In order to transpose BRRD2 into Czech law, an amendment to the Czech Crisis Resolution Act and other acts is currently entering scrutiny at a second reading at the Czech Chamber of Deputies. It is expected that the Czech Parliament will expedite the legislative process to ensure transposition of the BRRD2 into Czech law as soon as possible.
Key changes from BRRD2:
- BRRD2 amends the original BRRD directive in order to reflect the EU's updated resolution policy requirements and minimum requirement for own funds and eligible liabilities (MREL);
- BRRD2 implements the Financial Stability Board's total loss absorbing capacity (TLAC) standard by revising the MREL regime with intention to align the MREL requirements with the TLAC standard;
- BRRD2 harmonises resolution mechanisms and provides for specific rules in the area of group resolutions;
- BRRD2 provides for a legal framework which regulates the offering of subordinated debt instruments to non-professional (retail) investors.
To learn more about these changes in detail, which are particularly relevant for banks and which are likely coming later this year, you can read our analysis in full here.