Legal responsibility for this publication
J.-P. Servais, rue du Congrès/Congresstraat 12-14, 1000 Brussels
Photography Christophe Vander Eecken
Layout Gramma nv
Printing Graphius nv
Disclaimer
This document is intended to provide a concise and readable introduction to the work of the FSMA and cannot be regarded as a legally binding publication.
Dear readers,
The purpose of this brochure is to introduce the Financial Services and Markets Authority (FSMA), its operations and the powers conferred upon it by law. The FSMA is responsible for supervising the Belgian financial sector. It seeks to maintain a solid financial system that inspires confidence and pays due regard to the interests of consumers. The FSMA thus contributes to ensuring the reliability of financial services and the transparency and openness of the markets. It ensures that the products offered to you are suited to your needs and wishes, and that financial service providers work for the benefit of society. I would like to invite you to discover in this brochure the ways in which the FSMA fulfils its mandate.
Jean-Paul Servais, Chairman
The FSMA strives to ensure the honest and equitable treatment of financial consumers. Financial products must be comprehensible and reliable and supplementary pensions adequately protected. Consumers need to be able to count on accurate financial Information and on orderly and transparent financial markets. The FSMA sees to it that financial service providers are fair and honest, and that they place consumer interests at the core. Financial education helps consumers make informed choices. Thus, the FSMA seeks to ensure that the financial system deserves the trust of its users.
The FSMA was founded on 1 April 2011. Its full name is the Financial Services and Markets Authority. Its status is that of an autonomous public institution, meaning that it carries out independently the tasks in the public interest entrusted to it by Parliament.
The FSMA, alongside the National Bank of Belgium (NBB) and the Federal Public Service Economy, supervises the Belgian financial sector.
The powers of the FSMA cover various domains: financial products, financial markets and company financial information, conduct of business rules, financial service providers and intermediaries, supplementary pensions, financial education and measures against unlawful activities.
These powers are described in greater detail in the rest of this brochure.
Surveillance of financial markets and supervision of company information
Supervision of compliance with conduct of business rules
Supervision of supplementary pensions
Measures against unlawful activities
To avoid situations in which consumers have difficulties understanding financial products and are not aware of the financial risks to which they are exposed, the FSMA supervises financial products and takes initiatives to prevent certain kinds of problems and to enhance consumer confidence in these products. Its supervision is intended to help ensure that the products offered are comprehensible, safe, useful and cost-transparent.
• The FSMA supervises financial products such as funds, savings accounts, insurance products and derivatives.
• It checks to see if advertisements for financial products are accurate, clear and comprehensible. These checks help prevent the dissemination of misleading advertising materials. The products subject to ex ante supervision give rise to significantly fewer complaints.
• The FSMA has taken the initiative to implement a moratorium on the distribution, in Belgium, of particularly complex structured products. This has made it possible to reduce substantially the complexity of products distributed to consumers.
• The FSMA bans the distribution of certain products that are not appropriate for consumers. Such a ban is in effect, for example, for binary options and derivative products that use leverage, as well as for traded life policies and derivatives based on a virtual currency.
• It supervises the way in which sustainability criteria are applied and looks out for greenwashing.
Investors need access to correct information about companies to be able to take informed investment decisions. The FSMA ensures that the information disseminated by listed companies is complete, accurate and made available to the public in a timely and appropriate way. It also sees to the smooth and transparent functioning of the markets on which those companies are listed. Moreover, the FSMA supervises the information disseminated by unlisted companies if the latter issue securities to the public for purposes of raising capital. The FSMA provides support, via its knowhow and personnel, to the operations of the Belgian college responsible for the oversight of company auditors.
• The FSMA ensures that listed companies disclose their information in clear and transparent form and in a timely manner.
• It checks that such financial information is made available to everyone at the same time.
• The FSMA monitors the prices of instruments listed on Euronext Brussels in real time. It has various efficacious monitoring tools for the purpose.
• In the event of problems, the FSMA can suspend trading in a share and carry out additional analyses. These may in turn lead to further investigation and potential sanctions, for example in cases of insider dealing or market manipulation.
• Where transferable securities are offered for sale in Belgium, the FSMA approves the prospectus and related advertisements before publication.
• If a takeover bid is launched, the FSMA ensures that all shareholders are treated fairly.
Financial firms subject to the FSMA’s supervision must act honestly, fairly, and professionally in the best interests of their clients. They are required to have a suitable organizational structure and to use the required procedures to ensure the correct and appropriate treatment of consumers of financial services. In particular, the FSMA conducts site inspections to verify that firms comply with the applicable rules of conduct.
• The FSMA seeks to ensure that consumers buy only such financial products as fit their risk profile and investment objectives.
• It sees to it that the interests of financial institutions do not prevail over those of consumers.
