The government has proposed granting more independence to the National Securities Market Commission (CNMV). Thus, in the new Securities Market Law, the executive has extended the temporary mandate of the presidents, vice-presidents and the board of supervisors. The person in charge of this body has four years so far and can continue for another four years. Now it will last up to six years, non-renewable. Sources in the Ministry of Economy point out that the aim is to adapt the model to the model of other European market supervisors and the managers of the already used Bank of Spain.
Thus, the Ministry believes that more independence from the government is vested in those responsible for overseeing the traditional legislative period. This reform was included in a bill approved by the Council of Ministers this Monday, which is now to be submitted to Congress for parliamentary consideration. Another formal change for CNMV is included. Until now, the sanctioning decision of the supervisory body provided for the sanctioned person to apply to the Ministry itself. Now it disappears, allowing the victim to move directly to the disputed-administrative path of the judiciary.
The regulatory change comes at a time when CNMV has revealed its profile to the state in the face of the crisis Indra’s board is facing. Last week, SEPI, along with two other shareholders, including a major investor in the Prisa Group, took control of the technology company board and fired five independent directors. CNMV has acknowledged that this is a “disturbing” move and that it calls into question the governance of Ibex 35.
The bill, according to ministry sources, provides for the expansion of investor protection tools. Thus, among other aspects, SPACs have entered the law and prepared the ground for the establishment of a sanctioning regime for the misuse of cryptocurrencies when there is a new community regulation.
As for crypto assets, the new rule paves the way for the application of the CNMV sanctions regime once approved at European level. The European Commission is working on a new Community regulation to impose controls and sanctions on the cryptocurrency market, especially cryptocurrencies. This rule is still being drafted, so the Spanish law approved by the Council of Ministers, which is now due to go to Parliament for parliamentary consideration, is to prevent the government from implementing new administrative procedures for them. These sanctions were used. Thus, after its approval in Brussels, the CNMV will be able to apply the sanctions regime.
This new European regulation, known as the MICA, is committed to providing a regulated framework for the commercialization of cryptocurrencies and other assets of this nature, which provides greater protection for investors. The rule has not yet been approved, but previous projects are known, awaiting its final draft. These preliminary documents include certain obligations, such as the need for publishers to publish a white paper covering the characteristics and risks of these products. In addition, these issuers are required to be transparent with investors to avoid misleading communications or messages. The fines, according to previous documents, could be up to 3% of the income or at least up to 5 million euros.
As soon as this rule is approved, the sanctions regime will automatically be incorporated into Spanish legislation, according to sources in the Ministry of Economy.
Another great news of this new bill is the inclusion of SPACs in the law. This machine has experienced a boom in the US stock market in recent years and less so in Europe, although regulators have begun tightening the fence due to possible insecurity for retail investors. These are companies that go public on purchases to raise money. The acquired company takes the place of this company in the market, which facilitates the traditional modeling of the market.
The above sources of the Ministry point out that the purpose of the bill was to protect retail investors and not so much to promote the viability of these companies. Among other things, it includes a more flexible method for investors to separate from these companies. It should be noted that the popularity of SPAC is already beyond the US and none of these surgeries have been performed in Spain. Yes, there were Spanish companies that went public through the SPAC in the US.
The ministry clarified that the new law on the stock exchange reduces certain administrative procedures and rates to be paid by companies that decide to issue bonds in the fixed income market. The aim is thus to reduce the bank’s dependence on corporate financing by providing alternative tools.
Other changes are more formal and technical. It is the case that the procurement law obligations that apply to the listed companies are also binding on those operating in the so-called secondary market, currently known as BME Growth.
Source: El Diario