Krediiditeabe jagamise seadus (KJS)

§ 1. Scope of regulation of Act

This Act establishes requirements for the sharing of credit information, the maintenance of a credit information register, and for the credit information registrar, as well as the organisation of supervision over the maintenance of the register and the actions of the registrar, and liability for failure to comply with the requirements of this Act.

§ 2. Purpose of Act

The purpose of this Act is to promote responsible lending and borrowing by ensuring availability of the information necessary to assess creditworthiness, as well as to support the availability of credit information to ensure the integrity of the financial sector and to monitor and supervise credit markets.

§ 3. Credit information

For the purposes of this Act, credit information is data related to a consumer credit contract concluded with a consumer, which a credit information provider must forward to the credit information register.

§ 4. Consumer

For the purposes of this Act, a consumer is a person specified in subsection 5 of § 1 of the Law of Obligations Act who has concluded a consumer credit contract specified in § 402 of the Law of Obligations Act.

§ 5. Provider of credit information

For the purposes of this Act, a credit information provider is:

1) a credit institution for the purposes of the Credit Institutions Act;

2) a creditor as specified in § 5 of the Creditors and Credit Intermediaries Act;

3) a person specified in subsection 2 of § 2 of the Creditors and Credit Intermediaries Act;

4) a branch of a foreign credit institution or creditor founded in Estonia;

5) a credit servicer specified in subsection 1 of § 3 of the Credit Servicers and Credit Purchasers Act, if it acquires a consumer credit contract or a claim arising therefrom, or if it manages a consumer credit contract on behalf of a credit purchaser.

§ 6. Credit information register and registrar

(1) The credit information register is a database belonging to the state information system maintained for the purpose of making credit information available to assess creditworthiness.

(2) Data exchange with the register does not have to be conducted through the data exchange layer of the state information system.

(3) The credit information registrar is an undertaking that has been granted the exclusive right to maintain the register on the basis of § 12 of this Act (hereinafter registrar).

(4) The Ministry of Finance is the controller and the registrar is the processor of the credit information register.

(5) The statutes of the credit information register are established by a regulation of the minister in charge of the policy sector, providing for the following:

1) the responsibilities of the controller and the processor;

2) the specific composition of data collected in the register;

3) the specific procedure for granting access to data;

4) additional technical and organisational safeguards;

5) other administrative matters.

§ 7. Data processed in credit information register

(1) The following data are entered into the credit information register:

1) general details of a consumer – given name and surname, and personal identification code or, in the absence thereof, date of birth;

2) general details of a credit information provider – name or given name and surname, registry code or personal identification code or, in the absence thereof, date of birth, and the two-letter country code of the home country of the credit information provider;

3) details of a credit surety who is a natural person – given name and surname, personal identification code, or, in the absence thereof, date of birth, and the amount of the obligation arising from the suretyship in euros;

4) general details of a consumer credit contract – number, date of conclusion, and expiration date;

5) type of credit;

6) maximum credit amount in euros;

7) credit balance or receivable balance in euros;

8) type of credit repayment schedule;

9) type of credit interest rate;

10) amount of the next repayment instalment agreed upon in a consumer credit contract in euros, as of the last update of the data in the credit information register;

11) period of full or partial deferral of credit repayment;

12) the fact that the consumer is late in performing an obligation agreed upon in a consumer credit contract if 14 days have passed since the due date for performing the obligation;

13) the fact that a claim arising from a consumer credit contract has been assigned or that the consumer credit contract has been taken over by a third party.

(2) The registrar is required to maintain a log of data processing activities. The log must contain information on the grounds for processing the data specified in subsection 1 of this section, the time of such processing, and the person who processed the data.

§ 8. Forwarding of credit information to credit information register

(1) The credit information providers specified in subsections 1–4 of § 5 of this Act forward the data specified in subsection 1 of § 7 of this Act to the registrar within 24 hours after the conclusion or amendment of a consumer credit contract or after any change in the data specified in the same subsection.

(2) The credit information providers specified in clause 5 of § 5 of this Act forward to the registrar the data specified in clauses 1, 2, and 7 of subsection 1 of § 7 of this Act within 45 days after assuming a consumer credit contract or acquiring a claim arising from a consumer credit contract, or from the moment they begin to manage a consumer credit contract or a corresponding claim on behalf of a credit purchaser. If the amount of the credit balance or receivable balance specified in clause 7 of subsection 1 of § 7 of this Act changes, a credit information provider specified in clause 5 of § 5 forwards this information to the registrar within ten days after the change.

(3) If several consumer credit contracts or claims arising therefrom have passed to a credit information provider specified in clause 5 of § 5 of this Act with respect to a single consumer, and a comprehensive agreement has been concluded with the consumer for the settlement of such claims, the credit information provider forwards the data specified in subsection 2 of this section only with respect to such comprehensive agreement.

(4) The obligations specified in subsections 1–3 of this section expire upon the due performance or assignment of a claim arising from a consumer credit contract, upon the assumption of the consumer credit contract by a third party, or upon the expiration of the claim in any other instance.

(5) Information regarding the proper performance or assignment of a claim arising from a consumer credit contract, the fact that a third party has assumed a consumer credit contract, or the expiry of a claim in any other case is forwarded to the registrar by the credit information providers specified in clauses 1–4 of § 5 of this Act, within 24 hours of the due performance or assignment of the claim arising from the consumer credit contract, the assumption of the consumer credit contract by a third party, or the expiry of the claim in any other case.

(6) Information regarding the expiration of a claim is forwarded to the registrar by the credit information providers specified in clause 5 of § 5 of this Act within ten days of the expiration of the claim.

(7) A credit information provider is exempt from the obligations specified in subsections 1–3, 5, and 6 of this section if the registrar is unable to provide the register service for reasons not attributable to the credit information provider. Once the register service is restored, the credit information provider is required to forward the credit information as soon as possible.

§ 9. List of consumers subject to restrictions on concluding consumer credit contracts

(1) The list of consumers subject to restrictions on concluding consumer credit contracts (hereinafter list) is a sub-register of the credit information register, the purpose of which is to provide consumers with the opportunity to limit their ability to conclude consumer credit contracts in order to reduce the negative social and economic effects on them and on society that may result from excessive borrowing.

(2) A consumer is added to the list for an unlimited period after they submit a written request. Six months after being added to the list, the consumer has the right to request removal from the list.

(3) The consumer submits a written request to the registrar to be added to or removed from the list. Upon receiving a corresponding request, the registrar is required to add the consumer to the list or remove them from it immediately.

(4) The following data about each consumer is entered into the list:

1) given name and surname;

2) personal identification code or, in the absence thereof, date of birth;

3) date of submission of request.

(5) A consumer’s request to be added to or removed from the list cannot be withdrawn and it has no retroactive effect.

(6) The registrar is required to maintain a log of the processing of the data specified in this section. The log must contain information on the reason for, time of, and person responsible for the data processing.

