RESOLUTION OF BOARD OF THE NATIONAL BANK OF UKRAINE

of December 28, 2020 No. 169

About approval of the Regulations on implementation of permanent supervision by the National Bank of Ukraine in the markets of non-bank financial services

According to part one Item 8-1 of Article 7, to articles 55-1, 56 of the Law of Ukraine "About the National Bank of Ukraine", to Articles 20, of 21, of 28, 29 Laws of Ukraine "About financial services and state regulation of the markets of financial services", to Articles 35 - 37 Laws of Ukraine "About insurance", article 26 of the Law of Ukraine "About credit unions", article 5 of the Law of Ukraine "About consumer crediting", for the purpose of settlement of procedure by the National Bank of Ukraine of supervision of activities in the markets of non-bank financial services in the form of permanent supervision the Board of the National Bank of Ukraine DECIDES:

1. Approve Regulations on implementation of permanent supervision by the National Bank of Ukraine in the markets of non-bank financial services which are applied.

2. The resolution becomes effective from the date of, its official publication following behind day.

Approved by the Resolution of Board of the National Bank of Ukraine of December 28, 2020 No. 169

Regulations on implementation of permanent supervision by the National Bank of Ukraine in the markets of non-bank financial services

I. General provisions

1. This provision is developed according to the laws of Ukraine "About the National Bank of Ukraine" "About financial services and state regulation of the markets of financial services" (further - the Financial services act), "About insurance", "About credit unions", "About financial mechanisms of stimulation of export activities" (further - the Law on EKA), taking into account provisions of the Directive 2013/36/EU of the European parliament and Council of June 26, 2013 About access to activities of credit institutes and prudential supervision in relation to credit institutes and investment firms that makes changes to the directive 2002/87/EU and terminates Directives 2006/48/EU and 2006/49/EU, and also the Directive 2009/138/EU of the European parliament and Council of November 25, 2009 about the beginning and conducting activities in the field of insurance and reinsurance (solvency of II), for the purpose of establishment by the National Bank of Ukraine (further - National Bank) supervision procedure in the markets of non-bank financial services in the form of permanent supervision and taking into account the principles determined in part one of Article 29 of the Financial services act.

2. Terms in this provision are used in the following values:

1) permanent supervision - form of implementation by National Bank of supervision of observance by objects of permanent supervision of requirements of the Laws of Ukraine and other regulatory legal acts regulating activities for provision of non-bank financial services, and/or regulatory legal acts which establish requirements to objects of permanent supervision, the financial services performing activities for provision conditions of implementation of activities for provision of financial services including activities of Export credit agency (further - EKA) which implementation requires the corresponding license (licensed conditions) (further - regulatory legal acts in the field of non-bank financial services), without their visit on the location;

2) the e-mail address of object of permanent supervision / the responsible person of non-bank financial group for implementation of official communication with National Bank (further - the e-mail address) - the e-mail address of object of permanent supervision provided to National Bank according to the procedure, determined in the regulatory legal act of National Bank which regulates questions of licensing and registration of suppliers of financial services and condition of implementation by them of activities for provision of financial services, or in normative legal act of the National Bank regulating activities of EKA, or the e-mail address of the responsible person of non-bank financial group specified in the documents provided by such person to National Bank according to requirements of the legislation of Ukraine concerning supervision on the consolidated basis;

3) negative tendencies in activities of objects of permanent supervision - negative dynamics concerning assets, transactions, activities that can demonstrate deterioration in financial condition and/or inadequate accomplishment of agreement obligations about provision of financial services, including insurance contracts, reinsurance, provision of guarantees for EKA (further - agreements on provision of financial services);

4) objects of permanent supervision - participants of the market of non-bank financial services [non-bank financial institutions, including the ESA, legal entities who are not financial institutions, but have the right to provide separate financial services (further - face which is not financial institution), the persons providing intermediary services in the markets of financial services, the physical persons entrepreneurs providing financial services, registered according to the legislation of Ukraine permanent missions in form of branches of foreign insurance companies which also obtained in accordance with the established procedure the license for implementation of insurance activity] and non-bank financial groups, state regulation and supervision of which activities is exercised by National Bank;

