Note: The following is an unofficial translation of the relevant legislation for reference purposes only.

Transcription

1 Note: The following is an unofficial translation of the relevant legislation for reference purposes only. Law 4370/2016 Deposit guarantee schemes (transposition of Directive 2014/49/EU), Hellenic Deposit and Investment Guarantee Fund and other provisions PART ONE PROVISIONS ON DEPOSIT GUARANTEE SCHEMES (TRANSPOSITION OF DIRECTIVE 2014/49/EU) AND ON THE HELLENIC DEPOSIT AND INVESTMENT GUARANTEE FUND (TEKE) CHAPTER A GENERAL PROVISIONS ON DEPOSIT GUARANTEE SCHEMES Article 1 Purpose The provisions of Articles 1 to 53 of this Law are aimed to transpose into Greek law Directive 2014/49/ΕU οf the European Parliament and of the Council of 16 April 2014 (OJ L 173/ ) on deposit guarantee schemes and to amend the provisions of Law 3746/2009 on the Hellenic Deposit and Investment Guarantee Fund (TEKE). Article 2 Subject matter and scope (Article 1 of Directive 2014/49/ΕU) 1. The present law lays down rules and procedures relating to the establishment and operation of deposit guarantee schemes (hereinafter referred to as DGSs ) and investment compensation schemes, as well as to the financing of resolution measures. 2. This law shall apply to: (a) the Hellenic Deposit and Investment Guarantee Fund (hereinafter referred to as TEKE ); (b) institutional protection systems officially recognised as DGSs in accordance with Article 3(1), item (18); Page 1

2 (c) credit institutions affiliated to TEKE or to the institutional protection systems referred to in (b) above. 3. The present law may be supplemented by the guidelines of the European Banking Authority (EBA), as endorsed by decision of TEKE Board. Article 3 Definitions (Article 2 of Directive 2014/49/ΕU) 1. For the purposes of this law the following definitions apply: (1) value of client assets of an ICS member : the average current value of the total assets held by a credit institution participating in the Investment Cover Scheme (ICS) on behalf of its investor clients as at the reference dates. In the case of derivative financial products as referred to in Article 5 of Law 3606/2007, such value shall refer to the value of contracts and rights outstanding as at the reference dates. For client assets exceeding EUR 30,000, the amount of EUR 30,000 shall be taken as the value in the above sense. In cases of securities accounts which are held jointly by more than one person and to which the provisions of Law 5638/1932 (Government Gazette A 307) are applicable, the value shall be calculated as the covered amount per each of these persons in accordance with paragraphs (1) and (2) of Article 14 hereof. (2) claim from a covered investment service : a claim arising out of the inability of a credit institution to repay the funds owed to or belonging to its investor clients and held directly or indirectly on their behalf in connection with the provision of covered investment services, or out of its inability to return to investor clients any financial instruments, within the meaning of Article 5 of Law 3606/2007, belonging to them and held, managed or kept in custody on their behalf, despite the existence of an obligation of TEKE member credit institution to do so in accordance with applicable legal provisions and contractual arrangements with the investor client and irrespective of whether this obligation arises from such contractual arrangements or from the law, in the event that the credit institution is in any of the following situations: (a) the Bank of Greece has determined that the participating credit institution is unable to fulfill its obligations to its investor clients, for reasons directly related to its financial circumstances, and that the credit institution has no current prospect of being able to do so; or Page 2

3 (b) a judicial authority has made a ruling for reasons directly related to the participating credit institution s financial circumstances which has the effect of suspending the rights of investor clients to make claims against it, whichever is the earlier; (3) competent authority : the Bank of Greece or, for other Member States, a competent authority as defined in point (40) of Article 4 (1) of Regulation (EU) 575/2013 (OJ L 176); (4) payment commitments : irrevocable and unconditional cash payment commitments of a credit institution towards TEKE, which are fully collateralised providing that the collateral: (a) consists of low-risk assets; (b) is unencumbered by any third-party rights and is at the disposal of TEKE; (5) available financial means of TEKE : cash, deposits and low-risk assets which can be liquidated within a period not exceeding that referred to in Article 11(3) and payment commitments up to the limit set out in Article 27(9) and consisting of the available funds referred to in Article 39(1); (6) TEKE Board : the Board of Directors of TEKE in accordance with Article 48(1); (7) guaranteed claims from covered investment services : the part of eligible claims from covered investment services that does not exceed the coverage level laid down in Article 13; (8) covered deposits : the part of eligible deposits that does not exceed the coverage level laid down in Article 9; (9) Investment Cover Scheme assets : the assets of TEKE placed at the disposal of the Investment Cover Scheme and earmarked solely for meeting the claims of investor clients of credit institutions participating in the Investment Cover Scheme of TEKE; (10) Deposit Cover Scheme assets : the assets of TEKE placed at the disposal of the Deposit Cover Scheme and earmarked solely for meeting the claims of depositors of credit institutions participating in the Deposit Cover Scheme of TEKE and for financing resolution measures according to the stipulations of Article 104 within Article 2 of Law 4335/2015 (Government Gazette A 87); (11) investor client : any natural or legal person to which a credit institution provides any of the investment or auxiliary services referred to in Article 4 of Law 3606/2007; (12) eligible claims from covered investment services : claims from investment services that are not excluded from protection pursuant to Article 12; Page 3

