62021CC0202
OPINION OF ADVOCATE GENERAL
KOKOTT
delivered on 28 April 2022 (
1
)
Case C‑202/21 P
ABLV Bank AS, in liquidation
v
Single Resolution Board (SRB)
(Appeal – Banking Union – Single Resolution Mechanism for credit institutions and certain investment firms (SRM) – Regulation (EU) No 806/2014 (SRM Regulation) – Single Resolution Fund (SRF) – A credit institution’s ex ante contributions to the SRF during the initial period – Withdrawal of authorisation of a credit institution in the course of a contribution year – Commission Delegated Regulation (EU) 2015/63 – Refusal to reimburse ex ante contributions on a pro rata basis – Council Implementing Regulation (EU) 2015/81)
I. Introduction
1.
In order to achieve one of the objectives of the Banking Union – no more bank bailouts at the expense of the taxpayer – alternative financing mechanisms are needed in addition to loss sharing by investors in the event of a bank’s failure, in order to effect its orderly resolution if necessary. (
2
)
2.
Therefore, with effect from 1 January 2016, the SRM Regulation (
3
) created a Single Resolution Fund (SRF) to finance resolution procedures, the resources for which come from the banking sector in the Member States of the Banking Union itself. (
4
) In parallel, ever since 1 January 2015, the BRRD has required all Member States to establish national financing arrangements with corresponding objectives and financing. (
5
)
3.
Ensuring effective and sufficient financing of the SRF is of paramount importance to the credibility of the SRM. (
6
) In the view taken by the legislature, this requires the accumulation of funds corresponding to at least 1% of the covered deposits (
7
) of all credit institutions authorised in the participating Member States (‘target level’). However, the banking sector is unable to raise such a large sum – estimated at EUR 55 to 70 thousand million – all at once. It was therefore decided that the Fund would be gradually filled by ex ante contributions from the banks during an initial period of eight years (2016 to 2023), such that the target level would not be fully available until 2024.
4.
More specifically, one eighth of the (estimated) amount of the 2024 target level of the SRF is collected each year over that period. It is collected from the banks that are authorised in the participating Member States on 1 January of each contribution year, whereby their individual obligation to contribute is weighted according to size and risk profile.
5.
In addition, in order to ensure that the SRF was capable of functioning from the outset, the contributions that were raised by the Member States of the Banking Union on the sole basis of the BRRD in 2015 – that is to say, before the SRM Regulation entered into force – were already transferred to the SRF as ‘start-up capital’ with effect from 31 January 2016. Those contributions are offset over the initial period against the banks’ annual ex ante contributions to the SRF (
8
): each year, one eighth of the 2015 contribution is deducted from the ex ante contribution amount calculated for the year concerned.
6.
In the course of 2018, the European Central Bank (ECB) withdrew from the applicant at first instance and appellant in the present proceedings its authorisation as a credit institution. By then, it had already paid its 2018 ex ante contribution to the SRF. It therefore takes the view that that contribution, as well as the part of its 2015 contribution that has not yet been offset against future contributions, should be reimbursed to it on a pro rata basis. It was ultimately unsuccessful with that before the General Court.
7.
It is true that the Court of Justice has already addressed various aspects of the collection of ex ante contributions to the SRF. (
9
) However, in order to rule on the present appeal, it is necessary to examine in greater detail the functioning of the system of ex ante contributions for building up the SRF and thus the nature of those contributions.
II. Legal framework
A. Agreement on the transfer of contributions to the SRF
8.
The recitals of the Intergovernmental Agreement on the transfer and mutualisation of contributions to the Single Resolution Fund (‘the IGA’) of 14 May 2014 read, in extracts, as follows:
‘(7)
The SRM Regulation establishes, in particular, the Fund as well as the modalities for its use. The BRRD and the SRM Regulation lay down the general criteria to determine the fixing and calculation of ex ante contributions …, as well as the obligation of Member States to levy them at national level. Nonetheless, the participating Member States who raise the contributions on the institutions located in their respective territories according to the BRRD and the SRM Regulation, remain competent to transfer those contributions towards the Fund. The obligation to transfer the contributions raised at national level towards the Fund does not derive from the law of the Union. Such obligation will be established by this Agreement which lays down the conditions upon which the Contracting Parties, in accordance with their respective constitutional requirements, jointly agree to transfer the contributions that they raise at national level to the Fund.
…
(12)
National laws and regulations implementing the BRRD … start to apply as from 1 January 2015. The provisions concerning the establishment of the [SRF] will be, in principle, applicable as from 1 January 2016. As a consequence, the Contracting Parties will raise contributions earmarked to the national resolution financing arrangement they are to establish up to the date of application of the SRM Regulation, at which date they will start raising the contributions earmarked to the Fund. In order to reinforce the financial capacity of the Fund as of its inception, the Contracting Parties commit to transfer to the Fund the contributions they have raised by virtue of the BRRD up to the date of application of the SRM Regulation.’
9.
Article 1(1) of the IGA is worded as follows:
‘By this Agreement, the Contracting Parties commit to:
(a)
transferring the contributions raised at national level in accordance with the BRRD and the SRM Regulation to the Single Resolution Fund … established by that Regulation; and
(b)
allocating, during a transitional period … elapsing at the date when the Fund reaches the target level fixed in Article 68 of the SRM Regulation but not later than 8 years after the date of application of this Agreement …, the contributions they raise at national level in accordance with the SRM Regulation and the BRRD to different compartments corresponding to each Contracting Party. The use of the compartments shall be subject to a progressive mutualisation in such a manner that they will cease to exist at the end of the transitional period,
thereby supporting the effective operations and functioning of the Fund.’
10.
Article 3 of the IGA provides:
‘(1)   The Contracting Parties jointly commit to irrevocably transfer to the Fund the contributions that they raise from the institutions authorised in each of their territories by virtue of Articles 69 and 70 of the SRM Regulation, and in accordance with the criteria laid down therein and in the delegated and implementing acts to which they refer. The transfer of contributions shall take place in accordance with the conditions laid down under Articles 4 to 10 of this Agreement.
…
(3)   Contributions raised by the Contracting Parties in accordance with Articles 103 and 104 of the BRRD before the date of application of this Agreement shall be transferred to the Fund by 31 January 2016 at the latest or, if the Agreement has not entered into force by that date, one month after its date of entry into force at the latest.
…’
B. European Union law
1.
SRM Regulation
11.
Article 67(1) of the SRM Regulation (
10
) establishes the Single Resolution Fund. According to that provision, the SRF is to be filled in accordance with the rules on transferring the funds raised at national level towards the Fund as laid down in the IGA. According to paragraph 3 of that provision, the owner of the SRF is the Single Resolution Board (‘the SRB’).
12.
Article 69 of the SRM Regulation provides as follows:
‘1.   By the end of an initial period of eight years from 1 January 2016 …, the available financial means of the Fund shall reach at least 1% of the amount of covered deposits of all credit institutions authorised in all of the participating Member States.
2.   During the initial period referred to in paragraph 1, contributions to the Fund calculated in accordance with Article 70, and raised in accordance with Article 67(4), shall be spread out in time as evenly as possible until the target level is reached, but with due account of the phase of the business cycle and the impact that pro-cyclical contributions may have on the financial position of contributing institutions.
…
4.   If, after the initial period referred to in paragraph 1, the available financial means diminish below the target level specified in that paragraph, the regular contributions calculated in accordance with Article 70 shall be raised until the target level is reached. After the target level has been reached for the first time and where the available financial means have subsequently been reduced to less than two thirds of the target level, those contributions shall be set at a level allowing for reaching the target level within six years. …’
13.
According to Article 70 of the SRM Regulation:
‘1.   The individual contribution of each institution shall be raised at least annually and shall be calculated pro rata to the amount of its liabilities (excluding own funds) less covered deposits, with respect to the aggregate liabilities (excluding own funds) less covered deposits, of all of the institutions authorised in the territories of all of the participating Member States.
2.   Each year, the Board shall, after consulting the ECB or the national competent authority and in close cooperation with the national resolution authorities, calculate the individual contributions to ensure that the contributions due by all of the institutions authorised in the territories of all of the participating Member States shall not exceed 12.5% of the target level. …
3.   The available financial means to be taken into account in order to reach the target level specified in Article 69 may include irrevocable payment commitments which are fully backed by collateral of low-risk assets unencumbered by any third-party rights, at the free disposal of and earmarked for the exclusive use by the Board for the purposes specified in Article 76(1). The share of those irrevocable payment commitments shall not exceed 30% of the total amount of contributions raised in accordance with this Article.
