# kaal:claim:2061166-014

**Claim.** Because German law fixes no threshold conditions or determining factors for market reception or market confidence, the systemic relevance and contagion determinations that turn on those factors can never be made in a reliable and objective manner.

**Type.** failure  **Support.** argued

**Holds when.**

- determination of systemic threat under the German Banking Act

**Source quote.**

> The German law does not stipulate any threshold conditions or determining factors for market reception or confidence. As a result, it will always be difficult to determine any of these factors in a reliable and objective manner.

**From.** Christoph K. Henkel, Wulf A. Kaal, *Contingent Capital in European Union Bank Restructuring* (2012), (ii) Reorganization Procedure, page 42

**Cite as.** Christoph K. Henkel, Wulf A. Kaal, Contingent Capital in European Union Bank Restructuring (2012). SSRN: https://ssrn.com/abstract=2061166

**Verify.** sha256 of source PDF `43625ea260d0fc045e86d3435df50c9d0ca4abf8542e6085a6165be6653b4a7b` at https://raw.githubusercontent.com/wulfkaal/Academic-Papers/main/papers/pdf/Henkel%20and%20Kaal%20-%202012%20-%20Contingent%20Capital%20in%20European%20Union%20Bank%20Restructuring.pdf

**Failure mode.** Unmeasurable market confidence standard  (family: definitional-ambiguity)

**Topics.** systemic-risk, risk-and-incentives, economics, law-and-legal-systems

**Keywords.** german-banking-law, systemic-risk, market-confidence, legal-uncertainty, supervisory-discretion

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