title: Recommendations to national courts and tribunals in relation to the initiation of preliminary ruling proceedings

text:
               20.7.2018

               EN

               Official Journal of the European Union

               C 257/1

               In continuation of the Rules of Procedure of the Court of Justice (1), this text serves as a reminder of the essential characteristics of the preliminary ruling procedure and the factors to be taken into account by the national courts and tribunals before making references to the Court for a preliminary ruling, while providing them with some practical indications as to the form and content of a request for a preliminary ruling. Since that request will, after translation, be served on all the interested parties referred to in Article 23 of Protocol No 3 on the Statute of the Court of Justice of the European Union and since the decision of the Court closing the proceedings will, in turn, be published in all official languages of the European Union, close attention must be paid to the presentation of the request for a preliminary ruling and, in particular, to the protection of personal data of natural persons involved in the proceedings.

         RECOMMENDATIONS
   to national courts and tribunals in relation to the initiation of preliminary ruling proceedings
   (2018/C 257/01)

      Introduction

               1.

               The reference for a preliminary ruling, provided for in Article 19(3)(b) of the Treaty on European Union (‘TEU’) and Article 267 of the Treaty on the Functioning of the European Union (‘TFEU’), is a fundamental mechanism of EU law. It is designed to ensure the uniform interpretation and application of that law within the European Union, by offering the courts and tribunals of the Member States a means of bringing before the Court of Justice of the European Union (‘the Court’) for a preliminary ruling questions concerning the interpretation of EU law or the validity of acts adopted by the institutions, bodies, offices or agencies of the Union.

               2.

               The preliminary ruling procedure is based on close cooperation between the Court and the courts and tribunals of the Member States. In order to ensure that that procedure is fully effective, it is necessary to recall its essential characteristics and to provide further information to clarify the provisions of the rules of procedure relating, in particular, to the originator and scope of a request for a preliminary ruling, as well as to the form and content of such a request. That information — which applies to all requests for a preliminary ruling (I) — is supplemented by the provisions that apply to requests for a preliminary ruling requiring particularly expeditious handling (II) and by an annex which summarises the essential elements of any request for a preliminary ruling.

         I.   Provisions which apply to all requests for a preliminary ruling

      The originator of the request for a preliminary ruling

               3.

               The jurisdiction of the Court to give a preliminary ruling on the interpretation or validity of EU law is exercised exclusively on the initiative of the national courts and tribunals, whether or not the parties to the main proceedings have expressed the wish that a question be referred to the Court. In so far as it is called upon to assume responsibility for the subsequent judicial decision, it is for the national court or tribunal before which a dispute has been brought — and for that court or tribunal alone — to determine, in the light of the particular circumstances of each case, both the need for a request for a preliminary ruling in order to enable it to deliver judgment and the relevance of the questions which it submits to the Court.

               4.

               Status as a court or tribunal is interpreted by the Court as a self-standing concept of EU law, the Court taking account of a number of factors such as whether the body making the reference is established by law, whether it is permanent, whether its jurisdiction is compulsory, whether its procedure is inter partes, whether it applies rules of law and whether it is independent.

               5.

               The courts and tribunals of the Member States may refer a question to the Court on the interpretation or validity of EU law where they consider that a decision of the Court on the question is necessary to enable them to give judgment (see second paragraph of Article 267 TFEU). A reference for a preliminary ruling may, inter alia, prove particularly useful when a question of interpretation is raised before the national court or tribunal that is new and of general interest for the uniform application of EU law, or where the existing case-law does not appear to provide the necessary guidance in a new legal context or set of facts.

               6.

               Where a question is raised in the context of a case that is pending before a court or tribunal against whose decisions there is no judicial remedy under national law, that court or tribunal is nonetheless required to bring a request for a preliminary ruling before the Court (see third paragraph of Article 267 TFEU), unless there is already well-established case-law on the point or unless the correct interpretation of the rule of law in question admits of no reasonable doubt.

               7.

               It follows, moreover, from settled case-law that although national courts and tribunals may reject pleas raised before them challenging the validity of acts of an institution, body, office or agency of the Union, the Court has exclusive jurisdiction to declare such acts invalid. When it has doubts about the validity of such an act, a court or tribunal of a Member State must therefore refer the matter to the Court, stating the reasons for which it considers that the act is invalid.