§ 10. Granting access to data in credit information register

(1) The registrar is required to provide access to data in the credit information register:

1) to a credit institution and a branch of a foreign credit institution founded in Estonia for the purposes of the Credit Institutions Act, to a creditor specified in § 5 of the Creditors and Credit Intermediaries Act, and to a person specified in subsection 2 of § 2 of the same Act, as well as to a branch of a foreign creditor founded in Estonia, for the conclusion or amendment of a consumer credit contract or for the restructuring of debt for the purposes of § 416¹ of the Law of Obligations Act in order to assess the creditworthiness of a consumer who has submitted a declaration of intent or is applying for additional credit under an existing consumer credit contract;

2) to a court in the cases and in accordance with the rules provided by the laws governing court proceedings;

3) to a pre-trial investigation authority and the prosecutor’s office in criminal proceedings that have been initiated, including on the basis of a request for legal assistance from a foreign state received in accordance with the rules provided by an international treaty, or to perform an obligation provided by European Union law to comply with an international convention or other international treaty or a co-operation agreement with the police or similar competent authority;

4) to a security authority for performing the functions provided by the Security Authorities Act and for carrying out security vetting as specified in the State Secrets and Classified Information of Foreign States Act;

5) to a notary for conducting succession proceedings, and to an enforcement agent for performing the duties specified in the Code of Enforcement Procedure and for making an inventory of an estate;

6) to an interim trustee, a trustee in bankruptcy and the Insolvency Division of the Competition Authority for performing the duties provided by the Bankruptcy Act;

7) to a trusted practitioner specified in the Natural Person Insolvency Act for performing the duties provided by the Natural Person Insolvency Act or the Bankruptcy Act;

8) to a producer of official statistics for performing the duties provided by the Official Statistics Act it in the course of statistical activities;

9) to the Consumer Protection and Technical Regulatory Authority for conducting supervision on the basis of the Consumer Protection Act;

10) to the Estonian Information System Authority for conducting supervision on the basis of the Cybersecurity Act and the Public Information Act;

11) to the Data Protection Inspectorate for conducting supervision on the basis of Regulation (EU) 2016/679 of the European Parliament and of the Council on the protection of natural persons with regard to the processing of personal data and on the free movement of such data, and repealing Directive 95/46/EC (General Data Protection Regulation) (OJ L 119, 04.05.2016, pp 1–88) and the Public Information Act;

12) to the Financial Supervision Authority for conducting supervision on the basis of the Creditors and Credit Intermediaries Act and the Credit Institutions Act.

(2) Access to data is granted until a claim arising from a consumer credit contract has been duly performed or assigned, until a third party has assumed a consumer credit contract, or until a claim has otherwise expired, taking into account the special rules provided by subsections 3–6 of this section.

(3) Access to the data specified in clause 3 of subsection 1 of § 7 of this Act is granted until the suretyship expires.

(4) The person specified in clause 1 of subsection 1 of this section is granted access to the data specified in clause 12 of subsection 1 of § 7 of this Act until the consumer has met their obligation, but for no longer than 45 days starting from the date of the delay in meeting the obligation.

(5) Access to the data specified in clause 13 of subsection 1 of § 7 of this Act is granted within 45 days of the entry of such data into the credit information register.

(6) The person specified in clause 1 of subsection 1 of this section is granted access to the data specified in subsection 4 of § 9 of this Act until the data concerning the consumer are removed from the list.

(7) The registrar has the right to charge the person specified in clause 1 of subsection 1 of this section for access to the data, on the basis of a price list for register services as provided by subsection 1 of § 13 of this Act.

§ 11. Data retention

(1) Data and logs entered in the credit information register are retained for two years from the due performance or assignment of a claim arising from a consumer credit contract, the assumption of a consumer credit contract by a third party, or the entering of data in the register regarding the expiry of a claim in any other case.

(2) Data regarding a suretyship entered in the credit information register are retained for two years from entering the data on the expiration of the suretyship in the register.

(3) The retention period for the data specified in subsection 4 of § 9 of this Act starts from the time the consumers’ data are removed from the list.

§ 12. Appointment of registrar and administrative contract to be concluded

(1) The minister in charge of the policy sector decides on the appointment of the registrar and concludes an administrative contract with the registrar.

(2) The minister in charge of the policy sector assess the suitability of the person with whom they intend to enter into an administrative contract for maintaining the register, based on the requirements provided by this Act, and co-ordinates with the Financial Supervision Authority to ensure that the person meets the requirements. The Financial Supervision Authority assesses the person’s compliance with the requirements provided by §§ 16–35 of this Act.

(3) A written contract is concluded to authorise the registrar.

(4) In addition to the data and terms and conditions specified in § 10 of the Administrative Co-operation Act, the contract specified in subsection 1 of this section provides for the following:

1) the rights and obligations of the contracting parties;

2) terms and conditions for amending the contract;

3) the registrar’s obligations upon the expiration or early termination of the contract to ensure continuity in the performance of administrative duties, including the conditions, procedure, and deadlines for the transfer of register maintenance to a new registrar, as well as other measures to be taken to ensure the continuity of register maintenance;

4) confidentiality requirements.

(5) The validity period for a contract for register maintenance concluded with the registrar may not exceed eight years.

(6) In addition to the cases specified in subsection 1 of § 11 and in § 16 of the Administrative Co-operation Act, the minister in charge of the policy sector has the right to unilateral early termination of a contract concluded for register maintenance if:

1) the registrar materially violates its obligations;

2) the registrar has not complied with the secondary conditions established on the basis of subsection 4 of § 14 or subsection 2 of § 15 of this Act;

3) the registrar has not submitted a price list request by the expiration date of the approval or a new price list request within the time limit specified in subsection 1 of § 14 of this Act;

4) The minister in charge of the policy sector has, on three consecutive occasions, refused to approve the request for a new price list specified in subsection 1 of § 14 of this Act.

(7) The minister in charge of the policy sector notifies the Financial Supervision Authority immediately of any declaration of intent regarding early termination of a contract concluded for register maintenance.

§ 13. Price list for register services

(1) The registrar charges a fee to cover the expenses of providing the service. The registrar establishes a price list for register services (hereinafter price list) in accordance with the requirements provided by this Act.

(2) Before establishing the price list for fees, the registrar agrees on it with the minister in charge of the policy sector.

(3) The price list determines the maximum prices for register services.

(4) Fees charged for register services must be based on the efficient provision of the service and calculated on the basis of reasoned expenses.

(5) The registrar does not charge the persons specified in clauses 2–12 of subsection 1 of § 10 of this Act for access to the credit information register.

§ 14. Approval of price list

(1) The registrar submits a draft for the price list or for amendments thereto (hereinafter price list request) together with the relevant data and documents to the minister in charge of the policy sector for approval no later than three months before the scheduled entry into force of the price list or proposed amendments specified in the price list request, or no later than three months before the expiration of the approval granted for the current price list, unless a shorter time limit for submitting a price list request has been agreed with the minister in charge of the policy sector.

(2) When reviewing a price list request, the minister in charge of the policy sector has the right to:

1) request from the registrar its accounting policies and procedures and other data and documents;

2) request the opinion of the Financial Supervision Authority regarding the circumstances specified in subsection 1 of § 15 of this Act;

3) involve experts to clarify matters requiring specialist knowledge;

4) request an on-site inspection from the Financial Supervision Authority to clarify the circumstances surrounding the price list request;

5) submit the price list request to users of register services and the organisations representing them for their opinion.

(3) The minister in charge of the policy sector decides on whether to agree to the approval of a price list request or to refuse such approval within two months of receiving all the data and documents specified in subsection 1 or clause 1 of subsection 2 of this section, but no later than three months after receiving the application for approval of the price list.

(4) A price list request is approved either for an unlimited period or for a fixed period. The time limit for the approval may not be less than one year. When approving a price list request, the minister in charge of the policy sector may impose mandatory secondary conditions on the registrar pursuant to the circumstances specified in subsection 1 of § 15 of this Act.

(5) The registrar is required to publish the price list on its website immediately after receiving approval from the minister in charge of the policy sector. The date of publication is indicated on the website when the price list is published.

(6) The price list or amendments thereto enter into force at the time specified in the price list request, but not before one month has passed since the publication of the price list on the registrar’s website. The minister in charge of the policy sector may set an effective date for the price list or a part thereof that differs from the effective date specified in the request.

(7) If the registrar has not submitted a price list request by the expiration date of the approval, or if the minister in charge of the policy sector has refused to approve the price list request, the current price list remains in use until the new price list enters into force.

§ 15. Refusal to approve price list requests

(1) The minister in charge of the policy sector may refuse to approve a price list request if:

1) the registrar fails to comply with the requirements established in § 45 of the Accounting Act for undertakings with special or exclusive rights;

2) the fees included in the price list request are unfairly burdensome for users of register services or place users of register services at a significant disadvantage compared to conditions of free competition;

3) the fees included in the price list request are not designed pursuant to the principle of efficient use of resources, or are unreasonably higher than what is necessary to ensure the registrar’s continued operation and development, as well as a reasonable profit;

4) the fees included in the price list request are insufficient for compliance with the requirements and obligations imposed on the registrar by legislation and for ensuring the registrar’s continued operation and development;

5) the registrar has knowingly provided incorrect, misleading, or incomplete data or documents when submitting a price list request for approval, or has failed to submit, without good reason, the data or documents specified in subsection 1 or clause 1 of subsection 2 of § 14 of this Act within the prescribed time limit.

