The current Executive Directors of the Austrian Financial Market Authority (FMA) were reappointed by the President of Austria following the signing of the certificate of appointment for a further five year term from 14 February 2018. The FMA’s Executive Directors expressed thanks for this “vote of confidence”, but understand the reappointment as being in recognition for the excellent work conducted by the staff of the FMA in the recent years, in particular the work conducted in the aftermath of the serious upheaval caused by the Global Financial Crisis. Messrs. Ettl and Kumpfmüller now look forward to being able to implement the strategy together that they presented during their application for reappointment, entitled “FMA 2023: transparent, proportional and European supervision”. The concept contains a supervisory strategy based on five key points: integrated supervision, prevention, transparency, proportionality and digitalisation.
Integrated Supervision
Austria’s legislator has established the supervision of the Austrian financial market in accordance with an international best practice analysis on the basis of an integrated approach. This means that supervision of the Austrian financial market is carried out under one roof. The FMA’s objective is therefore to strengthen and optimise the synergies between the individual operative supervision areas. The package of measures for supervisory reform in 2017 (“Aufsichtsreform 2017”) was drawn up by all stakeholders in concert and has already been passed by Austria’s Parliament, and makes decisive improvements to the legal framework, to allow the supervisory authority to act more quickly, efficiently and effectively. Redundancies have been eliminated and capacities freed up to enable even greater concentration on material issues.
Prevention
The supervisory reform also enabled the instrument of “pre-clearance” that has hitherto already been used in specific areas of supervision to be extended to cover almost all areas of supervision. The FMA will therefore be able in the future to provide supervised entities upon request with binding legal information about specific practical questions raised in advance. Its strict implementation and application will form a material contribution to avoid legal breaches occurring in advance. In addition, the sanctioning regime is intended to increasing act in a preventive manner in the future, rather than punishing on an ex-post basis. The European legislator in particular focuses on a concept of efficient dissuasive threats of punishment. Under European law, there are therefore massively increased limits for fines. The objective is ultimately, to a great an extent as is legally possible to do away with trivial fines imposed retrospectively for minor infringements, and to punish serious infringement prohibitively. By repealing the principle of accumulation in administrative penal law, this also allows a shifting in focus in administering sanctions for legal infringements.
Transparency
In order to strengthen understanding for regulatory and supervisory action, the FMA will now publish a “medium-term strategy for supervision” annually. This publication will also be used to disclose the by sectors the respective supervisory and inspection focuses for the coming year. The consultation procedure for the FMA’s regulatory intentions has been extended: in the future anyone will be able to submit an opinion about draft legislation and all opinions received shall be published on the FMA’s website.
Proportionality
The FMA’s risk-based approach to supervision, which links the intensity and depth of supervision to the level of risk of the business model, will be extended further. The new provisions planned in the supervisory form provide the FMA with additional tools for a proportional application of the rules. The FMA will increasingly advocate the application of the principles of subsidiarity and proportionality in the further development of regulation at European level.
Digitalisation
The FMA will specifically focus on the challenges arising for the financial markets as a result of the digital revolution. The scope ranges from digital and cost-efficient applications through digital and IT security issues through to ensuring that a fair and level playing field is maintained between analogue and digital solutions and products. The FMA will also place particular attention on ensuring the protection of investors and consumers.
“We are convinced that in implementing our ‘FMA 2023’ strategy, that we will make a significant contribution to the continuing development of dynamic and flexible supervision in Austria, and will increase the stability of Austria’s financial market,” Ettl and Kumpfmüller commented.
The FMA’s current Executive Board members, Helmut Ettl and Klaus Kumpfmüller applied to serve a further term as Executive Directors of the FMA as part of the Executive Board positions being publicly advertised in accordance with the Austrian Tender Act (AusG; Ausschreibungsgesetz). Following a round of hearings conducted with the best qualified applicants, as stipulated in the Financial Market Authority Act (FMABG; Finanzmarktaufsichtsbehördengesetz), one Executive Board member was proposed by the Federal Minister of Finance and the other by the Oesterreichische Nationalbank (OeNB), with both being approved by the Council of Ministers (Ministerrat) on 20 September 2017. They were then appointed for a further term as Executive Directors of the Financial Market Authority (FMA) following the signing of the certificate of appointment by the President of Austria.
Journalists may address further enquiries to:
Klaus Grubelnik (FMA Media Spokesperson)
+43/(0)1/24959-6006
+43/(0)676/882 49 516