ordered to pay the SRB’s costs, in accordance with the form of order sought by the SRB. 201 The Republic of Latvia and the ECB are to bear their own costs, in accordance with Article 138(1) of the Rules of Procedure. On those grounds, THE GENERAL COURT (Seventh Chamber) hereby: 1. Dismisses the action; 2. Orders PNB Banka AS and the other applicants whose names appear in the annex to bear their own costs and to pay those incurred by the Single Resolution Board (SRB); 3. Orders the Republic of Latvia and the European Central Bank (ECB) to bear their own costs. Kowalik-Bańczyk Hesse Dimitrakopoulos Delivered in open court in Luxembourg on 15 November 2023. V. Di Bucci M. van der Woude Registrar President * Language of the case: English. 1 The list of the other applicants is annexed only to the version sent to the parties.