Parliament adopts law on finance and capital market commission

RIGA (BNS) - Parliament on June 1 adopted in the final reading a law creating a Finance and Capital Market Commission responsible for regulation and supervision of finance and capital markets and actions by participants of this market.

According to the law, the commission is responsible for stability and development of the financial market as well as promotion of free competition. The FCMC may issue regulations and instructions that are binding for finance and capital market members. The commission will take over rights, obligations and liabilities of the Stock Market Commission, Insurance Supervision Inspectorate and Deposit Guarantee Fund Administration as well as rights, obligations and liabilities of the Bank of Latvia as regards supervision of credit institutions.

The FCMC will start operating July 1, 2001.

The commission will be managed by a council of five members - a commission chairman, a deputy commission chairman and three council members, who will also act as the directors of departments under the FCMC.

The commission chairman and deputy chairman will be appointed by the parliament for a term of six years upon joint nomination by the Bank of Latvia president and finance minister.

Other council members are appointed and dismissed by the commission chairman subject to approval by the Bank of Latvia president and finance minister. According to the law, the FCMC will meet at least on a monthly basis. The operations of the commission will be financed from the payments made by finance and capital market participants with the amount determined by the council.

By July 1 every year, the commission is required to submit to Parliament a written report about its activities the previous year and an annual report examined by a sworn auditor.