Slovak Financial Law News 2004

Measure of National Bank of Slovakia on Issuance and Administration of Electronic Money and Payment Instruments of Electronic Money

Notification of the National Bank of Slovakia No. 305/2004 Coll. on issuance of the Measure of the National Bank of Slovakia dated  28 April 2004 No. 6/2004, stipulating Details on Conditions, Manner of Proving and Evidencing of Fulfilment of Conditions and on Applications on Granting or Amending the Approval for Issuance and Administration of Electronic Money and Payment Instruments of Electronic Money Including the Requisites of Enclosures to such Applications

According to the Act No. 510/2002 Coll. on System of Payments as amended (``System of Payments Act''), electronic payment instruments are electronic instruments enabling access to electronically evidenced or electronically kept financial values and enabling the performance of deposits, withdrawals, transfers or other operations through electronic or other technical equipment. As electronic payment instrument is considered: (a) payment instrument of distance access, and (b) payment instrument of electronic money.

Under the System of Payments Act, as issuer of electronic payment instrument may be also an institution of electronic money that shall be understood as other legal entity than a bank, branch of foreign bank or the National Bank of Slovakia, if an approval under the System of Payments Act for issuance and administration of electronic money and payment instruments of electronic money (``electronic money activity'') was issued to it. Under the System of Payments Act, only a joint stock company, with respect to legal form of a business entity, may act as an institution of electronic money.

Conditions that must be fulfilled for granting of the approval for electronic money activity by the National Bank of Slovakia as well as the requisites of the written application for its granting are set out in the Sec. 21 para. 2 and para. 3 of the System of Payments Act.

The above measure further executes provisions of the System of Payments Act by regulating in detail the conditions, and manner of their proving and evidencing, for performance of electronic money activity as well as requisites of application (including attachments thereto) for granting of approval or amendment to an approval for performance of electronic money activity.

This measure incorporates detailed list of documents as the enclosures to application proving capability and appropriateness of shareholders with qualified participation on the applicant, origin and extent of monetary contribution, origin and extent of assets contributed into the registered capital of the applicant, transparency of their relations with third persons (especially the transparency of shares on the registered capital and on the voting rights of the applicant), as well as the ability of the shareholder to overcome unfavourable financial situation of the applicant. The above documents are separately listed for: (i) a shareholder being a natural person, (ii) a shareholder being a natural person entrepreneur, and (iii) shareholder being a legal entity.

As a qualified participation shall be pursuant to the System of Payments Act understood a direct or indirect share, or aggregate amount thereof, representing at least 5 % share on the registered capital or voting rights of the applicant or the possibility of effectuation of other significant influence on management of the applicant corresponding to an influence under such share.

A special document submitting of which shall be required with respect to any kind of shareholder is the graphical description of a group with close relations to which the respective shareholder of the applicant belongs. According to the System of Payments Act as a group with close relations shall be understood any relation between two or more persons within which one person has a direct or indirect share on the registered capital or voting rights of the other person exceeding 20 % or if it directly or indirectly controls such other person, or any relation between two or more persons controlled by the same person. In case of a shareholder domiciled abroad, the applicant shall be obliged to present also legal regulations governing the issue of close relations in the state on the territory of which the group has close relations as well as documents proving that the close relations do not impede the performance of banking supervision.

The measure further regulates in detail the list of documents which the applicant is obliged to submit together with the application proving professional capability and trustworthiness of persons nominated for (i) members of statutory body, (ii) procurists, (iii) members of Supervisory Board, and (iv) chief officers of department of internal control and internal audit, as well as further documents concerning especially the proposed organisational structure, business plan, information system, internal rules and commercial terms and conditions of the applicant.

This measure also sets out the list of documents proving fulfilment of conditions for performance of electronic money activity pursuant to the System of Payments Act.

This Measure became effective on 15 May 2004.

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