      The subject matter and scope of the request for a preliminary ruling

               8.

               A request for a preliminary ruling must concern the interpretation or validity of EU law, not the interpretation of rules of national law or issues of fact raised in the main proceedings.

               9.

               The Court can give a preliminary ruling only if EU law applies to the case in the main proceedings. It is essential, in that respect, that the referring court or tribunal set out all the relevant matters of fact and of law that have prompted it to consider that any provisions of EU law may be applicable in the case.

               10.

               With regard to references for a preliminary ruling concerning the interpretation of the Charter of Fundamental Rights of the European Union, it must be noted that, under Article 51(1) of the Charter, the provisions of the Charter are addressed to the Member States only when they are implementing EU law. While the circumstances of such implementation can vary, it must nevertheless be clearly and unequivocally apparent from the request for a preliminary ruling that a rule of EU law other than the Charter is applicable to the case in the main proceedings. Since the Court has no jurisdiction to give a preliminary ruling where a legal situation does not come within the scope of EU law, any provisions of the Charter that may be relied upon by the referring court or tribunal cannot, of themselves, form the basis for such jurisdiction.

               11.

               Lastly, although, in order to deliver its decision, the Court necessarily takes into account the legal and factual context of the dispute in the main proceedings, as defined by the referring court or tribunal in its request for a preliminary ruling, it does not itself apply EU law to that dispute. When ruling on the interpretation or validity of EU law, the Court makes every effort to give a reply which will be of assistance in resolving the dispute in the main proceedings, but it is for the referring court or tribunal to draw case-specific conclusions, if necessary by disapplying the rule of national law held incompatible with EU law.

      The appropriate stage at which to make a reference for a preliminary ruling

               12.

               A national court or tribunal may submit a request for a preliminary ruling to the Court as soon as it finds that a ruling on the interpretation or validity of EU law is necessary to enable it to give judgment. It is that court or tribunal which is in fact in the best position to decide at what stage of the proceedings such a request should be made.

               13.

               Since, however, that request will serve as the basis of the proceedings before the Court and the Court must therefore have available to it all the information that will enable it both to assess whether it has jurisdiction to give a reply to the questions raised and, if so, to give a useful reply to those questions, it is necessary that a decision to make a reference for a preliminary ruling be taken when the national proceedings have reached a stage at which the referring court or tribunal is able to define, in sufficient detail, the legal and factual context of the case in the main proceedings, and the legal issues which it raises. In the interests of the proper administration of justice, it may also be desirable for the reference to be made only after both sides have been heard.

      The form and content of the request for a preliminary ruling

               14.

               The request for a preliminary ruling may be in any form allowed by national law in respect of procedural issues, but it should be borne in mind that that request serves as the basis of the proceedings before the Court and is served on all the interested persons referred to in Article 23 of Protocol No 3 on the Statute of the Court of Justice of the European Union (‘the Statute’) and, in particular, on all the Member States, with a view to obtaining any observations they may wish to make. Owing to the consequential need to translate it into all the official languages of the European Union, the request for a preliminary ruling should therefore be drafted simply, clearly and precisely by the referring court or tribunal, avoiding superfluous detail. As experience has shown, about 10 pages are often sufficient to set out adequately the legal and factual context of a request for a preliminary ruling.

               15.

               The content of any request for a preliminary ruling is prescribed by Article 94 of the Rules of Procedure of the Court and is summarised in the annex hereto. In addition to the text of the questions referred to the Court for a preliminary ruling, the request for a preliminary ruling must contain:

                           —

                           a summary of the subject matter of the dispute and the relevant findings of fact as determined by the referring court or tribunal, or, at the very least, an account of the facts on which the questions referred are based,

                           —

                           the tenor of any national provisions applicable in the case and, where appropriate, the relevant national case-law, and

                           —

                           a statement of the reasons which prompted the referring court or tribunal to inquire about the interpretation or validity of certain provisions of EU law, and the relationship between those provisions and the national legislation applicable to the main proceedings.

