Opinion of the European Central Bank of 28 September 2015 on a draft law on the financial instruments market (CON/2015/34)
Date: 2015-09-28
Institutions: European Central Bank
Subjects: Slovenia, financial instrument, financial stability, national law, payment system, securities

EN 

ECB-PUBLIC 

OPINION OF THE EUROPEAN CENTRAL BANK 

of 28 September 2015  

on a draft law on the financial instruments market 

(CON/2015/34) 

Introduction and legal basis 

On  29  July  2015  the  European  Central  Bank  (ECB)  received  a  request  from  the  Slovenian  Ministry  of 
Finance  for  an  opinion  on  the  draft  law  amending  the  Law  on  the  Financial  Instruments  Market1 

(hereinafter the ‘draft law’). 

The ECB’s competence to deliver an opinion is based on Articles 127(4) and 282(5) of the Treaty on the 

Functioning of the European Union and the third, fifth and sixth indents of Article 2(1) of Council Decision 
98/415/EC2,  as  the  draft  law  relates  to  Banka  Slovenije,  settlement  systems  and  rules  applicable  to 

financial institutions insofar as they materially influence the stability of financial institutions and markets. 

For  those  elements  of  the  draft  law  with  the  exclusive  purpose  of  transposing  Union  law,  the  ECB’s 

competence  to  deliver  an  opinion  is  based  on  Article  25.1  of  the  Statute  of  the  European  System  of 

Central Banks and of the European Central Bank. In accordance with the first sentence of Article 17.5 of 

the Rules of Procedure of the European Central Bank, the Governing Council has adopted this opinion. 

1.  

Purpose of the draft law 

1.1  The draft law transposes certain provisions from a number of Union Directives in the financial area3 

into Slovenian  law, and adjusts Slovenian  legislation  to certain Union Regulations in the financial 
area4.  

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2  

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Zakon  o trgu finančnih instrumentov (official gazette of the Republic of Slovenia, no. 108/10 –  official consolidated 
version, 78/11, 55/12, 105/12 – ZBan-1J and 63/13 – ZS-K). 

Council  Decision  98/415/EC  of  29 June  1998  on  the  consultation  of  the  European  Central  Bank  by  national 
authorities regarding draft legislative provisions (OJ L 189, 3.7.1998, p. 42). 
The  Union  Directives  concerned  are:  1)  Directive  2013/36/EU  of  the  European  Parliament  and  of  the  Council  of 
26 June 2013 on  access to the activity of credit institutions and the prudential supervision of credit institutions and 
investment firms, amending Directive 2002/87/EC and repealing Directives 2006/48/EC and 2006/49/EC (OJ L 176, 
27.6.2013, p. 338), as regards the investment firms (mainly to correct the cross-references to the Slovenian Law on 
Banking  which  implements  this  Directive  and  to  which  the  Law  on  the  Financial  Instruments  Market  refers);  2) 
Directive  2013/50/EU  of  the  European  Parliament  and  of  the  Council  of  22  October  2013  amending  Directive 
2004/109/EC of the European Parliament and of the Council on the harmonisation of transparency requirements in 
relation  to  information  about  issuers  whose  securities  are  admitted  to  trading  on  a  regulated  market,  Directive 
2003/71/EC of the European Parliament and of the Council on the prospectus to be published when securities are 
offered to the public or admitted to trading and Commission Directive 2007/14/EC laying down detailed rules for the 
implementation  of  certain  provisions  of  Directive  2004/109/EC  (OJ  L  294,  6.11.2013,  p.  13);  and  3)  Directive 
2014/51/EU  of the European Parliament and of the Council of 16 April 2014 amending Directives 2003/71/EC and 
2009/138/EC  and  Regulations  (EC)  No  1060/2009,  (EU)  No  1094/2010  and  (EU)  No  1095/2010  in  respect  of  the 
powers of the European Supervisory Authority (European Insurance and Occupational Pensions Authority) and the 
European  Supervisory  Authority  (European  Securities  and  Markets  Authority)  (OJ  L  153,  22.5.2014,  p.  1),  to  the 
extent  that  the  amendments  relate  to  the  amendments  made  by  the  latter  to  Directive  2003/71/EC,  in  particular 
regarding  the  duty  of  the  national  financial  market  supervisor  to  transmit  final  information  about  prospectuses  to 
ESMA. 

 
 
 
 
                                                 
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1.2  As  regards  Banka  Slovenije,  it  is  noted  that  the  draft  law  removes  the  provisions  regulating  the 

supervisory  competences  of  the  Securities  Market  Agency  and  Banka  Slovenije  over  the  central 

securities  depository.  These  competencies  will  be  regulated  in  a  separate  legal  act  implementing 

the Central Securities Depositories Regulation. 

