Overview: Revised Securities Trading Act entered into force on 1 January 2019

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The legal framework of securities trading in Norway were thoroughly reviewed from 2015 to 2017 with the aim of implementing the new markets in financial instruments directive (MiFID II) and regulation (MiFIR) adopted by the EU in 2014. The revised Norwegian Securities Trading Act and Securities Trading Regulation entered into force on 1 January 2019, along with several other changes to the legal framework of securities trading in Norway.

The review of the legal framework of securities trading in Norway are presented in the preparatory works NOU 2017:1 and Prop. 77 L (2017-2018) with regards to amendments to the Securities Trading Act of 29 June 2007 no. 75, and in the preparatory work NOU 2018:1 with regards to amendments to the Securities Trading Regulation of 29 June 2007 no. 876.

The revised Securities Trading Act entered into force on 1 January 2019. However, Section 8-1 on incorporation of MiFIR of the Act will not enter into force until MiFIR is embodied into the EEA-agreement. It is foreseen that MiFIR will be embodied into the EEA-agreement during first half of 2019.

The revised Securities Trading Regulation also entered into force on 1 January 2019. However, 17 sections incorporating Commission Regulations to MiFID II and MiFIR will not enter into force until these regulations is embodied into the EEA-agreement. It is foreseen that these Commission Regulations will be embodied into the EEA-agreement during first half of 2019.

One should particularly note that when MiFIR and the Commission Regulations are embodied into the EEA-agreement, these regulations will apply as Norwegian law directly (incorporated). Hence, there will be no implementation of these rules into Norwegian law.

The Norwegian Supplementary MiFID II and MiFIR Regulation of 20 December 2017 no. 2300, implementing Commission Directives and Regulations to MiFID II and MiFIR, will still apply. However, part 34 of the Regulation is repealed from 1 January 2019. This is because part 34 of the Regulation encompasses rules from the Commission Directive to MiFID II, which is implemented in the revised Securities Trading Regulation. The rest of the Regulation will be repealed when the Commission Regulations is embodied into the EEA-agreement.

The Norwegian MiFID II Regulation of 4 December 2017 no. 1913, temporary implementing MiFID II into Norwegian law from 1 January 2018, is subsequently repealed from 1 January 2019.

The Norwegian MiFIR Regulation of 4 December 2017 no. 1914, temporary implementing MiFIR into Norwegian law from 1 January 2018, will be repealed when MiFIR is embodied into the EEA-agreement.

The revised Securities Trading Act and Securities Trading Regulation will encompass rules governing regulated markets. Hence, the Regulated Markets Act of 29 June 2007 no. 74 and the Regulated Markets Regulation of 29 June 2007 no. 875 is repealed from 1 January 2019.

The revision encompasses certain amendments to sections 2-7 and 2-8 of the Financial Institution and Financial Group Act of 10 April 2015 no. 17 from 1 January 2019. It also encompasses certain amendments to section 1-4 of the Alternative Investment Fund Manager Regulation of 26 June 2014 no. 877, and it encompasses certain amendments to section 1-3 of and adds a new chapter XII to the Securities Funds Regulation of 21 December 2011 no. 1467.

Further, the revision also repeals the Investment Firm’s Transaction Notification Duty Regulation of 26 September 1996 no. 951 and the Margin Requirement for Loan Transmission and Lending from the Investment Firms Own Portfolio Regulation of 14 October 1996 no. 984.

Finan­cial and credit insti­tu­tions like insur­ance com­pa­nies, banks, regulated markets, invest­ment firms and management companies are fac­ing increas­ingly complex and extensive reg­u­la­tions, with the added complexity of the need to harmonize, incorporate and implement EU rules and regulations with Norwegian law. SVW’s Financial Regulatory group has extensive experience in guiding clients on all such reg­u­la­tory mat­ters.

Kasper Formo Asplin is a specialist on financial regulation law, and primarily assist Norwegian and foreign investment firms, management companies and credit institutions on applications for authorization and operating conditions, in addition to participants who operates in the financial market and do not require such authorization. Asplin’s core expertise encompasses EU/EEA law regarding passporting and cross-border activities both into and out of Norway.