5) positive tendencies in activities of objects of permanent supervision - positive dynamics concerning assets, transactions, activities that can demonstrate improvement of financial condition and/or proper accomplishment of agreement obligations about provision of financial services;

6) the authorized officer of National bank chairman of National Bank, his first deputy and vice-chairmen of National Bank, the head of the structural unit of National Bank to which functions implementation of permanent supervision of activities of participants of the markets of non-bank financial services (further - structural division on supervision), the deputy manager of structural division on supervision, the division manager as a part of structural division on supervision, their deputies or persons which are carrying out them obligations, the head of the structural unit of National Bank to which functions implementation of licensing of non-bank financial institutions and other faces which are not financial institutions belongs belongs, but have the right to provide separate financial services (further - structural division on licensing), the deputy manager of structural division on licensing, the division manager as a part of structural division on licensing, their deputies or persons which are carrying out them obligations.

Other terms used in this provision get on in the values given in the legislation of Ukraine.

3. This provision is not applied to implementation of permanent supervision of compliance with law of Ukraine About consumer protection of financial services and limited payment services, requirements for interaction with consumers in case of settlement of overdue debt. Implementation of permanent supervision of compliance with law of Ukraine About consumer protection of financial services and limited payment services, requirements for interaction with consumers in case of settlement of overdue debt is regulated by the normative legal act of National Bank concerning implementation of supervision of observance by objects of supervision of the legislation of Ukraine On consumer protection of financial services and limited payment services, requirements for interaction with consumers in case of settlement of overdue debt.

4. The National Bank exercises permanent supervision according to requirements of the Law of Ukraine "About the National Bank of Ukraine", the Law on EKA, the financial services act, this provision, other regulatory legal acts in the field of non-bank financial services on purpose:

1) supervision (control) of observance by objects of permanent supervision:

conditions of implementation of activities for provision of financial services (licensed conditions);

obligatory criteria and capital adequacy ratios and solvency, liquidity, profitability, quality of assets and riskiness of transactions, rules of provision of the financial services, other obligatory standard rates, indicators and requirements limiting risks on transactions with financial assets;

2) control of timeliness of representation, completeness and reliability of documents and information provided by objects of permanent supervision;

3) identification of signs of implementation by the non-bank financial institutions and persons which are not financial institutions, the risk activities menacing to interests of investors and/or other creditors of such objects of permanent supervision (further - risk activities);

4) timely identification of the signs testimonial of deterioration in financial condition of insurer/EKA / credit union, and the timely prevention of insurer/EKA / credit union about such signs for acceptance by him / her of measures for improvement of the financial condition;

5) the analysis of condition, tendencies and perspectives of market development of non-bank financial services taking into account perspectives of activities and potential risks of his participants;

6) timely and effective response to the established violations of requirements of regulatory legal acts in the field of non-bank financial services, risk activities, shortcomings and negative tendencies (negative dynamics concerning assets, transactions, activities that can demonstrate deterioration in financial condition and/or inadequate accomplishment of agreement obligations about provision of financial services) in activities of objects of permanent supervision;

7) control over the implementation by objects of permanent supervision of the corrective actions and measures provided by Items 1-7 of part eight of article 9 of the Law on EKA applied by National Bank (further - corrective actions);

8) supervision (control) of observance by objects of permanent supervision of other requirements of the regulatory legal acts regulating activities in the field of non-bank financial services and establishing requirements to persons performing activities for provision of financial services.

II. Implementation of permanent supervision

5. The National Bank exercises permanent supervision in the way:

1) monitoring of activities of objects of permanent supervision based on the analysis of the reporting, documents (their copies), transactions, questionnaires, written explanations, information obtained from objects of permanent supervision, from divisions of National Bank, state bodies, and also other information and documents received by National Bank during execution of it the functions including information/documents from official sources;

2) regular estimation by National Bank of general financial condition of non-bank financial institution, results of its activities and quality of corporate management, system of internal audit (control) and risk management, observance of the obligatory standard rates and other indicators and requirements limiting risks on transactions with financial assets.

