Full text of Act No. 289 / 2006 Coll.
Full text of Act No. 15 / 1998 Coll., on the Securities Commission and on the amendment and addition of other laws, as resulting from subsequent amendments
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Declared full text
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14.06.2006
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289
PRESIDENT OF THE GOVERNMENT
Announces
the full text of Act No. 15 / 1998 Coll., on the Securities Commission and on the amendment and addition of other laws as follows from the amendments made by Act No. 30 / 2000 Coll., Act No. 362 / 2000 Coll., Act No. 370 / 2000 Coll., Act No. 308 / 2002 Coll., Act No. 257 / 2004 Coll., Act No. 626 / 2004 Coll., Act No. 381 / 2005 Coll., Act No. 56 / 2006 Coll., Act No. 57 / 2006 Coll. and Act No. 70 / 2006 Coll.
THE LAW
on capital market supervision
Parliament has decided on this law of the Czech Republic:
CAPITAL MARKET SURVEILLANCE
SCOPE AND POWERS OF THE CZECH NATIONAL MARKET BANK
Subject matter
This law regulates the scope and powers of the Czech National Bank in the exercise of supervision of the capital market and lays down certain rights and obligations of the entities operating on that market.
In the exercise of supervision of the capital market, the Czech National Bank strengthens the confidence of investors and issuers of investment instruments in the capital market, in particular by contributing to the protection of investors and to the development of the capital market, and by encouraging education in this area.
Scope of the Czech National Bank in the field of capital market supervision
Czech National Bank in the Capital Market
(a) exercise supervision to the extent provided for by this Act and the specific legislation governing the capital market business, collective investment, bonds, company law and the allocation of funds of pension funds (1);
(b) decide on the rights, rights of protected interests and obligations of legal and natural persons, where provided for by this law or by specific legislation governing business in the capital market, collective investment, bonds, corporate law and the allocation of funds of pension funds (1);
c) controls the fulfilment of the information obligations of persons subject to the supervision of the Czech National Bank under this Act and the specific legislation governing the capital market, collective investment, bonds, corporate law and the allocation of funds of pension funds (1);
(d) carry out other activities under this Act.
repealed
Basic concepts
(1) An institutional investor means:
(a) a bank performing own-account transactions in capital-market investment instruments, an investment company, an investment fund, a pension fund and an insurance undertaking;
(b) a foreign person authorised to do business in the same fields in the territory of the Czech Republic as those referred to in (a).
(2) The service provider on the capital market is a securities dealer, a foreign securities dealer who provides investment services on the territory of the Czech Republic through a branch, a person receiving and transmitting orders relating to investment vehicles under the conditions laid down by special law (4a), an institutional investor, a depositary, a regulated market organiser, a securities settlement officer, a printing works operator authorised to print securities, a CSD (5), a Czech national bank in the scope of the securities register management.
(3) Capital market participant means, in particular, a provider of capital market services, an investor in the capital market, an issuer of securities, persons bound by such securities, the owner of securities, the issuer and the owner of another investment instrument.
Procedure before the Czech National Bank
(1) Proceedings in matters governed by this Act shall be governed by general legislation7), unless the various provisions of this Law or of special laws provide otherwise. The provisions of the Administrative Rules on the possible termination of the decomposition procedure (7a) shall not apply.
(2) The Czech National Bank will consider, before initiating proceedings in the field of capital market supervision (Section 3 (a)), whether it will initiate proceedings for the imposition of corrective measures or penalties for the alleged breach of obligations under this or special law. It is based in particular on the nature, gravity, duration and consequences of the infringement. If they do not initiate the procedure, they shall write an entry in the file and postpone the case. No decision to postpone the case shall be taken.
(3) The decision of the Czech National Bank in the field of capital market supervision may be subject to decomposition. Decomposition is decided by the Banking Board of the Czech National Bank, which also decides on an appeal against the decision of the organiser of a regulated market or exchange chamber under special legislature24e).
(4) In proceedings involving persons of a number higher than 30, documents may be served by a public order.
Subject matter of capital market supervision
Supervision of the Czech National Bank is subject to the capital market
(a) the fulfilment of the obligations laid down by this law to natural or legal persons;
(b) compliance with obligations laid down by special legislation1), 8), 9);
c) fulfilment of the obligations and conditions laid down in enforceable decisions of the Czech National Bank.
