Decision on Detailed Conditions and Manner of Supervision of Operations of Payment Systems

RS Official Gazette, Nos 49/2015 and 13/2025 Pursuant to Article 175, paragraph 5 of the Law on Payment Services (RS Official Gazette, No 139/2014) and Article 59, paragraph 2 of the Law on the National Bank of Serbia (RS Official Gazette, Nos 72/2003, 55/2004, 85/2005 – other law, 44/2010, 76/2012, 106/2012, 14/2015 and 40/2015 ‒ decision of CC), the Governor of the National Bank of Serbia hereby issues the D E C I S I O N ON DETAILED CONDITIONS AND MANNER OF SUPERVISION OF OPERATIONS OF PAYMENT SYSTEMS

1. This decision sets out detailed conditions and manner of supervision of operations of payment systems (hereinafter: supervision) by the National Bank of Serbia.
2. The aim of supervision shall be to verify compliance of a payment system operator (hereinafter: operator), in the part of its operations relating to the management of payment system operation, including the performance of activities in the system, with the Law on Payment Services (hereinafter: the Law) and regulations adopted under that Law.
3. The National Bank of Serbia shall conduct supervision: – indirectly (off-site) – by collecting and analysing reports and other documentation and data that the operator is required to submit to the National Bank of Serbia pursuant to the Law and regulations adopted under the Law, and other documentation and/or data on business operations of the operator which are at the disposal of the National Bank of Serbia; – directly (on-site) – by inspecting business books and other documentation and data of the operator. In the course of exercising supervision, the National Bank of Serbia may, in the manner stipulated in paragraph 1 hereof, conduct supervision of a person to whom the operator has outsourced some operational activities relating to payment system operation in accordance with the Law and regulations adopted under the Law, as well as other persons related with the operator by property, management and business links.
4. Persons subject to supervision referred to in Section 3 of this Decision shall enable authorised persons of the National Bank of Serbia to exercise supervision smoothly and shall cooperate with them.

2 Persons referred to in paragraph 1 of this Section shall, upon request of the National Bank of Serbia, submit all requested data and documentation within the time limit specified in that request. If data and documentation referred to in paragraph 2 of this Article have been prepared in a language other than Serbian, the National Bank of Serbia may request from the operator and/or persons referred to in that paragraph to provide, at their cost, the translation of those data and documentation into Serbian. 5. If, on the basis of available documentation and data on business operations of the operator the National Bank of Serbia has established deficiencies or irregularities in its operations, it shall prepare a report on the findings of such supervision. Provisions of this Decision pertaining to on-site supervision of the operator shall accordingly apply to further procedure of its off-site supervision. 6. On-site supervision of the operator shall be conducted by the employees of the National Bank of Serbia assigned such task by the decision of the governor of the National Bank of Serbia (hereinafter: authorised persons). The decision under paragraph 1 of this Article shall specify the operator under supervision and the subject of supervision. On-site supervision procedure shall commence by the issuance of the decision referred to in paragraph 1 hereof. The decision referred to in paragraph 1 hereof may be supplemented and/or amended in the course of on-site supervision. The National Bank of Serbia may engage other persons to be present during on-site supervision in order to provide authorised persons with appropriate expert support. 7. The operator shall enable the National Bank of Serbia to conduct on￾site supervision of its operations and/or specific activities at its head office, branches and other organisational parts. It shall be deemed that the operator has not enabled the National Bank of Serbia to conduct supervision referred to in paragraph 1 of this Decision if it:

1. failed to enable authorised persons to inspect, at their request, within a specified time limit, the business books, documentation and data in

3 written and/or electronic form, as well as to access the equipment, databases and computer programs that the operator uses; 2) failed to enable authorised persons to conduct supervision on non￾working days and/or outside working hours, when that was necessary because of the scope or nature of supervision; 3) failed to enable authorised persons to access all premises of the operator; 4) failed to enable authorised persons to communicate directly with members of the managing body, managers and responsible employees of the operator; 5) failed to provide necessary technical support to authorised persons during inspection of data and/or business books and documentation where the operator processes data or keeps its business books and other documentation in electronic form; 6) submitted inaccurate or incomplete data to authorised persons intentionally or by gross negligence; 7) failed to provide authorised persons with necessary conditions for the conduct of on-site supervision, including conditions ensuring that employees in the operator or third persons do not disturb them in their work. 8. The authorised persons shall prepare a report on conducted supervision (hereinafter: report on supervision). The National Bank of Serbia shall deliver the report on supervision to the operator, which may file its objections within 15 business days from the receipt of such report. The National Bank of Serbia shall not consider the objections from paragraph 2 hereof relating to factual changes which have arisen after the supervised period (cut-off date), but may take them into account when imposing measures under the Law. Authorised persons shall prepare a supplement to the report on supervision in cases when, after the verification of statements presented in objections from paragraph 2 hereof, it is established that the factual state is materially different from the one stated in the report. The supplement to the report on supervision shall be delivered to the operator within 15 business days after the filing of objections to the report. Objections referred to in paragraph 2 hereof shall imply consolidated objections of members of the operator’s managing body and the payment system director. If it establishes, based on the verification of statements contained in the objections to the supervision report, that the operator’s objections to the

