Regulation No. 2014-03 on the Register of Parent Companies

REGULATION ON THE REGISTER OF PARENT COMPANIES year 2014/ number 03 (Consolidated text as of 01/01/2015 – Update I)

Central Bank of the Republic of San Marino
Regulation No. 2014-03 Regulation on the Register of Parent Companies (Update I) ___________________________________________________________________________________________________________ Art. 1 – Definitions

1. For the purposes of this Regulation, the following terms are understood as:

• “Central Bank”: Central Bank of the Republic of San Marino;
• “Financial Parent Company”: a San Marino authorized entity possessing the requirements set forth in Article 54, paragraph 1, of the LISF, and positioned within the group architecture such that the sum of its own balance sheet assets and those of the companies and entities it controls meets the conditions for the existence of a RELEVANT GROUP;
• “Non-Financial Parent Company”: a San Marino holding company pursuant to Article 54, paragraph 2, of the LISF, possessing the requirements set forth in Article 54, paragraphs 1 and 3, of Law 17 November 2005 No. 165, and positioned within the group architecture such that the sum of its own balance sheet assets and those of the companies and entities it controls meets the conditions for the existence of a RELEVANT GROUP;
• “Financial Component”: a FINANCIAL ENTERPRISE, controlled by the parent company and consequently part of the RELEVANT GROUP;
• “Non-Financial Component”: a company or other entity, San Marino or foreign, controlled by the parent company, which carries out activities connected, instrumental, or ancillary to the reserved activities of the RELEVANT GROUP of which it is a part;
• “Control”: relationships between different enterprises characterized by the conditions set forth in Article 2 of the LISF;
• “Relevant Group”: a group or conglomerate, pursuant to Articles 53 and 60 of the LISF, for which the following additional conditions are met:
• the total assets are represented, to an extent not less than 50% of the total, by the balance sheet assets of FINANCIAL ENTERPRISES;
• the parent company is an AUTHORIZED SUBJECT San Marino or a San Marino holding company pursuant to Article 54, paragraph 2, of the LISF;
• all companies or entities comprising it are controlled by the parent company and have as their object the exercise of reserved activities or activities connected, instrumental, or ancillary thereto, including companies in voluntary liquidation or subject to bankruptcy proceedings or extraordinary procedures under Part II, Title II of the LISF or equivalent foreign procedures;
• “Financial Enterprise”: a San Marino or foreign entity that carries out, in an entrepreneurial manner, activities included in the list set forth in Annex 1 of the LISF;
• “LISF”: Law 17 November 2005, No. 165 and subsequent amendments;
• “Register”: Register of Parent Companies pursuant to Article 56 of the LISF;
• “Register of Authorized Subjects”: Register pursuant to Article 11 of the LISF, as regulated by Regulation 2006-01 and subsequent amendments;
• “Register of Companies”: Register pursuant to Article 6 of Law 23 February 2006 No. 47 and subsequent amendments;
• “Authorized Subjects”: subjects authorized, pursuant to the LISF, to carry out one or more reserved activities.

2. The use of defined terms is highlighted in UPPERCASE.
3. For all terms not defined in paragraph 1, reference is made to the definitions and concepts contained in the articles of the LISF.
   Art. 2 – Scope of Application and Legal Sources
4. This Regulation governs the register of parent companies pursuant to Article 56 of the LISF and finds its legal sources in Articles 53, 54, 55, and 56 of the LISF.

Central Bank of the Republic of San Marino
Regulation No. 2014-03 Regulation on the Register of Parent Companies (Update I) ___________________________________________________________________________________________________________ Art. 3 – Content of the Register

