4.

For the purposes of point (c) of paragraph 1, covered bonds secured by loans to or guaranteed by public undertakings as primary assets shall be subject to a minimum level of 10 % of overcollateralisation and subject to all the following conditions: the public undertakings provide essential public services on the basis of a licence, a concession contract or other form of entrustment granted by a public authority; the public undertakings are subject to public supervision; the public undertakings have sufficient revenue generating powers, which are ensured by the fact of such public undertakings: having adequate flexibility to collect and to increase fees, charges and receivables for the service provided in order to ensure their financial soundness and solvability; receiving sufficient grants on a statutory basis in order to ensure their financial soundness and solvability in exchange for providing essential public services; or having entered into a profit and loss transfer agreement with a public authority.

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Source: EUR-Lex (Cellar) · retrieved 2026-10-12 · Text as adopted (Official Journal); later amendments are not incorporated in this text.