
Article 1 
Arrangements under covered bonds shall be considered to adequately mitigate counterparty credit risk, where OTC derivative contracts concluded by covered bond entities in connection with covered bonds comply with all of the following criteria:

((a)) those contracts are registered or recorded in the cover pool of the covered bond in accordance with national legislation on covered bonds;
((b)) those contracts are not terminated in case of resolution or insolvency of the covered bond issuer or the cover pool;
((c)) the counterparty to the OTC derivative contract concluded with covered bond issuers or with cover pools for covered bonds ranks at least pari passu with the covered bond holders, except where the counterparty to the OTC derivative contract concluded with covered bond issuers or with cover pools for covered bonds is the defaulting or the affected party, or waives the pari passu rank;
((d)) the covered bond is subject to a regulatory collateralisation requirement of at least 102 %.
Article 2 
Arrangements under securitisations shall be considered to adequately mitigate counterparty credit risk where OTC derivative contracts concluded by securitisation special purpose entities in connection with securitisations satisfy all of the following criteria:

((a)) the counterparty to the OTC derivative concluded with the securitisation special purpose entity in connection with the securitisation ranks at least pari passu with the holders of the most senior securitisation tranche except where the counterparty to the OTC derivative concluded with the securitisation special purpose entity in connection to the securitisation is the defaulting or the affected party;
((b)) the securitisation special purpose entity in connection with the securitisation with which the OTC derivatives contract is associated is subject, on an ongoing basis, to a level of credit enhancement of the most senior securitisation note of at least 2 % of the outstanding notes.
Article 3 
Article 1(2) of Delegated Regulation (EU) 2015/2205 is deleted.
Article 4 
Article 1(2) of Delegated Regulation (EU) 2016/1178 is deleted.
Article 5 
This Regulation shall enter into force on the twentieth day following that of its publication in the Official Journal of the European Union.
This Regulation shall be binding in its entirety and directly applicable in all Member States;Done at Brussels, 16 December 2019.
For the Commission
The President
Ursula VON DER LEYEN