–

the Lithuanian Government, by R. Krasuckaitė, G. Taluntytė, V. Vasiliauskienė and D. Kriaučiūnas, acting as Agents,

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the Polish Government, by B. Majczyna, acting as Agent,

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the European Commission, by H. Tserepa-Lacombe and A. Steiblytė, acting as Agents,

1

This request for a preliminary ruling concerns the interpretation of Articles 5(2) and 6(1)(a) of Directive 2009/110/EC of the European Parliament and of the Council of 16 September 2009 on the taking up, pursuit and prudential supervision of the business of electronic money institutions amending Directives 2005/60/EC and 2006/48/EC and repealing Directive 2000/46/EC (OJ 2009 L 267, p. 7).

2

The request has been made in proceedings brought by ‘Paysera LT’ UAB, formerly ‘EVP International’ UAB (‘Paysera’), concerning a decision by the Lietuvos banko Priežiūros tarnyba (Supervision Board of the Bank of Lithuania) issuing a warning to the applicant on the ground that it had incorrectly applied the methods for the calculation of own funds to certain payment transactions (‘the contested decision’).

3

Recitals 2, 7 to 9 and 11 of Directive 2009/110 state:

…

…

4

According to Article 2 of Directive 2009/110, headed ‘Definitions’:

‘For the purposes of this Directive, the following definitions shall apply:

…

…’

5

Article 5 of that directive, entitled ‘Own funds’, provides in paragraphs 2 and 3 thereof:

‘2.   In regard to the activities referred to in Article 6(1)(a) that are not linked to the issuance of electronic money, the own funds requirements of an electronic money institution shall be calculated in accordance with one of the three methods (A, B or C) set out in Article 8(1) and (2) of Directive 2007/64/EC. The appropriate method shall be determined by the competent authorities in accordance with national legislation.

In regard to the activity of issuing electronic money, the own funds requirements of an electronic money institution shall be calculated in accordance with Method D as set out in paragraph 3.

Electronic money institutions shall at all times hold own funds that are at least equal to the sum of the requirements referred to in the first and second subparagraphs.

3.   Method D: The own funds of an electronic money institution for the activity of issuing electronic money shall amount to at least 2% of the average outstanding electronic money.’

6

Article 6 of that directive, entitled ‘Activities’, provides in paragraph 1(a) thereof:

‘1.   In addition to issuing electronic money, electronic money institutions shall be entitled to engage in any of the following activities:

(a) the provision of payment services listed in the Annex to Directive 2007/64/EC’.

7

Article 11 of Directive 2009/110, entitled ‘Issuance and redeemability’, provides in paragraphs 1 and 2 thereof:

‘1.   Member States shall ensure that electronic money issuers issue electronic money at par value on the receipt of funds.

2.   Member States shall ensure that, upon request by the electronic money holder, electronic money issuers redeem, at any moment and at par value, the monetary value of the electronic money held.’

8

Article 4 of Directive 2007/64/EC of the European Parliament and of the Council of 13 November 2007 on payment services in the internal market amending Directives 97/7/EC, 2002/65/EC, 2005/60/EC and 2006/48/EC and repealing Directive 97/5/EC (OJ 2007 L 319, p. 1), entitled ‘Definitions’, provides:

‘For the purposes of this Directive, the following definitions shall apply:

…

…

…’

9

Article 8 of that directive, entitled ‘Calculation of own funds’, provides in paragraphs 1 and 2 thereof:

‘1.   Notwithstanding the initial capital requirements set out in Article 6, Member States shall require payment institutions to hold, at all times, own funds calculated in accordance with one of the following three methods, as determined by the competent authorities in accordance with national legislation:

Method A

The payment institution’s own funds shall amount to at least 10% of its fixed overheads of the preceding year. The competent authorities may adjust that requirement in the event of a material change in a payment institution’s business since the preceding year. Where a payment institution has not completed a full year’s business at the date of the calculation, the requirement shall be that its own funds amount to at least 10% of the corresponding fixed overheads as projected in its business plan, unless an adjustment to that plan is required by the competent authorities.