4 report are unfounded and/or do not materially influence the factual state, the National Bank of Serbia shall make an official record thereof and deliver it to the operator. 9. The National Bank of Serbia shall render a conclusion on termination of the supervision procedure with the operator if no irregularities or deficiencies have been established in the report on supervision, or if the operator, in its objections submitted within the timeframe specified by this Law and this Decision, has successfully disputed all findings in the report on supervision. The conclusion referred to in paragraph 1 of this Section shall be submitted to the operator. 10. If irregularities or deficiencies in the business operations of the operator have been established in the supervision procedure and/or if it has been established that the operator acted contrary to the Law or regulations adopted under the Law, the National Bank of Serbia shall impose on the operator one of the measures referred to in Article 183, paragraph 1 of the Law, on the basis of the factual state established in the report on supervision. Irregularities in the operator’s business operations shall mean operator’s actions contrary to the Law and regulations adopted under the Law, and/or other actions that may jeopardise safe and sound operation of the payment system and interests of participants in that system. 11. The recommendation from Article 184 of the Law shall be given to the operator in whose business operations minor irregularities or deficiencies which do not pose a significant risk to its operation have been established. The recommendation shall state the time limit for eliminating irregularities and/or deficiencies from paragraph 1 hereof, as well as the time limit in which the operator is to submit to the National Bank of Serbia a report on eliminated irregularities and/or deficiencies, accompanied with relevant evidence. The National Bank of Serbia shall verify whether the operator has eliminated the identified irregularities and/or deficiencies following the expiration of the time limit referred to in paragraph 2 of this Section, and/or prior to expiration of that time limit if it receives the operator’s report stating that irregularities and/or deficiencies have been eliminated. After it establishes whether the operator has acted pursuant to the recommendation and to what extent, the National Bank of Serbia shall render a conclusion on termination of the supervision procedure with the operator or impose on the operator a new measure under Article 183, paragraph 1 of the Law, pursuant to the criteria referred to in Article 191 of the Law.

5 12. A letter of warning referred to in Article 185 of the Law shall be issued to an operator in whose business operations certain irregularities have been established that do not have a significant and direct impact on its operation, but might have such impact unless eliminated, or to the operator which failed to act in compliance with the recommendation. The letter of warning shall state the time limit for eliminating irregularities from paragraph 1 hereof, and the time limit in which the operator is to submit to the National Bank of Serbia a report on eliminated irregularities accompanied with relevant evidence. The National Bank of Serbia shall verify whether the operator has eliminated the identified irregularities following the expiration of the time limit referred to in paragraph 2 of this Section, or prior to the expiration of that time limit if it receives the operator’s report stating that the irregularities were eliminated. After it establishes whether the operator has acted pursuant to the letter of warning and to what extent, the National Bank of Serbia shall render a conclusion on termination of the supervision procedure with the operator or impose on the operator a new measure under Article 183, paragraph 1 of the Law, pursuant to the criteria referred to in Article 191 of the Law. 13. If it establishes that an operator did not act in compliance with the Law or regulations adopted under the Law, and/or in compliance with the letter of warning, the National Bank of Serbia shall render a decision imposing on the operator orders and measures to eliminate the established irregularities under Article 186 of the Law. The decision under paragraph 1 hereof shall order the operator to perform one or more activities referred to in Article 186, paragraph 2 of the Law and shall state the time limits in which the operator is to implement such activities and submit a report on eliminated irregularities, accompanied with relevant evidence. The National Bank of Serbia shall verify whether the operator has eliminated the identified irregularities following the expiration of the time limit referred to in paragraph 2 of this Section, or prior to the expiration of that time limit if it receives the operator’s report stating that the irregularities were eliminated. After it establishes whether the operator has acted pursuant to the decision referred to in paragraph 1 of this Section and to what extent, the National Bank of Serbia shall render a conclusion on termination of the supervision procedure with the operator and/or or impose on the operator a