                     In the absence of one or more of the above, the Court may have to decline jurisdiction to give a preliminary ruling on the questions referred or dismiss the request for a preliminary ruling as inadmissible.

               16.

               In its request for a preliminary ruling, the referring court or tribunal must provide precise references for the national provisions applicable to the facts of the dispute in the main proceedings, and accurately identify the provisions of EU law whose interpretation is sought or whose validity is challenged. The request should include, if need be, a brief summary of the relevant arguments of the parties to the main proceedings. It is helpful to bear in mind in that context that it is only the request for a preliminary ruling that will be translated, not any annexes to that request.

               17.

               The referring court or tribunal may also briefly state its view on the answer to be given to the questions referred for a preliminary ruling. That information may be useful to the Court, particularly where it is called upon to give a preliminary ruling in an expedited or urgent procedure.

               18.

               Lastly, the questions referred to the Court for a preliminary ruling must appear in a separate and clearly identified section of the order for reference, preferably at the beginning or the end. It must be possible to understand them on their own terms, without it being necessary to refer to the statement of the grounds for the request.

               19.

               In order to make the request for a preliminary ruling easier to read, it is essential that the Court receive it in typewritten form and that the pages and paragraphs of the order for reference be numbered.

               20.

               The request for a preliminary ruling must be dated and signed, then sent to the Court Registry, by email (DDP-GreffeCour@curia.europa.eu) or by post (Registry of the Court of Justice, Rue du Fort Niedergrünewald, L-2925 Luxembourg, LUXEMBOURG). When it is sent by email, the original request for a preliminary ruling must, where at all possible, be sent with the electronic transmission of the text of that request in an editable format (word processing software such as ‘Word’, ‘Open Office’ or ‘LibreOffice’) to facilitate the Court’s handing of the request and, in particular, the translation of the request into all the official languages of the European Union.

               21.

               The request for a preliminary ruling must be accompanied by all relevant documents and documents useful to its handling by the Court and, in particular, precise contact details for the parties to the main proceedings and their representatives, if any, as well as the file of the case in the main proceedings or a copy of it. The file (or copy file) — which may be sent electronically or by post — will be retained at the Registry throughout the proceedings where, unless otherwise indicated by the referring court or tribunal, it may be consulted by the interested persons referred to in Article 23 of the Statute.

               22.

               In order to ensure optimal protection of personal data in the Court’s handling of the case, the service of the request to the interested persons referred to in Article 23 of the Statute and the subsequent dissemination, in all official languages of the European Union, of the decision closing the proceedings, it is necessary for the referring court or tribunal itself, which alone has full knowledge of the file submitted to the Court, to render anonymous, in its request for a preliminary ruling, the names of natural persons referred to in the request or concerned by the dispute in the main proceedings and to redact any information which could enable them to be identified. Given the increasing use of new information technologies and, in particular, the use of search engines, any anonymisation carried out after the lodging of the request for a preliminary ruling and, a fortiori, after service of that request on the interested persons referred to in Article 23 of the Statute and the publication in the Official Journal of the European Union of the notice relating to the case concerned would be devoid of practical purpose.

      Interaction between the reference for a preliminary ruling and the national proceedings

               23.

               Although the referring court or tribunal may still order protective measures, particularly in connection with a reference on determination of validity, the lodging of a request for a preliminary ruling nevertheless calls for the national proceedings to be stayed until the Court has given its ruling.

               24.

               While the Court, in principle, remains seised of a request for a preliminary ruling for so long as that request is not withdrawn, it must nevertheless be borne in mind that the Court’s role in the preliminary ruling procedure is to contribute to the effective administration of justice in the Member States and not to give opinions on general or hypothetical questions. Since the preliminary ruling procedure is predicated on there being proceedings actually pending before the referring court or tribunal, it is incumbent on that court or tribunal to inform the Court of any procedural step that may affect the referral and, in particular, of any discontinuance or withdrawal, amicable settlement or other event leading to the termination of the proceedings. The referring court or tribunal must also inform the Court of any decision delivered in the context of an appeal against the order for reference and of the consequences of that decision for the request for a preliminary ruling.

               25.

