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March 2010 Financial Services Industry monthly bulletin
March 2010 Financial Services Industry monthly bulletin
March 2010 Financial Services Industry monthly bulletin
March 2010 Financial Services Industry monthly bulletin
March 2010 Financial Services Industry monthly bulletin
March 2010 Financial Services Industry monthly bulletin
March 2010 Financial Services Industry monthly bulletin
March 2010 Financial Services Industry monthly bulletin
March 2010 Financial Services Industry monthly bulletin
March 2010 Financial Services Industry monthly bulletin
March 2010 Financial Services Industry monthly bulletin
March 2010 Financial Services Industry monthly bulletin
March 2010 Financial Services Industry monthly bulletin
March 2010 Financial Services Industry monthly bulletin
March 2010 Financial Services Industry monthly bulletin
March 2010 Financial Services Industry monthly bulletin
March 2010 Financial Services Industry monthly bulletin
March 2010 Financial Services Industry monthly bulletin
March 2010 Financial Services Industry monthly bulletin
March 2010 Financial Services Industry monthly bulletin
March 2010 Financial Services Industry monthly bulletin
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March 2010 Financial Services Industry monthly bulletin

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The Financial Services Industry Monthly Bulletin is a banking and finance law publication by Reff & Associates (correspondent law firm of Deloitte Romania) and Deloitte Tax. …

The Financial Services Industry Monthly Bulletin is a banking and finance law publication by Reff & Associates (correspondent law firm of Deloitte Romania) and Deloitte Tax.

Each month, our specialist team of finance lawyers and tax advisors will keep you updated with the latest legal, regulatory and tax developments in the financial services industry in Romania as well as with the recent changes and trends in the international financial regulations.

The areas covered by our bulletin include:

Banking and non-banking financial institutions
Capital markets
Insurance companies
Private pension funds

Published in: Economy & Finance
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  • 1. March 2010
  • 2. NBR amends the current regulatory framework regarding the working procedures corresponding to the running of monetary market operations performed by NBR and the permanent facilities granted to eligible participants NBR enacted Order no. 3/2010 for the amendment of NBR’s Order no. 8/2006 regarding the working procedures corresponding to the running of monetary market operations performed by NBR and the permanent facilities granted to eligible participants. The above mentioned Order was published in the Official Gazette no. 165/15.03.2010, shall enter into force on 19.04.2010 and may be accessed here. NBR amends the interest rates paid for the minimum mandatory reserves corresponding to the period 24 February – 23 March 2010 NBR enacted Circular no. 9/2010 regarding the interest rates paid for the minimum mandatory reserves corresponding to the period 24 February – 23 March 2010. The annual interest rates set through the above mentioned Circular are the following:  2.65% for RON;  1.19% for EUR;  0.71% for USD. Circular 9/2010 above mentioned was published in the Official Gazette no. 179/19.03.2010 and may be accessed here. NBR amends the fees applicable to the performance of the operation regarding the issuance and receipt of cash in relation to credit institutions and State Treasury NBR enacted Regulation no. 3/2010 on the fees charged by NBR for the operations regarding the issuance and receipt of cash in relation to credit institutions and State Treasury. The above mentioned regulation was published in the Official Gazette no. 180/22.03.2010 and may be accessed here. NBR amends the current regulatory framework regarding the liquidity of credit institutions NBR enacted Regulation no. 4/2010 for the amendment of NBR’s Regulation no. 24/2009 on credit institutions liquidity by extending the deadline until credit institutions should complete the necessary steps to comply with the provisions of the said Regulation no. 24/2009. The above mentioned Regulation was published in the Official Gazette no. 192/26.03.2010 and may be accessed here.