1.3  The draft law also amends the Law on the Financial Instruments Market in order to: (i) clarify the 

bankruptcy  procedure  for  investment  firms,  (ii)  amend  certain  conditions  for  the  establishment  of 

small  investment  firms,  (iii)  amend  the  provisions  regarding  liability  for  the  accuracy  of  the 

information  contained  in  prospectuses,  (iv)  define  the  conditions  for  the  removal  of  debt 

instruments  from  trading  on  an  organised  market,  (v)  supplement  the  provisions  on  the 

performance of investment services, where the client has been referred by another investment firm, 

(vi)  introduce  amendments,  as  regards  the  stock  exchange  and  stock  market,  to  clarify  the 

application,  mutatis  mutandis,  of  certain  provisions  of  the  Law  on  Banking,  (vii)  regulate 

cooperation  between  the  Securities  Market  Agency  and  other  competent  third-country  financial 

market authorities and (viii) align certain provisions of the Law on the Financial Instruments Market 

with other national laws. 

1.4  Article  95  of  the  draft  law  corrects  certain  inconsistencies  in  the  provisions  of  Slovenian  law 
transposing Directive 98/26/EC 5 (the ‘Settlement Finality Directive’ or ‘SFD’), in particular regarding 

the  implementation  of  Article  3  of  the  SFD.  These  inconsistencies  concern  Article  450.a  of  the 

current  Law  on  the  Financial  Instruments  Market,  which  governs  the  finality  of  transfer  orders 

entered into the securities settlement system in the event of the insolvency of a system participant 

(or other proceeding or measures of  a competent authority of the Republic of Slovenia, or of any 

other  country,  against  a  settlement  system  participant,  excluding  or  limiting  the  execution  of  the 

orders of such participant,  as referred to  in  Article  450, and  hereinafter referred to as  ‘insolvency 

proceedings’). In particular, Article 450.a, as amended by Article 95 of the draft law, now (i) clearly 

distinguishes  between  the  use  of  the  terms  ʻentryʼ  and  ʻenteredʼ  to  differentiate  between  the 

ʻmoment  of  entry  of  a  transfer  order  into  a  systemʼ  (which  is  to  be  defined  in  the  rules  of  the 

system,  as  required  by  Article  39(2)  and  48(8)  of  the  CSDR  and  Article  3  of  the  SFD)  and  the 

ʻsendingʼ  of  the  transfer  order  by  the  system  participant.  Furthermore,  Article  95  of  the  draft  law 

corrects the reference to the timeframe within which the execution of a transfer order, if it has been 

entered  into  the  system  after  the  opening  of  insolvency  proceedings  against  a  participant,  must 

occur  in  order  for  it  to  be  valid,  which  is  understood  to  mean  legally  enforceable  and  binding  on 

third parties. Article 450.a now stipulates that a settlement order that was entered into the system 

after  the  opening  of  such  a  proceeding,  will  be  valid  if  it  was  executed  in  the  system  within  the 

same  day.  A  further  correction  is  made  to  clarify  that  the  system  operator  must  be  able  to  prove 

that he was not aware, or could not have been aware, of the opening of the insolvency proceedings 

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The  Union  Regulations  concerned  are:  1)  Regulation  (EU)  No  575/2013  of  the  European  Parliament  and  of  the 
Council  of  26  June  2013  on  prudential  requirements  for  credit  institutions  and  investment  firms  and  amending 
Regulation (EU) No 648/2012 (OJ L 176, 27.6.2013, p. 1), as regards investment firms/services;  and 2) Regulation 
(EU) No 909/2014 of the European Parliament and of the Council of 23 July 2014 on improving securities settlement 
in  the  European  Union  and  on  central  securities  depositories  and  amending  Directives  98/26/EC  and  2014/65/EU 
and  Regulation  (EU)  No  236/2012  (OJ  L  257,  28.8.2014,  p.  1)  (the  ‘Central  Securities  Depositories  Regulation’  or 
‘CSDR’). 
Directive 98/26/EC of the European Parliament and of the Council of 19 May 1998 on settlement finality in payment 
and securities settlement systems (OJ L 166, 11.6.1998, p.45). 

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against the participant at the point in time when the transfer order became irrevocable. Finally, the 

abovementioned  inconsistencies  are  addressed  by  rewording  point  2  of  paragraph  1  of 

Article 450.b,  which  governs  the  effects  of  insolvency  proceedings  against  a  settlement  system 

participant  on  the  validity  of  the  rights  arising  from  collateral  security  provided  in  connection  with 

the system. 

2. 

Observations 

2.1  The ECB takes note of the draft law. 

2.2  The ECB welcomes the fact that Article 95 and 96 of the draft law remove previous shortcomings in 

the  text  of  Articles  450.a  and  450.b  of  the  current  Law  on  the  Financial  Instruments  Market, 

implementing  the  SFD.  In  this  respect,  it  is  noted  that  the  reference  in  the  amended  second 

paragraph of Article 450.a  to the execution of a transfer order within the  ʻdayʼ should be replaced 

by a reference to ʻbusiness day, as defined by the rules of the systemʼ, to remove any uncertainty 
about the status of any night-time settlement services 6. 

This opinion will be published on the ECB’s website. 

Done at Frankfurt am Main, 28 September 2015. 

[signed] 

The President of the ECB 

Mario DRAGHI 

6  

See Section 6.1.3 of the explanatory memorandum to the proposal for a Directive of the European Parliament and of 
the  Council  amending  Directive  98/26/EC  on  settlement  finality  in  payment  and  securities  settlement  systems  and 
Directive  2002/47/EC  on  financial  collateral  arrangements  as  regards  linked  systems  and  credit  claims 
(COM(2008)213 final). 

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