Most Read Contributor in Netherlands, February 2017
The most significant development in 2017 for financial
institutions in the Netherlands will be the review of the Financial
Markets Supervision Act (Wft). The Wft has been amended more than
70 times since it entered into force in 2007. A considerable number
of the amendments were needed to implement European legislation. As
a result, the Wft has become voluminous and complex. In order to
make the Wft future-proof and easier to read, the Minister of
Finance is considering a review of the Wft and has published an exploratory study of the options for public
The proposed options are:
Leaving the Wft as is
Though there seems to be no consensus yet as to what shape a review
should take, there does seem to be consensus among supervisory
authorities and market participants that doing nothing is not the
preferable course of action.
Making minor legal-technical and
Keep the current cross-sectoral structure of the Wft intact, but
adopt technical and editorial amendments to rectify or clarify
provisions, and remove inconsistencies. In addition, improve the
explanatory notes to the Wft. The consultation document does not
specify which amendments are being considered.
Making improvements within the
current Wft structure
Improve the Wft as it currently exists within the cross-sectoral
structure. For example, bundle provisions on the governance and
organisation of financial institutions (such as suitability and
integrity, as well as sound and ethical business policies) that are
currently in various Wft chapters as a result of the division
between prudential supervision and conduct supervision.
Introducing a sectoral approach
Organise the rules by category of financial institution, service or
product. A major advantage of this option is that it would allow
the Wft to tie in with the sectors as defined in EU legislation. A
disadvantage is that this would involve a substantial overhaul of
Replacing the Wft with a number of
separate, sector-specific acts
Each category of financial institution, service or product would
get its own legislation.
Through this consultation, the Minister also wants to assess the
need for an English translation of the complete Wft, and for a
guide or website which explains the legislation that applies to
The Dutch "twin-peaks model" of financial supervision,
where the Dutch Central Bank (DNB) is responsible for prudential
supervision, and the Netherlands Authority for the Financial
Markets (AFM) for conduct of business supervision, will be
The five options outlined above are not set in stone; hybrids of
the options could be considered as well. Financial institutions
that want to express their views on the future direction of the Wft
have until 1 March 2017 to do so.
De Brauw has been actively involved in conversations with the
Ministry of Finance leading up to this consultation. We will
closely monitor and update you on new developments concerning the
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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The implementation of the mandatory exchange of initial and
variation margin for non-cleared OTC derivative trades in the EU
commenced on 4 February for financial counterparties with the
largest derivatives portfolios.
Nevertheless, a RAIF's investment policy is subject to certain risk diversification requirements laid down by the CSSF.
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