4 (13) eligible deposits : deposits that are not excluded from protection pursuant to Article 8; (14) target level : the amount of available financial means which the DCS is required to reach in accordance with Article 25(4), expressed as a percentage of covered deposits of its members; (15) investment firms : the undertakings specified in Article 2 (1) of Law 3606/2007; (16) date of unavailability : the date on which the Bank of Greece makes the determination referred to in points (2) and (27) of Article 3(1) or a judicial authority makes the ruling referred to in points (2) and (27) of Article 3(1); (17) reference date for the value of client assets of an ICS member or reference date : the last business day of each calendar quarter of the preceding year; (18) institutional protection schemes (IPSs) : the institutional protection schemes referred to in Article 113(7) of Regulation (EU) 575/2013 that fulfil the requirements of the second sentence of Article 4(2) of Directive 2014/49/ΕU; (19) covered investment services : the investment services referred to in paragraphs 1 (a)-(d), (f) and (h) of Article 4 of Law 3606/2007 and the auxiliary service referred to in paragraph 2(a) of the same Article, other than those excluded from TEKE compensation under Article 12(1) hereof; (20) deposit : a credit balance which results from funds left in an account or from temporary situations deriving from normal banking transactions and which a credit institution is required to repay under the legal and contractual conditions applicable, including a fixed-term deposit and a savings deposit, but excluding a credit balance where: (a) its existence can only be proven by a financial instrument as defined in Article 5 of Law 3606/2007, unless it is a savings product which is evidenced by a certificate of deposit made out to a named person and which exists in a Member State on 2 July 2014; (b) its principal is not repayable at par; (c) its principal is only repayable at par under a particular guarantee or agreement provided by the credit institution or a third party; The notion of deposits shall not include repurchase agreements; claims in connection with such instruments shall be covered in accordance with the provisions of Articles 16 to 19 on investment services. Page 4

5 (21) depositor : the holder or, in the case of a joint account, each of the holders, of a deposit; (22) joint account : an account opened in the name of two or more persons or over which two or more persons have rights that are exercised by means of the signature of one or more of those persons in accordance with Law 5638/1932 (Government Gazette A 307) re: Joint deposit accounts ; (23) home Member State : a home Member State as defined in point (43) of Article 4(1) of Regulation (EU) No 575/2013; (24) host Member State : a host Member State as defined in point (44) of Article 4(1) of Regulation (EU) No 575/2013; (25) Primary Deposit Cover Fund (PDCF) : a property group forming part of the total assets of TEKE and consisting of the assets of the DCS minus the assets of the SDCF; (26) client accounts of investment firms : the bank accounts into which funds of investor clients are deposited, according to Hellenic Capital Market Commission Decision No. 2/452/ (Government Gazette Β 2137); (27) unavailable deposit : a deposit that is due and payable but cannot be paid, in full or in part, by a credit institution under the legal or contractual conditions applicable thereto, where either: (a) The Bank of Greece has determined that the credit institution concerned is unable for the time being, for reasons which are directly related to its financial circumstances, to repay the deposit and that the institution has no current prospect of being able to do so. Such determination shall be made within five (5) business days of the time when it is first established that the participating credit institution has not repaid due and payable deposits and shall be published in the Government Gazette; or (b) a judicial authority has made a ruling for reasons which are directly related to the credit institution s financial circumstances and which has the effect of suspending the rights of depositors to make claims against it; The cases under (a) and (b) above shall constitute grounds for the withdrawal of the authorisation of the credit institution in accordance with point (e) of Article 19 of Law 4261/2014 (Government Gazette A 107); (28) designated authority : the Ministry of Finance or, for other Member States, a body which administers or supervises a DGS, or, where the operation of the DGS is Page 5

6 administered by a private entity, a public authority designated by the Member State concerned for supervising that scheme; (29) assets of investor clients : the financial instruments held by crediti institutions participating in the ICS on behalf of their investor clients in connection with the provision of covered investment services within the meaning of point (19) of Article 3(1). Financial instruments held by the DCS member credit institutions and branches shall include securities in book-entry form. The notion of holding shall include, in addition to the safekeeping and administration within the meaning of case (a) of Article 4(2) of Law 3606/2007 of financial instruments by the DCS member credit institurion in its capacity as custodian, also the assignment by the DCS member credit institution of the safekeeping of securities to a third party, credit institution or investment firm, acting as sub-custodian in accordance with the the DCS member s instructions and, in general, all cases where financial instruments are held by a third party, but the DCS member has power to dispose of the instruments, by giving instructions to such third party. Holding can be either in the name of the investor client or in the name of the DCS member on behalf of an investor client; (30) credit institution : a credit institution as defined in point (1) of Article 4(1) of Regulation (EU) No 575/2013, (31) Supplementary Deposit Cover Fund (SDCF) : the supplementary deposit cover fund created pursuant to paragraphs 11 to 15 of former Article 4 of Law 3746/2009 and now regulated as specified in Articles 6 and 25 hereof; (32) Resolution Scheme (RS) : the assets of TEKE established by former Article 13A of Law 3746/2009 and earmarked for the purpose of financing resolution measures in accordance with the specific stipulations of point (c) of Article 4(2) hereof and of Article 96 within Article 2 of Law 4335/2015; (33) Investment Cover Scheme (ICS) : the assets of TEKE earmarked for the purpose of meeting claims from investment services in accordance with the specific stipulations of point (b) of Article 4 (2); (34) Deposit Cover Scheme (DCS) : the assets of TEKE placed at the service of the purpose of guaranteeing deposits in accordance with the specific stipulations of case (a) of Article 4(2); Page 6

