Moldova’s Parliament Adopts New Law on Financial Institutions: Scope, Compliance, and Penalties
The Parliament of the Republic of Moldova has recently adopted a new law on financial institutions to strengthen financial regulation, protect household depositor interests, and promote a competitive financial sector. Here’s an in-depth look at the new law under markdown format.
Chapter I: General Provisions
Article 1: Scope and Objectives
The new law aims to:
- Protect household depositor interests,
- Prevent excessive risk to the financial system,
- Foster a strong and competitive financial sector,
- Facilitate market forces in the provision of financial services.
Article 2: Institutions Covered
The law applies to:
- Credit institutions,
- Investment firms,
- Electronic money institutions,
- Payment institutions,
- and other financial institutions.
Article 3: Main Definitions
Key definitions:
- Financial institution,
- Bank,
- Capital,
- Debt,
- Equity interest,
- Significant interest,
- Regulator,
- Subsidiary.
Chapter II: Licensing of Banks
Article 4: Licensing Authority
The National Bank of Moldova is the licensing authority for banks.
Article 5: Minimum Capital Requirement
The minimum initial capital required for a bank license: 100 million lei.
Procedures for License Issuance and Decision-Making
The following articles outline the procedure for license application, decision, and issuance.
- Article 6: Application Procedures and Requirements
- Article 7: License Decision
- Article 8: License Issuance and Fees
- Article 9: Register of Authorized Banks
- Article 10: Revocation of a License
Chapter III: Organization and Administration of Banks
Article 13: Organizations and Independence of Banks
Banks enjoy legal, operational, financial, and administrative autonomy and freedom of contract.
Article 14: Capital Requirements
Banks must maintain a minimum regulatory capital that complies with Article 5’s requirements.
Article 15: Restrictions on Ownership and Holdings
Restrictions on equity interest transfers and ownership limits for residents of offshore zones and/or countries are outlined.
Penalties for Non-Compliance
Article 38: Infractions and Penalties
The new law imposes penalties for infringements, including remedial actions, fines, or license revocation.
This article offers you a high-level overview of the new financial regulations law in Moldova. For a more detailed understanding, please refer to the official text of the law.
- Article 6: License Application
- Article 7: License Decision
- Article 8: Scope of License, Authorized Copies, and Fees
License issuance is indefinite, non-transferable, and subject to a fee.
- Article 10: Revocation of a License