6 new measure under Article 183, paragraph 1 of the Law, pursuant to the criteria referred to in Article 191 of the Law. 13а. If the National Bank of Serbia establishes, during on-site supervision or based on information obtained in off-site supervision, that the operator has committed major irregularities that may considerably jeopardise its work, and/or if it establishes that the operator’s financial condition has deteriorated considerably and/or its financial condition or liquidity are likely to deteriorate considerably, that the interests of payment system participants are or are likely to be considerably jeopardised or that there is likelihood of a damage that should be prevented without delay – the National Bank of Serbia may issue a decision referred to in Article 186 of the Law imposing one or several special measures from Article 186а of the Law. In the decision on special measures from paragraph 1 hereof, the National Bank of Serbia shall also determine the duration of those measures. 13b. If the decision on special measures referred to in Section 13а, paragraph 1 hereof appoints a temporary representative for supervising the operator’s business operations (hereinafter: temporary representative), the National Bank of Serbia shall define by that decision the authorisations of the temporary representative, and/or his obligations, objectives and tasks, and/or actions he is authorised to take, the acts and legal actions for which the operator must obtain the opinion or consent of the temporary representative, reporting to the National Bank of Serbia about the work of the temporary representative and operator’s business operations and compensation for the temporary representative’s work. A temporary representative shall be a person independent of the operator who meets the conditions from Article 80, paragraph 2 of the Law. A person independent of the operator referred to in paragraph 2 hereof shall mean a person meeting the following conditions:

1. that person or a member of his family does not hold direct or indirect ownership in the operator or in a legal person closely connected with the operator;
2. that person or a member of his family is not a member of the managing body or director of the operator or a person closely connected with the operator;
3. that person or a member of his family is not in a contractual relationship with the operator or a person closely connected with the operator that could negatively affect the impartiality or independence of such person or

7 the operator, nor was it in any such contractual relationship in the course of a year preceding the day of such person’s appointment. Family members from paragraph 3 hereof shall have the meaning specified in the law governing banks. The objectives and tasks of the temporary representative may, among other, pertain to establishing the actual financial condition of the operator, managing its overall business operations or part of operations in order to preserve or restore an appropriate financial condition of the operator and/or its safe and sound business operations, supervising the implementation of activities ordered to the operator by the National Bank of Serbia’s decision, and/or of the imposed orders and measures from Article 186 of the Law and Section 14 of this Decision, as well as supervising the performance of the operator’s managing body. If the decision appointing a temporary representative determines that the temporary representative shall replace the payment system director, as of the day of coming into force of that decision, the director shall cease to directly manage the payment system operation and the temporary representative shall be considered the payment system director. The decision appointing a temporary representative may establish the obligation for the operator’s managing body to obtain from the temporary representative prior consent and/or opinion regarding certain acts and legal actions adopted and/or taken by that body, which are determined by the decision appointing the temporary representative. Acts and legal actions referred to in paragraph 7 hereof may pertain to the decision of the operator’s managing body on the operator’s lending and borrowing, investment in assets and other legal persons, sale of operator’s assets, introduction of new services, determining the amount of compensation for members of the managing body of the operator and director of the payment system (including the amounts of bonuses and rewards paid out to those persons and other employees in the operator), determining the amount of assets required for the operator’s operational activities, concluding contracts with persons to which certain activities are outsourced etc. The decision appointing a temporary representative may also determine the authorisations within the remit of the operator’s managing body that are necessary for the realisation of objectives and tasks from paragraph 5 hereof, which may also include attendance at meetings of the operator’s managing body, convening meetings of other bodies in the operator’s governance and organisational structure (committees, expert departments

8 etc.), proposing agendas for the sessions, proposing the adoption of appropriate decisions, seeking appropriate reports from such bodies etc. The operator shall enable to the temporary representative access to all its organisational parts and premises, and communication with the managers of organisational units and employees of the operator, as well as put at his disposal business books and other documents needed for the performance of objectives and tasks from paragraph 5 hereof. Within 30 days from the day of appointment and/or 30 days prior to the expiration of his term of office, the temporary representative shall submit to the National Bank of Serbia a report on the operator’s business operations and financial condition, with the assessment of the operator’s financial position and possibilities for improving its performance. Along with the report from paragraph 11 hereof, the temporary representative shall also submit to the National Bank of Serbia a plan of activities for the realisation of objectives and tasks from paragraph 5 hereof for the coming quarter. The temporary representative shall submit to the National Bank of Serbia, at least quarterly and whenever requested by the National Bank of Serbia, a report on actions taken to realise the objectives and tasks from paragraph 5 hereof and the degree of realisation of those objectives and tasks, along with the planned future activities and the timeframe for their implementation. The temporary representative shall notify the National Bank of Serbia without delay of any circumstances that may lead to the non￾compliance with the measures imposed on the operator or to the deterioration of the operator’s financial condition. Based on the reports from paragraph 11 hereof, notifications from paragraph 14 hereof and other available data, the National Bank of Serbia may impose some of the measures from Articles 186 and 186а of the Law. The amount of compensation for the work of temporary representative shall be determined by the National Bank of Serbia, especially taking into account the scope of obligations, authorisations and tasks of the temporary representative specified in the decision on his appointment, the average salary of members of the managing body of the operator and director of the payment system for the three months preceding the issuance of this decision, the amount of assets secured for the operator’s business operations during the period while the authorisations of the temporary representative are