7 (35) low-risk assets : items falling into the first or second category referred to in Table 1 of Article 336 of Regulation (EU) No 575/2013 or any assets which are considered by the Bank of Greece to be equally safe and liquid; (36) deposit guarantee schemes or DGSs : the systems referred to in points (a) and (b) of Article 2(2) and similar systems of other Member States; (37) Resolution Fund : the RS of TEKE, in accordance with the provisions of Article 95 within Article 2 of Law 4335/2015; (38) branch : a place of business in a Member State which forms a legally dependent part of a credit institution and which carries out directly all or some of the transactions inherent in the business of credit institutions. 2. The Ministry of Finance shall be the competent authority for the purposes of Regulation (EU) 1093/2010 (OJ L 331/ ) in accordance with Article 4(2) of that Regulation. Article 4 Hellenic Deposit and Investment Guarantee Fund (TEKE) Status Name 1. The Hellenic Deposit and Investment Guarantee Fund (hereinafter TEKE ), established by virtue of Article 2(1) of Law 3746/2009, is hereby designated as the entity administering the Greek DGS, the investor compensation scheme and the Resolution Fund. The TEKE: (a) is a legal person governed by private law; (b) is based in Athens, at such address as may be specified from time to time by decision of its Board of Directors; (c) is supervised by the Ministry of Finance; (d) is not a public entity or a government agency and is outside the narrow or broader public sector, as defined from time to time; (e) has an initial capital amounting to eight million eight hundred four thousand one hundred and nine euro (EUR 8,804,109). In its foreign relations, TEKE shall use the name Hellenic Deposit and Investment Guarantee Fund or HDIGF or TEKE. 2. The purposes of TEKE shall be to: (a) pay compensation, through the Deposit Cover Scheme (hereinafter DCS ), to depositors in the event that deposits in any of the credit institutions referred to in Page 7

8 paragraphs 1, 5 and 6 of Article 5 become unavailable and to finance, through the DCS, resolution measures in credit institutions in accordance with the specific stipulation of Article 104 within Article 2 of Law 4335/2015; (b) pay compensation, through the Investment Cover Scheme (hereinafter ICS ), to investor clients of any of the credit institutions referred to in paragraphs 2, 4, 5 and 6 of Article 5 that are unable to fulfil their obligations to them in respect of claims arising from the provision of covered investment services; and (c) finance, through the Resolution Scheme (hereinafter RS ), resolution measures in credit institutions, in discharge of the obligations of TEKE as a Resolution Fund for credit institutions, in all three cases (a) to (c) above, subject to the fulfillment of the other requirements laid down by the legislation in force. 3. The DCS, the ICS and the RS are clearly distinct from each other and are separate property groups, each being solely earmarked for its respective purpose and serving such purpose in accordance with the provisions of the legislation in force. CHAPTER Β PARTICIPATION OF CREDIT INSTITUTIONS Article 5 Mandatory participation of credit institutions in TEKE (Article 4 (3) and Article 15 of Directive 2014/49/EU) 1. Participation in the DCS shall be mandatory for all credit institutions, within the meaning of point (1) of Article 2(1) of Law 4261/2014, which have been authorised in Greece, with the exception of the cases specified in (b) and (d) of Article 2(5) of the same law. Credit institutions shall not take deposits unless they participate in the DCS in accordance with the provisions hereof. 2. Participation in the ICS shall be mandatory for all credit institutions, within the meaning of point (1) of Article 2(1) of Law 4261/2014, which have been authorised in Greece, with the exception of the cases specified in (b) and (d) of Article 2(5) of the same law, and which provide at least one of the eligible investment services, within the meaning of point (19) of Article 3(1) of this law. Page 8

9 3. Participation in the DCS under paragraph 1 above shall automatically imply participation in the RS as well. Credit institutions shall be required to pay contributions in accordance with Article 36 hereof. 4. Optionally and upon request, domestic branches of credit institutions whose head office is located in another Member State may participate in the ICS for additional coverage to that provided in their home State in respect of the amount and/or the categories of eligible investment services in accordance with the provisions of Articles 12 and 13 hereof. 5. Specifically for credit institutions authorised in Greece, TEKE shall also cover: (a) the deposits of their branches located in other Member States of the EU; (b) the claims of investor clients from covered investment services provided by their branches in other Member States of the EU, where such claims are not covered by an equivalent investor compensation scheme in their host countries; and (c) the deposits and the claims of investor clients from covered investment services of their branches located in third countries, where such deposits and claims are not covered by an equivalent deposit guarantee or investor compensation scheme in their host countries. A decision of the Bank of Greece, following a recommendation from the Board of Directors, shall confirm the existence or not of equivalent coverage or, otherwise, specify the terms and conditions for TEKE coverage. 6. Participation in the appropriate Scheme of TEKE shall be mandatory for branches of credit institutions whose head office is located outside the EU and which are not covered by an equivalent deposit guarantee scheme or investor compensation scheme or resolution scheme operating in their home country. A decision of the Bank of Greece, following a recommendation from the Board of Directors, shall confirm the existence of equivalent coverage or, otherwise, specify the terms and conditions for TEKE coverage. Τhe level and scope of the coverage provided by TEKE to the depositors and investor clients of domestic branches of credit institutions whose head office is located outside the EU may not exceed the level and scope of the coverage provided under Articles 8, 9, 12 and 13 hereof. Article 6 Termination of participation in the DCS Page 9

