The European Financial Stabilisation Mechanism (EFSM) was created for the European Commission to provide financial assistance to any EU country experiencing or threatened by severe financial difficulties using bonds issued on behalf of the European Union.
The EFSM was used to provide financial assistance conditional on the implementation of reforms to Ireland and Portugal between 2011 and 2014, and to provide short-term bridge loans to Greece in July 2015.
Today, euro area countries in need of financial assistance turn to the European Stability Mechanism (ESM), a permanent intergovernmental institution. The ESM is set up by and for euro area countries. EU countries outside the euro area can turn to the EU for balance of payments assistance.
The EFSM, however, remains in place for specific tasks such as the lengthening of maturities for loans to Ireland and Portugal and providing bridge loans.
Overview of EFSM programmes
- Council Regulation (EU) No 407/2010 of 11 May 2010 establishing a European financial stabilisation mechanism.
- Council Regulation (EU) 2015/1360 of 4 August 2015 amending Regulation (EU) No 407/2010 establishing a European financial stabilisation mechanism (04 August 2015)
- Commission Proposal for a Council Regulation amending Council Regulation (EU) No 407/2010 establishing a European financial stabilisation mechanism (22 July 2015)
- Council Implementing Decision of 21 June 2013 amending Implementing Decision 2011/344/EU on granting Union financial assistance to Portugal (OJ L 175, 27.6.2013, p. 47–53)
- Council Implementing Decision of 21 June 2013 amending Implementing Decision 2011/77/EU on granting Union financial assistance to Ireland (OJ L 173, 26.6.2013, p. 40–40)
- Commission Press Release MEMO/11/602 of 14 September 2011: Commission proposed better financial terms for EU loans to Ireland and Portugal
- Communication from the Commission to the Council and the Economic and Financial Committee on the European Financial Stabilisation Mechanism (COM(2010) 713 final, 30.11.2010)