               In the interests of the proper conduct of the preliminary ruling proceedings before the Court and in order to maintain their effectiveness, it is important, however, that such information is communicated to the Court with the minimum of delay. The national courts and tribunals should also note that the withdrawal of a request for a preliminary ruling may have an impact on the management of similar cases (or of a series of cases) by the referring court or tribunal. Where the outcome of a number of cases pending before the referring court or tribunal depends on the reply to be given by the Court to the questions submitted by that court or tribunal, it is appropriate for that court or tribunal to join those cases in the request for a preliminary ruling in order to enable the Court to reply to the questions referred notwithstanding any withdrawal of one or more cases.

      Costs and legal aid

               26.

               Preliminary ruling proceedings before the Court are free of charge and the Court does not rule on the costs of the parties to the proceedings pending before the referring court or tribunal; it is for the referring court or tribunal to rule on those costs.

               27.

               If a party to the main proceedings has insufficient means, the Court may grant that party legal aid to cover the costs, particularly those in respect of its representation, which it incurs before the Court. That aid can, however, be granted only if the party in question is not already in receipt of aid under national rules or to the extent to which that aid does not cover, or covers only partly, costs incurred before the Court.

      Communication between the Court and the national court or tribunal

               28.

               The Court Registry will remain in contact with the referring court or tribunal throughout the proceedings, and will send it copies of all procedural documents and any requests for information or clarification deemed necessary in order for a useful reply to be given to the questions referred by that court or tribunal.

               29.

               At the end of the proceedings, the Registry will send the Court’s decision to the referring court or tribunal, which is requested to inform the Court of the action taken upon that decision in the case in the main proceedings and to communicate to the Court its final decision in that case.

         II.   Provisions applicable to requests for a preliminary ruling requiring particularly expeditious handling

               30.

               As provided in Article 23a of the Statute and Articles 105 to 114 of the Rules of Procedure, a reference for a preliminary ruling may, in certain circumstances, be determined pursuant to an expedited procedure or an urgent procedure. The Court will decide whether these procedures are to be applied, either on submission by the referring court or tribunal of a duly reasoned request setting out the matters of fact or of law which justify the application of such procedure(s), or, exceptionally, of its own motion, where that appears to be required by the nature or the particular circumstances of the case.

      Conditions for the application of the expedited and urgent procedures

               31.

               Article 105 of the Rules of Procedure provides that a reference for a preliminary ruling may thus be determined pursuant to an expedited procedure derogating from the provisions of those rules where the nature of the case requires that it be dealt with within a short time. Since that procedure imposes significant constraints on all those involved in it, and, in particular, on all the Member States called upon to lodge observations, whether written or oral, within much shorter time limits than would ordinarily apply, its application must be sought only in particular circumstances that warrant the Court giving its ruling quickly on the questions referred. According to settled case-law, the large number of persons or legal situations potentially affected by the decision that the referring court or tribunal has to deliver after bringing the matter before the Court for a preliminary ruling does not, in itself, constitute an exceptional circumstance that would justify the use of the expedited procedure.

               32.

               The same applies a fortiori to the urgent preliminary ruling procedure, provided for in Article 107 of the Rules of Procedure. That procedure, which applies only in the areas covered by Title V of Part Three of the TFEU, relating to the area of freedom, security and justice, imposes even greater constraints on those concerned, since it limits the number of parties authorised to lodge written observations and, in cases of extreme urgency, allows the written part of the procedure before the Court to be omitted altogether. The application of the urgent procedure must therefore be requested only where it is absolutely necessary for the Court to give its ruling very quickly on the questions submitted by the referring court or tribunal.

               33.

               Although it is not possible to provide an exhaustive list of such circumstances, particularly because of the varied and evolving nature of the rules of EU law governing the area of freedom, security and justice, a national court or tribunal may, for example, consider submitting a request for the urgent preliminary ruling procedure to be applied in the case, referred to in the fourth paragraph of Article 267 TFEU, of a person in custody or deprived of his liberty, where the answer to the question raised is decisive as to the assessment of that person’s legal situation, or in proceedings concerning parental authority or custody of young children, where the identity of the court having jurisdiction under EU law depends on the answer to the question referred for a preliminary ruling.