10 1. Participation in the DCS may be terminated by a member credit institution on a voluntary basis for any lawful reason or mandatorily in the event that a member credit institution is excluded from membership or its authorisation is withdrawn. In the case of voluntary termination, the credit institution in question shall promptly notify TEKE in writing as soon as it decides to withdraw. 2. If a DCS member credit institution, for any lawful reason whatsoever, withdraws from the Scheme without joining another deposit guarantee scheme, it shall be entitled to a refund of its share, if any, in the SDCF, at the current value at the time of withdrawal as specified by decision of TEKE Board. Without prejudice to paragraph 12 of Article 25, the calculation of the value of the share of the withdrawing member, the withholding of likely (as judged by TEKE) depositor claims and the payment of the remainder shall be as follows: a) Calculation of the value of the share of a withdrawing credit institution. (aa) The calculation of the value of the share of a withdrawing credit institution shall entail the prior calculation of the assets of the SDCF. The latter shall be calculated taking into account the claims of depositors of any DCS member credit institutions that are unable to repay deposits, if such inability has occurred no later than three months of the withdrawal of the credit institution in question. Subject to the condition precedent that the relevant amounts are paid to depositors, such amouns shall be deducted from the value of SDCF assets. (bb) The value of the share of the withdrawing credit institution shall be calculated according to the specific stipulations of Article 25(10). (cc) The refund claim of the withdrawing credit institution shall be set off against any claims of TEKE on the said credit institution, including any contributions due to the DCS, the ICS or the RS, membership fees or any other amounts that may have been specified by TEKE Board and that are due and payable by the date of withdrawal. This set-off shall be effected on the basis of the aforementioned amounts. (b) Withholding of amounts of likely (as judged by TEKE) depositor claims. (aa) The TEKE shall withhold from the share to be refunded to the withdrawing credit institution any amounts corresponding to likely claims of depositors on the DCS in respect of eligible deposits of the withdrawing credit institution. (bb) The amounts withheld as per point (aa) above shall not be refunded to the withdrawing credit institution until an irrevocable ruling on the case is made and, Page 10

11 depending on the outcome, shall be refunded by TEKE either to depositors or to the withdrawing credit institution. (cc) The amounts withheld shall be deemed to be set off against the refund claim of the withdrawing credit institution, subject to the condition precedent that an irrevocable court ruling determines that the withdrawing credit institution has no relevant obligation to its depositors. (c) Refund of the value of the share The value of the share of the withdrawing member, as calculated according to points (a) and (b) above, shall be refunded, without interest, within the first calendar month after the lapse of one year following withdrawal from the DCS. Having regard to the considerations of Article 39(6), the refund may be deferred by decision of TEKE Board and in any case for a maximum period of ten (10) years. 1. If a DCS member credit institution ceases to participate, for any lawful reason whatsoever other than as a result of its exclusion from membership, and joins another deposit guarantee scheme, the following shall apply: (a) the regular contributions that the credit institution has paid during the twelve months before ceasing to participate in the DCS shall be transferred to the new deposit guarantee scheme which the withdrawing credit institution has joined; and (b) the value of the withdrawing credit institution s share in the SDCF, as specified in the first sentence of paragraph 2, shall be refunded to the credit institution. In all other respects, the procedure described in points (a) to (c) of paragraph 2 shall apply. (c) Τhe above shall also apply in cases where certain activities of a credit institution are transferred to another Member State, in the sense that a part of its eligible deposits are transferred to and covered by another deposit guarantee scheme. The regular contributions that the credit institution has paid to the DCS during the twelve months preceding such transfer shall be transferred to the new deposit guarantee scheme pro rata to the part of eligible deposits transferred. Article 7 Termination of participation in the ICS 1. Participation in the ICS may be terminated by a member credit institution on a voluntary basis for any lawful reason or mandatorily in the event that a member credit institution is excluded from membership or its authorisation is withdrawn. In the case Page 11

