ESMA European Securities and Markets Authority : BoS rules of procedure- December 2015

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ESMA/2012/BS/88 rev 2

DECISION OF THE BOARD OF SUPERVISORS

Rules of procedure

The Board of Supervisors

10 December 2015 ESMA/2012/BS/88 rev2

Having regard to Regulation (EU) No 1095/2010 of the European Parliament and of the Council of 24 November 2010 establishing a European Supervisory Authority (European Securities and Markets Authority), amending Decision No 716/2009/EC and repealing Commission Decision 2009/77/EC1 (the "Regulation" and "ESMA"), and in particular Article 44 thereof,

Having regard to the Treaty of Accession concerning the conditions of accession of the republic of Croatia and the adjustment to the treaty on European Union, the treaty on the Functioning of the European Union and the treaty establishing the European Atomic Energy Community,2

Whereas:

1. In order for the Board of Supervisors to give guidance to the work of ESMA, take the deci- sions and fulfil the other tasks given to it under Article 43 of the Regulation, and to fulfil the requirements of Article 44 and other relevant requirements of the Regulation, it is neces- sary for the Board of Supervisors to adopt rules of procedure.

   
   

2. Following a review of the rules of procedure of the Board of Supervisors, it is considered necessary to make amendments to the decision-making procedures in order to reflect the current rules regarding the qualified majority voting as well as take into account the conse- quences resulting from the accession of Croatia to the European Union. Moreover, a refer- ence to the new rules of conflict of interest was made in the respective section of the rules of procedure.

Has decided as follows:

1 OJ L 331, 15.12.2010, p. 84.

2 OJ L112, 24.04.2012, p.21.

Article 1 - Composition

Members

1. The Board of Supervisors shall be composed of the following (each a "Member"):

   
   

2. ESMA's Chairperson who shall be non-voting;

   
   

3. the heads of the national authorities competent for the supervision of financial market participants in each Member State (each a "Voting Member");

   
   

4. one representative of the Commission who shall be non-voting;

   
   

5. one representative of the European Systemic Risk Board who shall be non- voting;

   
   

6. one representative of the European Banking Authority who shall be non-voting; and

   
   

7. one representative of the European Insurance and Occupational Pensions Au- thority who shall be non-voting.

   
   

8. In Member States where there is more than one authority responsible for the supervision according to the Regulation, those authorities shall agree on a common representative. Nevertheless, when an item to be discussed by the Board of Supervisors does not fall within the competence of the national authority being represented by a Member, that Member may bring a representative from the relevant national authority, who shall be non-voting.

   
   

   Observers

   
   

9. The Board of Supervisors may decide to admit additional observers and invite experts.

   
   

10. In accordance with Article 75(2) of the Regulation, representatives of third countries shall be entitled to attend Board of Supervisors meetings as an observer under the relevant provisions of any agreement concluded with the Union providing for such representation. Such representatives shall not attend any discussions relating to individual financial mar- ket participants, except where there is a direct interest.

    
    

11. Observers may include any State which has applied for membership of the European Union, on condition that the accession negotiations have been successfully completed.

    
    

    Executive Director

    
    

12. The Executive Director participates in meetings of the Board of Supervisors without the right to vote.

    
    

    Advisers

    
    

13. Members and observers may each be accompanied at meetings of the Board of Supervi- sors by one adviser. The Chairperson and Executive Director may be assisted by other ESMA staff.

    
    

    Notification of documents

    
    

14. ESMA staff shall maintain a list of the Members and observers and of alternates nomi- nated in accordance with Article 5(9). Members and observers shall notify the Chairper- son in writing of the email addresses to which notifications required by these rules of pro- cedure shall be sent and shall inform the Chairperson of any necessary change.




Article 2 - Tasks




1. The Board of Supervisors shall have the tasks specified in Article 43 of the Regulation and any other tasks provided for in Union acts.

   
   

2. The Board of Supervisors shall, in accordance with Article 45(1) of the Regulation, elect the members of the Management Board. The Board of Supervisors shall adopt a decision specifying the process for such elections.




Article 3 - Chairmanship and Vice-Chairmanship




1. Meetings of the Board of Supervisors shall be chaired by the Chairperson.

   
   

2. The Board of Supervisors shall elect from among its Voting Members an alternate (the "Vice-Chairperson"). The Vice-Chairperson shall not be elected from amongst the mem- bers of the Management Board. The Vice-Chairperson shall carry out the functions of the Chairperson in his absence.

   
   

3. Elections shall normally take place at the meeting preceding the expiry of the Vice- Chairperson's term of office or the date on which the position is expected to fall vacant. Where the position falls vacant unexpectedly, an election shall take place within three months.

   
   

4. The term of office of the Vice-Chairperson shall be two and a half years unless elected to fill a vacancy in the office in which case it shall be the remainder of the predecessor's term. The term of office shall in any event expire on ceasing to be a member of the Board of Supervisors. The term of office may be renewed once.

   
   

5. If both the Chairperson and the Vice-Chairperson are absent or unable to attend a meet- ing, those Members present shall elect a Member to chair the meeting.




Article 4 - Decision making procedures




Quorum




1. In order for the Board of Supervisors to vote, there shall be a quorum of two-thirds of the Voting Members.

   
   

   Voting

   
   

2. The Vice-Chairperson shall not normally vote when carrying out the functions of the Chairperson but may, exceptionally, do so if his vote as a Member could not otherwise be exercised.

   
   

3. Decisions of the Board of Supervisors shall be taken by a simple majority of its Voting Members unless otherwise stated. Each Voting Member shall have one vote. A simple majority is achieved where more Voting Members vote in favour of a proposal than vote against it. Abstentions will not be counted as approvals or as objections, and will not be considered when calculating the number of votes cast.

   
   

4. For acts relating to draft technical standards and guidelines and recommendations speci- fied in Articles 10 to 16 of the Regulation, and measures and decisions adopted on finan- cial provisions under the third subparagraph of Article 9(5) of the Regulation and Chapter VI of the Regulation, the Board of Supervisors shall take decisions on the basis of a qual- ified majority of its Voting Members, as defined in Article 16(4) of the Treaty on European Union ("TEU") and in Article 3 of the Protocol (No 36) on transitional provisions.

   
   

5. With regard to decisions in accordance with Article 19(3) of the Regulation, for decisions taken by the consolidating supervisor, the decision proposed by the panel referred to in Article 41(2) of the Regulation shall be considered as adopted if approved by a simple majority, unless it is rejected by Voting Members representing a blocking minority of the votes as defined in Article 16(4) TEU and in Article 3 of the Protocol (No 36) on transi- tional provisions.

   
   

6. For all other decisions in accordance with Article 19(3) of the Regulation, the decision proposed by the panel shall be adopted by a simple majority of the Voting Members ac- cording to the principle where each Voting Member has one vote.

   
   

7. When a decision is to be adopted by the Board of Supervisors by a qualified majority, it shall be adopted if there are at least 55% of the Voting Members in favour, comprising at least sixteen of them and coming from competent authorities from Member States com- prising at least 65% of the population of the Union.

   
   

8. In accordance with Article 3(2) of the Protocol (No 36) on transitional provisions, until 31 March 2017 a Voting Member can request application of the following voting rule instead: "when a decision is to be adopted by the Board of Supervisors by a qualified majority, it shall be adopted if there are at least 260 votes in favour representing a majority of the