Legal regime of investment services companies

Approval of Royal Decree 358/2015 of 8 May on the legal regime of investment services companies and other entities that provide investment services

That decree is finalized incorporation into Spanish law of the rules of company solvency of investment services approved in 2013. EU directive extends also to businesses of investment services rules of credit institutions of the Basel III agreements.

The most innovative elements of the new standard are:

• Eligibility Requirements to be met by members of the board of directors, managing directors and other persons who hold key positions in companies of investment services . They are grouped into three categories: commercial and professional integrity , knowledge, and ability to exercise good governance. Since much of these requirements are new for these companies , it is expected to delayed entry into force of three months.

• Practices in corporate governance. Under publication of information on remuneration policies are developed and clearly define the roles of the three committees under the Directive: the appointment, the remuneration and risk.

• Initial capital requirements. Minimum capital requirements to the minimum required under Directive to promote competition in the provision of investment services adapt . Initial capital requirements are reduced for access to the activity of investment services company until the minimum allowed by the aforementioned Community Directive of 2013.

• Solvency of investment services companies. The elements that companies should consider investment services in the process of internal capital adequacy assessment and design of mechanisms for risk management are developed. These aspects have to be evaluated by the supervisor for each particular entity, and may establish additional capital requirements (Basilea’s Pillar II). The regime of capital buffers, which are essentially the same is also developed than can be imposed on credit institutions.

• Supervision of investment services firms. The scope of the supervisory function of the National Securities Market Commission and the framework of collaboration with other supervisors develop. In addition, a number of obligations on publishing and information, both for business investment services, to the National Securities Market Commission is established.