(1) The supervision of the Czech National Bank over the capital market is subject to compliance with the obligations laid down by the Commercial Code and the Capital Market Act
(a) when adjusting the takeover offer and in cases where the provisions relating to the takeover offer apply mutatis mutandis or mutatis mutandis;
(b) when acquiring or reducing a share of the voting rights of companies whose shares are listed;
(c) in connection with the acquisition by or controlled by a public limited liability company of its own shares;
(d) the public offer of subscription of shares.
(2) In exercising the supervision provided for in paragraph 1, the Czech National Bank shall act under this Act and shall be entitled to impose the measures and penalties provided for by this Act, the Capital Market Act and the Commercial Code.
(3) The Czech National Bank is entitled, on its own motion, to suspend the exercise of voting rights to a person who has not properly and in a timely manner fulfilled the obligation to notify a share of voting rights or to make a takeover offer, even though the law imposes such an obligation on him for a period of up to one year from the date on which the decision becomes legal if it is necessary to protect the interests of other shareholders, creditors or employees of the company. An appeal against this Decision shall not have suspensory effect. An enforceable decision to suspend the exercise of voting rights shall also be sent by the Czech National Bank to the company in which the exercise of the voting rights of the obliged entity has been suspended, to the CSD and published in a manner enabling remote access.
(4) The Czech National Bank is entitled, in its opinion on the offer of takeover or redemption submitted to it under the Commercial Code, to recommend or decide to require the applicant or target company (9a) to publish additional information on the information already published in accordance with a specific law and to inform the Czech National Bank of the disclosure until the results of the offer are published.
(1) The Czech National Bank is entitled to:
(a) require information or supporting documents from the person subject to its supervision of the capital market;
(b) to require information or evidence from any person, if necessary for the investigation of a fact, suggesting an infringement, concerning the protection of inside information or market manipulation under a special law;
(c) to require clarification of the facts from each party if the condition referred to in (b) is met; the provisions of the specific legislation governing administrative procedures for the summons, presentation and questioning of witnesses shall apply mutatis mutandis;
(d) require the submission of records, reports or associated data transmitted through the electronic communications network by a person subject to its supervision of the capital market and who has lawfully acquired them;
(e) require the provision of operational and localisation data from a person providing a public communications network or providing a publicly available electronic communications service 9b, subject to the condition laid down in (b);
(f) carry out an on-the-spot check under a special law on the person subject to its supervision of the capital market;
(g) when deciding on a request for the approval of a prospectus, require information and supporting documents from the managers or from the auditor of the issuer of the security, the person who prepared the prospectus or the securities dealer who places the securities.
(2) The Czech National Bank may apply the authorisation provided for in paragraph 1 (b) to (e), even in the case of an investigation of a fact other than that referred to in paragraph 1 (b), where this is necessary to establish the information requested by a foreign financial supervisory authority, provided that this is necessary for the performance of its financial supervision tasks, that such information may be provided to it in accordance with Article 26 and that it may exercise comparable powers in its national territory in the event of a similar request from the Czech National Bank.
(3) The person subject to supervision of the Czech National Bank for the Capital Market is obliged to provide the Czech National Bank with the necessary synergies in the context of the on-the-spot check, in particular upon request to allow access to its premises without delay. The person from whom the Czech National Bank is entitled to request information or supporting documents or records and particulars referred to in paragraph 1 or 2 shall be required to provide such information or supporting documents or records and data without undue delay, unless the Czech National Bank provides for a longer period.
(4) If there is a risk of delay, the Czech National Bank may initiate on-the-spot checks in relation to persons subject to supervision pursuant to Article 7 by carrying out the first act of the check at the same time when notifying the initiation of the check. The notification of the initiation of an inspection may be served by analogy with Article 10 (2) and (3).
(5) Persons for whom it is reasonable to suspect that, without the relevant authorisation or approval of the Czech National Bank, they are carrying out an activity for which the authorisation or approval of the Czech National Bank is required, the Czech National Bank is entitled to control to the extent necessary to establish the facts relating to such an activity and the controlled person is obliged to provide synergies.
