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CJEU C‐156/15 / Judgment

‘Private Equity Insurance Group’ SIA v. ‘Swedbank’ AS

Policy area:
Budget
Deciding Body type:
Court of Justice of the European Union
Deciding Body:
COURT (Fourth Chamber)
Type:
Decision
Decision date:
10/11/2016

Key facts of the case:

(Reference for a preliminary ruling — Directive 2002/47/EC — Scope — Definition of ‘financial collateral’, ‘relevant financial obligations’ and ‘provision’ of financial collateral — Whether it is possible to enforce financial collateral notwithstanding the commencement of insolvency proceeding — Current account agreement including a financial collateral clause)

Results (sanctions) and key consequences of the case:

On those grounds, the Court (Fourth Chamber) hereby rules:

Directive 2002/47/EC of the European Parliament and of the Council of 6 June 2002 on financial collateral arrangements is to be interpreted as conferring on the taker of financial collateral, such as the collateral at issue in the main proceedings, whereby monies deposited in a bank account are pledged to the bank to cover all the account holder’s debts to the bank, the right to enforce the collateral, notwithstanding the commencement of insolvency proceedings in respect of the collateral provider, only if, first, the monies covered by the collateral were deposited in the account in question before the commencement of those proceedings or those monies were deposited on the day of commencement, the bank having proved that it was not aware, nor should have been aware, that those proceedings had commenced and, second, the account holder was prevented from disposing of those monies after they had been deposited in that account.