• The FSMA carries out site inspections at firms to ensure that the rules of conduct are complied with. It ensures for example that firms establish appropriate procedures so that clients are not advised to buy products that are unsuitable for them. The FSMA verifies that any shortcomings are remedied and weak points are eliminated.
• Inspections may also take the form of mystery shopping, with inspectors presenting themselves as consumers.
All consumers must be able to place their trust in their financial institution. The latter must be solid and its employees honest and competent. The FSMA supervises various types of firms within the financial sector. The checks it conducts have to do with a wide range of subjects such as business continuity, the professional integrity and expertise of senior executives, good governance, compliance with the conditions for authorization and with the legislation on money laundering and terrorist financing.
• Fund managers, portfolio management and investment advice companies, regulated real estate companies, crowdfunding service providers, virtual assets service providers, independent financial planners, bureaux de change, credit providers and financial intermediaries must be authorized by or registered with the FSMA in order to carry on their activities.
• If they do not meet the conditions of their authorization or registration, the FSMA may suspend or withdraw their authorization or registration.
• The FSMA also supervises certain firms that are authorized by or registered with another supervisory authority, such as banks and insurance companies.
Financial consumers can be a favourite target for swindlers. Among the FSMA’s tasks is that of warning consumers against certain unlawful activities such as boiler room fraud, fraud with binary options or virtual currencies, and pyramid schemes. The FSMA examines signs that an offer is suspect. It acts on information received from third parties, reports by consumers or its own observations. Alongside the publication of warnings, the FSMA conducts investigations that may give rise to sanctions or measures aimed at putting an end to unlawful activities.
Measures against unlawful activities
• The FSMA examines evidence of illicit offers of investment.
• It informs the public prosecutor if it has information indicating that financial products or services are being offered unlawfully.
• It publishes warnings regarding companies that engage in unlawful activities.
• It bans the distribution of certain products such as binary options and investment products based on virtual currencies.
The FSMA supervises supplementary pensions that employees, self-employed workers and company directors can build up through their professional activities. These occupational pensions, known as second-pillar pensions, are provided by insurance companies and by pension funds. The FSMA checks to see if pension institutions as well as the sponsoring institutions comply with the social legislation relating to second-pillar pensions. Parallel to this supervision, the FSMA also conducts prudential supervision of pension funds. This means that the FSMA verifies that these institutions are financially sound and have an appropriate organization.
• The FSMA supervises compliance with the social legislation applicable to supplementary pensions. In particular, it ensures that future pensioners have all the necessary information about their pension rights.
• If a pension institution should be insufficiently financed, the FSMA imposes recovery plans to make up the shortfall.
• The FSMA handles consumer questions and complaints relating to supplementary pensions.
• A list of frequently asked questions (FAQs) is available on the FSMA website in order to inform consumers.
Contributing to the financial education of the population is one of the FSMA’s legal mandates. To that end, the FSMA has set up a financial education programme known as Wikifin. The programme develops initiatives aimed at improving the population’s financial literacy. It is structured around three pillars: information, campaigns and tools addressed to the general public; cooperation with schools and teachers; and the Financial Education Centre in Brussels.
• The www.wikifin.be website provides neutral, reliable and practical information on money matters and a series of handy tools.
• The FSMA conducts a variety of different awareness campaigns. For example, once a year it holds a national week on a given theme to promote financial education.
• The younger generations are an important target group for the FSMA’s financial education programme. In order to reach that audience, the FSMA works with the school networks and provides educational materials for teachers.
• The Wikifin Lab in Brussels is a unique interactive centre for financial education, where students follow a trajectory organized around money topics.
The FSMA can take a wide range of possible actions in the course of carrying out its supervisory tasks. Here is an overview.
The FSMA is a contact point for consumers and companies. Consumers can turn to it with their questions and complaints. Most complaints are about unlawful offers of financial products or services. Companies, institutions and persons that come under the supervision of the FSMA can also ask it for information and explanations of the rules in force.
These are instruments which the FSMA uses to explain legislation and set out its interpretation thereof. The FSMA thus indicates how it will apply the rules, so that financial institutions may know precisely how to implement the legislation.
The FSMA may impose a range of different corrective measures. For instance, where the FSMA determines that some information is missing from a prospectus, it can require the undertaking or issuer to publish a correction. If that is not done, the FSMA itself may publish the additional information. It may, where necessary, require changes to be made to advertising materials for certain financial products.
The FSMA can ask the firms under its supervision to provide documentation and information, and may conduct on-site inspections in order to verify compliance with all the rules. In certain domains it can also conduct anonymous inspections in the form of mystery shopping.