  • 3. NBR amends the current regulatory framework regarding the reporting of the minimum capital requirements applicable for credit institutions NBR enacted Order no. 5/2010 for the amendment of NBR’s Order no. 12/2007 regarding the reporting of the minimum capital requirements for credit institutions. The main amendments brought by Order no. 5/2010 are described below as follows:  The term until when credit institutions should send the reports on a consolidated basis is set for May 15 of the following financial year;  If, further to the approval of annual financial statements by the general meeting of shareholders, the level of own funds or of comprising elements which enter into the calculation of indicators of prudential own funds calculated according to the own funds as of December 31 change, the report on the respective own funds and prudential indicators affected by the change, drafted for the last month of the previous financial year and for each month of the period since the beginning of the year until the date of approval of annual financial statements will be redrafted and retransmitted to NBR within 20 calendar days as of the date of approval of annual financial statements, but not later than 15 May. The said Regulation was published in the Official Gazette no. 192/26.03.2010 and may be accessed here. Romanian Parliament amends the current regulatory framework regarding the incorporation and functioning of the Fund for the Guarantee of Deposits in the Banking System Romanian Parliament enacted Law no. 44/2010 approving Government’s Emergency Ordinance no. 80/2009 for the amendment of Government’s Ordinance no. 39/1996 regarding the incorporation and functioning of the Fund for the Guarantee of Deposits in the Banking System. The above mentioned Law was published in the Official Gazette no. 200/30.03.2010 and may be accessed here. FGDBS issued Communication no. 1/2010 regarding the list of credit institutions participating to the Fund whose depositors’ benefit of the guarantee of their deposits The above mentioned Communication was published in the Official Gazette no. 139/02.03.2010 and may be accessed here. (communication section therein) Ministry of Finance enacted Order no. 708/2010 regarding the issuance prospectus of the discount treasury certificates and benchmark state bonds for March 2010. The above mentioned Order was published in the Official Gazette no. 140/3.03.2010. The Committee amends the legal framework regarding the state aide scheme to facilitate access to financing in the current period of economic and financial crisis, consisting of guarantees granted for the benefit of small and medium enterprises The Committee adopted Decision no. 14/2010 amending the Norm establishing a state aid scheme to facilitate access to financing in the current period of economic and financial crisis, consisting of guarantees granted for the benefit of small and medium enterprises. Decision no. 14/2010 entered into force on the date of its publication in the Official Gazette of Romania no. 153/09.03.2010.
  • 4. NBR amended the templates of the periodical financial records and of methodological norms regarding their drafting and utilization applicable to non-banking financial institutions NBR issued Order no. 4/2010 on amending the templates of the periodical financial situations and of methodological norms regarding their drafting and utilization applicable to non - banking financial institutions. The above mentioned Order was published in the Official Gazette no. 196/30.03.2010 and may be accessed here.
  • 5. PPSSC has amended the current regulatory framework on the control procedure for entities operating in the private pension system PPSSC adopted Norm no. 3/2010 on the control procedure for entities operating in the private pension system. Norm no. 3/2010 was approved through PPSSC’s Decision no. 4/2010, published in the Official Gazette no. 185/23.03.2010 and may be accessed here.
  • 6. NSC repeals the national regulatory framework regarding the criteria for agreeing the rating agencies NSC adopted Order no. 7/02.03.2010 repealing Instruction no. 4 /2007 regarding the criteria for agreeing the rating agencies, taking into consideration Regulation (EC) no. 1060/2009 of European Parliament and Council regarding the credit rating agencies, published in the Official Journal of European Union no. 302/17.11.2009, directly applicable in all Member States. The above mentioned Order may be accessed here. NSC amended the current legal framework on the exercise of certain rights of shareholders in general meetings of the companies NSC has adopted Regulation no. 7/2010 amending NSC’s Regulation no. 6/2009 on the exercise of certain rights of shareholders in general meetings of companies. Among the amendments brought through the above mentioned regulation it is to be outlined the limitation at maximum 15 days as of the date of the publishing of the summoning notice, of the term within one or more shareholders representing, individually or jointly, at least 5% of the share capital have the right: (i) to introduce new items on the agenda of the general meeting and (ii) to submit draft resolutions for items included or to be included on the agenda of the general meeting. The above mentioned regulation was published in the Official Gazette no. 186/24.03.2010 and can be accessed here. NSC approves the registration of Property Fund NSC approved Order no. 8/2010 regarding the approval of the Regulation no. 4/2010 regarding the registration with NSC and the functioning of the ”Property Fund” Joint Stock Company. The