12 of voluntary termination, the credit institution in question shall promptly notify TEKE in writing as soon as it decides to withdraw. 2. If an ICS member credit institution, for any lawful reason whatsoever, withdraws from the Scheme, it shall be entitled to a refund of its share in ICS assets, if any, at the current value at the time of withdrawal as specified by decision of TEKE Board. The calculation of the value of the share of the withdrawing member, the withholding of likely claims of the ICS and the payment of the remainder shall be as follows: (a) Calculation of the value of the share of a withdrawing credit institution. (aa) The calculation of the value of the share of a withdrawing credit institution shall entail the prior calculation of the assets of the ICS. The latter shall be calculated taking into account the claims of investor clients of any ICS member institutions that are unable to fulfil their obligations, subject to the following cumulative conditions: (i) the inability of the participating credit institution to fulfil its obligations occurred no later than three months of its withdrawal; and (ii) the claims of investor clients are presented not later than six months of the withdrawal. Subject to the condition precedent that the relevant amounts are paid to investor clients, such amounts shall be deducted from ICS assets. (bb) The value of the share of a withdrawing credit institution shall be calculated according to the stipulations of Article 30(3). (cc) The refund claim of the withdrawing credit institution shall be set off against any counterclaims of TEKE, including deposits held by TEKE with the credit institution in question, any outstanding contributions to the DCS, the ICS or the RS, membership fee or any other amounts specified by TEKE Boardυ as payable by the credit institution and outstanding as at the date of its withdrawal. This set-off shall be effected on the basis of the aforementioned amounts. (b) Withholding of likely (as judged by TEKE) claims of investor clients (aa) The TEKE shall withhold from the refundable share of the withdrawing credit institution any amounts corresponding to claims of investor clients on the ICS which are deemed as likely by TEKE and arise from the provision of covered investment services by the withdrawing credit institution; such claims may arise from: (i) a compensation application submitted during the twelve months following the withdrawal of the participating credit institution, provided that the relevant claim on the withdrawing credit institution was generated during the time of its participation in the ICS; or Page 12

13 (ii) a compensation application submitted prior to the withdrawal and pending for assessment. (bb) The amounts withheld as per point (aa) above shall not be refunded to the withdrawing credit institution until an irrevocable ruling on the case is made and, depending on the outcome, shall be refunded by TEKE either to investor clients or to the withdrawing credit institution. (cc) The amounts withheld shall be set off against the withdrawing credit institution s claim to a refund of its share, subject to the condition precedent that an irrevocable ruling determines that the withdrawing credit institution has no relevant obligation to its investor clients. (c) Refund of the value of the share The value of the share of the withdrawing member shall be refunded, without any interest, within the first calendar month after the lapse of one year following withdrawal from the ICS. Having regard to the considerations of Article 39(6), the refund may deferred by decision of TEKE Board, in any case for a maximum period of ten (10) years. CHAPTER C LEVEL AND SCOPE OF COVERAGE AND REPAYMENT PROCEDURE UNDER THE DCS Article 8 Eligibility of deposits Exceptions (Article 5 of Directive 2014/49/EU) 1. Eligible deposits shall be all deposits with the exception of the following, which shall be excluded from protection and therefore from compensation by TEKE: (a) without prejudice to Article 10(2), deposits made by other credit insitutions on their own behalf and for their own account; (b) credit institutions own funds as defined in point (118) of Article 4(1) of Regulation (EU) 575/2013; (c) deposits arising out of transactions in connection with which there has been a criminal conviction for money laundering, as defined in Article 2(2) of Law 3691/2008 (Government Gazette A 166). During the criminal proceedings, the Page 13

14 provision of Article 11(6) hereof shall apply, regarding the suspension of any payment until a final court ruling; (d) deposits by financial institutions, as defined in point (26) of Article 4(1) of Regulation (EU) 575/2013; (e) deposits by investment firms on their own behalf and for their own account. In the case of client deposits of an investment firm, the provision of Article 10(2) hereof shall apply; (f) deposits the holder or beneficiary of which has never been identified pursuant to Article 14(1) of Law 3691/2008 when they have become unavailable; (g) deposits by insurance undertakings and by reinsurance undertakings as well as by captive (re)insurance undertakings as referred in paragraphs 1 to 6 of Article 3 of Law 4364/2016 (Government Gazette A 13); (h) deposits by collective investment undertakings; (i) deposits by social security funds and occupational pension funds, (j) deposits by public authorities, as defined in para 1(a) of Article 14 of law 4270/2014 (Government Gazette A 143), as currently enforced; (k) debt securities issued by a credit institution and liabilities arising out of own acceptances and promissory notes; (l) deposits by TEKE held in accordance with paragraph 7 of Article Credit insitutions shall have appropriate systems in place in order to readily identify their eligible deposits. Article 9 Coverage level (Article 6 of Directive 2014/49/EU) 1. The coverage level for the aggregate deposits of each depositor at a credit institution covered by TEKE is set at one hundred thousand euro (EUR 100,000). This level shall apply to the aggregate deposits placed by one depositor with the same credit institution irrespective of the number of deposits, the currency and the location within the EU. 2. Exceptionally, an additional coverage level of three hundred thousand euro (EUR 300,000) shall apply to deposit accounts to which funds provenly originating from one or more of the following transactions are credited within one month of the date of Page 14