Measures to remedy
(1) If the Czech National Bank exercises supervision of the capital market under this Act, it shall be entitled to take the following measures to remedy:
(a) to require the person subject to such supervision to take action within the time limit set in the measure and to report on the measures taken within the time limit set;
(b) determine how the person subject to such supervision is required to remedy the deficiency.
(2) The Czech National Bank may impose a public warning instead of a fine. At the same time, the Czech National Bank shall decide on the scope, form and manner of publication of the warning, as appropriate, at the expense of the person to whom the public warning is imposed.
Transfers
(1) A natural person commits an offence by:
(a) as a person subject to supervision by the Czech National Bank in the field of capital market, does not provide the information and documentation which the Czech National Bank is entitled to require pursuant to § 8 (1) (a);
(b) does not provide information, documentation, records, data or explanations which the Czech National Bank is entitled to require pursuant to § 8 (1) (b) to (d) and § 2;
(c) as the leading entity of the issuer of the security, the person who prepared the prospectus or the agent of securities placing the securities does not provide the information and supporting documents which the Czech National Bank is entitled to require pursuant to § 8 (1) (g);
(d) infringes an obligation which is subject to supervision under § 7a; or
(e) infringes the obligation to cooperate pursuant to Article 8 (5).
(2) A fine of up to CZK 5 000 000 may be imposed for an offence referred to in paragraph 1 (a), (b), (c) and (e) and a fine of up to CZK 50 000 000 may be imposed for an offence referred to in paragraph 1 (d).
Administrative offences against legal persons and business natural persons
(1) A natural person, whether legal or legal, commits an administrative offence by:
(a) as a person subject to supervision by the Czech National Bank in the field of capital market, does not provide the information and documentation which the Czech National Bank is entitled to require pursuant to § 8 (1) (a);
(b) does not provide information, documentation, records, data or explanations which the Czech National Bank is entitled to require pursuant to § 8 (1) (b) to (d) and § 2;
(c) as an auditor of the issuer of the security, the person who has drawn up the prospectus or of the securities dealer placing the securities does not provide the information and supporting documents which the Czech National Bank is entitled to require pursuant to § 8 (1) (g);
(d) infringes an obligation which is subject to supervision under § 7a; or
(e) infringes the obligation to cooperate pursuant to Article 8 (5).
(2) A fine of up to CZK 5 000 000 shall be imposed for the administrative offence referred to in paragraph 1 (a), (b), (c) and (e) and for the administrative offence referred to in paragraph 1 (d).
Common provisions on administrative offences
(1) The legal person shall not be liable for an administrative offence if he proves that he has made every effort to prevent an infringement.
(2) In determining the amount of the fine to a legal person, account shall be taken of the seriousness of the administrative offence, in particular the manner in which it was committed and the consequences thereof and the circumstances in which it was committed.
(3) The liability of a legal person for an administrative offence shall cease if the administrative authority has not initiated proceedings on him within 1 year of the date on which he became aware of it, but no later than 5 years from the date on which he was committed.
(4) Administrative offences under this law are discussed by the Czech National Bank.
(5) The provisions of the Liability and Punishment Act are applicable to liability for acts which have taken place in the course of or directly related to the business of a natural person (10).
(6) Fines for administrative offenses imposed by the Czech National Bank under this Act are collected and enforced by the competent tax office locally. The income from fines imposed on securities dealers under this Act is the income from the Guarantee Fund of securities dealers, the income from other fines imposed under this Act is the income from the state budget.
Procedure for remedies
(1) The administrative procedure in which the remedies provided for in this Act are imposed may be initiated within one year of the date on which the Czech National Bank became aware of the facts relevant for their imposition, but no later than 10 years after the date on which the obligation for which they are last imposed was infringed.
(2) If there is a risk of delay or irremovable interference in the rights of other persons, the proceedings in which the Czech National Bank imposes remedies and penalties under this law or special laws may also be initiated by the delivery of the decision of the Czech National Bank for a preliminary measure.
(3) The Czech National Bank is entitled to initiate both administrative proceedings and service by means of a public decree, provided that at least one of the conditions laid down in paragraph 2 is met and that the decision has not been delivered and the circumstances further suggest that the person concerned will avoid receipt of the decision and that delays in the legal effects of the notification could significantly make it more difficult or impossible to implement the remedies or penalties. In this case, the decision of the Czech National Bank is delivered at the moment of the publication of the Order on the official plate of the Czech National Bank.
