Abstract
This paper analyses the relationship between the EU Capital Requirements Directive and the proposed Solvency II directive and their application in the context of parent-subsidiary relations and the general rules on groups of companies, as these are applied in the Member States of the EU. Art 68 and 69 of the CRD allow under certain conditions, to apply the capital requirement on a group approach, provided i.a. that there is no legal impediment to the prompt transfer of the own funds. This requirement may, in certain circumstances not be compatible with the common principles of the law on groups. The paper analyses to what extent in cases of financial distress the free transferability whether up- or downstream may be impeded. Similar issues could be raised in the Solvency context.
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