1) This request for a preliminary ruling concerns the interpretation of Article 3, Article 63 et seq. and Article 107 et seq. TFEU, Article 16 and Article 17 of the Charter of Fundamental Rights of the European Union (‘the Charter’), Article 29 of Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit institutions and investment firms and amending Regulation (EU) No 648/2012 (OJ 2013 L 176, p. 1), Article 6(4) of Council Regulation (EU) No 1024/2013 of 15 October 2013 conferring specific tasks on the European Central Bank concerning policies relating to the prudential supervision of credit institutions (OJ 2013 L 287, p. 63), and Article 10 of Commission Delegated Regulation (EU) No 241/2014 of 7 January 2014 supplementing Regulation No 575/2013 with regard to regulatory technical standards for Own Funds requirements for institutions (OJ 2014 L 74, p. 8).

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26) It was in those circumstances that the Consiglio di Stato (Council of State) decided to stay proceedings and to refer the following questions to the Court for a preliminary ruling:

‘(1) Do Article 29 of [Regulation No 575/2013], Article 10 of [Delegated Regulation No 241/2014], and Articles 16 and 17 of the Charter …, with reference to Article 6(4) of [Regulation No 1024/2013], preclude a national provision such as that introduced by Article 1 of Decree-Law No 3/2015 … which imposes an asset threshold above which a people’s bank must be converted into a company limited by shares, setting that limit at EUR 8 billion? Furthermore, do the abovementioned unified European parameters preclude a national provision which, if a people’s bank is converted into a company limited by shares, makes it possible for that company to defer or limit, including for an indefinite period, redemption of the shares held by the withdrawing shareholder?

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(5) Where, in its interpretation, the Court of Justice holds that European legislation is compatible with the interpretation asserted by the opposing parties, can the Court of Justice assess the lawfulness, in European terms, of Article 10 of [Delegated Regulation No 241/2014], in the light of Articles 16 and 17 of the Charter …, supplemented, also in the light of Article 52(3) of that Charter … and the case-law of the European Court of Human Rights on Article 1 of the First Additional Protocol to the [European Convention for the Protection of Human Rights and Fundamental Freedoms signed at Paris on 20 March 1952]?’

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41) By the first part of the first question, the referring court asks, in essence, whether Article 29 of Regulation No 575/2013, Article 10 of Delegated Regulation No 241/2014 and Articles 16 and 17 of the Charter, in conjunction with Article 6(4) of Regulation No 1024/2013, must be interpreted as precluding national legislation that sets an asset threshold of EUR 8 billion above which a people’s bank established as a limited liability cooperative society must be converted into a company limited by shares.

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51) As regards the request for interpretation of Articles 16 and 17 of the Charter, it should be recalled that, under Article 51(1) of the Charter, its provisions are addressed to the Member States only when they are implementing EU law.

52) In accordance with settled case-law, the concept of ‘implementing Union law’, as referred to in Article 51 of the Charter, assumes a degree of connection between an EU legal measure and the national measure in question, above and beyond the matters covered being closely related or one of those matters having an indirect impact on the other (judgments of 6 March 2014, Siragusa, C‑206/13, EU:C:2014:126, paragraph 24; of 10 July 2014, Julián Hernández and Others, C‑198/13, EU:C:2014:2055, paragraph 34; and of 6 October 2016, Paoletti and Others, C‑218/15, EU:C:2016:748, paragraph 14).

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69) Accordingly, by the second part of its first question and by its fourth question, which it is appropriate to examine together, the referring court asks, in essence, whether Article 29 of Regulation No 575/2013, Article 10 of Delegated Regulation No 241/2014 and Articles 16 and 17 of the Charter must be interpreted as precluding legislation of a Member State that allows a people’s bank established in that Member State to defer, for an unlimited period, the redemption of the shares held by the withdrawing shareholder and to limit the amount to be redeemed.

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81) Article 16 of the Charter recognises the freedom to conduct a business in accordance with Union law and national laws and practices.

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84) Under Article 17(1) of the Charter, everyone has the right to own, use, dispose of and bequeath his or her lawfully acquired possessions and no one may be deprived of his or her possessions, except in the public interest and in the cases and under the conditions provided for by law, subject to fair compensation being paid in good time for their loss. The use of property may be regulated by law in so far as is necessary for the general interest.