(2) The minister in charge of the policy sector may request that the price list be amended or impose mandatory secondary conditions on the registrar if the circumstances specified in clauses 3, 4, or 5 of subsection 1 of this section arise after the price list request has been approved.

(3) If, as of the expiration date of the approval, the minister in charge of the policy sector has refused to approve the price list request, the registrar is required to submit a new price list request for approval within one month of the minister’s refusal.

§ 16. Civil liability of registrar

(1) The registrar compensates for any harm caused by a violation of its obligations when maintaining the register.

(2) At the request of the minister in charge of the policy sector, the registrar must have liability insurance for the duration of providing the register service.

(3) The registrar’s liability arising from the maintenance of the register must be insured in a manner that adequately mitigates the risks associated with such activities.

(4) The registrar submits to the Ministry of Finance and the Financial Supervision Authority a copy of the main terms and conditions of the insurance contract concluded to mitigate risks within ten days of the conclusion of the insurance contract.

(5) The contract providing liability insurance specified in subsection 2 of this section must meet at least the following terms and conditions:

1) an insured event refers to the causing of pecuniary harm by the registrar’s violation of the obligations imposed on it by law;

2) the insurance coverage must be valid at least in Estonia;

3) insurance coverage applies to harm caused by an event or act that occurred during the insurance period;

4) the registrar may not, on the basis of the insurance contract, exclude harm that arises directly or indirectly from a defect in a computer programme or software.

(6) If claims for compensation for harm cannot be satisfied in the manner provided by subsections 1 and 2 of this section, or cannot be satisfied in full, the Republic of Estonia is liable for the harm incurred and has the right of recourse against the registrar.

§ 17. Qualifying holding

(1) For the purposes of this Act, a qualifying holding is a direct or indirect holding in the share capital of the registrar that constitutes at least 10 per cent of the company’s share capital or voting rights, or which makes it possible to exercise significant influence over its management.

(2) The determination of a qualifying holding and a controlled company is based on the provisions of subsections 2 and 3 of § 9, § 10 and subsection 1 of § 72¹ of the Securities Market Act.

§ 18. Requirements for persons acquiring qualifying holdings

(1) Any person (hereinafter in this Subchapter person) may acquire, hold, or increase a qualifying holding in the registrar, or gain control of, hold, or increase control over the registrar, provided that:

1) they have an impeccable reputation and their actions in connection with the acquisition are consistent with the principles of sound and reliable management of the registrar;

2) after acquiring or increasing a holding, they select, appoint, or designate as a member of the registrar’s supervisory board or management board only a person who meets the requirements provided by § 29 of this Act;

3) their financial standing is sufficiently strong to ensure the regular and reliable operation of the registrar, and, in the case of a legal person, their financial statements, if available, allow for an adequate assessment of its financial standing;

4) they ensure that the registrar complies with the capital requirements provided by this Act, particularly, in the case of a legal person, the requirement that the consolidation group of which the registrar becomes a part has a structure that allows for effective supervision and the exchange of information and co-operation with competent supervisory authorities;

5) there are no reasonable grounds to suspect that their acquisition of a holding is related to money laundering or terrorist financing, or an attempt thereof, or that the acquisition of a qualifying holding would increase such risks;

6) they are not subject to international sanctions for the purposes of the International Sanctions Act.

(2) The person’s reputation is not impeccable if the Financial Supervision Authority has identified circumstances that cast doubt on its existence or confirm its absence. When assessing the person’s reputation, the Financial Supervision Authority takes into account, among other things, whether there is a punishment in force in respect to that person for an economic offence, an office-related offence, an offence against property, or an offence against public trust, or whether the person has been accused or suspected in an offence case or otherwise involved in such a case, or whether the person has committed an unlawful, fraudulent, or trust-abusing act or has been involved in such an act or in investigation or supervisory proceedings related to it.

§ 19. Notification of Financial Supervision Authority of acquisition of holding

(1) The person who intends to acquire a direct or indirect qualifying holding in the registrar, or to increase such a holding to more than 20, 30, or 50 per cent of the share capital or of the number of votes represented by shares, or to enter into a transaction as a result of which the registrar becomes a company under the person’s control (hereinafter acquirer), notifies the Financial Supervision Authority of their intention and submits the data and documents specified in subsections 1 and 6 of § 20 of this Act.

(2) The provisions of this Subchapter also apply if, as a result of some other event or transaction, the person acquires a holding in the registrar as specified in subsection 1 of this section, if this holding increases to more than 20, 30, or 50 per cent of the registrar’s share capital or the number of votes represented by shares, or if, as a result of such an event or transaction, the registrar converts into a company under the control of that person. In such a case, the person is required to notify the Financial Supervision Authority immediately after gaining control over the registrar or becoming aware of the acquisition of a qualifying holding or an increase in such a holding.

(3) The Financial Supervision Authority notifies the acquirer in writing within five working days of receiving the notice or additional data and documents specified in subsections 1 or 2 of this section, and of the possible expiry of the procedural time limit.

§ 20. Data submitted to Financial Supervision Authority upon notification of acquisition of holding

(1) When notifying the Financial Supervision Authority of the acquisition of a holding, the following data and documents must be submitted:

1) the name of the company in which a qualifying holding is being acquired or increased, or which is being transformed into a company under the acquirer’s control, and the size of the holding being acquired in that company;

2) a description of the company to be acquired, including a list of shareholders showing the number of shares held by each shareholder, and information on the type and number of shares to be acquired by the acquirer or previously held by the acquirer;

3) the resume of an acquirer who is a natural person, which includes the acquirer’s name, place of residence, educational, employment and professional history to date, and personal identification code or, in the absence thereof, date and place of birth, as well as documents attesting to the person’s trustworthiness, experience, competence, and impeccable reputation;

4) the list of partners, [SV10.1]shareholders or members of an acquirer and information on the size of the shares held by each shareholder or member and the number of votes;

5) the name, registered office, and registry code of an acquirer who is a legal person, a certified copy of its register certificate, and, if available, a copy of its articles of association;

6) information about the members of the managing bodies of an acquirer who is a legal person, including each member’s given name and surname, personal identification code or, in the absence thereof, date and place of birth, and their educational, employment, and professional history to date, as well as documents confirming the trustworthiness, experience, competence, and impeccable reputation of these persons;

7) a statement confirming that no international sanctions have been imposed on an acquirer who is a natural person or a legal person or on the members of its managing bodies;

8) a description of the acquirer’s business activities and a description of the economic interests of the person involved in the acquisition;

9) a statement confirming that there have been and are no circumstances concerning the person specified in clause 2 of subsection 1 of § 18 of this Act that would preclude the person’s right to serve as the manager of the registrar according to law;

10) the annual reports of an acquirer who is a legal person for the last three financial years, if it has been active for that period;

11) in the case of an acquirer who belongs to a consolidation group, a description of the structure of the consolidation group, including information on the size of the holdings of the companies belonging to it, as well as the annual reports and sworn auditor’s reports of the consolidation group for the last three financial years;

12) documents certifying the financial status of an acquirer who is a natural person for the past three years;

13) data and documents regarding the source of the financial and non-financial resources intended to be used to acquire a qualifying holding, increase such a holding, or gain control;

14) circumstances related to the acquisition of a holding according to subsections 2 and 3 of § 9 and §§ 10 and 72¹ of the Securities Market Act;

15) the size of the qualifying holding owned after acquisition of a holding and the circumstances related to owning such a holding according to subsections 2 and 3 of § 9 and §§ 10 and 72¹ of the Securities Market Act;

16) an appropriate action plan and other circumstances related to exercising control and gaining a controlling holding in the event that the registrar converts into a controlled company;

17) an overview of the strategy to be implemented in connection with the acquisition of a holding in the registrar, provided that the registrar does not become a controlled company as a result of such acquisition;

18) a statement confirming that there is no punishment in force in respect of the acquirer for an economic offence, and office-related offence, an offence against property, or an offence against public trust. In the case of a citizen of a foreign country, an extract from the criminal records database of their country of origin or an equivalent document issued by a competent judicial or administrative authority, issued no more than three months ago.

