Definition of warranties guaranteed
B/ Warranty commitments not
covered by the guarantee
C/ Definition of members of the
Fonds de Garantie des Dépôts ("warranty guarantee
D/ Date when the guarantee
takes effect for the compensation calculation or for withdrawal
E/ Maximum limit for
compensation or withdrawal of commitment
procedure and deadlines
G/ Funds of the warranties
commitments procedure managed by the Fonds de Garantie des
A) Definition of warranties
This type of guarantee concerns warranty commitments required
by law or regulations undertaken by a credit institution on
behalf of individuals or legal entities under private law.
The article D 313-26 of COMOFI provides a list of
compulsory warranties covered by the "warranty
The procedure only comes into play if the entities undertaking
the warranty (travel agencies, private house constructors,
etc.) and the credit institution that has granted its warranty
are both in default of their commitments.
B) Warranties commitments not covered by the
guarantee (article D
The main exclusions are as follows :
- Warranties commitments guaranteeing transactions for which
the beneficiary has had a criminal conviction in connection
with a money laundering offence based on articles 222-38, 334-1
or 334-2 of the Code pénal (French Civil Code) or
article 415 of the Code des douanes (French Customs
- Warranty commitments for which the beneficiary, as an
individual, has obtained rates and financial advantages, which
have worsened the financial situation of the institution.
- Securities of personally liable partners or limited
partners holding at least 5 % of the capital of the credit
institution, Directors, members of the Management Board and the
Supervisory Board, managers and auditors of the credit
institution as well as any equivalent depositors in other
companies in the group.
- Securities from any third party acting on behalf of persons
set out in paragraph 3 above.
- Warranty commitments granted to pension schemes and pension
C) Definition of institutional members of
the Fonds de Garantie des Dépôts ("warranty
Members are credit institutions, which have their head office
in France or the in Principality of Monaco, or branches of
credit institutions with a head office located in a State of the European Economic Area.
While no rules exist within EU regulations to govern such
guarantees, branches of credit institutions with their head
office in another State of the European Economic Area, which
are authorised to grant warranties in their original country,
may voluntarily join the warranty commitments procedure managed
by the Fonds de Garantie des Dépôts. To date, no such
branch has applied for membership.
Please refer to the list of
members of the Fonds de Garantie des Dépôts
(warranty commitments procedure).
See the standard form
prepared by the industry concerning only member credit
institutions "warranty guarantee" procedure.
D) Date when the guarantee takes effect for
the compensation calculation or for withdrawal of
The date applied is the date when the french banking
commission requested the involvement of the Fonds de
Garantie des Dépôts.
E) Maximum limit for compensation or
withdrawal of commitment (regulation
CRBF no. 99-12, art. 3)
The maximum compensation limit (or withdrawal of
commitment) is limited to 90 % of the cost that would have been
incurred by the credit institution member defaulting on its
commitments. The uncompensated portion cannot under any
circumstances be less than €3,000.
The maximum compensation applies to each beneficiary
and each institution.
F) Compensation procedure and
deadlines(regulation CRBF no. 99-12, art. 1 and
The request to the Fonds de Garantie des Dépôts is made
by the french banking commission except for beginning
receivership or liquidation proceedings. The request to apply
the "warranty guarantee" procedure is made immediately after it
has established that a credit institution is no longer in a
position to meet its warranty
commitments set out in decree no. 99-776, either
immediately or in the near future.
Based on documents produced by the institution
concerned, the Fonds de Garantie des Dépôts launches the
"warranty guarantee" compensation, withdrawal or transfer
procedure in respect of the defaulting institution’s
By contrast to procedures for the "cash
guarantee" or the "securities
guarantee", deadlines laid down by regulations only relate to
registering beneficiaries’ claims and not their
The only time limit concerns the registration by the
Fonds de Garantie des Dépôts of all commitments to
beneficiaries granted by the defaulting member institution.
This deadline is 2 months from the date of notification by the
french banking commission.
During this period, the Fonds de Garantie des
Dépôts must notify the beneficiaries that the commitments
of the defaulting institution have been reassigned.
This letter will also indicate to the beneficiaries the
procedure they must follow and the supporting documentation
they must provide to receive compensation or to set in motion
the "warranty guarantee" procedure.
The Fonds de Garantie des Dépôts may ask the
french banking commission for an extension to this period of up
to 2 months. On the request of the Fonds de Garantie des
Dépôts, the banking commission may grant a maximum of 2
additional extensions whereby each extension cannot exceed 2
Notwithstanding the above, the Fonds de Garantie des
Dépôts will make every effort to compensate all the
beneficiaries of such warranties as soon as possible.
G) Funds of the warranties commitments
procedure managed by the Fonds de Garantie des
Dépôts (regulation CRBF
no. 2000-06, art. 10).
All institutional members of the Fonds de Garantie
des Dépôts in respect of the "warranty guarantee" provide
the necessary funds so that it can carry out its duties. Each
member’s contribution is calculated by the french banking
commission based on criteria defined by regulation
CRBF no. 2000-06, provided that the total amount claimed
does not endanger the stability of the banking system.
Over 5 years, from 2001 to 2005, funds receivable from
members will amount to €27m in the form of contributions; in
contrast to the "cash guarantee" and "securities guarantee"
procedures, there are no membership certificates. Although
contributions belong to the Fonds de Garantie des
Dépôts, they may, on request from the member, take the form
of guarantee deposits repayable after 5 years, but may be
converted, on first request from the Fonds de Garantie des
Dépôts, into monetary contributions belonging to the
Fonds de Garantie des Dépôts.
I) Information (articles D 313-28 to 313-31 of COMOFI)
The recipients of guarantee
commitments like any person who requests it, can obtain
information on this guarantee mechanism. Moreover, the
establishments must insert in their contracts of guarantee a
mention that recalls the engagement gets into the field of the
mechanism of guarantee.