New surveillance model for the financial sector – prudential surveillance on pension funds (IORPs) continues to be exercised by the BFIC

Back
Categories
Newsflash
Topics
Pensions
Date:
18 Mar 2011

The Belgian legislator has opted to change the surveillance structure of the financial sector to a so-called "Twin Peaks" model.

The Belgian legislator has opted to change the surveillance structure of the financial sector to a so-called "Twin Peaks" model.

In such model the surveillance tasks are divided: the prudential surveillance on the financial institutions moves from the Banking, Finance and Insurance Commission (BFIC) to the National Bank of Belgium (NBB). The BFIC only maintains the surveillance on the rules of conduct of the financial institutions, the surveillance on the financial markets, products and intermediaries, and consumer protection (stock market operations, mergers and acquisitions, insider information, stock market manipulation, etc.). Last week, a Royal Decree was published in that respect in the Belgian Official Gazette.

Furthermore, the institutions for occupational retirement provision or IORPs are part of the group of financial institutions that are subject to the regulations. It has been decided not to split (yet) the prudential surveillance on IORPs and the social surveillance on occupational pensions during a transitional phase. The prudential surveillance remains temporarily with the BFIC. In a second phase, the prudential surveillance on IORPs will be transferred to the NBB. The BFIC and the NBB will have to draft a report by 31 December 2013 on the basis of which a decision on the transfer can be taken. Responsibility for social surveillance on occupational pensions will remain with the BFIC.

Please note that this exception does not apply to (group) insurers. The prudential surveillance on insurance companies will be transferred as of 1 April to the NBB, whereas the social surveillance on group insurances will be executed by the BFIC.

The introduction of a new surveillance model in the Belgian financial sector is also linked to a change of the name of the BFIC. The new abbreviation in Dutch and French will be as from 1 April "FSMA" (Financial Services and Markets Authority). Its full title will be "Autoriteit financiële diensten en markten" in Dutch and "Autorité des services et marchés financiers" in French