(4) When imposing remedies under this law, the Czech National Bank is based in particular on the nature, gravity, manner, duration and consequences of the infringement. In deciding on the selection of remedies under this law, the Czech National Bank is also obliged to take into account the nature of the business and other gainful activities carried out by the person to whom the remedies are imposed.
(5) The person authorised to keep a register of investment vehicles shall be bound by a decision of the Czech National Bank relating to the register held by him as soon as it has been delivered to him, unless otherwise specified in the decision. The regulated market operator shall be bound by a decision of the Czech National Bank suspending securities trading and by a decision of the Czech National Bank on a provisional measure concerning securities as soon as it has been delivered, unless otherwise specified in the decision.
Provisional measures
(1) Except where interim measures may be imposed under the general administrative rules, the Czech National Bank is entitled to impose interim measures in the exercise of capital market supervision if this is necessary to ensure the protection of the rights and the rights of the protected interests of persons who are not parties to the administrative procedure, or if the execution of the final decision would be thwarted or seriously jeopardised.
(2) The Czech National Bank may impose a preliminary measure
(a) not to make any registration of the transfer of securities from that account to any other account of the same or other person or the registration of a contract lien for a person against whom corrective or penalty measures are taken;
(b) to any person holding an account of securities in order not to carry out any action to transfer securities from that account to any other account of the same or other person, or to register a contract lien, if it is an account to which they have been transferred by a person against whom corrective or penalty measures are taken or by another party to proceedings, securities from their accounts;
(c) to any person who has, in custody or administration of the securities, persons against whom corrective or penalty measures are taken, or to any other party to proceedings, in order not to carry out any action to transfer such securities to another person;
(d) a bank, a branch of a foreign bank or a savings and credit cooperative which they maintain for the person against whom the remedies or penalties are taken, or for any other party to the proceedings, a normal, deposit or other account, so as not to pay the funds from that account, do not charge them or otherwise charge them;
(e) a bank, a branch of a foreign bank or a savings and credit cooperative that holds a normal, deposit or other account in order not to pay the funds from that account, not to charge them or otherwise to charge them for an account to which they have been transferred by the person against whom the remedies or penalties are taken or by another party to proceedings.
(3) The decision on the interim measure shall be served on the parties to the proceedings and on the persons who, by decision on the interim measure, are required to comply with points (a) to (e) of paragraph 2; the decomposition brought against this Decision does not have suspensory effect. A party to the interim measure procedure referred to in paragraph 2 shall not be obliged under paragraph 2 (a) to (e).
(4) The provisional measure shall expire five days after its regulation. If the reasons for which it has been ordered are not omitted, the Czech National Bank shall file a motion against the parties before the court to impose the obligations referred to in paragraph 2 which were set out in the decision on interim measures. The application must be lodged before the court within five days of the order for interim action; in that case, the provisional measure shall expire only on the date of enforcement of the order of the court which decided on the application.
(5) The decision on interim measures shall also include an indication of when and under which conditions the interim measures cease to exist. If the Czech National Bank submits an application to the court pursuant to the third sentence of paragraph 4, it shall send the parties concerned the same day.
(6) The same obligation as may be imposed in the decision on interim measures under this Act may be imposed by the Czech National Bank in the exercise of its supervision of the capital market as a remedy under this Act or by the special legislation referred to in § 3. The decomposition against a decision under the first sentence shall not have suspensory effect. The Czech National Bank may indicate in the decision the duration of the obligation imposed or the condition whose implementation ceases to be effective. This condition may be that the Czech National Bank be notified of the withdrawal of the measures to correct the debtor.
