Proposed changes to the VPS Rules on Anti-Money Laundering and Sanctions
Euronext Securities Oslo notifies proposed changes to the VPS Rules on Anti-Money Laundering and Sanctions. We ask that any comments on the proposals are received by Euronext Securities Oslo by 19 May 2021
Under the current VPS Rules and General Terms and Conditions, account operators must comply with the obligations to which a securities register is subject pursuant to the Norwegian Anti-Money Laundering Act or equivalent foreign regulations. This arrangement is not in accordance with the new Anti-Money Laundering Act, pursuant to which it is the account operators of a securities register that uses external account operators that are subject to the obligations specified in the Act, not the securities register itself. Euronext Securities Oslo is thus proposing that its rules should be changed such that it is account operators that are obliged entities that have to comply with the obligations contained in the Norwegian Anti-Money Laundering Act or equivalent foreign regulations, in accordance with the new Act.
Securities fund management companies are, together with account operators investor, obliged entities for shareholders of the securities funds they manage. Normally, a securities fund management company applies customer due diligence measures for shareholders when they subscribe for units and before a customer relationship is established. This, however, is not possible where an account operator investor transfers fund units from one account to another account. Where a recipient of such a transfer is not yet a customer of the securities fund management company concerned, such a transfer means that the securities fund management company is not in compliance with the requirements of the new Anti-Money Laundering Act. Euronext Securities Oslo therefore proposes changing the VPS Rules for Registration of Financial Instruments and the General Terms and Conditions such that it is the party carrying out such a transfer that, once it has obtained consent from the recipient of the transfer, provides the securities fund management company with the requisite information, and that it should not be permitted to transfer the fund units without first securing the approval of the securities fund management company. Euronext Securities Oslo also proposes that the party transferring the fund units should also provide the information and documentation that has to be obtained pursuant to the Norwegian Tax Administration Act regarding where account holders and beneficial owners are resident/domiciled for tax purposes and whether they are American citizens (CRS/FATCA).
The relationship between Euronext Securities Oslo and its account operators with regard to the implementation of international sanctions is not currently regulated in either the VPS Rules or the General Terms and Conditions. Euronext Securities Oslo proposes inserting into these two documents a stipulation that Euronext Securities Oslo shall conduct searches in the international sanctions lists published by the EU, the UN and the USA, and a stipulation that if Euronext Securities Oslo or an account operator becomes aware that an issuer or account holder may be subject to international sanctions, they shall inform each other of this. Euronext Securities Oslo also proposes that account operators should be required to ensure that they take the measures needed to uncover whether issuers and account holders are subject to such sanctions, and to implement the sanctions required.