The European Central Bank under the Single Supervisory Mechanism. Cooperation, Delegation, and Reverse Majority Voting
The Council Regulation establishing the Single Supervisory Mechanism (SSM) vests the ECB with far-reaching banking supervisory powers. However, its legal basis, Article 127 (6) TFEU allows for the delegation of ‘specific tasks’ only. In order to avoid a conflict with the ECB’s monetary policy function, a new body of the ECB essentially dealing with supervisory tasks, the Supervisory Board, was established. Its draft decisions are adopted by the Governing Council of the ECB by non-objection (reverse majority voting). Under the SSM, the supervisory branch of the ECB and, under the latter’s guidance, the national supervisory authorities together perform banking supervision in the Eurozone.
This paper addresses important aspects of the functioning and the limits of the SSM along the lines of the following questions: How does administrative cooperation work within and with the supervisory authorities outside the SSM, for example the European Banking Authority? Is the delegation of powers upon the ECB, as effected by the SSM-Regulation, in accordance with Article 127 (6) TFEU and the Meroni-criteria (as recently re-considered by the Court)? Is the application of the reverse majority voting in the Governing Council compliant with the ECB’s decision-making rules laid down in primary law, eg the Statute of the ESCB/ECB?