4.   The duly received contributions of each entity referred to in Article 2 shall not be reimbursed to those entities.
…
6.   The delegated acts specifying the notion of adjusting contributions in proportion to the risk profile of institutions, adopted by the Commission under Article 103(7) of [the BRRD], shall be applied.
…’
2.
The BRRD
14.
According to Article 100(1) of the BRRD, (
11
) the Member States are to establish national financing arrangements, of which the target level under Article 102(1) of the BRRD is to reach at least 1% of the amount of covered deposits of all the institutions authorised in their territory.
15.
Article 103(1) and (2) of the BRRD reads as follows:
‘1.   In order to reach the target level specified in Article 102, Member States shall ensure that contributions are raised at least annually from the institutions authorised in their territory including Union branches.
2.   The contribution of each institution shall be pro rata to the amount of its liabilities (excluding own funds) less covered deposits, with respect to the aggregate liabilities (excluding own funds) less covered deposits of all the institutions authorised in the territory of the Member State.
Those contributions shall be adjusted in proportion to the risk profile of institutions, in accordance with the criteria adopted under paragraph 7.’
16.
According to Article 103(7) of the BRRD, the risk factors include the risk exposure of the institution, including the importance of its trading activities, its off-balance sheet exposures and its degree of leverage; the stability and variety of the company’s sources of funding; the probability that the institution enters into resolution; the complexity of the structure of the institution and its resolvability; and the importance of the institution to the stability of the financial system or economy of one or more Member States or of the Union.
3.
Implementing Regulation 2015/81
17.
Recital 6 of Implementing Regulation 2015/81 (
12
) reads as follows, in extract:
‘Contributions raised by the participating Member States in accordance with Articles 103 and 104 of [the BRRD] and transferred to the Fund by virtue of Article 3(3) of the [IGA] should be incorporated in the calculation of individual contributions and hence deducted from the amount due by each institution. …’
18.
Recital 11 of that regulation states as follows:
‘Under a single resolution fund with a European target level the annual individual contributions of institutions authorised in the territories of all of the participating Member States is dependent on those of all of the institutions subject to the SRM. The key for an effective functioning of the SRM and a smooth process of building-up the Fund is that all institutions pay their annual contributions in full to the Fund in a timely manner.’
19.
Article 4 of Implementing Regulation 2015/81 reads as follows:
‘For each contribution period, the Board shall calculate the annual contribution due from each institution, on the basis of the annual target level of the Fund, after consulting the ECB or the national competent authorities and in close cooperation with the national resolution authorities. The annual target level shall be established with reference to the target level of the Fund referred to in Articles 69(1) and 70 of [the SRM Regulation] and in accordance with the methodology set out in Delegated Regulation (EU) 2015/63.’
20.
Article 7(3) provides that:
‘The irrevocable payment commitments of an institution that no longer falls within the scope of [the SRM Regulation] are cancelled and collateral backing these commitments is returned.’
21.
Article 8(2) of that regulation provides as follows:
‘During the initial period, when calculating the individual contributions of each institution, the Board shall take into account the contributions raised by the participating Member States in accordance with Articles 103 and 104 of [the BRRD] and transferred to the Fund by virtue of Article 3(3) of the [IGA], by deducting them from the amount due from each institution.’
4.
Delegated Regulation (EU) 2015/63
22.
Commission Delegated Regulation (EU) 2015/63 of 21 October 2014 supplementing Directive 2014/59/EU of the European Parliament and of the Council with regard to ex ante contributions to resolution financing arrangements (‘Delegated Regulation 2015/63’) (
13
) was adopted on the basis of, inter alia, Article 103(7) of the BRRD. It defines the following in Article 3:
‘…
(5)
“annual contribution” means the amount referred to in Article 103 of [the BRRD] raised by the resolution authority for the national financing arrangement during the contribution period from each of the institutions referred to in Article 2 of this Regulation;
(6)
“contribution period” means a calendar year;
…’
23.
Article 4 of that regulation is worded as follows:
‘1.   The resolution authorities shall determine the annual contributions to be paid by each institution in proportion to its risk profile on the basis of information provided by the institution in accordance with Article 14 and by applying the methodology set out in this Section.
2.   The resolution authority shall determine the annual contribution referred to in paragraph 1 on the basis of the annual target level of the resolution financing arrangement by taking into account the target level to be reached by 31 December 2024 in accordance with paragraph 1 of Article 102 of [the BRRD] and on the basis of the average amount of covered deposits in the previous year, calculated quarterly, of all the institutions authorised in its territory.’
24.
Article 12 of Delegated Regulation 2015/63 provides:
‘1.   Where an institution is a newly supervised institution for only part of a contribution period, the partial contribution shall be determined by applying the methodology set out in Section 3 to the amount of its annual contribution calculated during the subsequent contribution period by reference to the number of full months of the contribution period for which the institution is supervised.
2.   A change of status of an institution, including a small institution, during the contribution period shall not have an effect on the annual contribution to be paid in that particular year.’
25.
Article 13 of that regulation provides as follows:
‘1.   The resolution authority shall notify each institution referred to in Article 2 of its decision determining the annual contribution due by each institution at the latest by 1 May each year.
…
5.   Where an institution is a newly supervised institution for only part of a contribution period, its partial annual contribution shall be collected together with the annual contribution due for the subsequent contribution period.’
26.
Article 14 of that regulation provides:
‘1.   Institutions shall provide the resolution authority with the latest approved annual financial statements available before the 31st of December of the year preceding the contribution period, together with the opinion submitted by the statutory auditor or audit firm, in accordance with Article 32 of Directive 2013/34/EU of the European Parliament and of the Council.
…
4. The information referred to in paragraphs 1, 2 and 3 shall be provided at the latest by 31 January each year in respect of the year ended on the 31st of December of the preceding year, or of the applicable relevant financial year. If the 31st of January is not a business day, the information shall be provided on the following business day.
…’
27.
According to Article 17(3) and (4) of Delegated Regulation 2015/63:
‘3.   Where the information submitted by the institutions to the resolution authority is subject to restatements or revisions, the resolution authority shall adjust the annual contribution in accordance with the updated information upon the calculation of the annual contribution of that institution for the following contribution period.
4.   Any difference between the annual contribution calculated and paid on the basis of the information subject to restatements or revision and the annual contribution which should have been paid following the adjustment of the annual contribution shall be settled in the amount of the annual contribution due for the following contribution period. That adjustment shall be made by decreasing or increasing the contributions to the following contribution period.’
5.
Delegated Regulation (EU) 2017/2361
28.
Commission Delegated Regulation (EU) 2017/2361 of 14 September 2017 on the final system of contributions to the administrative expenditures of the Single Resolution Board (‘Delegated Regulation 2017/2361’) (
14
) provides as follows in Article 7(1):
‘Where an entity or a group falls under the scope of Article 2 of [the SRM Regulation] only for part of the financial year, its individual annual contribution for that financial year shall be calculated by reference to the number of full months during which it falls under the scope of that Article.’
III. Facts and proceedings at first instance before the General Court
29.
ABLV Bank AS – the applicant at first instance and appellant (‘the appellant’) – was a credit institution established in Latvia which, as a ‘significant entity’ within the meaning of the SSM Regulation, (
15
) was subject to supervision by the ECB until its authorisation was withdrawn in 2018.
30.
In December 2015, it received from the competent Finanšu un kapitāla tirgus komisija (Financial and Capital Markets Commission, Latvia; ‘the FCMC’) the collection notice for the 2015 ex ante contribution to the national financing mechanism, determined in accordance with Article 103(1) of the BRRD. The amount subsequently paid by the appellant was transferred to the SRF in accordance with Article 3(3) of the IGA.
31.
On 23 February 2018, the ECB concluded that the appellant was failing or likely to fail within the meaning of Article 18(1) of the SRM Regulation. On the same day, the SRB decided that, due to the lack of public interest in sovereign resolution, resolution action under the SRM Regulation was not necessary. (
16
)
32.
