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Usually the answer to this is formulated in the rules of the institution. In Germany we call this the "Bachelor-/Masterprüfungsordnung" (for BSc and Msc) or "Promotionsordnung" (for a PhD).

The one from my institution contains something like

Die Promotion dient dem Nachweis der Befähigung zu vertiefter selbständiger wissenschaftlicher Arbeit.

which translates roughly to

The PhD degree certifies the ability for deepened and independent scientific work.

It also says that one needs a written work (called dissertation) and an oral exam. For the dissertation there is

Die Dissertation muss die Befähigung der Verfasserin oder des Verfassers zu vertiefter und selbständiger wissenschaftlicher Arbeit nachweisen und einen Beitrag zum Fortschritt der Wissenschaft auf [insert some field] darstellen.

which is roughly

The dissertation has to certify the ability of the writer to do deepened and independent scientific work and contribute to the advancement of science in [insert some field].

There are also some regulations for the oral exam but actually there is not a specific term what constitutes a passed or failed oral exam.