9 in force, the operator’s financial condition and other data relevant for determining that compensation. The compensation for the work of the temporary representative shall be paid out by the operator. The imposing of a special measure on the operator whereby a temporary representative is appointed and the data on dismissal of the temporary representative shall be entered in the records of payment systems kept by the National Bank of Serbia, not later than the next business day from the date of issuing the decision on such appointment and/or dismissal, and if the temporary representative undertakes to directly manage payment system operations, the data on such undertaking shall also be entered in the records. A temporary representative’s authorisation for supervising the operator’s business operations shall cease upon the expiry of the time period stipulated by the decision on his appointment or by the abolishment of such authorisation. The authorisation may expire before the expiry of such time period if the National Bank of Serbia assesses that the objectives and tasks from paragraph 5 hereof have been realised or that the operator’s financial condition has improved to such an extent that the temporary representative is no longer needed, in which case the National Bank of Serbia shall issue a conclusion on the termination of temporary representative’s authorisations. 14. If in the course of supervision procedure the National Bank of Serbia establishes that the operator did not comply with the Law or regulations adopted under the Law, especially if the same violations were committed during a certain period using the same situation, the National Bank of Serbia may impose a fine on the operator, as well as on the member of the managing body and/or the payment system director, by rendering a decision on orders and measures for the removal of identified irregularities referred to in Section 13, paragraph 1 of this Decision, pursuant to Article 187 of the Law. If the operator, within the time limit specified in paragraph 1 of this Section, fails to provide to the National Bank of Serbia evidence on the removal of irregularities, the National Bank of Serbia shall render a special decision imposing a fine and/or a new fine to the operator and/or a member of the managing body and/or the payment system director, pursuant to Article 187 of the Law. For the purpose of imposing a fine on a member of the managing body of the operator and/or the payment system director or the responsible person in the operator in accordance with Article 187 of the Law, the operator shall submit to the National Bank of Serbia the relevant data.

10 After they have been submitted to the operator and the responsible person in the operator, decisions from paragraphs 1 and 2 hereof imposing a fine shall be an enforceable title. The operator shall pay the imposed fine from paragraph 3 hereof to the current account of the National Bank of Serbia not later than eight days after the decision imposing the fine has been delivered. If the operator, member of the managing body or director of the payment system fails to pay the fine from paragraphs 1 and 2 hereof within the time limit from paragraph 5 hereof, the National Bank of Serbia shall resort to enforced collection. 15. If, on the basis of available data on the operator’s business operations, the National Bank of Serbia has established that the operator against whom any of the measures referred to in Article 183, paragraph 1, Sections 1) to 3) of the Law were imposed, has committed a new irregularity, the National Bank of Serbia may take against that operator a new measure referred to in Article 183, paragraph 1 of the Law, in compliance with the criteria referred to in Article 191 of the Law.

16. The National Bank of Serbia shall render a decision on revoking the license for payment system operation in cases prescribed by Article 190, paragraph 1 of the Law and/or may render such decision in cases from paragraph 2 of that Article. By the decision from paragraph 1 hereof the National Bank of Serbia may impose on the operator a fine, orders and measures relating to the termination of the payment system operation, and/or may order to the operator or another person to undertake certain activities related to such termination, аnd by that decision it may also impose fines under Article 190, paragraph 3 of the Law. 16а. The National Bank of Serbia may publish on its website or make in other way publicly available information about the measures taken against a certain operator in accordance with the Law and this Decision, unless making such information publicly available would seriously undermine the financial services market or cause disproportionate harm to the interested parties.
17. The decisions, reports and other acts, as well as notifications, requests and other supervision-related communications of the National Bank of Serbia submitted to the operator shall be considered to have been also

11 submitted to members of the managing body and managers of the payment system and no proof to the contrary shall be admissible. 18. This Decision is published in the RS Official Gazette and shall enter into force of 1 October 2015. Decision No 5 G o v e r n o r 2 June 2015 National Bank of Serbia B e l g r a d e Jorgovanka Tabaković, PhD Independent provisions of the Decision on Amendments and Supplements to the Decision on Detailed Conditions and Manner of Supervision of Operations of Payment Systems (RS Official Gazette, No 13/2025) 9. Supervision procedures initiated before the start of application of this decision shall be terminated according to the provisions of the Decision on Detailed Conditions and Manner of Supervision of Operations of Payment Systems (RS Official Gazette, No 49/2015). 10. This Decision shall enter into force on 22 February 2025 and shall apply as of 6 May 2025.