Therefore, on 26 February 2018, the appellant’s shareholders brought proceedings which would enable the appellant to complete its own liquidation and submitted to the FCMC a request for approval of its voluntary liquidation plan.
33.
By decision of 12 April 2018 on the calculation of the 2018 ex ante contributions, the SRB set the relevant annual contributions to the SRF. (
17
) On 27 April 2018, the appellant received the corresponding 2018 collection notice from the FCMC. On 3 July 2018, the appellant settled the claim set out in that notice.
34.
By decision of 11 July 2018, the ECB withdrew the appellant’s authorisation as a credit institution.
35.
By letter of 17 September 2018, the appellant requested the SRB to pay it the ‘remaining’ part of the 2015 ex ante contribution and to recalculate and reimburse, on a pro rata basis, the 2018 contribution in view of its withdrawal from the SSM during the contribution year.
36.
The SRB refused that request by letter of 17 October 2018 (‘the contested decision’). As grounds, it stated that Article 70(4) of the SRM Regulation did not provide for a recalculation of the 2018 ex ante contribution and expressly states that duly received contributions were not to be reimbursed. The SRB takes the view that the withdrawal of authorisation constituted a change of status within the meaning of Article 12(2) of Delegated Regulation 2015/63, which, according to that provision, did not have an effect on the amount of the contribution to be paid in the year in question. According to the SRB, the 2015 ex ante contribution could not be reimbursed on a pro rata basis in the case where a credit institution’s licence was withdrawn before the end of the initial period. Against the background of Article 70(4) of the SRM Regulation, the same applies in that regard as to all duly received contributions.
37.
The appellant brought an action against that decision before the General Court on 21 December 2018.
38.
In support of its action, it argued, in essence, that the loss of its status as a credit institution during 2018 meant that it could no longer benefit from SRF cover for that entire year. In addition, the concomitant elimination of the risk which the appellant posed to the stability of the financial system in its capacity as a credit institution led to a proportional reduction in the financing needs of the SRF. Thus, the contribution had been made without a legal basis and therefore not ‘duly’ within the meaning of Article 70(4) of the SRM Regulation, with the result that it must be reimbursed on a pro rata basis. Therefore, withdrawal from the system could not be regarded as giving rise to a ‘change of status’ within the meaning of Article 12(2) of Delegated Regulation 2015/63, as the status as a credit institution and thus the obligation to contribute ceased to exist in their entirety. Article 70(4) of the SRM Regulation was not applicable to the 2015 contribution, which was levied on the sole basis of the BRRD. That contribution represented a kind of ‘advance payment’ to the SRF. In that respect, it followed from Article 8(2) of Implementing Regulation 2015/81 that a bank’s 2015 contribution should be reimbursed by the end of the initial period at the latest.
39.
By decision of 30 April 2019, the European Commission was granted leave to intervene in support of the SRB.
40.
By judgment of 20 January 2021, ABLV Bank v SRB (T‑758/18, EU:T:2021:28) (‘the judgment under appeal’), the General Court dismissed the action and ordered the appellant to pay, in addition to its own costs, the costs incurred by the SRB and the Commission.
IV. Appeal proceedings before the Court of Justice
41.
By its appeal, lodged on 30 March 2021, the appellant claims that the Court of Justice should:
–
set aside the judgment under appeal;
–
declare void the contested decision;
–
order the SRB to pay the appellant’s costs and the costs of the appeal;
–
to the extent that the Court of Justice is not in a position to rule on the substance, refer the case back to the General Court.
42.
The SRB and the Commission claim that the Court should:
–
dismiss the appeal; and
–
order the appellant to pay the costs.
43.
The appellant, the SRB and the Commission submitted observations on the appeal in the written procedure before the Court. In accordance with Article 76(2) of the Rules of Procedure of the Court of Justice, the Court decided to rule on the appeal without holding a hearing, following the delivery of the Opinion.
V. Legal assessment
44.
The judgment under appeal upholds the decision of the SRB refusing, on the one hand, the pro rata reimbursement of the 2018 ex ante contribution of ABLV Bank and, on the other hand, the reimbursement of the ‘remaining’ part of the 2015 contribution which has not yet been offset against future contributions.
A. The judgment under appeal
45.
By way of conclusion, in paragraph 130 of the judgment under appeal, the General Court based its decision on the ground that Article 70(4) of the SRM Regulation precluded the reimbursement by the SRF of all duly received contributions even in the case where a contributing credit institution’s licence was withdrawn during a contribution year in the initial period.
46.
With regard to the 2018 contribution, it took the view, in essence, that the ex ante contributions, although levied annually, were not paid as consideration for the coverage offered by, or the use of, the SRF in a given year and, accordingly, could not be reimbursed under Article 70(4) of the SRM Regulation where the possibility to use the SRF ceased to exist in the course of a year due to the withdrawal of a credit institution from the system. Rather, the annual levy under Article 69(2) of the SRM Regulation merely served to spread out as evenly as possible over time the total amount of the target level, which must be reached by the end of the initial period in 2024. In order to be able to determine reliably and with legal certainty the contribution to be levied annually for all credit institutions, the amount of the contribution had to be set at a certain point in the year in question. (
18
) Therefore, Article 12(2) of Delegated Regulation 2015/63 provided that the contribution could not be recalculated and reimbursed on a pro rata basis in the case of a change of status in the course of the contribution year, including in the case of withdrawal of authorisation as a credit institution. (
19
) The General Court rejected all of the provisions and arguments which were put forward by the appellant at first instance and from which, in the appellant’s view, it follows that recalculation and reimbursement are possible in the case where an institution’s licence is withdrawn in the course of a contribution year. (
20
)
47.
With regard to the 2015 contribution, the General Court stated that Article 8(2) of Implementing Regulation 2015/81 did not impose a reimbursement obligation for the case where a credit institution withdrew from the system during the initial period. Rather, the 2015 contributions were definitively transferred to the SRF in accordance with the IGA and therefore became a fixed part of the target level to be achieved by 2024. In that respect, the offsetting rule in Article 8(2) of the implementing regulation merely ensured that the transfer of the 2015 contributions to the SRF did not lead to imbalances between the banks concerned as regards the sharing of the financial burden. Therefore, with regard to Article 70(4) of the SRM Regulation, the same applies to the 2015 contributions as to the contributions levied in the following years. (
21
)
B. The appeal
48.
The appellant relies on a total of 13 grounds of appeal to challenge the decision of the General Court, the content of which relates, first, to the possibility of having the 2018 contribution reimbursed on a pro rata basis (see Section 1); second, to the possibility to have the ‘remaining’ part of the 2015 contribution reimbursed (see Section 2); and, third, to the formal lawfulness of the SRB’s decision (see Section 3).
1.
The possibility of having the 2018 contribution reimbursed on a pro rata basis
49.
By its first to fourth, seventh and eighth grounds of appeal, the appellant first attacks, piece by piece, the legal arguments on which the General Court based its interpretation of Article 70(4) of the SRM Regulation and Article 12(2) of Delegated Regulation 2015/63, according to which those provisions preclude the 2018 contribution from being reimbursed as a result of the withdrawal of an institution’s licence. By its fifth, tenth, eleventh and twelfth grounds of appeal, it then argues that the General Court’s interpretation of those provisions runs counter to higher-ranking principles. It is therefore appropriate to examine those grounds of appeal together.
(a)
The first, second and fourth grounds of appeal
50.
By its first ground of appeal, the appellant submits, in essence, that the General Court failed to recognise that the SRF protected the contributing banks against the risk of failure. In that respect, the 2018 ex ante contribution was to be regarded as a kind of insurance premium for the coverage offered by the SRF in that year. Consequently, the guarantee of that insurance cover, or the increased risk to financial stability arising from the activity as a credit institution, constituted the legal basis for the obligation to pay contributions. However, both of those elements ceased to exist when the appellant left the system. Therefore, with respect to the period following the withdrawal of its licence on 11 July 2018, the 2018 contribution had not been ‘duly’ paid within the meaning of Article 70(4) of the SRM Regulation and, accordingly, should be reimbursed to it. In accordance with the fourth ground of appeal, the General Court should have reached the same conclusion by applying the principles of unjust enrichment, since the contribution had thus been made without any legal basis. (
22
) Consequently, the General Court erred in law in its interpretation of Article 70(4) of the SRM Regulation, according to which that provision precluded a pro rata reimbursement of the 2018 contribution. (
23
)
51.