main provisions of the NSC Regulation no. 4/2010 are as follows: Property Fund registration at the NSC The Property Fund shall be registered with NSC as other undertaking for collective investment of a special kind, in the form of a closed-end investment company, established in order to grant reparations for cases where the restitution in kind of real estate assets is not possible. If prior to the submission of the registration application with NSC, the Property Fund signed a management agreement with an Investment Management Company ("IMC") from other Member State, that IMC shall request the authorization from NSC for its Romanian branch before performing the management of the Property Fund’s portfolio. Amending the Property Fund Documents The subsequent amendments brought to the constitutive act or to the management agreement concluded between the Property Fund and IMC, the increase or reduction of capital, change of headquarters, set-up or closing down of secondary offices, as well as the amendments brought to the depository contract or to the issuance prospectus, will be subject to NSC approval before their entry into force. Supervision and reporting requirements of the IMC branch NSC is responsible for supervising the Romanian branch of the IMC from other Member State, as concerns the management activities for Property Fund portfolio. The Romanian branch of the IMC shall draft and submit to NSC half-yearly and annual reports on its activity.
  • 7. The method of calculating the net assets of Property Fund Property Fund's net assets value is determined as the difference between the total assets value and the summed value of company’s liabilities and revenues recorded in advance. The Property Fund’s total assets value is calculated monthly, and also at any other time required by the regulations of any regulated market on which company’s shares are traded, by aggregating the (i) fixed assets, (ii) current assets, (iii) financial derivative instruments and (iv) expenditures incurred in advance. The total value of Property Fund’s liabilities is determined based on the information provided by its own accounting. The unit value of the net assets at a certain date will be calculated as the result of dividing the net assets value with the number of shares issued and placed in circulation at that time, including the shares held in treasury. After being admitted on a regulated market/alternative trading system, the Property Fund will comply with reporting requirements established in accordance with the applicable legal provisions. The above mentioned Regulation entered into force on 12.03.2010, the date of its publication in the Official Gazette no. 161/12.03.2010, and may be accessed here. NSC establishes the regulatory framework applicable to securities lending operations and of establishment of guarantees associated to these and of short selling NSC issued Regulation no. 5/2010 regarding the usage of global accounts system, the usage of mechanisms with and without pre-validation of financial instruments, the performance of securities lending and establishment of guarantees associated to them and of short selling (“Regulation”). The main provisions of the Regulation are described below as follows:  in relation to the usage of global accounts system for performing of securities lending and establishing of associated guarantees o the exclusive purposes for which the securities lending operations can be performed, respectively: − performance of short selling including, the case when the securities are first borrowed by the intermediaries who further borrow them to their clients for performing short selling; − finalization of transaction disbursement in case (i) the custodian - intermediary does not confirm the disbursement of a transaction and (ii) the securities are not available for disbursement on the disbursement date; − maintenance of the market maker quality; − performance of disbursement operations of derivatives that imply physical delivery; − in any other situation in view of finalizing the disbursement, in such case the intermediary shall immediately notify the NSC and apply the corresponding penalties in accordance with its own regulations;
  • 8. o in case the securities lending operations and the establishment of associated guarantees are performed between an intermediary and one of its clients or the client of another intermediary, or the accounts of 2 clients of an intermediary, the intermediaries have the obligation to use a standard securities lending agreement concluded in base of the “Global Master Securities Lending Agreement” harmonized with Romanian legislation in force; o the associated guarantees shall be established in accordance with the legal framing of the contracting parties in the legislation regarding the guarantees as: (i) financial guarantees and (ii) as security interest  in relation with short selling operations o the obligation to conclude a securities lending framework agreement prior to perform a short selling operation; o obligations of the intermediaries to assure the technical support of the short selling operation; o the price of order of short selling should be at least equal with the best selling price registered on the main trading market at the moment when the order was introduced  several accounting obligations of the central depository and of the participants to the central depository system; o the prohibition of securities lending operations having as sole purpose the gain of dividends or voting rights in the general meeting of shareholders; o that the liability for the