15 the transaction and for a period of up to six (6) months after the date when such funds are credited: (a) sale or expropriation of private residential property or land, for the price paid to a non-professional seller of real property or the compensation paid to the owner, respectively; (b) payment of debt between spouses, if the relevant amount has been awarded by a court decision; (c) payment of lump-sum retirement benefit or periodical pension benefits; (d) compensation due to termination of employment; (e) payment of indemnity to persons detained, held in custody or convicted and subsequently acquitted in accordance with Article 533 of the Code of Penal Procedure; (f) payment of indemnity for disability or personal injury caused by tort; (g) payment of benefits under social security schemes or private insurance policies; (h) payment of indemnity to heirs for the wrongful death of a decedent or payments as a result of hereditary succession. Any amounts credited to the account later than one month from the respective transaction shall only be taken into account upon written proof that they originate from such transaction. In the event that any amount provenly originating from one or more of the above transactions is deposited into an account, the additional coverage level under paragraph 2 shall apply after the exhaustion of the coverage level specified in paragraph 1 per depositor. The total amount of compensation for each recipient of funds from the transactions listed in paragraph 2 may not be higher than three hundred thousand euro (EUR 300,000). In the case of joint accounts, the level referred to in this paragraph shall apply to all joint account co-owners, irrespective of which of them is the recipient of the credit transfer, and to the entire balance of the account after the coverage level referred to in paragraph 1 has been exhausted and in accordance with the stipulations of Article 10(1). 3. In the cases described in points (b) and (g) of paragraph 2, each amount credited shall only be taken into account for the purposes of that paragraph if it exceeds the EUR 3, The additional coverage level under paragraph 2 shall apply to the aggregate amount of categories (a) to (h) above. Page 15

16 5. Protection under paragraph 2 shall be only provided if depositors submit a relevant application to TEKE after being notified by the latter and not later than three (3) months from the date when the deposits become unavailable. Depositors claims under paragraph 2 shall be validated by the liquidator of the credit institution under liquidation. In the event that the credit institution is subject to the measure of liabilities restructuring (bail-in tool) referred to in paragraph 1 of Article 43 within Article 2 of Law 4335/2015, such validation shall be carried out by the qualified validator referred to in paragraph 1 of Article 36 within Article 2 of Law 4335/ The coverage level and the transactions listed in paragraph 2 may be modified by decision of the Ministry of Finance, following a recommendation from TEKE Board. Article 10 Determination of the repayable amount (Article 7 of Directive 2014/49/EU) 1. In calculating the coverage levels referred to in Article 9(1) and (2), the part corresponding to each owner of a joint account shall be deemed a separate deposit and shall be subject to the coverage level, together with his/her other deposits with the same credit institution. In the absence of special provisions or if the part of the deposit corresponding to each co-owner cannot be identified, the joint account shall be divided equally among coowners for the purposes of compensation. 2. Where the law permits holding a deposit on behalf of another person, in whole or in part, that other person shall be protected up to the coverage level, provided that such person is specified or can be specified prior to the date of unavailability. If more such persons exist, the coverage level shall be calculated on the basis of the part corresponding to each under the legal or contractual conditions applicable to operation of the deposit. In the absence of special provisions or if the part of the deposit corresponsing to each depositor cannot be identified, the joint account shall be divided equally among the depositors for the purposes of compensation. This can indicatively be the case with investment firms client accounts. 3. The reference date for the calculation of the repayable amount shall be the unavailability date. 4. For the purpose of calculating the repayable amount, the credit balances on deposit accounts shall be set off against any type of counterclaims of the credit institution Page 16

17 against the depositor, if and to the extent that they have fallen due and payable on or before the date of unavailablity, in accordance with the stipulations of Articles 440 et seq. of the Civil Code, the information provided to TEKE by the liquidator of the credit institution, and the legal and contractual provisions governing the overall relationship between the credit institution under liquidation and the depositor. The credit institution shall inform depositors, before they enter into any loan agreement or open a bank account, of the aforementioned conditions for set-off. 5. Interest on deposits which has accrued until, but has not been credited at, the unavailability date shall become payable on such date and shall be reimbursed within the coverage level. 6. Repayments to depositors shall be exempt from any tax, levy or other charge. Article 11 Activation of the DCS and repayment procedure (Article 8 of Directive 2014/49/EU) 1. The TEKE shall repay depositors if a deposit becomes unavailable, whereupon and on the unavailability date the repayment process shall be initiated. 2. Any deferral of due and payable obligations as envisaged in Article 138 of Law 4261/2014 shall not per se constitute unavaibility of deposits within the meaning of point (27) of Article 3(1) hereof. 3. The TEKE, as soon as it is notified of the determination of the Bank of Greece or of the ruling of the judicial authority under (a) and (b) of point (27) of Article 3(1), shall draw up a schedule of claims based on the information transmitted by the credit institution concerned. Within twenty (20) business days of notification of the determination or ruling, the liquidator shall make available to all depositors, in the most appropriate manner, up-to-date statements of movements and balances of all their accounts with the credit institution under liquidation. These data shall include the movements since the date of the latest statement was sent and up to the last day of operation of the credit institution, or the movements in the last thirty (30) days, except movements relating to pending transactions. Subsequently, after the set-offs referred to in paragraph 4 of Article 10, TEKE shall make available the amount of compensation within seven (7) business days of the date of unvailability. Page 17