Rather, the existence of Article 12(2) of Delegated Regulation 2015/63 showed that there must be cases in which an ex ante contribution is subsequently adjusted. That provision merely provided that a change of status during the contribution period did not have an effect on the contribution to be paid. This suggested that other changes may indeed have to be taken into account. However, the departure of an institution from the system as a result of the withdrawal of its licence was precisely not to be regarded as a ‘change of status’ within the meaning of Article 12(2) of Delegated Regulation 2015/63. Accordingly, by its second ground of appeal, the appellant argues that the General Court wrongly considered that Article 12(2) of the delegated regulation is relevant in the present case. (
24
)
52.
Since, in paragraphs 61, 62 and 68 to 72 of the judgment under appeal, the General Court based its view, in essence, on the functioning and objectives of the system of levying contributions in the initial period, those aspects must be examined in a first step (see Section 1). This is because, on that basis, it can then be shown in a second step that the first, second and fourth grounds of appeal are based on a misunderstanding of the relevant provisions and the nature of ex ante contributions (see Section 2).
(1) The functioning and objective of the system of levying contributions in the initial period
53.
In accordance with Articles 69 and 70 of the SRM Regulation, the objective of the levying of contributions is to reach a predetermined amount – the target level – which, however, cannot be levied all at once due to its significant size. Therefore, in accordance with Article 69(2) of the SRM Regulation, contributions are to be raised in such a manner that they are spread out in time as evenly as possible – that is to say, they are raised at least annually (
25
) – during the initial period in order to reach the target level of 1% of covered deposits in all participating Member States at the end of that period. Once the target level has been reached, contributions are no longer levied for the time being. (
26
)
54.
In order to ensure that contributions are spread out evenly, the total contributions collected from contributing banks in a given year may not exceed one eighth of the 2024 target level, in accordance with the first subparagraph of Article 70(2) of the SRM Regulation. It should be noted that the 2024 target level can only be estimated, as it is currently not known what the amount of covered deposits will be in 2024. Therefore, to put it simply, in accordance with Article 4(2) of Delegated Regulation 2015/63, (
27
) the SRB proceeds on the basis of the average amount of the covered deposits of all credit institutions authorised in the participating Member States in the year preceding the year in question, divides it by eight and collects slightly more than 1% of that amount, as covered deposits tend to increase. (
28
)
55.
The individual contributions of the individual banks to the annual target thus determined are then calculated according to their size and risk profile, in accordance with Article 70(1) and (2), second paragraph, of the SRM Regulation. The data of the credit institutions, which, in accordance with Article 14 of Delegated Regulation 2015/63, must be transmitted to the SRB by the end of the previous year, serve as the basis for that. (
29
)
56.
Lastly, the contribution thus determined on the basis of the previous year’s data is levied and is paid in the course of the following year by the banks which are authorised in the territory of the participating Member States on 1 January of that year. Article 12(2) of Delegated Regulation 2015/63 provides that changes of status during the contribution period do not have an effect on the contribution to be paid in that particular year.
57.
However, the banks do not necessarily have to pay the contribution in cash; instead, in accordance with Article 70(3) of the SRM Regulation, up to 30% of the total amount required in a contribution year can be paid by means of ‘irrevocable payment commitments’, which must be backed by cash collateral.
58.
Article 70(4) of the SRM Regulation provides that duly received contributions are not to be reimbursed.
(2) Consequences for the reimbursable nature of the 2018 contribution
59.
The described functioning and objective of the levying of contributions shows, first, that the 2018 contribution, for example, does not ‘relate to’ the year 2018 – contrary to the appellant’s representation in its first ground of appeal – but is merely collected in 2018.
60.
On the one hand, collection on an annual basis merely serves to spread the collections out as evenly as possible over time in the manner intended by Article 69(2) of the SRM Regulation. Although it is true that they could also have been structured with shorter intervals, such as quarterly, such an approach would entail an inordinately higher and possibly disproportionate administrative burden. This is because there is no evidence that the division into eight annual contributions compared to 32 correspondingly lower quarterly contributions leads to an excessive economic burden for the contributing banks. The avoidance of such a burden is precisely the raison d’être of the spreading out of the contributions. (
30
) Therefore, the decision to levy contributions on an annual basis is unquestionably covered by the broad discretion that the EU legislature has in this area. (
31
)
61.
On the other hand, in that connection, 1 January is only the reference date for determining the group of contributing banks. (
32
) That date does not say anything about the allocation of the contribution to the year in question. The legislature could just as well have taken as the basis the credit institutions authorised in the territory of the participating Member States on 31 December of the previous year. This is especially true given that the contributions to be paid in a particular year are calculated on the basis of the previous year’s data. (
33
)
62.
For that reason alone, the contribution levied in 2018 cannot be recalculated or reimbursed due to changes that occur only during that year. Accordingly, the conclusion reached by the General Court in paragraph 69 of the judgment under appeal is not vitiated by an error in law.
63.
Second, the functioning and objective of the system shows that the ex ante contributions are not comparable to insurance premiums, as the General Court rightly stated in paragraph 73 of the judgment under appeal.
64.
This is because, on the one hand, the payment of contributions does not give a credit institution a right to use the SRF. As the General Court stated without erring in law in paragraph 70 of the judgment under appeal, the SRF serves to safeguard the financial stability of the Banking Union as such and cannot be regarded as a rescue fund for individual banks. (
34
) In accordance with Article 18(1) of the SRM Regulation, resolution takes place only where it is in the public interest. In that respect, the SRF is intended to ensure the credibility and functionality of the Single Resolution Mechanism (
35
): it is the hope of the legislature that the existence of the SRF will stabilise the banking sector, since the systemic effects of failures of individual institutions can be limited by the existence of such structures. (
36
)
65.
On the other hand, although risk weighting according to an insurance-based logic takes place when calculating the amount of a bank’s individual contributions, that amount does not result from the application of a specific rate to a basis of assessment. (
37
) Rather, the amount of the contributions ultimately depends on the target level that must be met by an aggregate of all contributions collected before the end of 2023.
66.
The ex ante contributions of a bank in a given year therefore constitute first and foremost a fraction of the amount of the target level, and only ‘incidentally’ represent the risk profile of the bank in question. To put it another way, if all banks suddenly had a risk profile assessed as low and the amount of deposits remained the same, the total amount of ex ante contributions collected for the year would nevertheless not be lower – contrary to what the appellant’s argument suggests. Rather, a total amount corresponding to one eighth of slightly more than 1% of the previous year’s covered deposits is always levied in order to arrive, at the end of the initial period, at a total amount corresponding to at least 1% of all covered deposits in 2024. (
38
)
67.
At the same time, this means that the individual contribution of a bank also always depends decisively on the number and individual contributions of the other banks that owe contributions in the year in question, that is to say, on the relevant reference date. (
39
) Adjustment of the contribution of one bank would therefore always make it necessary to correct the contributions of the other banks. If contributions were continuously adjusted in the course of a contribution year, it would consequently be impossible to determine the individual contributions of all banks in a manner that ensures legal certainty. (
40
) For that reason, Article 12(2) of Delegated Regulation 2015/63 provides that a change of status during the contribution period does not have an effect on the contribution to be paid. Accordingly, moreover, Article 70(4) of the SRM Regulation precludes, in principle, reimbursement of contributions already received, since otherwise the shortfall would have to be collected from the other banks. As the Court has already ruled, the concept of ‘change of status’ must be understood broadly, (
41
) since, against that background, it must encompass all cases that could have an impact on the contribution burden of other banks, thus in particular also the case where a contributing bank withdraws from the system.
68.
Therefore, the annual ex ante contribution to the SRF does not quantify the risk that a supervised bank poses on a continuous basis during a year to financial stability or the use of SRF funds. For that reason, the period of time during which a contributing bank falls within the scope of the SRM Regulation in the contribution year is, in principle, irrelevant to the amount of the contribution due.
69.
It follows that an annual contribution must be regarded as having been ‘duly received’ within the meaning of Article 70(4) of the SRM Regulation only where a bank remains within the scope of the SRM Regulation for the entire duration of the contribution year. That circumstance does not constitute the legal ground for the obligation to contribute – contrary to what the appellant claims in its fourth ground of appeal. Rather, the decisive factor for the obligation to contribute is the fact that a credit institution is authorised in the territory of the participating Member States on the relevant reference date. This reflects the principle that financing by the banking sector as a whole is in the public interest as opposed to the interest of the individual banks. (
42
)
70.