observance of the purpose of the securities lending belongs to the involved intermediaries with respect to clients and, if case, to the central depository; o the technical and operational conditions of usage;  in relation with the securities lending operation and the establishment of guarantees associated to them o the obligation of the central depository to publish the list of the securities traded on a regulated market that can be the object of short selling including: (i) a section with the most liquid securities and (ii) a section with any other securities traded through market makers; o the central depository’s obligations of supervision of the securities lending operations; o the obligation of the parties performing securities lending operations to conclude a framework agreement and additional acts to it as per the (i) prior to the submission of the selling order, in case of applying the pre-validation mechanism or (ii) the latest at the date of disbursement of the disbursement term, in case of applying the mechanism without pre- validation;
  • 9.  the obligation of the participants to the central depository system to report to the central depository, on the last working day of the month, all information regarding the identity of the clients owning shares of financial investment undertakings (“SIF”) and the number of SIF shares owned; It is to be underline that the Regulation amends in the same time NSC’s Regulation no. 13/2005 on the authorization and functioning of the central depository, the clearing houses and central counterparties. Regulation was published in the Official Gazette no. 169/16.03.2010 and may be accessed here. NSC amends the current regulatory framework applicable to the performance and registration of the annual financial statements by the entities which are authorized, regulated and supervised by the said institution NSC enacted Order no. 13/2010 for the approval of NSC’s Instruction no. 1/2010 for the amendment of NSC’s Instruction no. 2/2007 regarding the performance and registration of the annual financial statements by the entities which are authorized, regulated and supervised by NSC, as subsequently amended. The above mentioned Order was published in the Official Gazette no. 173/17.03.2010 and may be accessed here. NSC sets new informing obligations for the regulated entities NSC established through Decisions no. 7 and 8 as of 11.03.2010 certain obligations for the entities authorized, regulated and supervised by NSC („the Entities”) as concerns the information to be shared by internet. In this respect, according to Decision no. 7/2010, the Entities have the obligation of publishing on their own internet pages the regulations/procedures/rules approved by NSC, within 3 working days as of the date of the approval’s notification by NSC. Moreover, the Entities have the obligation to ensure a non-discriminating treatment regarding the information shared through internet means for all participants to their own systems and/or beneficiaries of the services offered. Decision no. 8/2010 establishes the obligation of the Entities to own and update a web page. Moreover, the Entities covered by the provisions of Law no. 656/2002 on preventing and sanctioning money laundering shall create on their website a section that will include at least:  public statements issued by MONEYVAL Committee;  public statements issued by the Financial Action Task Force (GAFI/F.A.T.F.);  alerts regarding the news occurred in the field of preventing and sanctioning money laundering and terrorism financing;  links to web pages of the Financial Action Task Force (GAFI/F.A.T.F.), of the MONEYVAL Committee and of the National Authority for Prevention and Control of Money Laundering. Further on, the Entities covered by the provisions of Government Emergency Ordinance no. 202/2008 regarding the implementation of international sanctions have the obligation to create on their own web page a different section regarding the international sanctions, which shall include at least one link to the section “International Sanctions” of the web page of NSC. The deadline for implementing Decision no. 8/2010 is 30 business days as of its effective date. Both Decision entered into force as of their publication in the Electronic Bulletin of NSC namely as of 12.03.2010. NSC’s Decision no. 7/2010 mentioned above may be accessed here, while NSC’s Decision no. 8/2010 may be accessed here.
  • 10. Proposal for Order regarding the reporting of potential amendments of the economic value of the credit institutions as a result of changing interest rate levels Proposal for Order regarding the reporting of the exposers towards the persons having special relations with the credit institutions The full text of the proposal can be accessed here. Proposal of Norms for the archiving activity of insurers, reinsurers and insurance/reinsurance intermediaries The full text of the proposal can be accessed here. Proposal of Prudential Norms for resolving complaints regarding the activity of insurers, reinsurers and insurance/reinsurance intermediaries The full text of the proposal can be accessed here. Proposal of Norms on the profit rates of return in case of privately managed pension funds The said proposal can be accessed here. Proposal of Norm regarding the obligations of reporting and transparency in the voluntary pensions system The content of the proposal can be accessed here. Proposal of Instruction regarding the audit of informatics systems of the entities authorized, regulated and supervised by NSC The aforementioned proposal may be accessed here.
