This amendment is designed to make any debt restructuring more orderly, thereby reducing the costs linked to the uncertainty over how it will be done and how long it will take.
As already happened following the introduction of the current CACs in 2013, this amendment − which does not increase the likelihood of a default but reduces the uncertainty surrounding its outcome − could lead to a fall in sovereign debt risk premiums.4 There is no amendment to the reference in the current Treaty to private sector involvement, which remains strictly limited to exceptional cases and is in no way a precondition for obtaining financial assistance from the ESM (recital 12B of the reform proposal).