Thus, a bank will contribute to the target level of the SRF to a greater or lesser extent depending on the point in time at which it receives its licence during the initial period of the SRF. Banks that join only after the initial period may not even have to pay any contributions at all (initially). This may appear to be unjust at first glance. However, there is no option other than to collect contributions from the actors currently on the market. And the number of such actors fluctuates, of course.
71.
In that connection, Article 12(2) of Delegated Regulation 2015/63 confirms the principle expressed in Article 70(4) of the SRM Regulation that ex ante contributions are calculated according to a reference-date principle, as otherwise it would be impossible for contributions to be reliably calculated and levied. (
43
)
72.
That clarification is necessary because Article 12(1) provides for an exception to the reference-date principle. Under that provision, in the case where a credit institution is a newly supervised institution for only part of a contribution period, the partial contribution is to be determined by reference to the number of full months of the first contribution period for which the institution is supervised. Article 13(5) of Delegated Regulation 2015/63 provides that the partial annual contribution of such an institution is to be collected together with the annual contribution due for the subsequent contribution period. In other words, an additional partial contribution ‘for the previous year’ is levied on new institutions in the first contribution year. The General Court rightly referred to that in paragraph 144 of the judgment under appeal.
73.
By contrast, contributions are no longer levied on the appellant from 2019 onwards, even though it was still carrying out its activities for part of 2018 and was thus contributing, in particular, to the amount of covered deposits, which serves as the basis for calculating the annual target for 2019. This is because, as at the relevant reference date, 1 January 2019, it no longer belonged to the group of banks required to pay contributions. This confirms that it is not primarily the risk specifically posed by a bank during a given year that matters.
74.
Therefore, contrary to what the appellant submits in its second ground of appeal, Article 12(2) of Delegated Regulation 2015/63 does not demonstrate that all changes in the course of a contribution year which are not changes of status must lead to a (subsequent) adjustment of the contributions. Rather, that provision merely confirms the reference-date principle, from which paragraph 1 of the provision derogates.
75.
Purely for the sake of completeness, it is clarified at this point that Article 12(1) of Delegated Regulation 2015/63 does not otherwise lead to new banks being unduly placed in a less favourable position.
76.
The system provided for in Articles 69 and 70 of the SRM Regulation and further developed by Implementing Regulation 2015/81 and Delegated Regulation 2015/63 ensures that the burdens are distributed as fairly as possible within the banking sector, albeit not entirely equally. (
44
) Amongst other things, the provision in Article 12 of Delegated Regulation 2015/63 – in accordance with which a new bank must pay ‘for the past’ but, by contrast, a bank leaving the system will no longer be charged in the future – contributes to that. This is because a new bank is likely to belong to the banking sector for longer, and the SSM serves, in the abstract, to stabilise the banking sector. Therefore, the decision to opt for such an approach is covered by the broad discretion that the EU legislature has in this area. (
45
)
(3) Interim conclusion
77.
It follows from the above considerations that the contribution for 2018 cannot be recalculated and reimbursed on a pro rata basis due to the withdrawal of the appellant’s licence in the course of 2018. Accordingly, the first, second and fourth grounds of appeal must be rejected.
(b)
The third, seventh and eight grounds of appeal
78.
That outcome is not called into question by the other provisions which the appellant had cited at first instance in support of its legal view and which, as submitted by the appellant in its third, seventh and eighth grounds of appeal, were misinterpreted or misapplied by the General Court.
79.
Accordingly, it is true that Article 7 of Delegated Regulation 2017/2361 expressly provides for only a pro rata payment commitment in respect of the administrative contributions to the SRB where a credit institution falls within the scope of the SRM Regulation for only part of the financial year. In its third ground of appeal, the appellant submits that the General Court erred in law by regarding those contributions as not being comparable to the ex ante contributions to the SRF and by therefore ruling out an analogous application of Article 7 of Delegated Regulation 2017/2361 to the latter. (
46
)
80.
However, in paragraph 86 of the judgment under appeal, the General Court stated, without erring in law, that the administrative contributions to the SRB – unlike the contributions to the SRF – are paid as consideration for the administrative activities of the SRB during a given year. They therefore correspond to time-dependent expenditure. In that respect, those contributions do indeed ‘relate’ to a specific year. By contrast, the ex ante contributions to the SRF serve to achieve the target level set in Article 69(1) of the SRM Regulation incrementally over the initial period and are not incurred thereafter (at least initially), despite the passage of time. (
47
) Consequently, the General Court did not err in law in finding that those two types of contribution are not comparable.
81.
Therefore, the third ground of appeal must be rejected.
82.
Against that background, the General Court was also right to conclude in paragraph 109 of the judgment under appeal that an obligation to recalculate the contribution for 2018 does not follow from Article 17(3) and (4) of Delegated Regulation 2015/63 either in a case such as the present one.
83.
Article 17(3) and (4) of the delegated regulation provides for a recalculation of the contribution under certain circumstances where the data to be submitted by the credit institutions by 31 December of the previous year in accordance with Article 14(1) to (3) of that regulation have to be amended subsequently. However, in so far as the appellant cites that provision in its seventh ground of appeal as evidence of the (abstract) possibility of a subsequent recalculation of contributions, its arguments come to nothing. This is because the only decisive factor for the success of the appeal is whether the General Court was wrong to find that the contribution for 2018 is not reimbursable on a pro rata basis.
84.
In any event, the appellant does not specify the extent to which the withdrawal of the licence in 2018 necessitates restatements or revisions of the data which it was required to submit to the SRB by 31 December 2017. The fact that Article 17 of Delegated Regulation 2015/63 also does not provide for a recalculation in the case where data are subject to restatements in the following year is plainly and simply due to the fact that the annual contribution is not calculated on the basis of the data of the year in which that contribution is levied. (
48
)
85.
Consequently, the seventh ground of appeal must also be rejected.
86.
By its eighth ground of appeal, the appellant ultimately argues that the General Court wrongly found that Article 7(3) of Implementing Regulation 2015/81 does not apply mutatis mutandis to its situation. (
49
) Under that provision, irrevocable payment commitments are cancelled in the event that a credit institution leaves the system. Since, in accordance with Article 70(3) of the SRM Regulation, irrevocable payment commitments can be made instead of paying the contribution in cash, ex ante contributions would have to share ‘the same fate’ as irrevocable payment commitments in the case where an institution leaves the system: thus, if the latter were cancelled in this case, the contributions made in cash would have to be reimbursed.
87.
However, Article 7(3) of Implementing Regulation 2015/81 merely provides that irrevocable payment commitments are cancelled and the corresponding collateral is returned. However, this cannot mean that the amount covered by the irrevocable payment commitment is taken from the SRF. This is because, in accordance with Article 7(1) of Implementing Regulation 2015/81, recourse to irrevocable payment commitments shall in no manner affect the financial capacity or the liquidity of the Fund. That instrument is merely intended to ensure that the amount does not have to be paid immediately, but only once it has been called. It follows from Article 7(2) of Implementing Regulation 2015/81 that it is always only on receipt of the contribution that an irrevocable payment commitment is cancelled and the collateral returned. The same must therefore also apply in the event of withdrawal from the system in accordance with paragraph 3 of that article, since otherwise the irrevocable payment commitments could never achieve their objective. Thus, the cancellation of the irrevocable payment commitment and the return of the collateral does not mean that the contribution covered by that instrument does not have to be made. Rather, withdrawal from the system must lead to the irrevocable payment commitment being called, as was also confirmed by the SRB in the appeal proceedings.
88.
Therefore, Article 7(3) of Implementing Regulation 2015/81 cannot justify a (pro rata) reimbursement of contributions paid in cash in the event of a credit institution leaving the system by pointing to the need for equal treatment of irrevocable payment commitments and contributions paid in cash.
89.
It follows that the eighth ground of appeal must also be rejected.
(c)
The tenth ground of appeal
90.
In the light of the foregoing, the tenth ground of appeal – by which the appellant argues that, in paragraph 136 of the judgment under appeal, the General Court wrongly regarded the provision of Article 70(4) of the SRM Regulation as unambiguous and thus failed to have regard to the requirements of the principle of legal certainty – must also be rejected.