  • 11. The European Central Bank has published its Guidelines ECB/2010/1 on monetary policy instruments and procedures of the Euro - system. The said Guidelines amend Guidelines ECB/2000/7 and were published in the Official Journal of European Union no. L 63.22/12.03.2010 which can be accessed here.
  • 12. European Commission issued a Notice regarding the current level of interest rates applicable to the recovery of state aide and of reference/ discount for the 27 Member States applicable as of 1st March 2010. The above mentioned Notice can be accessed here. The European Commission has published an overview of the results of its public consultation on an EU framework for cross-border crisis management in the banking sector. For further details please access here. CEBS has published on 10 March 2010 a consultation paper on draft guidelines on liquidity cost benefit allocation. The main objective of the draft guidelines is to provide high-level guidance to institutions on the main elements to be considered when creating or reviewing adequate fund allocation mechanisms including liquidity cost, benefits and risks. The deadline for delivering any comments on the consultation is 10 June 2010. For more details please access here. CEBS published on 11 March 2010 its consultation paper on the review of its Guidelines on the recognition of External Credit Assessment Institutions. For further information please access here. CEBS initiated on 11 March 2010 the public consultation regarding its Guidelines on the exemptions from the rules applicable in case of short-term large exposures. For more details please access here.
  • 13. Sectorul Serviciilor Financiare Buletin lunar 9 On the 3rd of March 2010, CEIOPS presented its report regarding the liquidity premiums within insurance and occupational pension systems. The above mentioned report can be accessed here.
  • 14. Dates and time 20 April 2010, 9 – 11 am – Prague 21 April 2010, 9 – 11 am – Bratislava 22 April 2010, 9 – 11 am – Budapest 27 April 2010, 9 – 11 am – Bucharest, Deloitte office 28 April 2010, 9 – 11 am – Warsaw Location: Deloitte Bucharest, 4-8 Nicolae Titulescu Road, 3rd floor, Brancusi conference room Fee: Free of charge Breakfast will be provided Deloitte Tax and its Global Employer Services teams are pleased to invite you to our Central European Tax Business Breakfasts Road Show, which will take place individually in five Central European countries. The title of the upcoming Business Breakfasts is “New EU Social Security legislation – Regulation (EC) 883/2004”, which will become effective as of 1 May 2010. Do you have any international mobile employees? Do you plan to assign your employees to another EU country this year? Do you have experience applying EU social security rules? Are you aware that these rules will change as of 1 May 2010? Are you ready for the change? If so, then this Business Breakfast is designed for you. Separately in five locations in Central Europe, you will have a chance to meet our European social security specialists from Deloitte London, as well as the local social security experts from our local GES practices. The Business Breakfast will give you a European legislation overview, as well as local specifics and social security planning opportunities. Time will also be dedicated to answering any questions you may have. Agenda  Individuals covered by the EU rules  Basic rules  Changes from the current/old EU rules  Areas of uncertainty  Application of new EU legislation in practice  Deloitte capability to assist with social security issues  Optimising/reducing social security costs Presenters Deloitte London – George Milmine (Senior Manager) Deloitte Romania – Raluca Bontas (Manager) The event will be held in English. Q&A sessions will be held in English. Registration and other information Participation to this event is by invitation only but feel free to forward the invite to colleagues if you consider it appropriate. The conference is free of charge for recipients of the invitation. Please take into consideration that due to the limited number of seats, the first-come-first- served policy applies. You can register via e-mail at: mciobanu@deloittece.com.
