Description
Since the adoption of the Single Supervisory Mechanism in 2014, the European Central Bank (ECB), an independent institution of the European Union (EU), is responsible for carrying out banking supervision in the euro area and other participating EU Member States, alongside national supervisors. For the purpose of carrying out its tasks, the ECB is entrusted with supervisory and investigatory powers, including the power to conduct on-site visits (inspections) at the business premises of supervised banks. Relevant banks (credit institutions) subject to supervision primarily include banks established in participating Member States. The SSM Regulation however also confers on the ECB supervisory powers regarding third parties to whom these banks have outsourced functions or activities, as well as subsidiaries of SSM banks. Such third parties and subsidiaries might be based outside SSM participating States, and thus outside ECB or EU jurisdiction. This implies that the ECB may, at least on the basis of the SSM Regulation, be entitled to conduct on-site visits in relation to foreign subsidiaries or third-country providers. The exercise of such investigatory powers on the territory of a third State, defined here as a State which is not a SSM participating State, is in tension with the prohibition of extraterritorial enforcement jurisdiction in international law. Indeed, international law prohibits the exercise of sovereign powers by a State or regional international organization on the territory of a third State without the latter’s consent. The aim of this contribution is to inquire how this tension could be resolved, if at all.| Period | 4 Jul 2024 |
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| Held at | European Central Bank, Germany |