The freedom to provide services and the freedom of establishment are basic principles of the European Union (EU). For financial services, this means that: A broker, crypto-asset service provider, an insurer or a bank with a licence in one country is also able to provide services in other EU countries without requiring and additional authorisation. The Austrian Financial Market Authority (FMA) informs consumers about what their need to be aware of if they uses companies from other EU countries (or EEA countries, which in addition include Iceland, Liechtenstein, and Norway) in it series, “Let’s talk about money” (Reden wir über Geld).
In particular, it is important to remember that:
- authorisation and ongoing supervision are conducted by the competent authority in the company’s home country. The FMA is informed that a company is starting operating in Austria, but has no comprehensive supervisory powers.
- Guarantee systems like the deposit guarantee scheme for banks or the investor compensation scheme for investment firms are as a rule allocated in accordance with the company’s registered address. While the rules are harmonised throughout the EU, when something goes wrong, communications and processes abroad may be more complicated for consumers.
- Austrian insurers are required to form a cover pool (Deckungsstock) for life insurance products, that is held separately from the insurance company’s other assets – such a system does not exist in every country. Find out information about the specific provider.
- In any case, check whether the provider is listed in the FMA’s Company Database, and whether it is authorised for the type of business that you wish to conduct with it.
Financial services providers that operate on a cross-border basis ensure greater competition and more options. This means a greater choice for consumers, as well as more individual responsibility. Consumer protection is not equally strong in all countries, while legal enforcement if problems arise sometimes being regulated differently. Even if the publicity or website is in German (or English), this does not automatically mean that customer service is easy to reach, or that problems are able to be handled without any difficulties.
The new edition of “Let’s talk about money” can be found at https://redenwiruebergeld.fma.gv.at/en/. Follow us also on Instagram at @redenwiruebergeld and listen to the “Reden wir über Geld” Podcast with Fiona Springer and Patricia Floh-Weninger.
Journalists may address further enquiries to:
Boris Gröndahl (FMA Media Spokesperson)
Telephone: +43/(1)249/59-6010
Mobile: +43 676 8824 9995
E-Mail: [email protected]