The reform of cooperative banks launched in 2015 does not violate European Union law. The advocate general of the EU Court, Gerard Hogan, clearly states this in his non-binding conclusions.
The lawyer's opinion concerns a preliminary ruling brought by the Council of State which asked to clarify whether the Italian legislation on cooperative banks was compatible with EU rules in the light of some appeals brought by members of cooperative banks, Adusbef and Federconsumatori.
The appeals had already been rejected by the Lazio Regional Administrative Court, but the appellants had decided to appeal the sentence before the Council of State which raised the question of constitutional legitimacy. At this point the Consulta (we have reached 2018) declared the aforementioned questions unfounded and the Council of State promoted a procedure to the EU Court to definitively clarify the matter.
At the heart of the dispute is the so-called 8 billion euro rule. The reform, approved five years ago by the Renzi government, provides that cooperative banks with assets exceeding 8 billion have three options: reduce it, turn into a joint stock company or proceed with liquidation. To date, all Italian cooperative banks have adapted to the new legislation, with the exception of Popolare di Sondrio and Banca Popolare di Bari.
According to the attorney general, “EU law neither imposes nor precludes national legislation which prescribes the aforementioned threshold of assets of 8 billion euro”, reads the note. Indeed, the limitation "appears justified by the aim of guaranteeing sound governance and the stability of the banking sector as a whole in Italy and, in particular, of the cooperative banking sector in that Member State", adds the lawyer, turning off de facto the excesses of the appellants.
The 2015 reform also provides that in the event of transformation of the bank into a joint stock company, if one of the shareholders opts for withdrawal, his right to the redemption of the shares may be limited to ensure the safety of the bank. In this respect, the EU lawyer observed that "the European legislator considered that the public interest in guaranteeing an appropriate prudential safeguard against the credit institution concerned prevails over the private interests of the shareholders who intend to obtain repayment of their actions".
As mentioned, the Advocate General's opinion is not binding, but traditionally the judges of the EU court take his opinion into account in their sentences.
