General Measures of Credit Authorities - Section II - Bank of Italy: Communication on New Reporting on Corporate Bodies (Or.So.)

General Measures of Credit Authorities
Section II - Bank of Italy
Supervisory Bulletin No. 6, June 2011 II.1
Communication of June 7, 2011 – New Reporting on Corporate Bodies (Or.So.).
Instructions for Intermediaries (1)

The Bank of Italy has prepared a new procedure for sending reports concerning information on the members of the corporate bodies of supervised intermediaries (2) and of financial intermediaries listed in the general register pursuant to Article 106 of the TUB (3).

The procedure is accessible from the INFOSTAT data collection website, through which the “Or.So.” reports must be prepared, consulted, and sent to the Bank of Italy. The new system fits into the overall revision of supervisory registers and lists (the “G.I.A.V.A.” project - Integrated Management of Supervisory Registers and Registers), within the framework of which other paper-based identity communications (e.g., form 3 SIOTEC, relating to the opening and closing of bank branches) are scheduled to be replaced by Internet reports in the coming months.

Main Innovations
The Instructions for preparing and sending reports regarding corporate bodies are attached to this communication.

Among the main novelties, it is emphasized that reporting is required for:

• corporate figures of particular importance for Supervision (internal audit, complaints office, risk management, compliance, and anti-money laundering);
• the legal representative of branches of foreign banks operating in Italy.

Effective Date and Initial Compliance
A) Effective Date
The new procedure and its Instructions enter into force on July 1, 2011; from that date, the following provisions are repealed:

• Circular No. 229 of April 21, 1999 (Supervisory Instructions for Banks):
  • Title VI, Chapter 3;
  • Title VII, Chapter 3, Section VII, para. 1.2, limited to the preamble referencing Title VI, Chapter 3;
  • Title VII, Chapter 4, Section III, para. 2, limited to the preamble referencing Title VI, Chapter 3;
• Bank of Italy Decision of April 14, 2005 (Regulation on the collective management of savings), Title IV, Chapter IV, Section II, para. 5;
• Circular No. 164 of June 25, 1992 (Supervisory Instructions for Intermediaries of the Securities Market), Title II, Chapter 6, para. 7;

(1) This communication concerns banks, group parent financial companies of banking groups, Italian branches of EU and non-EU banks, Poste Italiane spa (Bancoposta division), SGR, SICAV, SIM, financial intermediaries listed in the general and special registers, IMEL, and payment institutions. (2) Banks, group parent financial companies, and Italian branches of foreign banks; Poste Italiane (Bancoposta division); SGR and SICAV; SIM; financial intermediaries listed in the special register pursuant to Article 107 TUB; IMEL and payment institutions. (3) Until the entry into force of the implementing provisions provided for in Article 10 of Legislative Decree No. 141 of August 13, 2010, and subsequent amendments and integrations, these provisions apply to financial intermediaries listed in the general register pursuant to Article 106 TUB and in the special register pursuant to Article 107 TUB; subsequently, financial intermediaries listed in the register pursuant to Article 106 TUB will be subject to them.

General Measures of Credit Authorities
Section II - Bank of Italy
Supervisory Bulletin No. 6, June 2011 II.2

• Circular No. 216 of August 5, 1996 (Supervisory Instructions for Financial Intermediaries listed in the “Special Register”), Part One, Chapter IV, para. 2, letter a);
• Circular No. 253 of March 26, 2004 (Supervisory Instructions for Electronic Money Institutes (IMEL)), Chapter XI, para. 3;
• Bank of Italy Decision of February 15, 2010 (Supervisory provisions for payment institutions), Chapter XI, para. 3;
• Bank of Italy Decision of May 14, 2009, Article 11, paragraph 1, and Annex No. 7.

B) Supervised Intermediaries
From July 1, 2011, reports must be sent exclusively through the new procedure. The Bank of Italy will acquire reports produced by intermediaries using the current “Or.So. data-entry” until June 15, 2011; during the period June 16-30, 2011, submission via this procedure will no longer be accepted, and reporting entities will be invited to reproduce the content, from July 1, 2011, using the new methods.

For subjects already recorded in the previous archive, the situation as of June 15, 2011, will be automatically acquired in the new system, and therefore no initial report is required; for corporate figures of importance for Supervision, however, a first report, referring to the most up-to-date situation, must be submitted by September 30, 2011.

C) Financial Intermediaries Listed in the General Register pursuant to Article 106 TUB Financial intermediaries listed in the general register pursuant to Article 106 TUB must send, using the new procedure, from July 1, 2011, and no later than September 30, 2011, a complete initial report referring to the date of June 30, 2011.

° ° °

The obligation to report subsequent changes, adhering to the Instructions, remains in force for all intermediaries (see supra points B and C).

General Measures of Credit Authorities
Section II - Bank of Italy
Supervisory Bulletin No. 6, June 2011 II.3
Attachment
REPORTING ON MEMBERS OF CORPORATE BODIES (Or.So.)
INSTRUCTIONS FOR COMPLETION

Preamble
For the purposes of exercising supervisory activities, timely and updated knowledge of the composition of bodies with strategic supervision, management (including subjects with management roles), and control functions of intermediaries, as well as the identity of heads of corporate functions of particular importance for Supervision, is relevant.