18 4. In the circumstances described in paragraph 2 of Article 10(2), the period of the preceding paragraph shall be extended for up to a total of three months from the date of unvailability. 5. Repayment by TEKE may be deferred where: (a) the deposit has been blocked by a court order or ruling, until such time as TEKE is informed of the lifting of the blocking; (b) the deposit is subject to restrictive measures imposed by national governments or international bodies until such time as TEKE is informed of the repeal of the restrictive measures; (c) the amount to be repaid is deemed to be part of a temporary high balance as defined in Article 9(2); or (d) the amount to be repaid is to be paid out by the DGS of the host Member State in accordance with Article 43(2). The TEKE shall repay depositors in each of the above cases when it verifies that the reasons for the deferral no longer exist. 6. Notwithstanding the time limit laid down in paragraphs 3 and 4, where a depositor or any person entitled to or interested in sums held in an account has been charged with an offence arising out of or in relation to money laundering, as defined in paragraph 2 of Article 2 of Law 3691/2008, TEKE shall suspend any payment relating to the depositor concerned, pending the judgment of the court. 7. The compensation shall be payable in the currency of the country where the account is held. If the accounts are kept in a currency other than the currency of repayment, the Euro Foreign Exchange Reference Rate of the European Central Bank prevailing on the unavailability date shall be used in the conversion. 8. The repayable amount shall be made available without a request to TEKE being necessary. For that purpose, the credit institution shall transmit the necessary information on deposits and depositors as soon as requested by TEKE. 9. Notwithstanding paragraph 8, for the payment of compensation under the circumstances of paragraph 2 of Article 9, depositors shall apply following a communication by TEKE, which sets out the procedure and deadine for applying and the content of applications. 10. Alternatively, instead of repayment, the access of depositors to covered deposits may be preserved by deposit book transfer, provided that the cost to TEKE does not Page 18

19 exceed the net amount it would repay to the depositors of the relevant credit institution. 11. Any correspondence between TEKE and the depositor shall be drawn up: (a) in the Greek language; or (b) in the official language of the EU institutions that is used by the credit institution holding the covered deposit when writing to the depositor; or (c) in the official language or languages of the Member State in which the covered deposit is located. If a credit institution operates directly in another Member State without having established branches, the information shall be provided in the language that was chosen by the depositor when the account was opened. 12. No repayment shall be made where there has been no transaction relating to the deposit within the last 24 months and the value of the deposit is lower than the administrative costs that would be incurred by TEKE in making such a repayment. The administrative costs of TEKE shall be determined by decision of its Board of Directors and may be modified if deemed appropriate. The notion of a transaction shall be understood to refer to any actual transaction by a beneficiary, depositor or third party upon the instructions of any beneficiary, as well as any inquiry by the beneficiary regarding the balance of the deposit account, including but not limited to the presentation of a deposit book to be updated or account balance inquiries transmitted via alternative channels (ATMs, internet or phone banking, etc.). Crediting and compounding of interest on the deposit shall not be deemed a transaction. 13. The TEKE shall not be liable to pay interest on the repayable amount for the period until repayment to entitled depositors, if the repayable amount has been made available within the deadlines set out in paragraphs 3 and The TEKE shall announce the repayment procedure through the press. The announcements shall be repeated over a period of at least fifteen (15) days. 15. Upon initiation of the repayment procedure, the funds of the DCS deposited with the credit institution concerned, the interest accrued thereon, as well as any contribution due to the DCS, shall be promptly payable to the latter by the management of the credit institution, notwithstanding any other provision of substantive or procedural law, and before any other claims. Page 19

20 CHAPTER D LEVEL AND SCOPE OF COVERAGE AND REPAYMENT PROCEDURE UNDER THE ICS Article 12 Eligibility of claims from covered investment services and excluded claims 1. Eligible claims shall be all claims from covered investment services with the exception of the following, which shall be excluded from protection and therefore from compensation by TEKE: (a) claims of other credit insitutions on their own behalf and for their own account; (b) claims arising out of transactions of investor clients in connection with which there has been a criminal conviction for money laundering/terrorist financing as defined in the applicable legislative provisions or the relevant legislation of other countries; (c) claims, for their own account, of investment firms as defined in point (2) of Article 3(1) of Law 4261/2014 and investment service providers (ΕPEY) as defined in Article 2(1) of Law 3606/2007; (d) claims of financial institutions, as defined in point (22) of Article 3(1) of Law 4261/2014; (e) claims of insurance undertakings, as defined in Law 4364/2016; (f) claims of undertakings for collective investment in transferable securities (UCITS) within the meaning of Law 4099/2012, including UCITS management companies; (g) claims of legal persons which are linked, in the sense of paragraph 5 of Article 42e of Codified Law 2190/1920 (Government Gazette A 216), to TEKE member credit institution that is unable to fulfil its obligations. (h) claims of central government, as defined in point (f) of Article 14(1) of Law 4270/2014 (Government Gazette A 143), as currently in force; (i) claims of members of the governing body and senior management of a TEKE member credit institution that is unable to fulfil its obligations; (j) claims of the shareholders of a TEKE member credit institution that is unable to fulfil its obligations, which hold, directly or indirectly, at least five per cent (5%) of the capital or of the voting rights, as well as claims of persons responsible for carrying out the statutory audit of the financial statements of that credit institution; Page 20

