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Norway Tightens Screws on Money Service Businesses with New Regulations
Oslo, Norway - Financial Supervisory Authority (Finanstilsynet) Introduces New Rules
The Financial Supervisory Authority (Finanstilsynet) has introduced new regulations aimed at bolstering supervision over money service businesses operating in Norway. The new rules are designed to ensure that foreign credit institutions, insurance undertakings, fund management companies, electronic money institutions, and account information service providers operating in Norway are subject to effective supervision.
Supervision of Foreign Institutions
According to the new rules, Finanstilsynet will be responsible for supervising foreign institutions that have their head office outside of Norway but operate within the country. The authority will conduct its supervision in accordance with the EEA Agreement Annex IX, Directive (EU) 2015/2366, and other relevant legislation.
- Competent authorities from the home state of these foreign institutions will be responsible for supervising their business activities in Norway.
- These authorities may perform on-site inspections at Norwegian branches or subsidiaries upon prior notification to Finanstilsynet.
Cooperation with Other Supervisory Authorities
The new regulations also require Finanstilsynet to cooperate with supervisory authorities from other EEA states and exchange necessary information for effective supervision. In some cases, Finanstilsynet may transfer or take over supervisory functions in agreement with these authorities.
- If a foreign institution operating in Norway loses its right to conduct business, Finanstilsynet must immediately notify the relevant supervisory authorities of other EEA states.
- Finanstilsynet may prohibit foreign institutions operating in Norway from disposing over their assets in the country or restrict such disposal at the request of the supervisory authority of their home state.
Powers of Finanstilsynet
The new regulations empower Finanstilsynet to:
- Order a financial institution to cease operations in Norway if it is found guilty of gross or persistent violations of its obligations under Norwegian laws and regulations.
- Prohibit foreign institutions operating in Norway from disposing over their assets in the country or restrict such disposal at the request of the supervisory authority of their home state.
Effective Date
The new regulations will come into effect simultaneously with the entry into force of the Agreement on the European Economic Area.