(2) The Financial Supervision Authority may waive the request for the data or documents specified in subsection 1 of this section, either in part or in full.

(3) The data and documents to be submitted to the Financial Supervision Authority must be prepared in Estonian. With the consent of the Financial Supervision Authority, the above data and documents may be submitted in another language.

(4) The data and documents specified in clauses 3 and 6 of subsection 1 of this section are submitted to the Financial Supervision Authority using the form approved by its management board.

(5) Where more than nine months have passed since the end of the last financial year in the circumstances provided by clause 10 of subsection 1 of this section, an audited interim report covering the first half of the financial year is submitted. A sworn auditor’s report is attached to the reports where the preparation of such a report is required by law.

(6) The Financial Supervision Authority may make a written request for additional data and documents to clarify and verify the data and documents specified in subsection 1 of this section.

§ 21. Proceedings and procedural time limit

(1) The Financial Supervision Authority assesses the acquirer’s compliance with the requirements provided by § 18 of this Act and decides whether to authorise or prohibit the acquisition of a holding within 60 working days (hereinafter procedural time limit) from the receipt of the notice specified in subsection 3 of § 19 confirming the receipt of the data and documents necessary for the assessment.

(2) The Financial Supervision Authority has the right to request the additional data and documents specified in subsection 6 of § 20 of this Act within 50 working days from the start of the procedural time limit.

(3) The Financial Supervision Authority has the right to collect personal data and other information from the criminal records database and other sources for the purpose of verifying the data specified in subsection 1 of § 20 of this Act.

(4) The procedural time limit is suspended for the period between the Financial Supervision Authority’s initial request for the additional data and documents specified in subsection 6 of § 20 of this Act and the receipt of the additional data and documents requested from the acquirer, but such suspension may not exceed 20 working days. The procedural time limit is not suspended if additional data and documents are requested.

(5) If the data or documents specified in subsection 1 of § 20 of this Act are changed during proceedings, the acquirer submits the updated versions to the Financial Supervision Authority immediately. If the change is significant, the Financial Supervision Authority may consider the date on which it learned of the significant change to be the start of the procedural time limit. In such a case, the Financial Supervision Authority will notify the acquirer of the new procedural time limit.

(6) If the acquirer is not subject to financial supervision, or if a competent supervisory authority of a third country exercises supervision over the acquirer, the Financial Supervision Authority may extend the suspension of the procedural time limit specified in subsection 4 of this section to a maximum of 30 working days.

(7) When assessing the acquisition or increase of a qualifying holding, or the transformation of the registrar into a controlled company, the Financial Supervision Authority co-operates with a foreign competent supervisory authority if the Financial Supervision Authority deems it necessary.

(8) In the course of such co-operation as specified in subsection 6 of this section, the Financial Supervision Authority consults with other competent supervisory authorities. Unless otherwise provided by this Act or by the Financial Supervision Authority Act, the Financial Supervision Authority forwards to the other competent supervisory authority immediately all data that is relevant to the assessment of the acquisition or increase of a qualifying holding or the transformation of the registrar into a controlled company.

(9) The Financial Supervision Authority may refrain from reviewing a notification specified in subsections 1 or 2 of § 19 of this Act if the notification or the documents attached thereto contain significant deficiencies.

§ 22. Terms and conditions for acquiring holding

(1) The Financial Supervision Authority has the right to set a time limit for the acquirer, during which the acquirer has the right to acquire or increase a qualifying holding or the right to transform the registrar into a controlled company. The Financial Supervision Authority may extend the prescribed time limit, but the time limit may not exceed a total of 12 months. The acquirer is required to notify the Financial Supervision Authority immediately within the specified time limit of entering into a transaction to acquire or increase a qualifying holding, or to transform the registrar into a controlled company, or of a decision not to enter into such a transaction.

(2) A qualifying holding may be acquired or increased, or the registrar transformed into a controlled company, unless the Financial Supervision Authority prohibits this by means of a precept.

§ 23. Grounds for prohibiting acquisition of holding and decision on acquisition

(1) The Financial Supervision Authority may, by means of its precept, prohibit the acquisition or increase of a qualifying holding, or the transformation of the registrar into a controlled company, if:

1) the acquirer does not comply with the requirements provided by this Act;

2) the acquirer fails to submit the information or documents provided by this Act or requested pursuant to this Act to the Financial Supervision Authority by the prescribed due date;

3) the data or documents submitted to the Financial Supervision Authority do not comply with the requirements provided by this Act or other legislation, or are incorrect, misleading or incomplete, or the data and documents submitted are insufficient to dispel the Financial Supervision Authority’s reasonable doubt regarding the inappropriateness of the acquisition and the fact that the acquisition does not comply with the requirements provided by this Act;

4) the registrar would transform into a company controlled by a person residing or located in a third country, and that person is not subject to adequate supervision in the country of their residence or location, or the competent supervisory authority of that third country has no legal basis or possibility to co-operate with the Financial Supervision Authority;

5) the Financial Supervision Authority has reasonable doubts that the acquisition is in the interest of a third party or that another person’s rights will be exercised upon acquisition.

(2) The Financial Supervision Authority forwards a decision to the acquirer concerning the authorisation to acquire the qualifying holding or a prohibiting precept within two working days after adoption of the decision but prior to the expiry of the procedural time limit. If the acquirer is subject to supervision by a competent supervisory authority of another Contracting Party to the Agreement on the European Economic Area (hereinafter contracting party), the decision also includes, the assessment of that supervisory authority regarding the acquisition or increase of a qualifying holding or the transformation of the registrar into a controlled company.

(3) If the circumstances specified in subsection 1 of this section arise after the acquisition or increase of a qualifying holding or after the registrar has been transformed into a controlled company, the Financial Supervision Authority may issue a precept pursuant to which the acquisition of the holding or the transformation of the registrar into a controlled company is deemed to be in conflict with this Act.

(4) In the event of the circumstances specified in subsections 1 or 3 of this section, the Financial Supervision Authority has the right to issue a precept prohibiting or restricting the exercise of the voting rights of the registrar or other rights enabling control by the acquirer or a person who holds a qualifying holding in the registrar or whose controlled company is the registrar. The Financial Supervision Authority may issue a precept on the basis of this subsection regardless of whether a precept provided by subsections 1 and 3 has been issued. The Financial Supervision Authority discloses precepts or parts thereof on its website at the request of the acquirer or, if necessary, on its own initiative.

(5) If the acquirer or a person who holds a qualifying holding in the registrar, or whose controlled company is the registrar, is a credit institution, fund manager, investment fund, investment firm, insurer, payment institution, e-money institution, or any other person subject to financial supervision who is registered in another EEA contracting party, or a person belonging to the same consolidation group as such a person, the Financial Supervision Authority notifies the competent supervisory authority of that EEA contracting party of the issuance of a precept specified in subsection 3 or 4 of this section.

(6) The registrar, the person maintaining its share register, and any other person who arranges for the exercise of voting rights are also required to comply with the Financial Supervision Authority’s precepts specified in subsections 1, 3, and 4 of this section.

§ 24. Consequences of illegal acquisition of holdings

(1) As a result of a transaction involving the acquisition or increase of a qualifying holding, the person does not acquire the voting rights attached to the shares or otherwise, and the votes represented by the holding are not counted toward the quorum of a general meeting or a meeting of partners if:

1) the transaction conflicts with a previous precept issued by the Financial Supervision Authority;

2) the Financial Supervision Authority has issued a precept on the basis of subsection 3 of § 23 of this Act;

3) the Financial Supervision Authority has not been notified of the transaction in accordance with the rules provided by § 19 of this Act;

4) the transaction was entered into after the expiration of the time limit specified in subsection 1 of § 22 of this Act or before the expiration of the time limit specified in § 21, or before the acquisition of a qualifying holding was permitted under this Act.