91.
As has just been demonstrated, the meaning of Article 70(4) of the SRM Regulation follows from the functioning and objectives of the system of levying contributions to the SRF.
92.
The tenth ground of appeal is therefore based on a misunderstanding of the requirement of clarity of legal provisions, which follows from the principle of legal certainty. (
50
) This is because the fact that a provision is subject to interpretation and must be viewed in conjunction with other rules does not mean that it infringes that requirement. (
51
)
93.
Consequently, the tenth ground of appeal must also be rejected.
(d)
The fifth and eleventh grounds of appeal
94.
By its eleventh ground of appeal, the appellant argues that the General Court failed to have regard to the meaning of the principle of proportionality in the interpretation of legal provisions.
95.
The argument put forward in that connection is ultimately based on a misreading of the judgment, whereby, according to the appellant, the General Court ruled that reimbursement under Article 70(4) of the SRM Regulation is always and in all circumstances excluded, which, in the appellant’s view, would be disproportionate. However, such a finding would obviously go beyond the subject matter of the dispute and, moreover, was not made by the General Court in the judgment under appeal.
96.
The appellant, on the other hand, has not explained why the application of Article 70(4) of the SRM Regulation would lead to a disproportionate outcome in its case, but has instead provided hypothetical examples of such an outcome.
97.
It is true that the eleventh ground of appeal, together with the fifth ground of appeal, by which the appellant argues that, in paragraph 147 of the judgment under appeal, the General Court disregarded its plea of illegality of Article 70(4) of the SRM Regulation, can be understood as meaning that the appellant submits that that provision is invalid because it leads to disproportionate outcomes in the examples given. However, the appellant likewise failed to explain why that is the case and why a proportionate interpretation of Article 70(4) of the SRM Regulation is supposed to be impossible, in particular in the examples given. (
52
) This is once again due to the fact that the appellant wrongly proceeds on the assumption that the General Court ruled that reimbursement of ex ante contributions is excluded in all conceivable cases by virtue of Article 70(4) of the SRM Regulation.
98.
Therefore, the fifth and eleventh grounds of appeal must also be rejected.
(e)
The twelfth ground of appeal
99.
In its twelfth ground of appeal, the appellant argues that the General Court misinterpreted the principle nemo auditur propriam turpitudinem allegans. The appellant submits that the General Court was wrong to hold in paragraph 172 of the judgment under appeal that the alleged illegality of the SRB’s decision of 23 February 2018, adopted under Article 18(1) of the SRM Regulation – according to which the appellant is to be regarded as failing or likely to fail, but no resolution measures are required – has no bearing on the legality of the contested decision. According to the appellant, it was the SRB’s decision under Article 18(1) of the SRM Regulation that led to the withdrawal of its banking licence on 11 July 2018 in the first place. However, since that decision of the SRB was unlawful, it could not rely on it in order then to deny it ‘protection’ by the SRF as a result of the withdrawal of the licence, without at the same time reimbursing it the ex ante contributions.
100.
However, first, it follows from the above statements that the representation according to which the appellant was prevented from making use of the SRF as a result of the withdrawal of the licence, even though it had ‘paid’ for that facility, is factually incorrect. (
53
) Second, acts of the EU institutions are presumed to be lawful and thus valid until such time as they are declared invalid. (
54
) Accordingly, the General Court rightly pointed out in paragraph 171 of the judgment under appeal that the alleged illegality of the SRB’s decision under Article 18(1) of the SRM Regulation has no bearing on the present proceedings, since it is not the subject of the proceedings.
101.
Consequently, the twelfth ground of appeal must also be rejected.
(f)
Conclusion
102.
Consequently, the General Court’s conclusion in paragraph 130 of the judgment under appeal that a pro rata reimbursement of the contribution for 2018 because of the withdrawal of the appellant’s licence in the course of that year is excluded, is not vitiated by any error of law.
2.
The possibility of paying the ‘remaining’ part of the contribution for 2015 (sixth and ninth grounds of appeal)
103.
By its sixth and ninth grounds of appeal, the appellant challenges, in essence, the General Court’s interpretation of Article 70(4) of the SRM Regulation with regard to the contribution for 2015. The General Court takes the view that that provision precludes payment of the ‘remaining’ part of the contribution for 2015 despite the offsetting rule in Article 8(2) of Implementing Regulation 2015/81.
104.
As a reminder: since 1 January 2015, the BRRD has required all Member States to establish national resolution financing arrangements, which, in accordance with Articles 102 and 103 of that directive, are likewise filled by ex ante contributions from the banks until a certain target level is reached. For the Member States of the Banking Union, however, the practical relevance of that requirement is insignificant, since, for all institutions that fall within the scope of the SRM Regulation, the SRF replaced the national funding arrangements with effect from 1 January 2016. (
55
) In order to reinforce the financial capacity of the SRF as of its inception, the Member States of the Banking Union have therefore committed under the IGA to transfer to the SRF the full amount of the contributions collected from those institutions in 2015 by virtue of Article 103 of the BRRD. (
56
) As of 1 January 2016, the contributions of those institutions are in principle (
57
) calculated in accordance with Articles 69 and 70 of the SRM Regulation. In accordance with Article 67(4) of the SRM Regulation, they are to continue to be raised by the Member State authorities and transferred to the SRF in accordance with the IGA.
105.
Article 8(2) of Implementing Regulation 2015/81 provides that, during the initial period of the SRF, the contribution paid by the banks in 2015 will be incrementally offset against the contributions collected on the basis of Articles 69 and 70 of the SRM Regulation. In practice, one eighth of the contribution paid by a bank in 2015 is deducted from that credit institution’s individual contribution calculated annually in accordance with Article 70 of the SRM Regulation, in conjunction with Delegated Regulation 2015/63. (
58
)
106.
The appellant takes the view that the General Court failed to recognise that it follows from that arrangement that the contribution for 2015 is merely an ‘advance payment’ for the SRF, which must ultimately be repaid to the banks that made it. The appellant submits that, since this cannot be achieved by offsetting future contributions in the case of a bank that withdraws from the system before the end of the initial period, the remaining balance must therefore be paid to it at the time of its withdrawal. According to the appellant, the fact that such a payment is possible is evidenced by Decision SRB/ES/SRF/2018/03 on the calculation of the 2018 ex ante contributions. (
59
) The appellant claims that, according to that decision, banks for which the offsetting of their annual contribution for 2018 against the share of their 2015 contribution results in a negative amount are paid the difference. The General Court’s conclusion that reimbursement of the ‘remaining’ part of the contribution for 2015 is excluded by virtue of Article 70(4) of the SRM Regulation is therefore erroneous in law, submits the appellant.
107.
It is true that the contribution for 2015 is offset against the annual ex ante contributions by the banks that have paid it and thus does not result in an ‘additional’ charge for them. Rather, by virtue of Article 8(2) of Implementing Regulation 2015/81, a bank that was already authorised in a Member State of the Banking Union on 1 January 2015 and paid the contribution for 2015 will have paid the same amount at the end of the initial period as a bank which is comparable in terms of size and risk profile and only started operating on 1 January 2016 and remains liable to pay contributions throughout the initial period.
108.
However, it does not follow from this that the contribution for 2015 is an ‘advance payment’ that must be repaid. Nor does it mean that the ‘remaining’ part of the 2015 contribution not yet offset against future contributions can be reimbursed to a bank that withdraws from the SSM before the end of the initial period and thus pays no further contributions.
109.
This is because, as the General Court correctly held in paragraph 117 of the judgment under appeal, the 2015 contributions became an integral part of the SRF’s resources once transferred to it in accordance with the IGA. They are treated in the same way as all other contributions which also continue to be levied at national level but are transferred to the SRF in accordance with the IGA. (
60
) This also makes sense, since the national funding arrangements for the Member States of the Banking Union are replaced by the SRF in any event. (
61
)
110.
Thus, the sum of all contributions collected in 2015 is included from the outset in the calculation of the total amount that must be collected in order to reach the SRF’s estimated target level for 2024. Accordingly, that money would be missing if each bank leaving before the end of the initial period were to be reimbursed a residual amount from the payment for 2015. Therefore, the principle laid down in Article 70(4) of the SRM Regulation, according to which duly received contributions cannot be reimbursed, must also apply with regard to the contributions for 2015. (
62
)
111.
