Rules of conduct and compliance
In its capacity as the compliance supervisor, the Financial Market Authority monitors adherence to the compliance provisions laid down in the following laws and regulations:
- Stock Exchange Act (BörseG; Börsegesetz);
- 2007 Compliance Decree for Issuers (CDI 2007; Emittenten-Compliance-Verordnung);
- Compliance provisions and rules of conduct as referred to in:
- the 2007 Securities Supervision Act (WAG 2007; Wertpapieraufsichtsgesetz),
- the 2011 Investment Fund Act (InvFG 2011; Investmentfondsgesetz),
- the Alternative Investment Fund Managers Act (AIFMG; Alternatives Investmentfonds Manager-Gesetz) and the AIFM Regulation.
Below you can find information about:
- Supervisory tools of the FMA
- Companies subject to compliance supervision
- Information sources and relevant links
Supervisory tools of the FMA
The Financial Market Authority monitors adherence to statutory provisions by employing various supervisory tools. It carries out on-site inspections pursuant to Article 91 para. 3 no. 3 WAG 2007, Article 48q para. 1 no. 3 BörseG, Article 147 paras. 1 and 2 no. 4 InvFG 2011 as well as pursuant to Article 56 para. 1 in conjunction with para. 2 no. 3 AIFMG. In addition there are company visits and management talks. All of these supervisory tools are used to remain in constant contact with the supervised entities, to establish the market standard and to discuss current issues in the individual case.
Management talks and company visits are also used as a follow-up measure following on-site inspections.
Companies subject to compliance supervision
The following companies are subject to compliance supervision by the FMA:
- credit institutions:
- investment fund management companies/management companies;
- insurance undertakings and Pensionskassen;
- investment firms and investment service providers; and
- alternative investment fund managers (AIFMs)
All credit institutions as defined in the Austrian Banking Act (BWG; Bankwesengesetz) must take the compliance-related measures referred to in Article 82 para. 5 nos. 1 to 3 BörseG with a view to preventing insider dealing (Article 48s in conjunction with Article 82 para. 5 BörseG). Furthermore, credit institutions that, as part of their licence pursuant to Article 1 para. 3 BWG, are also authorised to provide investment services such as investment advice, portfolio management on an individual customer basis and/or receipt and transmission of securities orders (in accordance with Article 3 para. 2 nos. 1 to 3 WAG 2007) must also adhere to Chapter 2 – Organisational requirements of the WAG 2007 and any related provisions.
The InvFG 2011 contains comprehensive regulations for investment fund management companies with regard to rules of conduct and compliance, which are based on the WAG 2007. Additionally, investment fund management companies acting as credit institutions pursuant to the BWG are also subject to the compliance rules set out in the BörseG (Article 48s in conjunction with Article 82 para. 5 BörseG).
Where investment fund management companies also hold an additional licence to provide the investment services of investment advice and portfolio management on an individual customer basis (Article 5 para. 2 nos. 3 and 4 lit. a in conjunction with Article 6 para. 2 no. 12 InvFG 2011 or Article 4 nos. 1 or 2 lit. a AIFMG), certain provisions of the WAG 2007 (Article 2 para. 3 WAG 2007) apply to these activities.
Furthermore, investment fund management companies that hold a licence pursuant to the AIFMG must adhere to compliance provisions modelled on those in the WAG 2007 (AIFMG, AIFM Regulation).
In the case of issuers, the FMA monitors compliance with the provisions relating to the record of insiders pursuant to Article 48d para. 3 BörseG and adherence to the compliance provisions set out in Article 82 para. 5 nos. 1 to 3 BörseG in conjunction with the terms of the ECV 2007.
Insurance undertakings and Pensionskassen are also required to adhere to the compliance measures specified in the BörseG (Article 48s in conjunction with Article 82 para. 5 BörseG). Where insurance undertakings place units in investment funds as specified in Article 6 para. 3 of the 2016 Insurance Supervision Act (VAG 2016; Versicherungsaufsichtsgesetz), they are additionally subject to certain provisions of the WAG 2007 governing such activities (Article 2 para. 2 WAG 2007).
Investment firms and investment service providers are obliged, in accordance with the provisions of the WAG 2007, to act in their customers’ best interest. This is primarily ensured by adherence to the organisational requirements as laid down in Chapter 2 of the WAG 2007 as well as in the related regulations.
The AIFMG and the AIFM Regulation contain provisions with regard to rules of conduct and compliance which are based on the WAG 2007.
Information sources and relevant links:
Within the scope of regulatory development, the FMA has issued numerous circular letters to contribute towards ensuring legal certainty and as well as to inform those concerned of legal developments. In addition, the FMA also works with market participants to draw up self-regulation policies which represent minimum regulations that each market participant may turn into stricter rules. In coordination with the FMA, the Austrian Federal Economic Chamber (WKO) has prepared the Standard Compliance Code of the Austrian banking industry, the Austrian Insurance Association (VVO) has drawn up the Standard Compliance Code of the Austrian insurance industry, and the Association of Austrian Occupational Pensionsfunds has developed the Standard Compliance Code of the Austrian Pensionskassen.