(2) A transaction involving any of the circumstances specified in subsection 1 of this section does not give rise to any rights for the person that would transform the registrar into a company controlled by that person.

(3) If, as a result of a transaction involving any of the circumstances specified in subsection 1 of this section, the votes representing a qualifying holding that was acquired or increased were counted toward the quorum of a general meeting and these votes influenced the adoption of a resolution of the general meeting, such resolution is null and void. A court may, upon a petition filed by the Financial Supervision Authority, a shareholder, or a member of the company’s managing body, determine that a resolution of the general meeting is null and void, provided that the petition is filed within six months of the adoption of the resolution.

(4) Upon exercising control-enabling rights arising from a transaction whereby the registrar was to transform into a company controlled by the person, and which involved any of the circumstances specified in subsection 1 of this section, the court may, upon petition by the Financial Supervision Authority, a shareholder, or a member of the company’s managing body, declare the exercise of such rights invalid, provided that the petition is filed within three months of the exercise of the rights.

§ 25. Notification of change in qualifying holding

(1) If the person intends to transfer shares in such an extent that they lose a qualifying holding in the registrar, reduce their holding below any of the thresholds specified in subsection 1 of § 19 of this Act, or relinquish control over the registrar, they notify the Financial Supervision Authority of this intention immediately, specifying the number of shares they hold, the number of shares to be transferred, and the number of shares remaining in their ownership after the transaction.

(2) The provisions of subsection 1 of this section also apply if the person loses control over the registrar or a qualifying holding in the registrar due to some other event or as a result of a transaction, or if the person’s holding falls below any of the thresholds specified in subsection 1 of § 19 of this Act. In such a case, the person notifies the Financial Supervision Authority immediately upon learning of the loss of a qualifying holding or control, or of a reduction in the holding.

(3) Upon learning of the transactions specified in subsections 1 and 2 of § 19 of this Act and in subsections 1 and 2 of this section, the registrar is required to notify the Financial Supervision Authority immediately.

(4) The registrar submits, within two weeks after a general meeting is held, but no later than six months after the end of the financial year, data to the Financial Supervision Authority regarding persons who, as of the end of the financial year, held a qualifying holding in the registrar, indicating the size of the holding and the circumstances related to its ownership according to §§ 17 and 19 of this Act.

§ 26. Registrar’s company form and other business activities

(1) The registrar may operate only as a public limited company.

(2) The registrar is not permitted to engage in any other business activities.

§ 27. Registered office and headquarters

The registered office, headquarters and place of permanent and continuous economic activity of the registrar entered in the Estonian commercial register must be in Estonia.

§ 28. Number of management board members

The management board of the registrar must have at least two members.

§ 29. Requirements for selecting and appointing managers

(1) A person who possesses the knowledge, skills, experience, education, and impeccable reputation necessary to manage the registrar may be selected or appointed as a member of the management board or supervisory board of the registrar (hereinafter manager).

(2) A person’s reputation is not impeccable if the Financial Supervision Authority has identified circumstances that cast doubt on its existence or confirm its absence. When assessing the person’s reputation, the Financial Supervision Authority takes into account, among other things, whether the person has been accused or suspected in an offence case or otherwise involved in such a case, or whether the person has committed an unlawful, fraudulent, or trust-abusing act or has been involved in such an act or in investigation or supervisory proceedings related to it.

(3) A person’s reputation is not impeccable, among other things, if:

1) they have been convicted of a criminal offence in the first degree or punished for an offence against property, an economic offence, an office-related offence, an offence against public trust or an offence against the person, or for financing or supporting an act of terrorism or activities directed at it, or for an offense related to a violation of personal data processing requirements, and the information concerning the punishment has not been deleted from the criminal records database according to the Criminal Records Database Act;

2) they engage or have engaged in usury for the purposes of subsection 4 of § 39 of the Creditors and Credit Intermediaries Act;

3) an international sanction has been imposed on them;

4) they have not acted in a transparent, open, or co-operative manner in their previous dealings with supervisory authorities, or they have provided false information to supervisory authorities or failed to disclose material information;

5) insolvency proceedings are pending against them or they have been declared bankrupt, unless a court has exempted them from obligations that they failed to perform in the bankruptcy proceedings;

6) their actions or inaction have resulted in the bankruptcy or revocation of the activity licence of a creditor, credit intermediary, credit institution, investment firm, or other person subject to financial supervision, at the initiative of a financial supervisory authority;

7) a court has imposed on them an occupational ban on the basis of § 49 of the Penal Code or a prohibition to engage in enterprise on the basis of § 49¹ of the Penal Code, as well as in cases where a prohibition on business or a prohibition to work in a particular profession or position has been imposed on them as prescribed by law or a court decision, or where they have been punished for violating such a prohibition.

(4) The person to be selected as a manager of the registrar must have enough time to perform their duties in this position and they must be a good fit for the managing body in terms of knowledge, skills, and experience.

(5) It is prohibited to select or appoint as a manager of the registrar, or as a member of the supervisory board or management board of the registrar’s parent undertaking or a company belonging to the same consolidation group as the registrar, any person whose previous actions have resulted in the bankruptcy or compulsory liquidation of a company, or the revocation of its activity licence, or who is subject to a prohibition to engage in enterprise or whose prior conduct as a manager of a company has demonstrated that they are incapable of running a company in such a way as to adequately protect the interests of the company’s shareholders, partners, members, creditors, and consumers, or whose past conduct has demonstrated that they are unsuitable to manage a company for any other valid reason.

§ 30. Responsibilities and duties of managers and employees

(1) The registrar’s managers and employees act with the foresight and diligence expected of them and according to the requirements imposed on their roles and positions.

(2) The managers of the registrar ensure that the registrar’s organisational structure is transparent and includes clearly defined areas of responsibility, and that procedures are in place for identifying, measuring, managing, continuously monitoring, and reporting of risks, which are adequate and proportionate given the nature, scope, and complexity of the registrar’s activities.

(3) The management board of the registrar is required to make sure that any rules established on the basis of this Act are up to date, to evaluate their effectiveness, and to take appropriate measures to remedy any deficiencies.

(4) Employees of the registrar are required to provide services lawfully, competently, accurately, and diligently.

(5) For the purposes of this Act, an employee means a natural person who works for the registrar under an employment contract or other contract under the law of obligations, and whose duties include activities related to the provision of services on behalf of the registrar.

(6) The managers and employees of the registrar are required to keep any personal data that has come to their knowledge confidential for an unlimited period, unless otherwise provided by legislation.

§ 31. Notification of Financial Supervision Authority of managers, internal auditors, and audit firms

(1) To be selected or appointed as a manager of the registrar, the relevant person must give their written consent. Along with their written consent, the person has to submit at least the following data and documents to the Financial Supervision Authority:

1) given name and surname, in the event of a name change, the previous name along with the date and reason for the change; personal identification code or, in the absence thereof, date of birth; citizenship; place of residence; contact information; description of educational background; comprehensive list of employment and positions held; details regarding the term and location of service; and, in the case of a member of the management board, a description of their area of responsibility, as well as documents confirming their reputation and trustworthiness and compliance with the requirements of this Act;

2) information on companies in which it holds more than 20 per cent of the shares, including information on the amount of share capital and a list of areas of activity;

3) information regarding potential conflicts of interest and the time devoted to the performance of the person’s official duties;

4) a statement confirming the absence of any circumstances provided by this Act that would preclude their right to serve as a manager of the registrar;

5) a statement confirming that there is no punishment in force against the person for a criminal offence in the first degree, or for an economic offence, an office-related offence, an offence against property, an offence against public trust, or an offence against the person, or for financing or supporting an act of terrorism or activities directed at it, or for an offense related to a violation of personal data processing requirements. In the case of a citizen of a foreign country, an extract from the criminal records database of their country of origin or an equivalent document issued by a competent judicial or administrative authority, issued no more than three months ago.