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86) Furthermore, it should also be borne in mind that, in accordance with Article 52(1) of the Charter, limitations may be imposed on the exercise of the rights and freedoms recognised by the Charter, such as the freedom to conduct a business and the right to property, as long as those limitations are provided for by law, respect the essence of those rights and freedoms and, subject to the principle of proportionality, are necessary and genuinely meet objectives of general interest recognised by the European Union or the need to protect the rights and freedoms of others.

87) The ability, granted to people’s banks by national legislation, to limit the redemption of their capital instruments, where necessary in order to ensure that the capital instruments that they issue may be accounted for as Common Equity Tier 1 instruments, is provided for by law within the meaning of Article 52(1) of the Charter.

88) The essence of the freedom to conduct a business, guaranteed by Article 16 of the Charter, and of the right to property under Article 17 thereof is respected by national legislation, such as that at issue in the main proceedings, providing for the ability to limit the redemption of shares in the event of withdrawal of a shareholder, which is intended to satisfy the condition set out in Article 29(2)(b) of Regulation No 575/2013 so that the shares qualify as Common Equity Tier 1 instruments.

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95) As a result, it must be held that restrictions on the exercise of the right to property and, if they exist, restrictions on the exercise of the freedom to conduct a business, resulting from legislation such as that at issue in the main proceedings genuinely meet objectives of general interest recognised by the European Union within the meaning of Article 52(1) of the Charter.

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97) In the light of all the foregoing considerations, the answer to the second part of the first question and to the fourth question is that Article 29 of Regulation No 575/2013, Article 10 of Delegated Regulation No 241/2014 and Articles 16 and 17 of the Charter must be interpreted as not precluding legislation of a Member State which prohibits people’s banks established in that Member State from refusing the redemption of capital instruments but which allows those banks to defer, for an unlimited period, the redemption of the shares held by the withdrawing shareholder and to limit the amount to be redeemed in full or in part, provided that the limitations on redemption imposed when exercising that option do not go beyond what is necessary, in the light of the prudential situation of the banks concerned, in order to ensure that the capital instruments they issue qualify as Common Equity Tier 1 instruments, having regard, in particular, to the matters referred to in Article 10(3) of Delegated Regulation No 241/2014, which is a matter for the referring court to ascertain.

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109) Since these proceedings are, for the parties to the main proceedings, a step in the actions pending before the national court, the decision on costs is a matter for that court. Costs incurred in submitting observations to the Court, other than the costs of those parties, are not recoverable.

On those grounds, the Court (First Chamber) hereby rules:

1. Article 29 of Regulation (EU) No 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit institutions and investment firms and amending Regulation (EU) No 648/2012, Article 10 of Commission Delegated Regulation (EU) No 241/2014 of 7 January 2014 supplementing Regulation (EU) No 575/2013 with regard to regulatory technical standards for Own Funds requirements for institutions and Articles 16 and 17 of the Charter of Fundamental Rights of the European Union must be interpreted as not precluding legislation of a Member State which prohibits people’s banks established in that Member State from refusing the redemption of capital instruments but which allows those banks to defer, for an unlimited period, the redemption of the shares held by the withdrawing shareholder and to limit the amount to be redeemed in full or in part, provided that the limitations on redemption imposed when exercising that option do not go beyond what is necessary, in the light of the prudential situation of the banks concerned, in order to ensure that the capital instruments they issue qualify as Common Equity Tier 1 instruments, having regard, in particular, to the matters referred to in Article 10(3) of Delegated Regulation No 241/2014, which is a matter for the referring court to ascertain.
2. Article 63 et seq. TFEU must be interpreted as not precluding legislation of a Member State that sets an asset threshold on the exercise of banking activities by people’s banks established in that Member State as limited liability cooperative societies above which those banks must be converted into companies limited by shares, reduce their assets to below that threshold or be liquidated, provided that that legislation is appropriate for securing attainment of the general interest objectives pursued and does not exceed what is necessary to attain them, which is a matter for the referring court to ascertain.