European Deposit Guarantee Scheme

The EU Commission's proposed Regulation on the creation of a European deposit insurance scheme has sparked heated debate. Although the European Deposit Insurance Scheme (EDIS) is initially only intended to apply to the eurozone, in the future it will also apply to Member States who will join the common banking supervision by the ECB. The main component is the creation of a joint Deposit Insurance Fund to provide payouts to depositors and contributions to resolution.


In cep's view, the proposed EDIS Regulation cannot be based on the internal market competence (Art. 114 TFEU). The flexibility clause (Art. 352 TFEU) can only be used as a basis where its overall effect is to strengthen investor confidence within the eurozone. This cannot be predicted with any reliability. In any case, the flexibility clause requires unanimity in the Council; thus every Member State has a right of veto.