Notice No. 2/2021

Notice No. 2/2021 Published in: DR, 2nd Series, No. 68, Part E, of 08-04-2021 Mod. 99999939/T – 01/14

Index Text of the Notice

Text of the Notice

Decree-Law No. 317/2009, of 30 October, which approved the legal regime regarding access to the activity of payment institutions and the provision of payment services, transposed into the internal legal order Directive No. 2007/64/EC of the European Parliament and of the Council, of 13 November, on payment services in the internal market. During the validity of that legal regime, it was found necessary to define the regulatory framework applicable to payment institutions, a need that was at the origin of the issuance of Notice No. 10/2009 of the Bank of Portugal.

With the publication of Decree-Law No. 91/2018, of 12 November, Directive (EU) 2015/2366 of the European Parliament and of the Council, of 25 November 2015, on payment services in the internal market (the second Payment Services Directive), was transposed into the internal legal order, consequently revoking the legal regime regulating access to the activity of payment institutions and the provision of payment services, approved by Decree-Law No. 317/2009, of 30 October. In this context, the Legal Regime of Payment Services and Electronic Money was approved, annexed to Decree-Law No. 91/2018, of 12 November, currently in force.

In view of the above, and taking into account the time elapsed since the establishment of the current normative framework regarding the activity of payment institutions and electronic money institutions, the relevant regulatory developments that have occurred in the meantime, as well as the legislative trend towards a unitary treatment regarding the legal regime of payment institutions and electronic money institutions, this Notice aims to update the regulatory framework regarding the matters to which payment institutions and electronic money institutions, hereinafter designated as "Institutions", are subject to the supervision of the Bank of Portugal, thereby revoking Notices No. 10/2009 and No. 4/2014 of the Bank of Portugal.

In particular at the level of internal governance, Institutions must have governance, internal control and risk management systems that, in all their aspects, ensure sound and prudent management of them and allow the identification and adequate treatment of risks arising from their activity. In this regard, considering the size, nature, scope and complexity of the activities developed by these institutions, as well as the risk underlying them, it was decided to follow the principle of proportionality by making a selective reference to certain provisions of Notice No. 3/2020 of the Bank of Portugal, with the aim of adapting the applicable regime to the prudential and supervisory concerns felt at the level of internal control of this type of institutions.

Thus, the rules of internal governance resulting from Notice No. 3/2020 of the Bank of Portugal are applicable to Institutions, namely in the following areas: (i) conduct and organizational culture, (ii) internal audit structure, (iii) register of meetings of collegiate bodies, (iv) organizational structure and strategic planning, (v) internal control and risk management system, with special emphasis on the framework shaping the establishment, organization and performance of internal control functions and respective managers, (vi) conflicts of interest policy, (vii) participation in irregularities, (viii) subcontracting within the framework of internal control functions, (ix) selection and appointment of statutory auditor or statutory audit firm, (x) establishment of common services, (xi) self-assessment of governance and internal control systems, and finally, (xii) documentation system, systematization and dissemination of information relating to the internal control system.

In order to provide existing institutions operating in the national market with a necessary period of adaptation to this new regime, they will have a period of 6 months to do so (similarly to what is established in paragraph 1 of Article 66 of Notice No. 3/2020 of the Bank of Portugal).

The draft of this Notice was subject to public consultation in accordance with legal provisions.

The Bank of Portugal, using the competence conferred upon it by Article 17 of its Organic Law, by Article 117-A of the General Regime of Credit Institutions and Financial Companies, approved by Decree-Law No. 298/92, of 31 December, by paragraph c) of paragraph 1 of Article 7 and by paragraph 8 of Article 19, both of the Legal Regime of Payment Services and Electronic Money, approved by Decree-Law No. 91/2018, of 12 November, determines the following, without prejudice to the application of other regulatory norms of the Bank of Portugal:

Article 1. Object

This Notice aims to define the regulatory framework applicable to the activity of payment institutions and electronic money institutions, without prejudice to the provisions of any regulatory norms that expressly provide for the application of their regime to these institutions.

Article 2. Regime

The following are applicable to payment institutions and electronic money institutions: a) Notices No. 1/2003, 10/2008, 8/2009 and 1/2019 of the Bank of Portugal; b) Notice No. 3/2020 of the Bank of Portugal is also applicable, with due adaptations, to payment institutions and electronic money institutions, with the exception of the provisions in Chapters I, IX and XIV, as well as the provisions in Articles 5, 7, 18, 53 and 61, in paragraph 7 of Article 29, in paragraph 4 of Article 30, in paragraph 8 of Article 32 and in paragraph i) of paragraph 1 of Article 27.

Article 3. Temporal Application

1 - Payment institutions and electronic money institutions shall adapt to the provisions of Notice No. 3/2020 of the Bank of Portugal, with the scope of application provided for in paragraph b) of the previous article, within a period of 6 months after the entry into force of this Notice.

2 - The provisions of Notice No. 3/2020 of the Bank of Portugal, with the scope of application provided for in paragraph b) of the previous article, apply to authorization procedures for the establishment of payment institutions and electronic money institutions pending on the date of its entry into force.

3 - Payment institutions and electronic money institutions whose establishment has already been authorized, but which are not yet registered in a special register at the Bank of Portugal, have a period of 6 months from the date of registration to adapt to the provisions of Notice No. 3/2020 of the Bank of Portugal, with the scope of application provided for in paragraph b) of the previous article.

Article 4. Repeal Provision

Notices No. 10/2009 and No. 4/2014 of the Bank of Portugal are revoked.

Article 5. Entry into Force

This Notice enters into force on the day following its publication.

30 March 2021. - The Governor, Mário Centeno.