The Austrian Financial Market Authority (FMA) has published its priorities for inspections for 2020 today. “Building on our medium-term risk assessment for 2020 – 2024 we have identified areas of the financial market that will present regulation and supervision with particular challenges in the coming years,” remarked the FMA’s Executive Board Members, Helmut Ettl and Klaus Kumpfmüller: The FMA warns that “escalating trade wars, political conflicts in many regions of the world, and the threat of multilateralism mean that the danger of a geopolitical recession is looming.” Furthermore, the continuing low interest environment, disruptions due to digital transformation, the increasing risk of money laundering as well as the spillovers of the consequences of climate change to the financial markets, mean that buyers and sellers in the markets are face with massive challenges. “In accordance with our principle of ‘anticipatory thinking, acting anticyclically’ we have developed a bundle of specific measures, to counter such challenges for the Austrian financial market, and have codified them in our priorities for supervision and inspections for 2020,” remarked Ettl and Kumpfmüller.
Priorities for supervision and inspections 2020
The FMA has defined the following thematic areas as priorities for supervision and inspections in the coming year:
- Using digitalisation addressing risks.
- According new business models in regulatory and supervisory terms.
- Ensuring Austria’s orderliness as a financial centre.
- Further development of collective consumer protection.
- Strengthening the resilience of financial services providers against crises.
- Improving the governance of the supervised entities.
Operationalisation of the priorities for inspections
The FMA has defined a range of specific measures for each of these thematic areas, to operationalise the priorities for inspections. For example, the challenges presented by digitalisation will be addressed for example by means of inspections being further refined in the areas of IT security and cyber security, with the risks arising from the digitalisation strategy of the entities being analysed and addressed, and the digital interconnectedness of market participants and the arising concentration risks being identified and kept in check. To further improve Austria’s orderliness as a financial centre, the strict “zero tolerance” approach in relation to the prevention of money laundering will be consequently continued, and for the first time expanded to include the world of crypto assets. Operators of electronic wallets (wallets) as well as swap and trading platforms for crypto-currencies are therefore required to register themselves and to observe the due diligence obligations for preventing money laundering. The effects of climate change on the financial markets and their participants do not constitute a separate priority for supervision and inspection in their own right, by all necessary preparations are taken under the objective of “increasing resilience against crises”: The degree to which individual market segments and participants are affected is assessed, the current state of the management of ESG risks (Environment, Social and Governance) is being ascertained, and a Guideline for managing sustainability risks drawn up.
The priority for supervision with regard to collective consumer protection will focus on the further development of the successfully implemented initiatives for ensuring cost transparency, the integrated approach for conduct supervision continues and the unpublished market report extended.
Transparency and Clarity of Supervision
The aforementioned measures are only few outstanding examples. For clear and detailed presentation of all the measures for the Priorities for supervision and inspections 2020” has been published on the FMA website (In German) at (https://www.fma.gv.at/publikationen/fakten-trends-strategien/) as well as in the Publication “Fakten, Trends und Strategien 2020” (Facts and Figures, Trends and Strategies 2020).
“The tool of determining priorities for supervision and inspections for the year ahead has proved itself. Firstly, doing so contributes towards creating awareness for the material risks and challenges for the coming years. Furthermore, their publication makes a valuable contribution towards ensuring the transparency and clarity of supervision activities, and also increases confidence in the Austrian financial market”, remarked Ettl and Kumpfmüller.
Journalists may address further enquiries to:
Klaus Grubelnik (FMA Media Spokesperson)
+43 / (0) 1 / 24959-6006
+43/ (0) 676 / 88 249 516