6. The National Bank when implementing permanent supervision is guided by the principles determined in part one of Article 29 and Article 31 of the Financial services act.

7. The National Bank when implementing permanent supervision for the purpose of identification of positive and negative tendencies in activities of objects of permanent supervision, signs of risk activities, and also for determination of risk degree from implementation of their activities estimates transactions, transactions, circumstances and events from the point of view of their economic, legal and actual contents, determination of compliance to requirements of regulatory legal acts which establish conditions of implementation of activities for provision of financial services (licensed conditions), considers circumstances and conditions of specific situation based on the complex and comprehensive analysis:

1) information and copies of the documents submitted to National Bank within the procedure of interaction and exchange of information, and also information, documents/copies of the documents received by structural divisions of National Bank when implementing activities within their competence, state bodies and other persons provided by this Provision;

2) information and documents/copies of the documents which are available for National Bank including information and documents/copy of documents received by National Bank during execution of it the powers and functions.

8. By National Bank by results of permanent supervision it can be established:

1) violation by object of permanent supervision of regulatory legal acts in the field of non-bank financial services;

2) signs of implementation by the non-bank financial institution or person which is not financial institution, risk activities;

3) values of the quantitative and qualitative indexes used by National Bank for assessment of criteria by which the National Bank estimates risk degree from implementation of activities by participants of the market of non-bank financial services, their public importance based on which frequency of conducting scheduled inspection inspections of participants of the markets of non-bank financial services, regulation and of which exercises supervision National Bank, is determined;

4) absence/availability of negative tendencies (negative dynamics concerning assets, transactions, activities that can demonstrate deterioration in financial condition and/or inadequate accomplishment of agreement obligations about provision of financial services) in activities of object of permanent supervision;

5) improvement/deterioration in financial condition of object of permanent supervision;

6) availability of the bases for conducting unscheduled inspection inspection by National Bank determined by the legislation of Ukraine;

7) the accomplishment/failure to carry out fact object of permanent supervision of decisions of National Bank on application of corrective actions to it.

III. Interaction and exchange of information when implementing permanent supervision

9. The National Bank according to part one of article 57 of the Law of Ukraine "About the National Bank of Ukraine", part six of Article 29 of the Financial services act, item 4 of part six of article 9 of the Law on EKA for implementation of permanent supervision within the powers in the field of state regulation of the markets of non-bank financial services sends to object of permanent supervision the written requirement:

1) in electronic form, signed by the qualified digital signature (further - the CAP) the authorized officer of National Bank, - on the e-mail address of object of permanent supervision for implementation of official communication with National Bank or

2) in paper form / the paper copy of the electronic document certified by the signature of the authorized officer of National Bank (in the cases provided in Item 18 of the Section III of this provision or if the National Bank has no data on the e-mail address of object of supervision), - on the postal address of object of permanent supervision / the responsible person of non-bank financial group.

10. The National Bank in case of creation of the written requirement to object of permanent supervision which location according to data from the Unified State Register of Legal Entities, physical persons entrepreneurs and public forming is the settlement of territorial community / the territory which/which according to the legislation are carried to the territory of active fighting or the territories of Ukraine which are temporarily occupied by the Russian Federation according to the list which is created according to the procedure, established by the Cabinet of Ministers of Ukraine provided that rather respective settlement of territorial community / territory dates of completion of fighting actions / dates of completion of temporary occupation are not determined (further - the territory of active fighting), does not send to object of permanent supervision the paper copy of the written requirement according to the procedure, determined in the subitem 2 of Item 9 of the Section III of this provision, and in cases, provided in Item 18 of the Section III of this provision.

11. The National Bank will promulgate the written requirement to object of permanent supervision which location is the territory of active fighting, on the page of official Internet representative office of National Bank with observance of requirements for information security with limited access in case of non receipt by National Bank of delivery confirmation of the written requirement of the e-mail address within three working days from the date of its sending.