  • 15. Sectorul Serviciilor Financiare Buletin lunar 11 Reff & Associates is the correspondent law firm of Deloitte Romania, fully integrated with the Deloitte multi-disciplinary advisory practice and affiliated to a network of law firms and legal departments working with Deloitte all over the world. Deloitte’s correspondent legal practice provides assistance to clients in Romania on various matters pertaining to mergers and acquisitions, corporate and commercial law, finance, banking and capital markets, real estate, project finance, employment, competition, fiscal and commercial litigation, and intellectual property. In the financial services sector, Reff & Associates provides the full range of services to banks and financial institutions, including: - Finance deals: transaction support in bilateral and syndicated loans, loan workouts, securitisation, loan transfers and assists in drafting and negotiating the transaction documentation (loan agreements, security and other ancillary documentation). - M&A transactions in the financial services sector: advice on the structure of the transaction, the pre-contractual documentation, due diligence, drafting/negotiating the purchase agreements and assisting the implementation of the transaction. - Regulatory assistance: ongoing assistance with respect to the specific legal and regulatory requirements applicable to banks / non banking financial institutions operating in Romania, development of new financial products, representation in front of the regulators (National Bank of Romania, Insurance Supervisory Commission, Securities Commission etc.). Andrei Burz Pinzaru Partner + 40 21 207 52 05 aburzpinzaru@deloittece.com Simina Mut Manager + 40 21 207 52 69 smut@deloittece.com Leontin Trifa Manager + 40 21 207 53 13 ltrifa@deloittece.com
  • 16. George Mucibabici Chairman tel: + 40 21 207 52 55 e-mail: gmucibabici@deloittece.com Audit Santiago Pardo Partner tel: + 40 21 207 54 92 e-mail: sapardo@deloittece.com Enterprise Risk Services Gary Bauer Director tel: + 40 21 207 52 19 e-mail: gbauer@deloittece.com Financial Advisory Antonis Ioannides Partner tel: + 40 21 207 56 26 e-mail: anioannides@deloittece.com Tax Rodica Segarceanu Partner tel: + 40 21 207 52 31 e-mail: rsegarceanu@deloittece.com Legal Andrei Burz-Pinzaru Partner, Reff&Associates correspondent law firm of Deloitte Romania tel: + 40 21 207 52 05 e-mail: aburzpinzaru@deloittece.com Consulting Razvan Horobeanu Manager tel: + 40 21 207 53 57 e-mail: rhorobeanu@deloittece.com Actuarial & Insurance Solutions Slawomir Latusek Consultant tel: + 48 (22) 511 04 54 e-mail: slatusek@deloittece.com
  • 17. Deloitte refers to one or more of Deloitte Touche Tohmatsu, a Swiss Verein, and its network of member firms, each of which is a legally separate and independent entity. Please see www.deloitte.com/ro/about for a detailed description of the legal structure of Deloitte Touche Tohmatsu and its member firms. Deloitte provides audit, tax, consulting, and financial advisory services to public and private clients spanning multiple industries. With a globally connected network of member firms in more than 140 countries, Deloitte brings world-class capabilities and deep local expertise to help clients succeed wherever they operate. Deloitte's more than 169 000 professionals are committed to becoming the standard of excellence. Deloitte's professionals are unified by a collaborative culture that fosters integrity, outstanding value to markets and clients, commitment to each other, and strength from cultural diversity. They enjoy an environment of continuous learning, challenging experiences, and enriching career opportunities. Deloitte's professionals are dedicated to strengthening corporate responsibility, building public trust, and making a positive impact in their communities. This publication contains general information only, and none of Deloitte Touche Tohmatsu, its member firms, or its and their affiliates are, by means of this publication, rendering accounting, business, financial, investment, legal, tax, or other professional advice or services. This publication is not a substitute for such professional advice or services, nor should it be used as a basis for any decision or action that may affect your finances or your business. Before making any decision or taking any action that may affect your finances or your business, you should consult a qualified professional adviser. None of Deloitte Touche Tohmatsu, its member firms, or its and their respective affiliates shall be responsible for any loss whatsoever sustained by any person who relies on this publication. © 2010 Deloitte Romania

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