1. The REGISTER contains informational elements regarding:
   a) FINANCIAL or NON-FINANCIAL PARENT COMPANIES; b) FINANCIAL or NON-FINANCIAL COMPONENTS; c) participation or control relationships between the subjects referred to in the preceding points a) and b).
2. The RELEVANT GROUP is marked by an identification code. For each RELEVANT GROUP, the parent company and the individual components are indicated.
3. For FINANCIAL PARENT COMPANIES and FINANCIAL COMPONENTS entered in the REGISTER OF AUTHORIZED SUBJECTS, only the registration number in the aforementioned register is indicated, with the exception of the former, which, if themselves subject to the CONTROL of a foreign FINANCIAL ENTERPRISE acting as parent company for the jurisdiction of belonging, indication is also given, with a specific note inserted in the REGISTER, of the identity of the latter.
4. For NON-FINANCIAL PARENT COMPANIES, the following are indicated:
   a) the name; b) the legal form; c) the registered office; d) the administrative office, if different from the registered office; e) the date and number of registration in the REGISTER OF COMPANIES; f) the economic operator code; g) the audit firm; h) the share capital (subscribed and paid-up); i) the corporate officers; j) the last three approved annual financial statements, complete with any accompanying reports and certifications; k) the holders of shareholdings in the share capital exceeding 5% and the share attributable to each; l) any secondary offices in the Republic of San Marino; m) any foreign parent company.
5. For NON-FINANCIAL COMPONENTS and FINANCIAL COMPONENTS not entered in the REGISTER OF AUTHORIZED SUBJECTS, the following are indicated:
   a) the name; b) the legal form; c) the registered office; d) the administrative office, if different from the registered office; e) the share capital (subscribed and paid-up); f) the corporate purpose; g) total assets reported in the last approved annual financial statement; h) the holders of shareholdings in the share capital not less than 20% and the share attributable to each. Art. 4 – Registration in the Register
6. Subjects who, pursuant to Article 53, paragraph 2, and Article 54 of the LISF and implementing supervisory provisions, assume the characteristics required to acquire the status of parent company, are required to communicate, within thirty days from the occurrence of the conditions for assuming such status, the existence of the RELEVANT GROUP and its composition, for the purpose of registering the group in the REGISTER. The CENTRAL BANK, having verified the completeness and correctness of the data and documents received for publication purposes, proceeds without delay with the registration.
7. The CENTRAL BANK may proceed ex officio to ascertain the existence of a GROUP or any modification of its composition, even contrary to what communicated by the parent company. Upon completion of such assessments, the CENTRAL BANK communicates to the parent company the completion of the registration. It is the responsibility of the latter to communicate this to the individual components of the RELEVANT GROUP, specifying the composition recognized by the CENTRAL BANK and also reporting to the FINANCIAL COMPONENTS only the information set forth in the following Article 5, paragraph 1.
   Art. 5 – Content of the Communication
8. The communication referred to in the first paragraph of the previous article must contain, in addition to any data that, pursuant to Article 3, paragraphs 4 and 5, is subject to insertion in the Register, the following indications:
   a) the organizational structure of the RELEVANT GROUP as well as the methods by which the parent company intends to perform the directive functions set forth in Article 57, paragraph 2, of the LISF; b) the identity of the subjects who, regardless of participation in the share capital of the parent company, have CONTROL thereof, also jointly; c) the type of CONTROL; d) the indication of any further shareholdings not falling within the RELEVANT GROUP;
9. For NON-FINANCIAL PARENT COMPANIES, NON-FINANCIAL COMPONENTS, and FINANCIAL COMPONENTS not entered in the REGISTER OF AUTHORIZED SUBJECTS, in addition to what is already provided in the previous paragraph, the communication must also be accompanied by the following documents:

• a copy of the articles of association from which the type of economic activity carried out clearly results, for the purpose of verifying consistency with Article 54, paragraph 2 of the LISF or, respectively, the connected, instrumental, or ancillary nature with respect to the reserved activities of the RELEVANT GROUP;
• a copy of the last three approved annual financial statements, complete with any accompanying reports and certifications, if present;
• a certificate of validity or, for companies or entities of foreign law, another equivalent certificate.
  Art. 6 – Variations to the Register

1. Parent companies are required to communicate without delay to the CENTRAL BANK any variation of the information contained in the REGISTER, simultaneously requesting its update, including the substitution of the earliest published annual financial statement with the last approved one, regardless of the fulfillment, prior or subsequent, of communication obligations concerning, in whole or in part, the same subject matter and deriving from other supervisory provisions different from Reg. 2006-01.
2. Any variation communicated to the CENTRAL BANK, and duly proven, is annotated without delay on the REGISTER.
3. The CENTRAL BANK, in the absence of the communication referred to in the first paragraph, has the discretion to proceed ex officio to update the information contained in the REGISTER in cases where it has come to know of the data anyway.