Financial service providers who wish to offer their services in Belgium must first receive authorization from or register with the competent supervisory authority. If a service provider carries on activities in Belgium without having such authorization or registration, or if financial products are offered without the necessary authorization, the FSMA publishes a warning to this effect. The information is also reported to the judicial authorities.
The FSMA ensures that price-sensitive information concerning listed companies is available to everyone at the same time. If this is not the case, then the FSMA may decide to suspend trading in the shares of the company in question until the information has been made available to everyone.
If the FSMA determines that a financial service provider no longer fulfils the conditions for authorization or registration, it may take administrative measures. The most severe measure is revoking the provider’s authorization or striking it from the register. If that happens, the service provider may no longer carry out its activities.
The FSMA may impose fines or penalties for infringements of financial legislation. Actors in the financial sector which fail to comply with the rules may be sanctioned. Companies or individuals who, for example, infringe the rules on market abuse may also be required to pay a fine. There is a specific procedure to follow for imposing administrative fines. This procedure may also lead to an agreed settlement.
Jean-Paul Servais, Chairman
Henk Becquaert, Member of the Management Committee
Annemie Rombouts, Deputy Chairman
Sébastien Yerna, Member of the Management Committee
The Management Committee is the governing body of the FSMA and determines its policy orientations. All individual decisions and measures necessary to carry out the FSMA’s supervisory mandate are taken in this body. All decisions of the Management Committee are collegial in nature. Each member of the Management Committee is responsible for the operational oversight of specific services, as indicated on the organization chart (see next page).
The Supervisory Board oversees the operations and financing of the FSMA. The Board also advises on priorities and on the implementation of the FSMA’s supervisory policy. It approves the FSMA’s budget as well as its annual report.
The Sanctions Committee is an independent body that determines the imposition of administrative sanctions. It has twelve members, six of whom are judges.
Management Committee
Jean-Paul SERVAIS Chairman
Annemie ROMBOUTS Deputy Chairman
Legal services, Economic research and forecasting service, Market and post-trade unit and management of multidisciplinary teams, International relations and Sustainability policy, Strategy and organization, Communication and financial education
Legal services, Economic research and forecasting service, market and post-trade unit and Management of multidisciplinary teams
Henk BECQUAERT Member
Operational supervision of the markets, asset management and bank savings and investment products
Supervision of company information, Supervision of financial reporting by issuers and Surveillance of financial markets
Data analytics expertise centre and Operational supervision of insurance and pensions
Data analytics expertise centre and Supervision of insurance
Sébastien YERNA Member
Central inspection team and Operational supervision of conduct of business rules, Supervision of intermediaries and financial service providers and Anti-money laundering policy, Accounting and Management control
Supervision of intermediaries and of financial service providers and Anti-money laundering policy
International relations and Sustainability policy
Communication and Financial education
Enforcement Perimeter supervision
Supervision of asset management and of bank savings and investment products
Human resources
Supervision of pensions
Central inspection team and Supervision of conduct of business rules
Infrastructure
Internal audit
Given the internationalization of financial markets, financial regulations are increasingly set at European or international levels. International cooperation and collaboration among supervisors have likewise gained in importance. The FSMA is a member of various European and international organizations that draw up new rules and set standards for the financial sector. In October 2022, Jean-Paul Servais, Chairman of the FSMA, was elected Chair of IOSCO, the International Organization of Securities Commissions.
At international level, the FSMA is a member of:
The FSMA is also involved in the work of the Financial Stability Board
At European level, the FSMA is involved in drafting and transposing new financial legislation. It is a member of:
the European Securities and Markets Authority
the European Insurance and Occupational Pensions Authority
The FSMA also takes part in the work of the European Systemic Risk Board
As a supervisor, the FSMA must exude authority and decisiveness. It does so by performing its tasks efficiently, consistently and professionally. The FSMA acts decisively to enforce the rules.
In order for its actions to be effective, the FSMA must itself fulfil its mandate with care and integrity. For this reason, the FSMA has teams of highly qualified specialists. Integrity and professional ethics are the watchwords for both the institution itself and its employees.
The FSMA is an autonomous public institution, and the members of its Management Committee are appointed by Royal Decree for a period of six years. The FSMA applies the existing rules independently, without outside influence.
While respecting its obligation of professional secrecy, the FSMA communicates as transparently as possible about its decisions and activities, and provides justification for them. Among the ways it does so is via its annual report and its website.
You can get in touch with the FSMA using the contact forms for consumers and financial professionals available on the website or by phone or post.
FSMA
Financial Services and Markets Authority
Rue du Congrès/Congresstraat 12-14
1000 Brussels
Tel. +32(0)2 220 52 11
www.fsma.be
Website of the financial education programme: www.wikifin.be
You can follow the FSMA on Twitter @FSMA_info and LinkedIn.