(2) Upon selecting or appointing an audit firm, the registrar submits to the Financial Supervision Authority the name of the audit firm and a confirmation from the audit firm stating that there are no circumstances that would preclude its right to serve as the registrar’s audit firm. In addition, the names of the sworn auditors are provided.

(3) Upon selecting or appointing an internal auditor, the registrar submits to the Financial Supervision Authority the internal auditor’s name, personal identification code, and a confirmation from the internal auditor stating that there are no circumstances that would preclude their right to serve as the registrar’s internal auditor.

(4) The registrar is required to notify the Financial Supervision Authority of any intention to select or appoint a manager, internal auditor, audit firm, or sworn auditor, of any extension of their powers, as well as of their resignation or the initiation of their removal before the expiry of their powers at least ten days in advance before the relevant decision is made or immediately after receiving the relevant application. This time limit does not apply if prior notice is not possible for a valid reason.

(5) The data specified in subsection 1 of this section are submitted using a form approved by the management board of the Financial Supervision Authority.

(6) The Financial Supervision Authority may, in order to clarify and verify the data and documents specified in subsection 1 of this section, request in writing for additional data and documents and collect personal data and other information from the criminal records database and public sources.

§ 32. Removal, non-selection and non-appointment of manager of registrar

(1) The Financial Supervision Authority has the right to issue a precept requesting the removal, non-selection or non-appointment of a manager of the registrar in the following cases:

1) the person does not meet the requirements established for managers in this Act;

2) the person has submitted misleading or untrue data or falsified documents for the purpose of being selected or appointed;

3) the person’s activities as a manager of the registrar have demonstrated that they are not capable of managing the registrar in a reliable and sound manner.

(2) If the registrar has not fully complied with the precept specified in subsection 1 of this section or has not done so within the set time limit, the Financial Supervision Authority has the right to seek the removal of a manager through court proceedings.

§ 33. Appointment of data protection specialist

The registrar is required to appoint a data protection specialist.

§ 34. Internal rules

(1) The management board of the registrar establishes, by its decision, rules of procedure governing the activities of the registrar and its managers and employees (hereinafter internal rules), which serve to ensure compliance with the legislation regulating the registrar’s activities and with the decisions of the registrar’s managers, as well as the lawful and regular provision of services.

(2) The internal rules determine the level of knowledge, skills, and experience required of managers and employees to perform their duties in those roles or positions within the registrar’s organisation. The qualifications and work or professional experience necessary to perform the duties associated with the role or position are taken into account when determining the level of knowledge and competence.

(3) The internal rules establish appropriate procedures to ensure effective and reliable management, including the separation of duties, business continuity, and the avoidance of conflicts of interest. The management board supervises the implementation of the procedures in a manner that supports the integrity of the credit market.

(4) The internal rules determine, among other things:

1) procedure for the internal flow of information and documents, including requirements for the submission and forwarding of information;

2) employees’ duties and official duties, subordination relations, reporting lines, reporting procedures, and delegation of authority, establishing the separation of functions when assuming obligations on behalf of the registrar, recording services in accounting and reports, and assessing risks;

3) procedure for assessing a manager’s suitability;

4) a description and action plan for mitigating and avoiding conflicts of interest, as well as relevant mitigation measures;

5) procedure for maintaining the register and handling data;

6) rules of procedure specifying the security and regular inspection of the information technology systems in use;

7) internal control system operating procedure and risk management rules, as well as the procedure for their implementation;

8) rules of procedure for receiving, processing, and forwarding reports of violations or potential violations of obligations established in legislation governing the registrar’s activities, and for addressing the consequences thereof;

9) accounting policies and procedures;

10) in the case of a branch, the procedure for verifying its compliance with operational requirements;

11) procedure for the preparation and submission of reports for supervisory purposes, including the composition and regularity of the reports, the employees responsible for preparing and submitting them, the information systems used, and the internal control procedures for verifying the accuracy of the information provided.

§ 35. Internal control system

(1) A sufficient internal control system must be established and implemented within the registrar with the aim of ensuring that the registrar’s activities comply with this Act, applicable internal rules and adopted decisions at all management and operation levels of the registrar.

(2) To perform internal control, operating principles and rules are established within the registrar through internal rules to identify, mitigate or avoid legal risks arising from failure to perform any obligations arising from this Act, as well as other related risks, when providing services to clients. These operating principles and rules must enable the Financial Supervision Authority to effectively carry out its supervisory duties.

(3) The supervisory board of the registrar appoints an internal auditor or a person to perform this function who possesses the necessary knowledge, skills, experience, education, professional qualifications, and an impeccable business reputation. The requirements and legal bases for activities provided by the Auditors Activities Act with respect to certified internal auditors apply to internal auditors. Internal auditors may not perform duties that give rise to or could give rise to a conflict of interest.

(4) Internal auditors must ensure that:

1) the activities of the registrar, its managers, and employees are regularly reviewed for compliance with this Act and for compliance with legislation issued on the basis thereof, the precepts of the supervisory authority, decisions of the managing bodies, internal rules, contracts concluded by the registrar, and best practices; and assessments are made of the compliance of the internal rules established and decisions taken by the registrar with legislation, as well as the appropriateness and effectiveness of measures taken to remedy deficiencies in the registrar’s performance of its obligations;

2) the management board and supervisory board of the registrar receive regular reports on the performance of the obligations specified in clause 1 of this subsection.

(5) The registrar provides internal auditosr with the working conditions and rights necessary to perform their duties, including the right to obtain explanations and information from the registrar’s managers and employees, and the opportunity to monitor the remediation of identified deficiencies and the implementation of proposals made.

(6) Internal auditors are required, immediately, to forward in writing to the managers of the registrar, as well as to the supervisory board of the registrar and to the Financial Supervision Authority, any information that has come to their knowledge regarding the registrar that indicates or may indicate a material violation of law or harm to the interests of creditors or consumers.

§ 36. Registrar’s share capital

(1) The registrar’s share capital must amount to at least 125,000 euros.

(2) The registrar’s share capital must be fully paid in.

§ 37. Organising accounting

(1) Accounting and reporting arrangements are governed by the provisions of this Act, the Accounting Act, the articles of association and accounting policies and procedures of the registrar, and other legislation regulating accounting.

(2) Accounting must ensure that accurate information is obtained about the registrar’s financial standing and economic activities.

§ 38. Reports and submission thereof to Financial Supervision Authority

(1) The registrar submits to the Financial Supervision Authority its annual report approved by a general meeting, together with the sworn auditor’s report, within two weeks after the general meeting of shareholders takes place, but no later than six months after the end of the financial year. If the registrar has disclosed the above reports on its website or submitted them to the commercial register within six months after the end of the financial year, it is not required to submit them to the Financial Supervision Authority.

(2) The registrar submits reports not specified in subsection 1 of this section to the Financial Supervision Authority in accordance with the rules provided by this Act and legislation issued on the basis thereof.

(3) The reporting period provided by subsection 2 of this section is the quarter, and the reports must be submitted to the Financial Supervision Authority within one month after the end of the reporting period, unless otherwise provided by this Act and legislation issued on the basis thereof. If the last date for submitting the report falls on a day off, the regular report must be submitted no later than the first working day following that day off.

(4) In addition to the provisions of this section, the Financial Supervision Authority has the right to request reports if they are necessary for exercising supervision in the scope provided by this Act.

(5) The forms for registrar reports to be submitted to the Financial Supervision Authority, the methodology for their preparation, and the procedure for their submission are established by a requlation of the minister in charge of the policy sector.

§ 39. Review of reports submitted to Financial Supervision Authority, remediation of deficiencies therein, and retention of source data relating to such reports

(1) After receiving a supervisory report specified in subsection 2 of § 38 of this Act, the Financial Supervision Authority must check its compliance with applicable requirements as soon as possible.