12. Object of permanent supervision which location is the territory of active fighting is considered properly notified on the written requirement constituted to it from the first working day following behind day of promulgation of the written requirement on the page of official Internet representative office of the National Bank performed in case, the provided in paragraph one of Item 11 of the Section III of this provision.

13. In the written requirement are specified:

1) the bases which caused need of its sending;

2) the list of information/copies of documents which need to be provided to National Bank, and/or questions on which the National Bank requires to provide explanations;

3) provision term object of permanent supervision of the answer to such requirement.

14. The National Bank has the right to specify in the written requirement the description of the facts which can demonstrate violation by object of permanent supervision of normative legal acts in the field of non-bank financial services, and require provision of explanations.

15. The National Bank establishes provision term object of permanent supervision of the answer to the written requirement taking into account nature of problems, circumstances and conditions of specific situation, amount of required information and copies of documents, but at least two working days from the date of its sending.

16. Objects of permanent supervision shall submit within the terms established by National Bank to National Bank in the cases, procedure, form and format determined by this Provision, complete and authentic information / explanations/copies of documents of proper quality (font size shall be such that allows to read all data specified in them).

17. Object of permanent supervision shall send information/explanations/copies of documents to National Bank:

1) means of system of e-mail of National Bank (on condition of connection to system of e-mail of National Bank) or on electronic mailbox of National Bank with imposing the CAP;

2) if there is no opportunity to send by the method determined in the subitem 1 of Item 17 of the Section III of this provision or if it is specified in the written requirement, - on the postal address of National Bank the registered mail with the inventory of investment.

18. The written requirement of National Bank sent to object of permanent supervision is considered properly directed:

1) in electronic form - in case of obtaining on electronic mail / electronic mailbox of National Bank of delivery confirmation of this written requirement of the e-mail address of object of permanent supervision for implementation of official communication with National Bank;

2) in paper form / in the form of the paper copy of the electronic document - in case of its sending by the registered mail on the postal address of object of permanent supervision if the National Bank did not receive confirmation about delivery of the written requirement in electronic form;

3) by promulgation on the page of official Internet representative office of National Bank in the cases determined in Item 11 of the Section III of this provision.

19. object of permanent supervision provides to National Bank according to its written requirement information/explanations/copies of documents one of the following methods:

1) electronically with imposing the CAP through the web portal of National Bank placed on the web page: https://portal.bank.gov.ua. technical requirements on forming of files, imposing the CAP, loading of files through the web portal of National Bank are placed on the web portal of National Bank;

2) electronically with imposing the CAP the electronic message on official electronic mailbox of National Bank: nbu@bank.gov.ua;

3) in paper form with simultaneous obligatory submission of electronic copies of these documents without imposing Cap on digital data carriers [compact disks (CD, the DVD) or USB флешнакопителях]. Copies of documents are created by scanning from papers taking into account the following requirements:

the document is scanned in the file in the PDF format;

the scanned copy of each separate document is stored as the separate file; the file shall have the short name Latin letters displaying content and details of the document;

the documents containing more than one page are scanned in one file;

permission of scanning shall be not lower than 300 dpi.

20. Copies of the documents transferred by object of permanent supervision to National Bank in paper form shall be proper quality, certified by the signature of the head / the authorized person of object of permanent supervision / the responsible person of non-bank financial group with indication of his / her position, initials and surname, date of assurance and putting down of text "according to the original".

Pages (sheets) of the copy of the document which is transferred by object of permanent supervision to National Bank in paper form and consists of two and more pages (sheets), shall be numbered, stitched and on reverse side of the last leaf of such copy in the place of fastening of threads paper of 50 x 50 millimeters in size is pasted and on it the text is noted: "It is numbered and stitched... ARC." "the number of sheets in figures and words is specified) and the mark about the certificate of the copy of the document according to the procedure, certain in paragraph one of Item 20 of the Section III of this provision is put down.

On the face in the upper right corner of the first leaf of the copy of the document the mark "copy" is put down.