Method B

The payment institution’s own funds shall amount to at least the sum of the following elements multiplied by the scaling factor k defined in paragraph 2, where payment volume (PV) represents one twelfth of the total amount of payment transactions executed by the payment institution in the preceding year:

Method C

The payment institution’s own funds shall amount to at least the relevant indicator defined in point (a), multiplied by the multiplication factor defined in point (b) and by the scaling factor k defined in paragraph 2:

2.   The scaling factor k to be used in Methods B and C shall be:

10

The Annex to Directive 2007/64, entitled ‘Payment Services (Definition 3 in Article 4)’ sets out the list of activities regarded as such:

‘1.   Services enabling cash to be placed on a payment account as well as all the operations required for operating a payment account.

2.   Services enabling cash withdrawals from a payment account as well as all the operations required for operating a payment account.

3.   Execution of payment transactions, including transfers of funds on a payment account with the user’s payment service provider or with another payment service provider:

4.   Execution of payment transactions where the funds are covered by a credit line for a payment service user:

5.   Issuing and/or acquiring of payment instruments.

6.   Money remittance.

7.   Execution of payment transactions where the consent of the payer to execute a payment transaction is given by means of any telecommunication, digital or IT device and the payment is made to the telecommunication, IT system or network operator, acting only as an intermediary between the payment service user and the supplier of the goods and services.’

11

Paysera is a company incorporated under Lithuanian law which holds licences issued to it by the Lietuvos bankas (Bank of Lithuania) to operate as an electronic money institution and a payment institution, under which it is authorised to issue electronic money and to provide services linked to the issuance of such money as well as other payment services.

12

Following an inspection of Paysera’s operations conducted by the Supervision Board of the Bank of Lithuania, by the contested decision, that board issued a warning to that company and required it to rectify the infringement of the rules for the calculation of the own funds requirements of electronic money institutions.

13

The Supervision Board of the Bank of Lithuania refused to recognise the following activities pursued by the applicant in the main proceedings as constituting payment services linked to the issuance of electronic money:

14

Subsequently, since the action brought against the contested decision was dismissed by decision of 13 January 2016 of the Vilniaus apygardos administracinis teismas (Regional Administrative Court, Vilnius, Lithuania), the applicant in the main proceedings brought an appeal before the Lietuvos vyriausiasis administracinis teismas (Supreme Administrative Court, Lithuania).

15

The referring court raises the question of whether Services I and II should be classified as ‘payment services linked to the issuance of electronic money’.

16

In those circumstances, the Lietuvos vyriausiasis administracinis teismas (Supreme Administrative Court, Lithuania) decided to stay the proceedings and to refer the following question to the Court for a preliminary ruling:

‘Is Article 5(2), read in conjunction with Article 6(1)(a), of Directive [2009/110] to be interpreted as meaning that, in circumstances such as those in the present case, the following are to be regarded as payment services that are (not) linked to the issuance of electronic money:

17

By its question, the referring court asks, in essence, whether Article 5(2) of Directive 2009/110 must be interpreted as meaning that services provided by electronic money institutions in payment transactions such as those at issue in the main proceedings constitute activities linked to the issuance of electronic money.

18

In that regard, it should be noted that, in accordance with Article 5 of that directive, electronic money institutions are required to comply with certain own funds requirements.

19

In particular, it is clear from Article 5(2) and (3) of that directive that, with regard to the activity of issuing electronic money, the own funds requirements of an electronic money institution are to be calculated in accordance with Method D and must amount to at least 2% of the average outstanding electronic money.

20

By contrast, with regard to the activities which are not linked to the issuance of electronic money, and which, on that ground, constitute a payment service within the meaning of point 3 of Article 4 of Directive 2007/64, the own funds requirements of an electronic money institution are calculated in accordance with one of the three methods (A, B or C) set out in Article 8(1) and (2) of that directive.

21

Consequently, taking into account the own funds requirements relating to each of those methods, an electronic money institution is required to have more own funds when those are calculated by using methods A, B or C, than when they are calculated in accordance with method D.