Central Bank of the Republic of San Marino
Regulation No. 2014-03 Regulation on the Register of Parent Companies (Update I) ___________________________________________________________________________________________________________ Art. 7 – Verification of the Persistence of Registration Conditions and Update of Accompanying Documents

1. Parent companies are required to verify, upon approval of the annual financial statement, the maintenance of the conditions set for the relevance of the group for the purposes of this Regulation, giving immediate notice to the CENTRAL BANK of the loss thereof, for the purpose of deleting the RELEVANT GROUP from the REGISTER.
2. For the purpose of updating the documents required pursuant to Article 5, paragraph 2, parent companies must also promptly send to the CENTRAL BANK copies of subsequent annual financial statements and articles of association and certificates, if updated, due to subsequent statutory modifications.
   Art. 8 – Deletion from the Register.
3. The CENTRAL BANK proceeds with the deletion of the RELEVANT GROUP from the REGISTER in cases where:
   a) the parent company loses the requirements for assuming such status; b) the parent company has entered liquidation; c) the balance sheet assets of the FINANCIAL ENTERPRISES fall below 50% of the total assets of the RELEVANT GROUP; d) the composition of the RELEVANT GROUP, excluding components in liquidation, is limited to the parent company alone.
4. In the event that a new parent company succeeds the one previously registered as such, the RELEVANT GROUP, by changing its name, will be deleted and re-registered in the REGISTER with another coding pursuant to Article 3, paragraph 2.
   Art. 9 – Publicity of Registration
5. The components of a RELEVANT GROUP, entered in the REGISTER, must give appropriate evidence thereof, in documents and correspondence.
   Art. 10 – Consultation of the Register
6. Consultation of the REGISTER, kept in an automated manner, is permitted to anyone and consists of the right to receive, upon written request to the CENTRAL BANK, the data and information contained therein.
7. The CENTRAL BANK publishes on its website the list of RELEVANT GROUPS entered in the REGISTER indicating:
   a) for FINANCIAL PARENT COMPANIES, their name, a hyperlink (link) to the data present in the REGISTER OF AUTHORIZED SUBJECTS and any note on belonging to a foreign group pursuant to Article 3, paragraph 3; b) for NON-FINANCIAL PARENT COMPANIES, the most updated information and documents relating to the elements set forth in Article 3, paragraph 4; c) for FINANCIAL COMPONENTS:

• entered in the REGISTER OF AUTHORIZED SUBJECTS, their name and a hyperlink (link) to the data present therein;

Central Bank of the Republic of San Marino
Regulation No. 2014-03 Regulation on the Register of Parent Companies (Update I) ___________________________________________________________________________________________________________

• not entered in the REGISTER OF AUTHORIZED SUBJECTS, the most updated information relating to the elements set forth in Article 3, paragraph 5;
  d) for NON-FINANCIAL COMPONENTS, the most updated information relating to the elements set forth in Article 3, paragraph 5.
  Art. 11 – Opposability to Third Parties

1. The information contained in the REGISTER, for the purposes of opposability to third parties, does not prevail over any divergent information contained in the REGISTER OF COMPANIES or in equivalent registers of other jurisdictions.
   Art. 12 – Amendments to Regulation No. 2006-01
2. At Article 3, paragraph 5, of Regulation No. 2006-01 titled “Regulation on the Register of Authorized Subjects”, the following letter is inserted:
   “f) any registration in the Register of Parent Companies;”.
3. After Article 11 of Regulation No. 2006-01 titled “Regulation on the Register of Authorized Subjects”, the following article is inserted:
   “Art. 11 – Publicity of Registration
4. Subjects entered in the REGISTER must give appropriate evidence thereof, in documents and correspondence.”
   Art 13 – Entry into Force
5. This Regulation enters into force on July 1, 2014.
6. Within ninety days from the entry into force of this Regulation, parent companies must submit to the CENTRAL BANK a request for registration in the REGISTER, attaching the documentation provided for in the preceding articles.