Financial Market Stabilization Act

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Basic data
Title: Law establishing a financial market stabilization fund
Short title: Financial Market Stabilization Fund Act
Abbreviation: FMStFG
Type: Federal law
Scope: Federal Republic of Germany
Legal matter: Commercial administrative law
References : 660-3
Issued on: October 17, 2008
( Federal Law Gazette I, p. 1982 )
Entry into force on: October 18, 2008
Last change by: Art. 1 G of March 27, 2020
( Federal Law Gazette I p. 543 )
Effective date of the
last change: 		March 28, 2020
(Art. 5 G of March 27, 2020)
GESTA : E039
Please note the note on the applicable legal version.

The Financial Market Stabilization Act (FMStG) (with Article 1 Financial Market Stabilization Fund Act (FMStFG)) is an article law of the Federal Republic of Germany that was passed as an emergency act on October 17, 2008, signed by the Federal President and announced in the Federal Law Gazette on the same day .

content

The law enables the implementation of a package of measures to stabilize the financial market , which was troubled by the financial crisis in autumn 2008 . It aims to ensure the solvency of financial institutions based in Germany and to avoid a general credit crunch . The main component is a rescue fund at the new Financial Market Stabilization Agency (FMSA), an institution under public law that is part of the Deutsche Bundesbank , but is organized separately from it. The financial market stabilization fund is set up in the form of a special fund of the federal government, so its expenditure is not directly included in the federal budget. A deficit remaining after the fund is dissolved is 65 percent to be borne by the federal government and 35 percent, but a maximum of 7.7 billion euros, by the federal states . Deficits that have arisen as a result of supporting a Landesbank are borne separately by the Länder in accordance with their participation in the respective Landesbank. The fund is limited in time when it is announced on December 31, 2009. As of 2011, the fund is no longer actively stabilizing; only the stabilization measures that have already been taken are managed and monitored to ensure that the conditions associated with the measures are complied with.

The fund has a volume of 100 billion euros. Initially, the fund may take out loans of up to 70 billion euros to purchase problem assets and recapitalize ( participate in ) financial institutions. A further credit line of ten billion euros can be used for the same purpose with the consent of the budget committee of the German Bundestag . In addition, the Federal Ministry of Finance is authorized to raise a further 20 billion euros in order to satisfy claims resulting from guarantees: The fund is authorized to issue guarantees of up to one for debt instruments and liabilities of the beneficiary companies issued by December 31, 2009 To pronounce a total of 400 billion euros. Beneficiary companies are:

  • Institutes within the meaning of Section 1 (1b) of the KWG (credit institutions and financial services institutions),
  • Insurance companies and pension funds within the meaning of Section 1 (1) No. 1 and 2 of the VAG ,
  • Investment companies within the meaning of the InvG ,
  • Operator of securities and futures exchanges

as well as their parent company . The aid only applies to companies based in Germany.

Based on the Financial Market Stabilization Fund Act, on October 20, 2008, the Federal Government issued the Ordinance to Implement the Financial Market Stabilization Fund Act (Financial Market Stabilization Fund Ordinance - FMStFV).

Steering Board and Steering Committee

At the suggestion of the Federal Minister of Economics, Karl-Theodor zu Guttenberg , a steering committee was convened as an advisory body, which will issue an opinion on guarantees for EUR 300 million or loans over EUR 150 million. Furthermore, the council should issue an assessment in cases of fundamental importance . The following persons belong to the council:

The decision on the allocation of funds will be made by a steering committee headed by State Secretary Walther Otremba . The committee consists of three representatives from federal ministries and one representative from the Federal Chancellery .

In its assessment, the Steering Board can also rely on other opinions from advisors or bodies. The applications submitted to the council are also examined and evaluated by an auditing company, PricewaterhouseCoopers . If an application for credit is submitted, it will be checked by the Reconstruction Loan Corporation . Furthermore, there is also a parliamentary scrutiny reservation on granting a company support of over 300 million euros. The competent authority of the European Union must also approve the granting of support to a company.

origin

In the context of the financial crisis of 2007/2008 and the crisis surrounding Hypo Real Estate at the end of September 2008, the federal government decided in October 2008 on a rescue package for the German banks with a maximum volume of 480 billion euros.

The draft law (like the Financial Market Stabilization Amendment Act ) was not drawn up by the Federal Ministry of Finance itself, but by the law firm Freshfields . For this, the federal government paid the commercial law firm EUR 163,744.

Constitutional complaint

On March 26, 2009 , the Federal Constitutional Court did not accept for decision a constitutional complaint directed against parts of the Financial Market Stabilization Fund Act, the Financial Market Stabilization Acceleration Act and the Financial Market Stabilization Fund Ordinance. It referred the complainant to the specialized courts .

See also

literature

  • Florian Becker , Sebastian Mock: FMStG - Financial Market Stabilization Act: Heymanns Commentary , Cologne 2009, ISBN 978-3452270689 .
  • Matthias Jaletzke, Peter Verannemann: Financial Market Stabilization Act. Comment. CH Beck, Munich 2009, ISBN 978-3-406-58760-3
  • Gerald Spindler: Financial Crisis and Legislature - the Financial Market Stabilization Act. In: German Tax Law 47/2008, pp. 2268–2276

Web links

Individual evidence

  1. ↑ tagesschau.de  - Agreement on burden sharing of the rescue package - The federal government alone bears high losses (accessed on October 16, 2008)
  2. ↑ Tasks of the Federal Agency for Financial Market Stabilization expanded  ( page no longer available , search in web archives )  Info: The link was automatically marked as defective. Please check the link according to the instructions and then remove this notice. SoFFin press release of December 29, 2010.@1@ 2Template: Toter Link / www.soffin.de  
  3. ^ Ami, Guttenberg creates a guarantee council, Frankfurter Allgemeine Zeitung, March 4, 2009
  4. ↑ Focus, August 17, 2009: The Official Whisperers
  5. ↑ Arne Semsrott: Why the bank bailout bill cost taxpayers 160,000 euros (plus court costs). In: FragDenStaat. Retrieved October 28, 2018 .
  6. ^ Decision of March 26, 2009, Az.BvR 119/09