22

Therefore, it must be held that Article 5(2) and (3) of Directive 2009/110 creates an exception to the rules on own funds laid down by Directive 2007/64 as regards payment services linked to the issuance of electronic money provided, in so far as those services are linked to the activity of issuing electronic money.

23

Thus, in order to determine whether the services in question in the main proceedings constitute activities linked to the issuance of electronic money, it is necessary to determine whether those services are inherently linked to the issuance or redemption of electronic money.

24

The concept of the ‘issuance of electronic money’ is not defined by Directive 2009/110, which merely specifies, in Article 2(2) thereof, that the concept of ‘electronic money’ is to be understood as electronically, including magnetically, stored monetary value as represented by a claim on the issuer which is issued on receipt of funds for the purpose of making payment transactions as defined in point 5 of Article 4 of Directive 2007/64, and which is accepted by a natural or legal person other than the electronic money issuer.

25

Point 5 of Article 4 of Directive 2007/64 defines a payment transaction as an act, initiated by the payer or by the payee, of placing, transferring or withdrawing funds, irrespective of any underlying obligations between the payer and the payee. Furthermore, as is clear from point 3 of Article 4, read in conjunction with the Annex to that directive, the execution of a payment transaction, including the transfer of funds to a payment account, constitutes a payment service.

26

Additionally, it must be noted that Article 11(2) of Directive 2009/110 requires electronic money issuers to redeem, upon request by the electronic money holder, at any moment and at par value, the monetary value of the electronic money held.

27

As regards the concept of ‘redemption’, which is not defined by Directives 2007/64 and 2009/110, it consists in the conversion of electronic money to its par value and the subsequent payment of funds on the instruction of the electronic money holder. In that regard, those directives do not require that those funds are paid into the account of the electronic money holder or to a third-party account.

28

Since the issuance of electronic money unconditionally and automatically confers entitlement to redemption, the concept of ‘payment service linked to the issuance of electronic money’ also includes the redemption of the electronic money within the meaning of Article 5(2) of Directive 2009/110.

29

Thus, a payment service provided for the purpose of enabling the redemption of the par value of the electronic money constitutes an activity linked to the issuance of electronic money.

30

In order to determine whether the services at issue in the main proceedings constitute payment services linked to the issuance of electronic money, it must therefore be determined whether the provision of those services triggers the issuance or redemption of electronic money in a single payment transaction.

31

In that regard, Service I consists of a payment transaction whereby, at the request of the electronic money holder, the electronic money institution redeems the funds at par value and transfers them to a third-party bank account.

32

In so far as the funds are redeemed solely for the purpose of their transfer and in a single payment transaction – which it is for the referring court to ascertain – a service such as Service I may be regarded as being linked to the issuance of electronic money within the meaning of Article 5(2) of Directive 2009/110.

33

As regards Service II, it consists of a transaction whereby, at the request of the seller, the buyer of the goods or services pays for them by making a transfer of funds for that purpose to the electronic money institution, which, upon receipt of the funds, issues electronic money for the benefit of the seller (electronic money holder).

34

Subject to the findings of the referring court, a service such as Service II is also directly linked to the issuance of electronic money, if the transfer of funds automatically triggers, in a single payment transaction, the issuance of electronic money. The transfer of funds is thus linked to the issuance of electronic money.

35

In light of the above, the answer to the question referred is that Article 5(2) of Directive 2009/110 must be interpreted as meaning that services provided by electronic money institutions in payment transactions such as those at issue in the main proceedings constitute activities linked to the issuance of electronic money, within the meaning of that provision, if those services trigger the issuance or redemption of electronic money in a single payment transaction.

36

Since these proceedings are, for the parties to the main proceedings, a step in the action 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:

Article 5(2) of Directive 2009/110/EC of the European Parliament and of the Council of 16 September 2009 on the taking up, pursuit and prudential supervision of the business of electronic money institutions amending Directives 2005/60/EC and 2006/48/EC and repealing Directive 2000/46/EC, must be interpreted as meaning that services provided by electronic money institutions in payment transactions such as those at issue in the main proceedings constitute activities linked to the issuance of electronic money, within the meaning of that provision, if those services trigger the issuance or redemption of electronic money in a single payment transaction.