(2) The Financial Supervision Authority will notify the submitter if it identifies any deficiencies in a supervisory report.

(3) The submitter of a supervisory report is required, in the case provided by subsection 2 of this section, to remedy the deficiencies and submit a revised report to the Financial Supervision Authority without undue delay. A revised report must also be submitted to the Financial Supervision Authority if the submitter identifies an error in previously submitted data, or if the audited data differ from the unaudited data submitted previously.

(4) The submitter is required to retain any documents containing source data used to prepare a supervisory report for a period of five years. This time limit does not restrict the registrar’s right to retain data and documents for longer periods if the registrar has another legal basis for processing them.

§ 40. Audit

(1) The registrar’s annual accounts must be audited.

(2) A person specified in subsection 2 of § 7 of the Auditors Activities Act, who has sufficient knowledge and experience may be appointed as the registrar’s audit firm.

(3) The court that serves the locality of the registrar appoints an audit firm based on a request from the Financial Supervision Authority if:

1) no audit firm has been appointed by a general meeting;

2) the audit firm appointed by a general meeting declines to perform the audit;

3) the audit firm has, in the opinion of the Financial Supervision Authority, lost its credibility.

(4) The powers of an audit firm designated by the Financial Supervision Authority remain in effect until a new audit firm is appointed by a general meeting or a meeting of partners.

§ 41. Audit firm’s notification obligation

(1) An audit firm is required to immediately notify the Financial Supervision Authority in writing of any circumstances that have come to its knowledge during an audit of the registrar and that result in or may result in:

1) a material violation of the requirements provided by legislation governing the registrar’s activities;

2) risk of disruption to the registrar’s continued operations;

3) a modified sworn auditor’s report on the annual accounts;

4) a situation in which the registrar is unable to perform its obligations, or a risk that such a situation may arise;

5) significant pecuniary harm to the registrar, to a person specified in clause 1 of subsection 1 of § 10 of this Act, or to a consumer, resulting from the actions of a manager or an employee of the registrar.

(2) The forwarding of data to the Financial Supervision Authority according to subsection 1 of this section does not constitute a violation of the obligation to maintain professional secrecy as provided by the Auditors Activities Act, or of any contractual confidentiality requirements imposed on an audit firm.

§ 42. Transformation, merger and division

The transformation, merger, or division of the registrar is not permitted.

§ 43. Bankruptcy

(1) The following persons may file a petition for bankruptcy against the registrar:

1) the Financial Supervision Authority;

2) the Ministry of Finance;

3) liquidators;

4) creditors;

5) the registrar itself.

(2) The acting registrar notifies the Financial Supervision Authority immediately of the filing of a petition for bankruptcy by the persons and institutions specified in clauses 2–4 of subsection 1 of this section.

§ 44. Person exercising supervision

(1) The Financial Supervision Authority exercises supervision over compliance with the requirements imposed on the registrar by this Act.

(2) To exercise supervision, the Financial Supervision Authority:

1) reviews matters related to the acquisition, increase, and reduction of holdings and the obtaining of control;

2) grants a permit or consent in the cases provided by this Act;

3) monitors reports and other documents, and also conducts on-site inspections to verify that the registrar’s activities comply with the law;

4) issues mandatory precepts and gives orders as necessary;

5) performs other duties arising from this Act and from legislation issued on the basis thereof.

(3) In order to exercise the supervisory functions provided by this Act, the Financial Supervision Authority may take measures provided by this Act, which include issuing administrative acts, taking actions, and implementing the special state supervision measures provided by § 31 of the Law Enforcement Act.

(4) The Financial Supervision Authority may disclose a ruling made in a misdemeanour matter, an administrative act or an administrative contract on its website on the basis of subsection 5 of § 54 of the Financial Supervision Authority Act.

(5) The Financial Supervision Authority retains personal data processed in the course of supervisory proceedings for two years from the date the supervisory proceedings are concluded.

§ 45. Rights and obligations of parties to proceedings in supervisory proceedings

(1) Where necessary, the Financial Supervision Authority explains to a party to the proceedings their rights and obligations in supervisory proceedings.

(2) A party to the proceedings has the right to access the data collected about them by the Financial Supervision Authority and to make copies and extracts of such data. The Financial Supervision Authority has the right to refuse to disclose data to a party to the proceedings, to provide such data at a later time, or to restrict their provision if doing so would harm or could harm the legitimate interests of a third party, or if access to the data would hinder the achievement of supervisory objectives or jeopardise the establishment of truth in criminal proceedings. Data are not disclosed as long as this is necessary to achieve the objectives.

(3) A party to the proceedings has the right to ask questions of a witness in supervisory proceedings through the Financial Supervision Authority. The Financial Supervision Authority has the right to refuse, for valid reasons, to refer questions to a witness if the questions are irrelevant or if such refusal is necessary to prevent a violation of the witness’s rights or interests.

§ 46. Rights of Financial Supervision Authority in obtaining information

(1) To exercise supervision, the Financial Supervision Authority has the right to request from the following persons reports, cost-free information, documents, and oral or written explanations relating to circumstances relevant to the supervision:

1) a manager or an employee of the registrar;

2) a manager or an employee of a company belonging to the same group as the registrar;

3) a shareholder of the registrar;

4) a liquidator or a trustee in bankruptcy of the registrar;

5) another third party.

(2) To exercise supervision, the Financial Supervision Authority has the right to:

1) request from the registrar all data necessary to verify compliance with the requirements provided by this Act and to assess the suitability of members of the managing body, shareholders, and employees;

2) conduct on-site inspections of companies belonging to the same group as the registrar to verify information forwarded to the Financial Supervision Authority or in cases of suspected violations of legal provisions, and request the submission of data and documents necessary for exercising supervision;

3) obtain information from the registrar’s audit firm and co-operate with it;

4) receive information from the registrar’s internal auditor and co-operate with them.

(3) If necessary, the Financial Supervision Authority may require a person specified in subsection 1 of this section to appear at the offices of the Financial Supervision Authority at a specified time to provide explanations.

(4) To exercise supervision, the Financial Supervision Authority has the right to obtain information related to the registrar from a third party without notifying the registrar of obtaining such information. The third party may not notify the registrar of the forwarding of such information.

(5) Provided that it does not impair the execution of supervision, the Financial Supervision Authority informs the persons specified in subsection 1 of this section of the purposes of requesting information.

§ 47. On-site inspection

(1) The Financial Supervision Authority has the right to conduct on-site inspections at the registrar’s registered office or place of business for supervisory purposes if:

1) it is necessary to verify that the data provided correspond to reality;

2) the Financial Supervision Authority suspects the violation of requirements provided by this Act or by legislation established on the basis thereof;

3) it is necessary for the performance of other supervisory functions.

(2) The Financial Supervision Authority orders an on-site inspection, specifying the objective and scope of the inspection, the period covered and the time of the inspection. The order is served on the registrar no later than three working days before the start of the on-site inspection, unless advance notice of the order would jeopardise the achievement of the inspection’s objective. On-site inspections are conducted by an authorised employee of the Financial Supervision Authority (hereinafter inspector), unless otherwise provided by this Act.

(3) During on-site inspections, the inspector has the right to:

1) enter all premises while complying, to the extent possible, with the security regulations applicable to the registrar;

2) request necessary working conditions and a separate room;

3) examine the documents and data carriers necessary for exercising supervision and make extracts, transcripts, and copies thereof;

4) monitor work processes;

5) request oral and written explanations from the managers and employees of the registrar.

(4) The registrar is required to appoint a competent representative who will be present during the inspection and who will provide the inspector with the information necessary for the performance of their duties, and submit documents, including the sworn auditor’s reports and the sworn auditor’s special-purpose reports on the registrar’s reports, providing the necessary explanations regarding them.

(5) The inspector is required to prepare a draft act on the results of the inspection within three months after the completion of the on-site inspection, which the Financial Supervision Authority communicates to the registrar.