repealed
Lists and documentation management and publication
(1) The Czech National Bank keeps lists
(a) securities dealers to which it has granted authorisation under the law governing the capital market business (11);
(b) brokers authorised under the law governing the capital market business (12);
(c) the organisers of the over-the-counter market to whom it has granted authorisation under the law governing the capital market business (13);
(d) persons carrying out securities settlement that have been authorised under the law governing the capital market business (14);
(e) printing works authorised to print securities which have been authorised under the law governing the capital market business (15);
(f) investment companies, mutual and investment funds operating under the Collective Investment Act (16);
(g) forced trustees and liquidations5),
(h) depositaries of collective investments18),
(i) pension funds and depositories of pension funds (19);
(j) insure20),
(k) investment intermediaries;
(l) investment companies located in a Member State of the European Union which provide their services in the territory of the Czech Republic with details of any organisational component located in the territory of the Czech Republic,
(m) foreign standard funds which offer publicly their securities on the territory of the Czech Republic, with details of the bank with which they have a contract under a special legislation governing collective investment (10c);
(n) foreign special funds which may offer their securities publicly on the territory of the Czech Republic, with details of the bank with which they have a similar contract as referred to in (m);
(o) settlement systems and participants in such settlement systems;
(p) participants in settlement systems listed by the Commission of the European Communities who have their registered office or place of business in the Czech Republic,
(q) participants in a CSD;
(r) credit rating agencies;
(s) persons authorised to keep separate records of investment vehicles;
(t) foreign officially recognised public markets;
(u) the securities prospectus approved by the Czech National Bank, including an electronic reference to the security prospectus, published in a manner that allows remote access on the website of the issuer or operator of the regulated market for at least 12 months after approval;
(v) commercial companies and natural persons which, at their request, are registered as qualified investors under the Capital Market Business Act;
(w) financial holding companies; these lists are sent by the Czech National Bank through the Ministry to the Commission of the European Communities and to the competent authorities of the Member States of the European Union,
x) securities dealers established in a Member State of the European Union who provide their services in the Czech Republic, with details of any organisational component located in the Czech Republic.
(2) The Czech National Bank publishes
(a) a list of foreign regulated markets published in the Official Journal of the European Union;
(b) a list of the settlement systems listed by the Commission of the European Communities.
(3) The Czech National Bank shall publish the lists referred to in paragraphs 1 and 2 in a way that allows remote access.
(1) The Czech National Bank publishes in a way that allows remote access or in the form of official communications from the Czech National Bank in the Bulletin of the Czech National Bank ("Bulletin")
(a) the list referred to in Article 13 (1) (a);
(b) final decisions of the Czech National Bank under this Act or specific capital market legislation (Section 3), which are of a fundamental nature, with the exception of those which contain the facts covered by the Special Act 21);
(c) statements of the final decisions of the Czech National Bank in the matter under this Act or specific capital market legislation (§ 3);
(d) the opinions of the Czech National Bank on the capital market;
(e) other communications or notifications of the Czech National Bank relevant to the capital market.
(2) The Czech National Bank in the Bulletin will announce the place where they will be publicly accessible for consultation
(a) approved prospectuses of listed securities, including investment and mutual funds, pension fund and insurance policies and bond issue conditions;
(b) information on the management of issuers of quoted securities pursuant to special legislation13), 16), 17), 22).
cancelled
Cooperation with the Chamber of Auditors of the Czech Republic
The Czech National Bank collaborates with the Chamber of Auditors of the Czech Republic, in particular in the implementation of internationally recognised audit procedures in relation to service providers on the capital market and issuers, and in directing the audit activities in the application of these procedures.
cancelled
Obligations of confidentiality and international cooperation
(1) The employees of the Czech National Bank overseeing the capital market and persons whose services the Czech National Bank uses in the exercise of supervision of the capital market, and their employees and members of the advisory bodies of the Czech National Bank for the capital market, are obliged to remain silent about all information obtained in connection with the exercise of its activities, functions or employment in the capital market supervision field. The information referred to in the first sentence may be used only in the manner and to the extent necessary for the performance of the tasks or functions relating to the supervision of the capital market or in judicial proceedings in connection with the decision or exercise of supervision of the capital market or in similar international proceedings. An infringement of the obligation of confidentiality shall not constitute a summary disclosure to a third party in such a way that the specific entity to which the information relates cannot be identified. The obligation of confidentiality shall continue after the activity, employment or function which has been established.
