Financial Crime World

Romania’s Financial Compliance Landscape: A Closer Look at Banking, Electronic Money, Insurance, and Payment Services Regulations

Amidst the complex regulatory framework governing the Romanian financial sector, this article provides an in-depth analysis of the key laws, entities, and activities under supervision, focusing on banks and financial institutions, electronic money institutions, non-banking financial institutions, and insurance and payment services.

I. Regulatory Framework for Financial Institutions

1. Applicable Laws and Regulations

  • The Romanian financial sector is subject to various enactments:
    • Government Emergency Ordinance 99/2006 on credit institutions
    • Capital Markets Law No. 297/2004
    • Law No. 136/1995 on insurance and reinsurance
  • The framework includes provisions from the European Union (EU)

2. Entities and Agencies

  • Key entities responsible for supervision and control:
    • National Bank of Romania (NBR)
    • Insurance Supervisory Commission (ISC)
    • National Securities Commission (NSC)
  • The NBR oversees credit institutions, electronic money institutions, and non-banking financial institutions
  • The ISC supervises the insurance and reinsurance market
  • The NSC focuses on capital markets and related activities

II. Banks and Financial Institutions

  • Banking sector is primarily regulated by the Banking Law and the Statute of the National Bank of Romania
  • Includes credit institutions: banks, mortgage banks, savings banks, housing credit cooperative organizations, mortgage bonds, and securitization of receivables

III. Electronic Money Institutions

  • Electronic money sector falls under the jurisdiction of the Electronic Money Law
  • Aims to transpose the Electronic Money Directive into Romanian law
  • Electronic money institutions perform activities like electronic money issuance, payment services, and business activities

IV. Non-banking Financial Institutions (IFNs)

  • IFNs are governed by the IFN Law
  • Primarily engage in granting loans, financial leasing, factoring, and other financing activities
  • Required to register with the NBR and meet specific legal requirements

V. Insurance and Reinsurance

  • Insurance market is regulated by the Insurance and Reinsurance Law, along with the Romanian Civil Code, Law on insurance activity and insurers’ supervision, and Law on financial reorganization and bankruptcy of insurance companies
  • ISC is responsible for supervising the insurance market and enforcing related legislation

VI. Payment Services

  • Romanian Government Emergency Ordinance on payment services is the primary legislative instrument governing the payment services sector
  • Covers various payment services, such as executing payment transactions and money remittance

VII. Regulatory authorities and oversight bodies

  • Each regulatory body plays a crucial role in ensuring the supervision and compliance of their respective sector
  • The National Bank of Romania, Insurance Supervisory Commission, and National Securities Commission maintain significant influence in the financial landscape
  • Cooperate with the European Banking Authority, European Commission, and other competent authorities