      The request for application of the expedited procedure or the urgent procedure

               34.

               To enable the Court to decide quickly whether the expedited procedure or the urgent preliminary ruling procedure should be applied, the request must set out precisely the matters of fact and law which establish the urgency and, in particular, the risks involved in following the ordinary procedure. In so far as it is possible to do so, the referring court or tribunal must also briefly state its view on the answer to be given to the questions referred. Such a statement makes it easier for the parties to the main proceedings and the other interested persons participating in the procedure to define their positions, and therefore contributes to the rapidity of the procedure.

               35.

               The request for the application of the expedited procedure or the urgent procedure must in any event be submitted in an unambiguous form that enables the Registry to establish immediately that the file has to be dealt with in a particular way. Accordingly, the referring court or tribunal is requested to specify which of the two procedures is required in the particular case, and to mention in its request the relevant article of the Rules of Procedure (Article 105 for the expedited procedure or Article 107 for the urgent procedure). That mention must be included in a clearly identifiable place in its order for reference (for example, at the head of the page or in a separate judicial document). Where appropriate, it may be helpful for a covering letter from the referring court or tribunal to refer to that request.

               36.

               As regards the order for reference itself, it is particularly important that it should be concise where the matter is urgent, as this will help to ensure the rapidity of the procedure.

      Communication between the Court, the referring court or tribunal and the parties to the main proceedings

               37.

               A court or tribunal submitting a request for the expedited procedure or the urgent procedure to be applied is requested to send that request and the order for reference — together with the text of the latter in an editable format (word processing software such as ‘Word’, ‘Open Office’ or ‘LibreOffice’) — by email (DDP-GreffeCour@curia.europa.eu).

               38.

               In order to expedite and facilitate subsequent communication with the referring court or tribunal and the parties to the main proceedings, the referring court or tribunal is also requested to state its email address and fax number, if any, which may be used by the Court, together with the email addresses and any fax numbers of the representatives of the parties to the proceedings.

      (1)  OJ L 265, 29.9.2012, p. 1.

      ANNEX

         The essential elements of a request for a preliminary ruling

      1.   The referring court or tribunal

      A request for a preliminary ruling must specify the referring court or tribunal and, where appropriate, the chamber or formation of the court or tribunal making the reference, and must include full contact details for that court or tribunal, in order to facilitate subsequent contact between that court or tribunal and the Court of Justice.
      2.   The parties to the main proceedings and their representatives

      After specifying the referring court or tribunal, the request for a preliminary ruling should state the names of the parties to the main proceedings and anyone representing them before that court or tribunal. Where it proves necessary for the protection of personal data, the referring court or tribunal is to anonymise the request for a preliminary ruling and, to that end, must redact the name of natural persons referred to in the request or concerned by the dispute in the main proceedings and all data likely to enable them to be identified.
      If it has them, the referring court or tribunal is to send to the Court both versions of its request for a preliminary ruling, that is to say, the nominal version of that request, including the names of and full contact details for the parties to the main proceedings, and the anonymised version of the request. It is the latter which will be served, after translation into all the official languages of the European Union, on all the interested persons referred to in Article 23 of the Statute and which will serve as the basis of the dissemination and subsequent publications concerning the case.
      3.   The subject matter of the dispute in the main proceedings and the relevant facts

      The referring court or tribunal must briefly describe the subject matter of the dispute in the main proceedings and the relevant findings of fact, as determined by that court or tribunal.
      4.   The relevant legal provisions

      The request for a preliminary ruling must contain precise references to the national provisions applicable to the facts of the dispute in the main proceedings, including any relevant case-law, and the provisions of EU law whose interpretation is sought or whose validity is challenged. Those references must be comprehensive and must include the precise title of and citations for the provisions concerned, as well as their publication references. As far as possible, case-law citations, whether national or European, should also include the ECLI number (‘European Case Law Identifier’) of the decision concerned.
      5.   The grounds for the reference