(2) The non-disclosure referred to in paragraph 1 does not constitute disclosure
(a) employees of the Czech National Bank who are involved in the supervision of the financial market in the Czech Republic,
(b) an office in a Member State of the European Union or in another State constituting the European Economic Area which operates in the exercise of supervision over the financial market;
(c) a person with his registered office or permanent residence in the Czech Republic, a Member State of the European Union or another State constituting the European Economic Area, which is:
1. the liquidator, the forced trustee, the bankruptcy trustee, the preliminary trustee, the equalisation trustee or a person having a similar function in an entity operating on the financial market and subject to supervision;
2. Auditor of the statutory financial statements of the entity operating in the financial market and subject to supervision,
3. the European Central Bank or another central bank responsible for monetary policy,
4. an operator of a securities settlement system providing settlement services to a regulated market operator in the Czech Republic where the provision of information is necessary to ensure the proper performance of the functions of that person in the event of default or impending default by the participant or participants in the regulated market to whom that person provides services;
5. operator of the compensation system for investors or deposit guarantee schemes;
(d) the Office in the Czech Republic or in a Member State of the European Union or another State constituting the European Economic Area, acting in the exercise of its oversight of persons referred to in (c) (1) and (2); In addition, the Czech National Bank will provide information to the Authority in the Czech Republic or in a Member State of the European Union or another State forming the European Economic Area, which operates in the exercise of oversight over payment systems and compliance with company law,
(e) the legislative services of central administrative bodies dealing with legislation in the financial market sector;
(f) authorities in the Czech Republic or in a Member State of the European Union or another State forming a European Economic Area active in criminal proceedings or dealing with combating the legalisation of proceeds from crime or the implementation of international sanctions to maintain international peace and security, the protection of fundamental human rights and the fight against terrorism; information may also be provided to an international organisation active in the fight against crime or the legalisation of proceeds from crime,
(g) a court in connection with bankruptcy proceedings or similar foreign proceedings conducted in the event of bankruptcy of a person subject to the supervision of the Czech National Bank; However, data on the person who tried to save the deceased cannot be provided,
(h) The Ombudsman in connection with an investigation under a special law.
(3) The information to the bodies and offices referred to in paragraph 2 shall be made available in the manner and to the extent necessary for the performance of their duties or their duties, and provided that they have an obligation to remain silent to a minimum extent comparable to the scope of this Law.
(4) Information obtained in connection with the exercise of supervision of the capital market may also be provided to the European Union authorities if this is necessary for the performance of an international contract to which the Czech Republic is bound and which has been duly declared.
(5) The information provided to the Czech National Bank by a foreign office acting in the exercise of supervision over the financial market cannot be used for any purpose other than that for which it was provided and may not be provided to anyone else without the consent of the provider.
(6) Information obtained by the Czech National Bank in the context of a control within the territory of a foreign State must not be provided to anyone else without the approval of the Financial Market Supervisory Authority of that State.
(7) The body or authority referred to in points (b), (c) (1) and (2) of paragraph 2, in the sentence (d) before the semicolon and in the sentence (f) before the semicolon, in a State which is not a Member State of the European Union or of the European Economic Area, may be provided with information for the purpose of carrying out its tasks in the field of capital markets on the basis of an agreement provided that it has an obligation to maintain confidentiality regime at least comparable to that provided for under this law.
cancelled
PROVISIONS TRANSITIONAL
(1) The procedure initiated by the Ministry under special laws before 1 April 1998 will be continued before the Commission under this law.
(2) The model of the State Capital Market Surveillance Card is laid down by the Commission by law.
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Regulation Information
| Citation | Full text of Act No. 289 / 2006 Coll., Act No. 15 / 1998 Coll., on the Securities Commission and on the amendment and addition of other laws, as resulting from subsequent amendments |
|---|---|
| Regulation Type | Declared full text |
| Author | - |
| Collection | Code of Laws |
| Date of Promulgation | 14.06.2006 |
|---|---|
| Effective from | - |
| Effective until | - |
| Status | Valid |
Legal Areas:
Banking, Money
Securities
Social security benefits
Finance
Competition
Economic (State)
Information, Data, Data
Wages, salaries, wages, compensation
Civil law
Civil law of procedure
Commercial law
Commercial companies
Labour law
Social security law
Administrative authorities
Administrative law
State (official) control
Business
Eligibility for the pursuit of certain professions (activities)
The regulation text is for informational purposes only.
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