Portugal is one of the oldest countries in Europe and this fact underlines the rich history of the country. Moreover, it is a developed country with an advanced economy. Also, the local population enjoys high living standards. It is worth mentioning that Portugal was also one of the founding members of the North Atlantic Treaty Organization (NATO) as well as the Eurozone, the Organisation for Economic Co-operation and Development. Interestingly, Brazil which is the biggest country in terms of population and economy in South America is a member of the Community of Portuguese Language Countries.
The history of the Portuguese Securities Market Commission dates back to May, 1991. The commission is tasked with supervising and regulating the financial instruments markets and agents that operate within those markets. Another task is investor protection.
Let’s have a look at the responsibilities of the commission. The list is quite impressive. For example, the commission guarantees the stability of financial markets by contributing to identifying and preventing systemic risk. Moreover, it provides information and handles complaints from retail investors.
This is not the end of the story. Another task of the Portuguese Securities Market Commission is to mediate conflicts between entities to its supervision as well as between them and investors. Furthermore, the commission assists the government and its member responsible for finance. It is worth mentioning that the commission performs any other duties assigned to it by law.
The Structure of the Portuguese Securities Market Commission
It is worth mentioning that the Portuguese Securities Market Commission is a public legal entity, with administrative and financial autonomy as well as its own assets. In this part of the article, we will discuss the structure of the commission.
Importantly, the commission carries out its duties autonomously and it has all the necessary means to fulfill its responsibilities. People should take into account that the Portuguese Securities Market Commission enjoys structural, functional, and technical independence. Moreover, it has its own bodies, services, personnel, and assets.
Furthermore, the commission is entitled to management, administrative, financial, and asset autonomy. Also, it has regulatory, supervisory, oversight, and infraction sanctioning powers.
Let have a look at the bodies of the Portuguese Securities Market Commission. There are four of them: Management board, oversight committee, advisory board, ethics committee.
Importantly, the management board is responsible for defining the commission’s performance including the management of the respective services. The Board is compromised of five members: Chair, Vice-Chair, and three Board Members. Interestingly, the member of the government who is responsible for finance appoints the members of the commission for a six-year term, and this term is non-renewable.
Let’s move to the oversight committee. This committee is responsible for checking the legality, regularity, financial as well as asset management of the commission and for consulting its management board in these areas. The oversight committee consists of three members. A chair of the committee and two members. As in the case of the management board, the government member responsible for finance appoints the members of the oversight commission. Interestingly, one of the members is a statutory auditor with a non-renewable four-year office term.
Advisory Board and Ethics Committee
As mentioned above, apart from the Management Board and Oversight Committee, the commission also includes the Advisory Board and Ethics Committee.
Notably, the Advisory Board is an advisory body of the Management Board on matters regarding the commission’s responsibilities. The chair of the Advisory Board is appointed by the government member responsible for finance, on the proposal of the Chair of the commission’s Management Board. The purpose of the Board is to comment on issues submitted by the Management Board. Moreover, it has the authority to present its own initiative, recommendations, and suggestions to the Management Board within the scope of the commission’s duties.
The Ethics Committee consists of three members. The committee issues a statement of reasons regarding a conflict of interests.
Entities Subject to the Portuguese Securities Market Commission’s Supervision
People should take into account that the following persons and entities are subject to the commission’s supervision. For example, financial intermediaries, independent consultants, professional investors, investment funds, auditors, and credit rating companies, etc.
It is worth noting that entities stated above must collaborate with the commission. Moreover, the Portuguese Securities Market Commission has the authority to inform the public of detected law violations and sanctions.
Notably, the commission regulates the functioning of the securities markets, the execution of public offerings as well as the performance of all entities operating in these markets. Moreover, it is up to the commission to deal with all matters concerning this area of activity.
The commission is part of major international organizations. For example, the Portuguese Securities Market Commission participates in various policy committees and permanent groups of the International Organization of Securities Commissions. Also, the commission takes part in the work of all the standing committees and selected technical support groups of ESMA. As a reminder, ESMA stands for the European Securities and Markets Authority.
Interestingly, when it comes to its supervisory function, the commission is a member of regulatory colleges responsible for the oversight of the trading venues such as Euronext or MIBEL.
Last but not least, people should be careful when it comes to working with financial intermediaries, independent consultants, and other entities or persons.
Reprinted from financialbrokerage, the copyright all reserved by the original author.