21 (k) claims of persons which hold positions or functions comparable to those listed under (i) and (j) above in companies linked, as defined in paragraph 5 of Article 42e of Codified Law 2190/1920, to a TEKE member credit institution that is unable to fulfil its obligations; (l) claims of relatives up to the second degree and spouses of the persons listed under (i) and (j) and (k) above, as well as claims of any third parties acting on behalf of such persons. Article 13 Coverage level for investment services 1. The maximum level of TEKE coverage for the aggregate claims of each investor client on an ICS member credit institution which arise out of covered investment services is set at thirty thousand euro (EUR 30,000). This level shall apply to the aggregate claim of an investor client on the same ICS member credit institution, irrespective of the type of the covered investment services, the number of accounts, the currency and the location in which of the investment service is provided. 2. If the coverage level is raised by virtue of a legislative provision, TEKE Directors shall decide by the qualified majority specified in paragraph 8 of Article 48 to adjust accordingly the annual contributions payable to the ICS under the provisions of Article 32. Article 14 Determination of the compensation amount 1. Where more than one investor client of TEKE member credit institutions are joint owners of a claim from covered investment services, the share of each one of them in the claim shall be deemed a separate claim on the credit institution and, aggregated with that investor client s other claims on the same credit institution from covered investment services, shall be compensated up to the coverage level specified in Article If each investor client s share in the claim cannot be derived from the contractual arrangements between the joint owners and TEKE member credit institution, the claim shall be divided equally among the joint owners. 3. Where the law permits holding an investor s account on behalf of another person, in whole or in part, that other person shall be covered by the guarantee up to the Page 21

22 coverage level, provided that such person has been or can be identified before the date of unavailability. If the account is held on behalf of more than one person, the coverage level shall be calculated taking into account each one s share according to the legal or contractual provisions applicable to the management of investor accounts. In the absence of special provisions or if the share of each person cannot be derived, the account shall be divided equally among these persons for the purposes of their compensation. 4. The compensation paid to investor clients shall be exempt from any tax, levy or other charge. Article 15 Investor clients compensation initiation and procedure 1. The TEKE shall initiate the compensation procedure and shall compensate investor clients for their claims arising from covered investment services, where it is established that an ICS member credit institution is unable to fulfil its obligations, in accordance with points (a) and (b) of indent (2) of Article 3(1) obligations. 2. The extension of the period for paying arrears envisaged in Article 138 of Law 4261/2014 shall not per se imply that a member credit institution is unable to to fulfil its obligations in the sense of points (a) and (b) of indent (2) of Article 3(1). 3. The TEKE shall compensate investor clients at the latest within three months after it has transmitted a schedule of claims to the Bank of Greece as speficied in Article In exceptional circumstances and upon the request of TEKE, the Bank of Greece may approve an extension by three months of the period specified in paragraph 3 for the payment of compensation by TEKE to investor clients. 5. Compensation shall be paid in the currency of the country in which the covered investment service was provided. 6. Notwithstanding the time limit laid down in paragraphs 3 and 4, where an investor client or any person entitled to or interested in sums held in an account has been charged with an offence arising out of or in relation to money laundering, as defined in paragraph 2 of Article 2 of Law 3691/2008, TEKE shall suspend any payment relating to the investor client concerned, pending the judgment of the court. Page 22

23 7. The TEKE shall not be liable to pay interest on the amount of compensation for the period until the payment of compensation to investor clients, if the compensation amount has been made available within the deadlines set out in paragraphs 3 and Upon initiation of the compensation procedure, the funds of the ICS deposited with the member credit institution which is unable to fulfil its obligations, the resulting accrued interest, as well as any contribution due to the ICS shall be promptly paid to the latter by the management of the credit institution, notwithstanding any other provision of substantive or procedural law, and before any other claims. 9. The procedure for the compensation of investor clients is described in detail in Articles 16 to 19. Article 16 Invitation to investor clients to apply for compensation 1. Within reasonable time following the determination or ruling referred to in points (a) and (b) of indent (2) of Article 3(1), TEKE shall publicly invite all investor clients to assert in writing their claims against TEKE member credit institution arising from covered investment services and shall specify the procedure, deadline and content of the relevant applications. 2. The TEKE shall announce the compensation procedure through the printed and electronic press. The announcements shall be repeated for at least 15days. 3. The invitation shall contain, as a minimum, the following: (a) the name and address of the registered head office of the credit institution in respect of which the compensation procedure has been initiated by TEKE; (b) the deadline for the submission of compensation applications; such deadline shall not be less than six months or more than nine months from the date of the last public announcement under paragraph 2 above; (c) the place and method of submission of applications and their precise content; 4. In exceptional circumstances, TEKE may, through an announcement which is subject to the publication requirements set out in paragraph 2 above, extend the deadline for the submission of compensation applications up to three months.. 5. The TEKE may not invoke the fact that the deadlines of paragraph 3 point (b) and paragraph 4 above has expired to deny compensation to an investor client who for good reason has not been able to apply for compensation within the time allowed. Page 23