The Verkhovna Rada of Ukraine on 12 September adopted the law on amendments to some legislative acts of Ukraine concerning improvement of the functions of state regulation of financial services markets No. 1069-2 MPs by Danil Getmanets and Alexander by Dubinski (fraction “servant of the people”).
As the correspondent of Agency “Interfax-Ukraine”, this decision was supported by 296 deputies.
According to the document, the national Bank of Ukraine (NBU) and the national Commission on securities and stock market (NKTSBFR) July 1, 2020 are the successors of the National Commission, carrying out state regulation in the sphere of the markets of financial services (Natskomfinuslug), in exercise of the powers and functions of state regulation and supervision in the sphere of financial services markets within the powers established by the law “On financial services and state regulation of financial services markets”.
“This bill is a marker in the programme of cooperation with the IMF. It will significantly improve regulation of the supervision of financial institutions, because this regulation will become more transparent and more specific,” – said the Deputy head of the parliamentary Committee on Finance, taxation and customs policy Alexander Dubinsky, presented a bill in Parliament.
As noted in the explanatory Memorandum to the bill, its purpose is to reduce the amount of regulatory and Supervisory bodies in the markets of non-banking financial services through the distribution of functions of the financial services Commission, among other bodies, carrying out state regulation of markets of financial services. In particular, regulation and supervision in the system of funded pension provision, regulation and oversight of the financial-credit mechanisms and property management during housing construction and real estate transactions to implement the securities Commission, the other powers Natskomfinuslug proposed to be transferred to the NBU.
According to the draft law, the NBU is entitled to issue non-banking financial institutions and entities that are not financial institutions, but have the right to provide individual financial services, the license for activity implementation on provision of financial services, determines the order of their issuance, suspension, renewal and revocation (cancellation). In addition, the NBU determines requirements for persons intending to conduct activities for provision of financial services, including requirements for their property structure, corporate governance, risk management and internal control, terms of implementation of activities for provision of financial services, the implementation of which requires a respective license (licensing terms), and the order of the control over their observance.
In addition, the NBU establishes the right to set the fees for registration actions, based on the principle of reimbursement of costs associated with the provision of such services, to monitor compliance with non-banking financial institutions. In the event of a breach of financial services legislation (except for legislation regulating activities on the securities markets and in the system of funded pension provision) and regulatory legal acts of the Central Bank may apply sanctions and impose administrative sanctions.
Normative legal acts of the national Bank are regulatory acts are developed, reviewed and accepted subject to the requirements of the law “On foundations of state regulatory policy in economic activities”.
The main directions of supervision of the NBU in the field of non-banking financial services stipulates a regular assessment of the overall financial condition of the nonbank financial institutions, the results of its operations and the quality of corporate governance, the internal audit system and risk management, compliance with prudential ratios and other indicators and requirements that limit risks on operations with financial assets.
In addition, the national Bank establishes non-Bank financial institutions rules and reporting on their activities, the requirements for the amount and timing of its publication
The Central Bank is entitled to receive from the state organs and other persons information, including confidential, about the financial/property status of participants non-banking financial institutions, entities acquiring or increasing an essential participation in such institutions, their business reputation, the sources of funds that will be used for capital formation.
The NBU also has the right to request in writing from the subordinated structures of the copies of the documents and written explanations regarding their activities, who are required to provide the regulator.
In the limits of their powers in the sphere of state regulation of markets non-Bank financial services the NBU has the right to conduct scheduled and unscheduled inspections of activities of participants of financial services markets (except for consumers of financial services), their affiliated and related entities.
NBU approves the criteria by which to assess the risk degree from implementation of activities of participants of the market of non-banking financial services and its social significance, on the basis of which determines the periodicity of routine inspections. Planned inspections may be conducted no more than once per year. NBU approves the annual plan of inspections for the following calendar year no later than 25 December of the current year and will publish at its official website not later than 10 days after approval.