Netherlands Authority for the Financial Markets
Encyclopedia
The Netherlands Authority for the Financial Markets is the financial services regulatory authority for the Netherlands
. Its role is comparable to the role of the SEC in the United States.
The AFM falls under the political responsibility of the Minister of Finance
but is an autonomous administrative authority
, which means that the AFM operates autonomously based on the powers given by the Minister of Finance.
s in the Netherlands. This includes regulating the behaviour of all parties involved with the savings, loans, investment
and insurance
markets. It includes regulating all organisations that provide financial products and those that issue products, including stock exchange
s.
The AFM has the following three aims:
The public, the business sector and the government all depend on the financial products offered on the various markets for many of their activities. Confidence in the orderly and honest operation of these markets is therefore crucial.
The AFM works in conjunction with the De Nederlandsche Bank
which is responsible for prudential regulation in the Netherlands
.
Previous board members:
On March 13, 2007 Mr. Koster announced his resignation with effect of 1 Jan 2008, however at the request of the government he remained in office as director until April 1, 2008.
stock exchange which is not only located in Amsterdam
, but also in Paris
, Brussels
, London
and Lisbon
, the AFM works closely with the regulators in those other countries to regulate this cross border stock exchange
.
The AFM is a member of the Committee of European Securities Regulators
(CESR), which is actively contributing to the harmonisation of financial regulation in Europe.
The AFM also participates in the International Organization of Securities Commissions
(IOSCO), which brings together more than 80 securities regulators from all around the world.
Netherlands
The Netherlands is a constituent country of the Kingdom of the Netherlands, located mainly in North-West Europe and with several islands in the Caribbean. Mainland Netherlands borders the North Sea to the north and west, Belgium to the south, and Germany to the east, and shares maritime borders...
. Its role is comparable to the role of the SEC in the United States.
History
The Netherlands Authority for the Financial Markets was set up on 1 March 2002 as the successor to the Securities Board of the Netherlands . As part of the legislation that created the AFM, its responsibilities were greatly expanded to cover all financial products, including savings, investments, loans, insurance and accounting.The AFM falls under the political responsibility of the Minister of Finance
Ministry of Finance (Netherlands)
The Ministry of Finance is the Dutch ministry of finance: it is occupied with the national budget, taxation and financial economic policy, including supervision of financial markets...
but is an autonomous administrative authority
Quango
Quango or qango is an acronym used notably in the United Kingdom, Ireland and elsewhere to label an organisation to which government has devolved power...
, which means that the AFM operates autonomously based on the powers given by the Minister of Finance.
Responsibilities and operations
The Netherlands Authority for the Financial Markets is the body responsible for regulating behaviour on the financial marketFinancial market
In economics, a financial market is a mechanism that allows people and entities to buy and sell financial securities , commodities , and other fungible items of value at low transaction costs and at prices that reflect supply and demand.Both general markets and...
s in the Netherlands. This includes regulating the behaviour of all parties involved with the savings, loans, investment
Investment
Investment has different meanings in finance and economics. Finance investment is putting money into something with the expectation of gain, that upon thorough analysis, has a high degree of security for the principal amount, as well as security of return, within an expected period of time...
and insurance
Insurance
In law and economics, insurance is a form of risk management primarily used to hedge against the risk of a contingent, uncertain loss. Insurance is defined as the equitable transfer of the risk of a loss, from one entity to another, in exchange for payment. An insurer is a company selling the...
markets. It includes regulating all organisations that provide financial products and those that issue products, including stock exchange
Stock exchange
A stock exchange is an entity that provides services for stock brokers and traders to trade stocks, bonds, and other securities. Stock exchanges also provide facilities for issue and redemption of securities and other financial instruments, and capital events including the payment of income and...
s.
The AFM has the following three aims:
- making the financial markets more accessible
- promoting the smooth operation of the financial markets
- promoting confidence in the financial markets.
The public, the business sector and the government all depend on the financial products offered on the various markets for many of their activities. Confidence in the orderly and honest operation of these markets is therefore crucial.
The AFM works in conjunction with the De Nederlandsche Bank
De Nederlandsche Bank
De Nederlandsche Bank is the central bank of the Netherlands. It is part of the European System of Central Banks .-History:...
which is responsible for prudential regulation in the Netherlands
Netherlands
The Netherlands is a constituent country of the Kingdom of the Netherlands, located mainly in North-West Europe and with several islands in the Caribbean. Mainland Netherlands borders the North Sea to the north and west, Belgium to the south, and Germany to the east, and shares maritime borders...
.
Administration
The board of the AFM consists of:- Hans Hoogervorst (since September 2007, Chairman)
- Rene Maatman (since May 2008)
- Theodor Kockelkoren (since March 2008)
Previous board members:
- Paul Koster (since March 2001-March 2008)
- AW Kist (since September 2005 to August 7, 2007)
On March 13, 2007 Mr. Koster announced his resignation with effect of 1 Jan 2008, however at the request of the government he remained in office as director until April 1, 2008.
International
With the advent of EuronextEuronext
Euronext N.V. is a pan-European stock exchange based in Amsterdam and with subsidiaries in Belgium, France, Netherlands, Portugal and the United Kingdom. In addition to equities and derivatives markets, the Euronext group provides clearing and information services...
stock exchange which is not only located in Amsterdam
Amsterdam
Amsterdam is the largest city and the capital of the Netherlands. The current position of Amsterdam as capital city of the Kingdom of the Netherlands is governed by the constitution of August 24, 1815 and its successors. Amsterdam has a population of 783,364 within city limits, an urban population...
, but also in Paris
Paris
Paris is the capital and largest city in France, situated on the river Seine, in northern France, at the heart of the Île-de-France region...
, Brussels
Brussels
Brussels , officially the Brussels Region or Brussels-Capital Region , is the capital of Belgium and the de facto capital of the European Union...
, London
London
London is the capital city of :England and the :United Kingdom, the largest metropolitan area in the United Kingdom, and the largest urban zone in the European Union by most measures. Located on the River Thames, London has been a major settlement for two millennia, its history going back to its...
and Lisbon
Lisbon
Lisbon is the capital city and largest city of Portugal with a population of 545,245 within its administrative limits on a land area of . The urban area of Lisbon extends beyond the administrative city limits with a population of 3 million on an area of , making it the 9th most populous urban...
, the AFM works closely with the regulators in those other countries to regulate this cross border stock exchange
Stock exchange
A stock exchange is an entity that provides services for stock brokers and traders to trade stocks, bonds, and other securities. Stock exchanges also provide facilities for issue and redemption of securities and other financial instruments, and capital events including the payment of income and...
.
The AFM is a member of the Committee of European Securities Regulators
Committee of European Securities Regulators
The Committee of European Securities Regulators was an independent committee of European Securities regulators established by European Commission on June 6 of 2001...
(CESR), which is actively contributing to the harmonisation of financial regulation in Europe.
The AFM also participates in the International Organization of Securities Commissions
International Organization of Securities Commissions
The International Organization of Securities Commissions is an association of organisations that regulate the world’s securities and futures markets....
(IOSCO), which brings together more than 80 securities regulators from all around the world.