(6) The registrar has the right to submit written explanations within one month of service of a draft act.

(7) After receiving written explanations from the registrar or after the time limit for submitting explanations has expired, but no later than five months after the completion of the on-site inspection, the Financial Supervision Authority confirms the concluding act with its reasoned decision, which is served on the registrar.

(8) The Financial Supervision Authority may extend the time limit provided by subsection 7 of this section by up to two months if the explanations provided by the registrar or other relevant circumstances require further assessment. If significant amendments are made to the concluding act during this period, the Financial Supervision Authority will resend it to the registrar for written explanations.

(9) The Financial Supervision Authority may set a time limit in the concluding act for the registrar to remedy identified deficiencies, or impose other obligations and restrictions on the registrar, enforcing a non-compliance levy in the event of noncompliance or improper compliance.

(10) The Financial Supervision Authority has the right to disclose the concluding act of an on-site inspection, or a part thereof if it proves necessary, having regard to the integrity and transparency of the financial sector.

§ 48. Expert involvement

(1) The Financial Supervision Authority may involve experts in the supervisory proceedings to clarify significant circumstances that require specialist knowledge.

(2) If experts identify circumstances that are relevant to the supervisory proceedings, even though the Financial Supervision Authority had not specifically tasked them with clarifying these circumstances, they will also provide their opinion or assessment regarding those circumstances.

(3) Experts are required to keep confidential, for an unlimited period, any information not subject to disclosure that came to their knowledge in the course of performing the duties specified in this section.

(4) The Financial Supervision Authority covers the costs of expert assessment.

§ 49. Precepts

The Financial Supervision Authority has the right to issue a precept if:

1) supervision reveals a violation of the requirements of this Act or of legislation established on the basis thereof;

2) it is necessary to prevent the violation of law specified in clause 1 of this section;

3) the risks assumed by the registrar have increased to a significant extent or there are other circumstances that jeopardise or could jeopardise its operations or the interests or integrity of the financial sector as a whole;

4) it is necessary to protect the interests of the registrar’s clients or to ensure the transparency of the financial sector.

§ 50. Rights of Financial Supervision Authority in issuing precepts

(1) The Financial Supervision Authority has the right, by way of a precept, to:

1) prohibit the registrar’s transactions or actions or limit their scope;

2) prohibit or restrict the use or disposal of the registrar’s assets, including accounts;

3) prohibit, in whole or in part, payments from the registrar’s profits;

4) request amendments or updates to the registrar’s internal rules and internal control system;

5) request the removal, non-selection or non-appointment of a manager of the registrar, or the temporary suspension of their powers;

6) submit a proposal to a general meeting of the registrar to change the registrar’s audit firm;

7) request that an employee of the registrar be suspended from work;

8) request the suspension of the registrar’s economic activities in the event of a material violation of the requirements of this Act or of legislation established on the basis thereof;

9) request that the registrar change or update its operating principles and procedure for resolving complaints;

10) submit other requests to ensure compliance with the requirements of legislation governing the registrar’s activities.

(2) If a precept is not complied with, the Financial Supervision Authority may take other measures provided by this Act, including:

1) request that a court remove a manager of the registrar;

2) impose a non-compliance levy.

§ 51. Convening of managing body and revocation of resolutions of managing body at Financial Supervision Authority’s request

(1) The management board of the registrar notifies the Financial Supervision Authority of holding a general meeting and a meeting of the supervisory board at least two weeks in advance. Notice of an extraordinary general meeting should be given at least one week in advance, if possible.

(2) The Financial Supervision Authority has the right to issue a precept:

1) to convene a meeting of the management board, supervisory board or a general meeting of the registrar;

2) to include in the agenda of a meeting of the management board, supervisory board or a general meeting a matter deemed necessary by the Financial Supervision Authority.

(3) The Financial Supervision Authority has the right to send its representative to a meeting, and that representative has the right to express opinions, make proposals, and request that they be recorded in the minutes of the meeting.

(4) The court that serves the locality of the registrar may, following a petition filed by the Financial Supervision Authority, declare a resolution of a general meeting, a meeting of the supervisory board or a meeting of the management board to be invalid if it conflicts with this Act, the Commercial Code or with legislation or articles of association issued on the basis thereof, provided that the petition is filed within three months of the adoption of the resolution.

§ 52. Non-compliance levy

(1) Upon failure to comply with, or improper compliance with, a precept or another administrative act issued on the basis of this Act, the Financial Supervision Authority may impose a non-compliance levy in accordance with the rules provided by the Substitutional Performance and Non-Compliance Levies Act.

(2) If an administrative act is not complied with or is complied with improperly, the maximum non-compliance levy for a natural person is up to 5,000 euros for the first time and up to 10,000 euros for subsequent times to enforce compliance with one and the same obligation, for a total of up to 1,000,000 euros.

(3) If an administrative act is not complied with or is complied with improperly, the maximum non-compliance levy for a legal person is up to 10,000 euros for the first time and up to 100,000 euros for subsequent times to enforce compliance with one and the same obligation, for a total of up to 3,000,000 euros or up to ten per cent of annual net turnover.

§ 53. Violation of registrar’s internal rules

(1) Violation of the requirements for internal rules provided by § 34 of this Act

is punishable by a fine of up to 100,000 euros.

(2) The same act, where committed by a legal person,

is punishable by a fine of up to 1,000,000 euros or up to 10 per cent of the annual net turnover.

§ 54. Violation of registrar’s internal control requirements

(1) Violation of the internal control requirements provided by § 35 of this Act

is punishable by a fine of up to 100,000 euros.

(2) The same act, where committed by a legal person,

is punishable by a fine of up to 1,000,000 euros or up to 10 per cent of the annual net turnover.

§ 55. Failure to submit information

(1) Failure to submit or untimely submission of a report, document, explanation or other information or data provided by this Act to the Financial Supervision Authority or submission or disclosure of incorrect, incomplete or misleading information or submission of data in a form which does not enable exercise of supervision,

is punishable by a fine of up to 200,000 euros.

(2) The same act, where committed by a legal person,

is punishable by a fine of up to 2,000,000 euros or up to 10 per cent of the annual net turnover.

§ 56. Violation of procedure for acquisition of qualifying holding in registrar

(1) Acquisition of a holding in the registrar, transfer thereof or transformation of the registrar into a company controlled by the acquirer without prior notification to the Financial Supervision Authority according to this Act, or contrary to a precept specified in § 23 of this Act, and exercise of the right to vote in the registrar or other rights enabling control over the company contrary to a precept of the Financial Supervision Authority

is punishable by a fine of up to 100,000 euros.

(2) The same act, where committed by a legal person,

is punishable by a fine of up to 1,000,000 euros or up to 10 per cent of the annual net turnover.

§ 57. Proceedings

The Financial Supervision Authority is the out-of-court proceedings authority for the misdemeanours specified in this Chapter.

§ 58. Introduction of credit information register

(1) Credit information related to a consumer credit contract concluded and in effect prior to the entry into force of this Act, as well as credit information related to a consumer credit contract transferred or assumed prior to the entry into force of this Act, and credit information related to a claim arising from such a contract, will be forwarded by a credit information provider to the registrar within eight months as of the entry into force of this Act, according to subsection 1 of § 64 of this Act.

(2) Consumers will have the right to submit a request to be added to the list of consumers subject to restrictions on concluding consumer credit contracts as provided by § 9 of this Act, starting from 1 March 2029.

(3) Access to the credit information register on the basis of § 10 of this Act will be granted as of 1 March 2029.

§ 59

–

§ 63

[Provisions amending other Acts are omitted from the translation.]

§ 64. Entry into force of Act

(1) Clauses 1, 3, and 9 of § 60, clauses 1–3 and 6 of § 61, and clauses 1, 2, and 5 of § 62 of this Act enter into force on 1 July 2028.

(2) Clauses 2, 5, 6, and 8 of § 60, clause 5 of § 61, clause 4 of § 62, and § 63 of this Act enter into force on 1 March 2029.