In relation to this, the Bank of Italy manages the electronic archive of members of corporate bodies and holders of relevant corporate functions of supervised intermediaries. The archive, which has a historical character, is populated through reports, which supervised intermediaries are required to prepare and send according to the indications in these instructions.

1. Recipients of the Instructions
   The recipients of these instructions are:

• Italian banks;
• Group parent financial companies of banking groups;
• Poste Italiane spa, for the Bancoposta activity;
• Italian branches of EU banks;
• Italian branches of non-EU banks;
• SGR and SICAV;
• SIM;
• Financial intermediaries;
• IMEL;
• Payment institutions.

2. Legal Sources
   The matter is regulated:

• for banks, by the following articles of the TUB:
  • Article 51, which provides that banks send to the Bank of Italy balance sheets, periodic reports, and any other data or documents requested;
  • Article 66, which attributes to the Bank of Italy the power to request from subjects included in the scope of consolidated supervision pursuant to Article 65 the transmission of situations, data, and any other useful information also on a periodic basis;

General Measures of Credit Authorities
Section II - Bank of Italy
Supervisory Bulletin No. 6, June 2011 II.4

• Article 8, paragraph 1 of the TUF, which establishes that the Bank of Italy may request, within its competences, from authorized subjects, the communication of data and news and the transmission of acts and documents with the methods and terms established by it;
• Article 12, paragraph 3 of the TUF, which establishes that the Bank of Italy may request, within its competences, from subjects identified pursuant to Article 11, paragraph 1, letter b), the subject controlling the group parent company referred to in Article 11, paragraph 1-bis, the SIM or the management company, as well as those controlled, directly or indirectly, or participated in for at least twenty percent by one of the subjects identified pursuant to Article 11, paragraph 1, letter b), the transmission, also on a periodic basis, of data and information;
• for financial intermediaries, until the entry into force of the implementing provisions provided for in Article 10 of Legislative Decree No. 141 of August 13, 2010, and subsequent amendments and integrations, by Article 11, paragraph 1 of the Bank of Italy Decision of May 14, 2009, for those listed in the general register pursuant to Article 106 TUB, and by Article 107, paragraph 3, for those listed in the special register pursuant to Article 107 TUB; subsequently, by Article 108, paragraph 4 TUB, which establishes that financial intermediaries send to the Bank of Italy, with the methods and terms established, periodic reports as well as any other data and documents requested;
• for IMEL and payment institutions, respectively, by Articles 114-quater and 114-quaterdecies TUB, which refer to Article 51 of the same TUB.

3. Definitions
   For the purposes of this regulation, the following are defined:
   a) “financial intermediaries”: until the entry into force of the implementing provisions provided for in Article 10 of Legislative Decree No. 141 of August 13, 2010, and subsequent amendments and integrations, financial intermediaries listed in the general register pursuant to Article 106 TUB and in the special register pursuant to Article 107 TUB; subsequently, financial intermediaries listed in the register pursuant to Article 106 TUB; b) “members of corporate bodies”:

• persons holding offices in bodies with strategic supervision, management, and control functions;
• persons holding management functions;
• for branches in Italy of EU and non-EU banks: the legal representative and the substitute of the first establishment branch;
• for intermediaries subject to extraordinary administration, compulsory administrative liquidation, voluntary liquidation: extraordinary commissioners, liquidators, and members of supervisory committees;
  c) “holders of corporate functions of particular importance for Supervision”, the heads of the following functions (even if allocated at external entities, such as group companies or other consultants and service providers):
• internal audit;
• risk management;
• compliance;
• complaints office;
• anti-money laundering office;
  d) “changes in corporate bodies” any appointment, change, suspension, or termination of office from which the reporting obligations pursuant to these instructions arise; e) “GIAVA procedure (Integrated Management of Supervisory Registers and Registers)”, the computer procedure, part of the Bank of Italy’s Internet data collection system (INFOSTAT 4), which intermediaries use to comply with the reporting obligations pursuant to these instructions.

For the use of the procedure, reference is made to the User Manual for Reporting Intermediaries published on the Bank of Italy website under the item “Data Collection” on the “Supervision” page.
The Manual contains information to perform: 1) adherence to the INFOSTAT data collection system; 2) registration of procedure users; 3) preparation, digital signature, and submission of reports.

4. Reporting Terms
   Intermediaries report to the Bank of Italy updates regarding members of corporate bodies within 20 days from the date of acceptance of the appointment or change of office, suspension, or termination.

With reference to newly constituted intermediaries, the submission of the first report must be made within 30 days from the receipt of the authorization decision to exercise the activity.

In case of reporting errors identified by the Bank of Italy or the intermediary, the latter must report the correction of the erroneous report in the shortest possible time.

5. Content of the Report
   The content of the reports is given by the identifier of persons (“subject code”) holding offices in corporate bodies or holding corporate functions of particular importance for Supervision; for each subject, the following informational elements are also provided:

• the corporate office;
• the date of appointment;
• the expiration date, if provided;
• the appointing body;
• in case of termination or suspension, the date of termination or the indicator of suspension of the office.

(4) INFOSTAT is the computer platform, accessible via Internet, which offers support for the preparation and transmission of reports destined for the Bank of Italy.