The fact, emphasised in the fifth ground of appeal, that the offsetting of contributions in accordance with Article 8(2) of Implementing Regulation 2015/81 may in individual cases result in a negative amount, which is then paid to the bank concerned, does not mean that the contributions for 2015 can be taken back from the SRF.
112.
Rather, that payment is due to two systemic reasons: first, under the first subparagraph of Article 70(2) of the SRM Regulation, no more than one eighth of the target level may be levied per year, as the General Court also pointed out in paragraph 100 of the judgment under appeal. That provision is intended to ensure that contributions are distributed evenly and thus do not lead to an excessive economic burden on the banking sector, which could have a destabilising effect. However, if the negative amount resulting from a set-off were not paid to the bank concerned, the amount levied would be more than one eighth of the target level in that year. This is because the contributions for 2015 have been an integral part of the SRF’s resources since they were transferred to the SRF in accordance with the IGA. (
63
)
113.
Second, the banking sector as a whole is to provide at least the equivalent of 1% of all covered deposits in the participating Member States over the eight-year period. However, an individual bank is to contribute to that sum no more than a proportion which is in principle made up of eight annual contributions. It is true that the legislature could have set a different individual maximum contribution; yet, there is nothing to indicate that the upper limit thus determined is an error of discretion. (
64
)
114.
Nonetheless, in order for the SRF to have sufficient funds already in its first year of existence, it was necessary to provide in that year start-up capital in the form of the contribution for 2015. However, that neither increased the target level nor shortened the duration of the initial period.
115.
Without the offsetting provided for in Article 8(2) of Implementing Regulation 2015/81, a bank that was or is already liable to pay contributions before the SRM Regulation entered into force and until the end of the initial period would therefore pay a higher contribution than the specified maximum contribution. Therefore, as the General Court rightly stated in paragraph 124 of the judgment under appeal, the offsetting rule ensures that the transfer of the 2015 contributions to the SRF does not lead to imbalances between the banks concerned as regards the sharing of the financial burden.
116.
In that respect, since the appellant is no longer required to pay contributions from 2019 onwards, it remains overall below the maximum contribution in any event, even though the ‘remaining’ amount is not paid to it. It is true that it thus ultimately paid more than a hypothetical comparable bank of the same size and risk profile, which only started operating on 1 January 2016 and withdrew from the system at the same time as the appellant.
117.
However, as explained above, differences in individual contribution burdens depending on when a bank starts operating during the initial period are inherent in the system and cannot be completely avoided. (
65
) This is ultimately due to the fact that the target level cannot be raised by the banking sector all at once, but only over a longer period of time, and the composition of the banking sector changes during that time. However, that cannot lead to a situation where any change means that it is necessary to start ‘from scratch’, as it were. Otherwise, the attainment of the objective of reaching the target level by 2024 would be seriously jeopardised. (
66
)
118.
Consequently, the General Court also ruled, without erring in law, that the ‘remaining’ amount of the contribution for 2015 cannot be paid to a bank in the event that it leaves the system during the initial period.
119.
The sixth and ninth grounds of appeal must therefore be rejected.
3.
The formal legality of the contested decision (thirteenth ground of appeal)
120.
With regard to the formal legality of the contested decision, the General Court held in paragraphs 174 to 180 of the judgment under appeal that the SRB’s decision satisfied the requirement to state reasons under Article 296 TFEU. This is because, according to the General Court, the essential elements of facts and the SRB’s understanding of the relevant legal rules on which it based its refusal of the appellant’s application can be inferred from it.
121.
By its thirteenth ground of appeal, the appellant argues, in essence, that the General Court applied an incorrect standard in that regard, since the confirmation of the SRB’s decision required the application of further legal considerations in the judgment under appeal and cannot therefore be regarded as being based on an adequate statement of reasons. Moreover, submits the appellant, the questions and discussions during the hearing before the General Court showed that the SRB’s reasoning was inadequate.
122.
That line of argument manifestly disregards the spirit and purpose of the requirement to state reasons. In accordance with settled case-law, that requirement serves to allows persons concerned to decide in full knowledge of the circumstances whether it is worthwhile to bring an action against the decision and the court with jurisdiction to review it. It is not necessary, therefore, for details of all relevant factual and legal aspects to be given. (
67
) Compliance with the requirement to state reasons must be distinguished from the substantive correctness of the statement of reasons. (
68
) Even a substantively incorrect statement of reasons can therefore be adequate with regard to Article 296 TFEU. (
69
)
123.
Consequently, neither the fact that the General Court took into account further elements of law in confirming the SRB’s interpretation of the law nor the fact that certain points were the subject of controversial discussion is capable of demonstrating an error in law in the General Court’s finding that the contested decision was sufficiently reasoned.
124.
The thirteenth ground of appeal must therefore also be rejected.
C. Costs
125.
It follows from the foregoing considerations that the appeal must be dismissed in its entirety. Consequently, in accordance with Article 184(2) of the Rules of Procedure, the Court is to make a decision as to costs. Under Article 138(1) of those rules, applicable to appeal proceedings by virtue of 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. Since the SRB has applied for such costs, the appellant must be ordered to bear its own costs and to pay the costs of the appeal proceedings and of the SRB.
126.
In accordance with Article 140(1) of the Rules of Procedure, which applies to appeal proceedings, the Member States and institutions which have intervened in the proceedings are to bear their own costs. Moreover, in accordance with Article 184(4) of the Rules of Procedure, where, without having brought the appeal itself, an intervener at first instance has participated in the written or oral part of the proceedings before the Court of Justice, the latter may decide that it is to bear its own costs. The Commission must therefore be ordered to bear its own costs.
VI. Conclusion
127.
In summary, I propose that the Court should:
1.
Dismiss the appeal.
2.
Order ABLV Bank AS, in liquidation, to pay its own costs and to pay the costs of the appeal and the costs of the Single Resolution Board.
3.
Order the European Commission to pay its own costs.
(
1
)	Original language: German.
(
2
)	See recitals 3 and 19 of the SRM Regulation (see citation in footnote 3 below) and recitals 5, 76 and 104 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) (‘the BRRD’).
(
3
)	Regulation (EU) No 806/2014 of the European Parliament and of the Council of 15 July 2014 establishing uniform rules and a uniform procedure for the resolution of credit institutions and certain investment firms in the framework of a Single Resolution Mechanism and a Single Resolution Fund and amending Regulation (EU) No 1093/2010 (OJ 2014 L 225, p. 1) (‘the SRM Regulation’).
(
4
)	That is to say, from the commercial banks that are authorised in a Member State which participates in the Single Surveillance Mechanism (SSM). Participating Member States are all the Member States of the euro area and, since 1 October 2020, Croatia and Bulgaria.
(
5
)	See Article 100 of the BRRD. As of 2016, that requirement on the part of the Member States of the Banking Union was replaced, in effect, by their participation in the establishment of the SRF.
(
6
)	See recital 107 of the SRM Regulation.
(
7
)	According to Article 6(1) of Directive 2014/49/EU of the European Parliament and of the Council of 16 April 2014 on deposit guarantee schemes (OJ 2014 L 173, p. 149), Member States are to ensure that the deposits of each depositor are protected up to an amount of EUR 100000.
(
8
)	See Article 8(2) of Council Implementing Regulation (EU) 2015/81 of 19 December 2014 specifying uniform conditions of application of Regulation (EU) No 806/2014 of the European Parliament and of the Council with regard to ex ante contributions to the Single Resolution Fund (OJ 2015 L 15, p. 1) (‘Implementing Regulation 2015/81’).
(
9
)	See, in particular, judgments of 14 November 2019, State Street Bank International (C‑255/18, EU:C:2019:967); of 3 December 2019, Iccrea Banca (C‑414/18, EU:C:2019:1036); and of 15 July 2021, Commission v Landesbank Baden-Württemberg and SRB (C‑584/20 P and C‑621/20 P, EU:C:2021:601).
(
10
)	See citation in footnote 3.
(
11
)	See citation in footnote 2.
(
12
)	See citation in footnote 8.
(
13
)	OJ 2015 L 11, p. 44.
(
14
)	OJ 2017 L 337, p. 6.
