Part 2: Subsidy control requirements Chapter 2: Prohibitions and other requirements Section 22: Liquidating deposit takers or insurance companies
This section establishes rules around subsidies for the purpose of liquidating ailing or insolvent banks, other deposit takers or insurance companies. Subsidies to a bank, other deposit taker or insurance company unable to credibly demonstrate that it can be restored to long-term viability are prohibited unless specific conditions or terms are met.
	These conditions are set out in subsections (3) to (5), and require:
that the purpose of the subsidy is to ensure the orderly liquidation and exit from the market of the beneficiary of the subsidy;
that the public authority giving the subsidy is satisfied that the subsidy is limited to what is strictly necessary to ensure an orderly liquidation and exit from the market, and is limited to minimise any negative effects on competition or investment within the UK or trade or investment between the United Kingdom and countries and territories outside the United Kingdom; and
that the beneficiary of the subsidy, its shareholders, its creditors (or the business group it belongs to) should make a significant contribution to the cost of its own liquidation, or else have a contractual obligation to do so.