21. The written explanations provided by object of permanent supervision to National Bank in paper form are signed by head/person, the acting as the head of object of permanent supervision / the responsible person of non-bank financial group with indication of his / her position, own name and surname, and also signature date of explanation.

22. The documents constituted in foreign language / copy, made of the specified documents for representation to National Bank shall be translated into Ukrainian (authenticity of the signature of the translator makes sure notarially). Ukrainian of Ukrainian is not translated into foreign and Ukrainian languages, and documents/copy made of the documents constituted in foreign and Ukrainian languages at the same time.

23. The National Bank when implementing permanent supervision of non-bank financial group directs the written requirement in the form determined in Item 9 of the Section III of this provision, to the responsible person of non-bank financial group. The written requirement goes to this person with observance of requirements of Item 18 of the Section III of this provision.

The responsible person of non-bank financial group provides provision to National Bank of information/explanations/copies of documents according to Items 16, of 17, of 19, of 20, 22 Sections III of this provision.

24. The National Bank for the purpose of discussion of the questions arising within implementation of permanent supervision has the right to initiate carrying out working meetings with owners of essential participation, head/person, the acting as the head of object of permanent supervision / the responsible person of non-bank financial group, the representative of authorized body of management of EKA, way of the direction it the corresponding invitation.

The invited person has the right to participate in working meeting personally / together with the authorized representative / translator or remotely by audiovisual communication. Certain method of participation of the invited person, and also the questions/basis which are subject of carrying out working meeting, the place, time and method of its carrying out are specified by National Bank in the corresponding invitation.

The invitation is sent not later than five working days before date of working meeting on the e-mail address or in paper form on the postal address of object of permanent supervision.

The National Bank has the right to perform audio-and video of working meeting according to the legislation of Ukraine.

25. National Bank by results of implementation of permanent supervision:

1) in case of identification of the signs testimonial of deterioration in financial condition of insurer/EKA / credit union, insurer/EKA / credit union in writing warns about such signs for acceptance of measures for improvement of the financial condition by him / her;

2) considers information obtained during permanent supervision in case of risk degree assessment from activities implementation by object of permanent supervision (except EKA) and/or the level of its public importance;

3) in case of identification of the violations determined in part one of Article 41 of the Financial services act draws up the statement of offenses, and in case of identification of other offenses constitutes the report.

The act form about the offense/report is determined by the administrative act of National Bank;

4) in case of identification of signs of implementation by object of permanent supervision of risk activities constitutes the report in which it is noted about availability of these signs.

The form of the report is determined by the administrative act of National Bank;

5) is initiated by conducting unscheduled inspection inspection in case of availability of the bases, stipulated by the legislation Ukraine;

6) is initiated by application of corrective action according to the regulatory legal act of National Bank concerning application of corrective actions in the field of state regulation of activities in the markets of non-bank financial services taking into account effects of violation and effects of application of such measures;

7) exercises control over the implementation of decisions of National Bank on application of corrective actions;

8) addresses to law enforcement agencies in case of identification of signs of crime execution;

9) instantly, but no later than 10 working days is notified by authorized body of management of EKA in case of identification of the bases for application to EKA of corrective actions.

26. Object of permanent supervision / the responsible person of non-bank financial group has the right during the term of provision of the answer determined in the written requirement to provide to National Bank according to the procedure, provided in the subitem 1 of Item 17 of the Section III of this provision, objection/explanation of rather committed violations, the description of the facts about which making it is specified in the written requirement, and/or information of rather independent elimination of violation and the reasons promoting its making, documents/copy of the documents confirming independent elimination of violation, and also information and supporting documents about the taken measures for prevention/non-admission of making of the revealed violations.

27. The National Bank considers and considers the objections/explanations provided by object of permanent supervision / the responsible person of non-bank financial group with observance of requirements of this provision in case of decision making about application/non-use of corrective actions to object of permanent supervision taking into account the requirements determined by the regulatory legal act of National Bank about application of corrective actions in the field of state regulation of activities in the markets of non-bank financial services.

 

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