(
15
)	See Article 6(4) of Council Regulation (EU) No 1024/2013 of 15 October 2013 conferring specific tasks on the European Central Bank concerning policies relating to the prudential supervision of credit institutions (OJ 2013 L 287, p. 63) (‘the SSM Regulation’).
(
16
)	Decision SRB/EES/2018/09 of 23 February 2018.
(
17
)	SRB/ES/SRF/2018/03.
(
18
)	Paragraphs 65 to 76 of the judgment under appeal.
(
19
)	Paragraphs 77 to 90, in particular paragraph 84, of the judgment under appeal.
(
20
)	Paragraphs 77 to 111 of the judgment under appeal.
(
21
)	See, in particular, paragraphs 120 to 129 of the judgment under appeal.
(
22
)	See paragraphs 92 to 96 of the judgment under appeal.
(
23
)	See paragraphs 65 to 76 of the judgment under appeal.
(
24
)	See, in particular, paragraphs 80 to 89 of the judgment under appeal.
(
25
)	See Article 70(1) of the SRM Regulation.
(
26
)	That is to say, at least until the available financial means fall below two thirds of the amount corresponding to 1% of all covered deposits at the relevant point in time, either as a result of the Fund being used or as a result of a further increase in covered deposits (see the first subparagraph of Article 69(4) of the SRM Regulation).
(
27
)	It is true that that regulation applies directly to the collection of contributions to the national financing arrangements. However, for the Member States of the Banking Union, the SRF replaced those financing arrangements upon the entry into force of the SRM Regulation for all institutions covered by it. Therefore, Delegated Regulation 2015/63 applies mutatis mutandis to the calculation of the ex ante contributions to the SRF (see Article 70(6) of the SRM Regulation).
(
28
)	In fact, a mixture of the average amount of covered deposits in the Member State concerned and the total amount of covered deposits in all participating Member States in the previous year is taken as the basis (see Article 8(1) of Implementing Regulation 2015/81). However, that is not of decisive importance in understanding the functioning of the system of levying contributions. In each of the previous years, the SRB set a total annual contribution corresponding to one eighth of between 1.05% and 1.35% of the thus calculated average amount of deposits covered in the previous year (see https://www.srb.europa.eu/en/content/2020-srf-levies-ex-ante-contributions).
(
29
)	See Article 4(1) and Article 14(1) to (4) of Delegated Regulation 2015/63, and judgment of 14 November 2019, State Street Bank International (C‑255/18, EU:C:2019:967, paragraph 42).
(
30
)	See the Commission’s proposal for the SRM Regulation, of 10 July 2013 (COM(2013) 520 final), pp. 14 and 15.
(
31
)	See, in that regard, judgment of 15 July 2021, Commission v Landesbank Baden-Württemberg and SRB (C‑584/20 P and C‑621/20 P, EU:C:2021:601, paragraph 117).
(
32
)	Or the moment of a ‘snapshot’, in the wording of the Opinion of Advocate General Campos Sánchez-Bordona in State Street Bank International (C‑255/18, EU:C:2019:539, point 71).
(
33
)	See, in particular, points 54 and 55 of this Opinion.
(
34
)	See also the Commission’s proposal for the SRM Regulation, of 10 July 2013 (COM(2013) 520 final), p. 15.
(
35
)	See recital 107 of the SRM Regulation.
(
36
)	See also, in that regard, my Opinion in Cases Aeris Invest v SRB and Algebris (UK) and Anchorage Capital Group v SRB (C‑874/19 P and C‑934/19 P, EU:C:2021:563, point 104). See also the Commission’s proposal for the SRM Regulation, of 10 July 2013 (COM(2013) 520 final), p. 15.
(
37
)	Judgment of 15 July 2021, Commission v Landesbank Baden-Württemberg and SRB (C‑584/20 P and C‑621/20 P, EU:C:2021:601, paragraph 113).
(
38
)	See point 54 above.
(
39
)	See recital 11 of Implementing Regulation 2015/81.
(
40
)	See, to that effect, judgment of 14 November 2019, State Street Bank International (C‑255/18, EU:C:2019:967, paragraph 43).
(
41
)	Judgment of 14 November 2019, State Street Bank International (C‑255/18, EU:C:2019:967, paragraph 44).
(
42
)	See recitals 20 and 102 of the SRM Regulation.
(
43
)	See, to that effect, judgment of 14 November 2019, State Street Bank International (C‑255/18, EU:C:2019:967, paragraph 43).
(
44
)	In that regard, see point 69 above.
(
45
)	See, in that regard, judgment of 15 July 2021, Commission v Landesbank Baden-Württemberg and SRB (C‑584/20 P and C‑621/20 P, EU:C:2021:601, paragraph 117).
(
46
)	See, in particular, paragraph 86 of the judgment under appeal.
(
47
)	Contributions may be levied again if the target level falls below two thirds of the amount corresponding to 1% of the covered deposits, for example due to funds being used (see the first subparagraph of Article 69(4) of the SRM Regulation and point 53 of this Opinion).
(
48
)	In that regard, see points 54 to 56 above.
(
49
)	See paragraphs 110 and 111 of the judgment under appeal.
(
50
)	See, for example, judgment of 9 July 2015, Cabinet Medical Veterinar Dr. Tomoiagă Andrei (C‑144/14, EU:C:2015:452, paragraphs 34 and 35).
(
51
)	See, to that effect, judgments of 28 June 2005, Dansk Rørindustri and Others v Commission (C‑189/02 P, C‑202/02 P, C‑205/02 P to C‑208/02 P and C‑213/02 P, EU:C:2005:408, paragraphs 217 and 218), and of 28 March 2017, Rosneft (C‑72/15, EU:C:2017:236, paragraph 167).
(
52
)	Indeed, a provision is to be regarded as invalid only if it cannot be interpreted in a manner which is compatible with higher-ranking principles or legal provisions; see, to that effect, judgments of 29 June 1995, Spain v Commission (C‑135/93, EU:C:1995:201, paragraph 37); of 4 October 2001, Italy v Commission (C‑403/99, EU:C:2001:507, paragraphs 28 and 37); and of 26 June 2007, Ordre des barreaux francophones and germanophone and Others (C‑305/05, EU:C:2007:383, paragraph 28).
(
53
)	See, in particular, points 64 to 69 of this Opinion.
(
54
)	See judgments of 2 October 2014, Strack v Commission (C‑127/13 P, EU:C:2014:2250, paragraph 78); of 28 January 2016, Éditions Odile Jacob v Commission (C‑514/14 P, not published, EU:C:2016:55, paragraph 40); and of 10 September 2019, HTTS v Council (C‑123/18 P, EU:C:2019:694, paragraph 100).
(
55
)	In the Member States of the Banking Union, contributions to the national financing arrangement are now levied only on undertakings not covered by the SRM Regulation.
(
56
)	See recital 12 and Article 3(3) of the IGA.
(
57
)	See, for the details in that regard, Article 8(1) of Implementing Regulation 2015/81.
(
58
)	See paragraph 100 of the judgment under appeal.
(
59
)	See point 33 of this Opinion.
(
60
)	See Article 67(4) of the SRM Regulation and Article 1(1) and Article 3(1) of the IGA.
(
61
)	See recital 9 of the IGA.
(
62
)	In that regard, see point 67 above.
(
63
)	See point 108 above.
(
64
)	Regarding the broad discretion that the legislature has in this area, see points 60 and 76 above.
(
65
)	In that regard, see points 69 and 76 above.
(
66
)	See, to that effect, judgment of 14 November 2019, State Street Bank International (C‑255/18, EU:C:2019:967, paragraph 43).
(
67
)	See judgment of 15 July 2021, Commission v Landesbank Baden-Württemberg and SRB (C‑584/20 P and C‑621/20 P, EU:C:2021:601, paragraphs 103 and 104).
(
68
)	See judgments of 10 July 2008, Bertelsmann and Sony Corporation of America v Impala (C‑413/06 P, EU:C:2008:392, paragraph 181); of 15 November 2012, Council v Bamba (C‑417/11 P, EU:C:2012:718, paragraph 60); and of 22 April 2021, Council v PKK (C‑46/19 P, EU:C:2021:316, paragraphs 55 and 56).
(
69
)	Judgment of 10 July 2008, Bertelsmann and Sony Corporation of America v Impala (C‑413/06 P, EU:C:2008:392, paragraph 181).