      The Court can rule on the request for a preliminary ruling only if EU law is applicable to the case in the main proceedings. The referring court or tribunal must therefore set out the reasons which prompted it to inquire about the interpretation or validity of provisions of EU law, and the relationship between those provisions and the national legislation applicable to the main proceedings. If it considers it helpful for the purposes of understanding the case, the referring court or tribunal may set out here the arguments of the parties in that regard.
      6.   The questions referred for a preliminary ruling

      The referring court or tribunal should set out, clearly and distinctly, the questions it is submitting to the Court for a preliminary ruling. It must be possible to understand those questions on their own terms, without the need to refer to the statement of the grounds for the request for a preliminary ruling.
      In so far as it is able to do so, the referring court or tribunal should also briefly state its view on the answer to be given to the questions referred for a preliminary ruling.
      7.   Possible need for specific treatment

      Lastly, where the referring court or tribunal considers that the request it is submitting to the Court has to be dealt with in a particular way, both as regards the need to preserve the anonymity of the persons concerned by the dispute in the main proceedings and as regards the rapidity with which the request may have to be dealt with by the Court, the reasons for such treatment must be set out in detail in the request for a preliminary ruling and in any covering letter.

         Formal aspects of the request for a preliminary ruling

      Requests for a preliminary ruling must be submitted in a form that facilitates electronic processing by the Court and, in particular, that enables them to be scanned and optical character recognition to be applied. To that end:

                  —

                  the request should be typed on white, unlined, A4-size paper,

                  —

                  the text should be in a commonly used font (such as Times New Roman, Courier or Arial), in at least 12 point in the body of the text and at least 10 point in any footnotes, with 1,5 line spacing and horizontal and vertical margins of at least 2,5 cm (above, below, at the left and at the right of the page), and

                  —

                  all the pages of the request, and the paragraphs they contain, should be numbered consecutively.

            The request for a preliminary ruling must be dated and signed. It is to be sent to the Court Registry, with the file of the case in the main proceedings, either by email (DDP-GreffeCour@curia.europa.eu) or by registered post addressed to the Registry of the Court of Justice (Rue du Fort Niedergrünewald, L-2925 Luxembourg, LUXEMBOURG). When it is sent by email, the original request for a preliminary ruling is to be sent with the electronic transmission of the text of that request in an editable format (word processing software such as ‘Word’ or ‘Open Office’).
      In the event of a request for the expedited procedure or the urgent procedure to be applied, it is recommended that email be the preferred method of sending the request for a preliminary ruling and the editable version of that request.


title: Recommendation of the European Systemic Risk Board of 20 October 2017 amending Recommendation ESRB/2015/2 on the assessment of cross-border effects of and voluntary reciprocity for macroprudential policy measures (ESRB/2017/4)

text:
               15.12.2017

               EN

               Official Journal of the European Union

               C 431/1

         RECOMMENDATION OF THE EUROPEAN SYSTEMIC RISK BOARD
   of 20 October 2017
   amending Recommendation ESRB/2015/2 on the assessment of cross-border effects of and voluntary reciprocity for macroprudential policy measures
   (ESRB/2017/4)
   (2017/C 431/01)
   THE GENERAL BOARD OF THE EUROPEAN SYSTEMIC RISK BOARD,
   Having regard to the Treaty on the Functioning of the European Union,
   Having regard to Regulation (EU) No 1092/2010 of the European Parliament and of the Council of 24 November 2010 on European Union macro-prudential oversight of the financial system and establishing a European Systemic Risk Board (1), and in particular Article 3 and Articles 16 to 18 thereof,
   Having regard to Decision ESRB/2011/1 of the European Systemic Risk Board of 20 January 2011 adopting the Rules of Procedure of the European Systemic Risk Board (2), and in particular Article 15(3)(e) and Articles 18 to 20 thereof,
   Whereas:

               (1)

               The framework on voluntary reciprocity for macroprudential policy measures set out in Recommendation ESRB/2015/2 (3) of the European Systemic Risk Board should ensure that all exposure-based macroprudential policy measures activated in one Member State are reciprocated in the other Member States to the greatest possible extent.

               (2)

               Relevant authorities in Member States may exempt an individual financial service provider with non-material exposure from the application of the reciprocating measure (de minimis principle).

               (3)

               The current framework on voluntary reciprocity of the European Systemic Risk Board (ESRB) does not provide guidance on the threshold to be used by the relevant authorities to determine the materiality of exposure. Where a relevant authority exempts an individual financial service provider with non-material exposure, the authority currently may adopt the threshold it deems appropriate, creating potential divergences in the application of the de minimis principle.

               (4)

               To avoid such potential divergences, the relevant activating authority should propose a maximum materiality threshold at the financial service provider level when requesting reciprocation. The permanent Assessment Team of the ESRB, as referred to in Decision ESRB/2015/4 of the European Systemic Risk Board (4), may recommend a different threshold if deemed necessary.

               (5)

               Therefore, Recommendation ESRB/2015/2 should be amended accordingly,

         HAS ADOPTED THIS RECOMMENDATION:

      Amendments

   Recommendation ESRB/2015/2 is amended as follows:

               1.

               in Section 1, sub-recommendation B(2) is replaced by the following:

                           ‘2.

                           If reciprocation by other Member States is deemed necessary to ensure the effective functioning of the relevant measures, the relevant activating authorities are recommended to submit a request for reciprocation to the ESRB, together with the notification of the measure. The request should include a proposed materiality threshold.’;

               2.

               in paragraph 1 of Section 2, the following point is added:

                           ‘(i)

                           “materiality threshold” means a quantitative threshold below which an individual financial service provider’s exposure to the identified macroprudential risk in the jurisdiction where the macroprudential policy measure is applied by the activating authority can be considered non-material.’;

               3.

               in Section 2, paragraph 2(1) is replaced by the following:

                           ‘1.

                           The relevant authorities may exempt an individual financial service provider under their jurisdiction from applying a particular reciprocating macroprudential policy measure, if this financial service provider has non-material exposure to the identified macroprudential risk in the jurisdiction, where the relevant activating authority is applying the macroprudential policy measure in question (de minimis principle). The relevant authorities are requested to report to the ESRB on such exemptions, using the template for notifying reciprocating measures as published on the ESRB’s website.
                           For the purpose of applying the de minimis principle, the ESRB recommends a materiality threshold based on that proposed by the relevant activating authority pursuant to Section 1, sub-recommendation B(2). The threshold calibration should follow the best practices as established by the ESRB. The materiality threshold is a recommended maximum threshold level. Reciprocating relevant authorities may apply the recommended threshold, set a lower threshold for their jurisdiction where appropriate, or reciprocate the measure without any materiality threshold. When applying the de minimis principle, authorities should monitor whether leakages and regulatory arbitrage materialise and close the regulatory loophole where necessary.’;

               4.

               Section 2, paragraph 4 is replaced by the following:

                           ‘4.

                              Amendments to the Recommendation

                           The General Board will decide when this Recommendation needs to be amended. Such amendments include in particular any additional or modified macroprudential policy measures to be reciprocated as set out in Recommendation C and the related annexes containing measure-specific information, including the materiality threshold provided by the ESRB. The General Board may also extend the deadlines set forth in the previous paragraphs where legislative initiatives are necessary to comply with one or more recommendations. In particular, the General Board may decide to amend this Recommendation following the European Commission’s review of the mandatory recognition framework under Union law or on the basis of experience gained with the operation of the voluntary reciprocity arrangement established by this Recommendation.’.

      Done at Frankfurt am Main, 20 October 2017.

         Francesco MAZZAFERRO,

            Head of the ESRB Secretariat,

            on behalf of the General Board of the ESRB

      (1)  OJ L 331, 15.12.2010, p. 1.

      (2)  OJ C 58, 24.2.2011, p. 4.

      (3)  Recommendation ESRB/2015/2 of the European Systemic Risk Board of 15 December 2015 on the assessment of cross-border effects of and voluntary reciprocity for macroprudential policy measures (OJ C 97, 12.3.2016, p. 9).

      (4)  Decision ESRB/2015/4 of the European Systemic Risk Board of 16 December 2015 on a coordination framework for the notification of national macroprudential policy measures by relevant authorities, the issuing of opinions and recommendations by the ESRB, and repealing Decision ESRB/2014/2 (OJ C 97, 12.3.2016, p. 28).