TEMA 2CNMV

Classified in Law & Jurisprudence

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The CNMV is the agency responsible for monitoring and inspecting the Spanish stock Markets and the activity of all the agents involved in them. It was created by the Act 24/1988 on the Securities Markets.

The aim of the CNMV is to ensure the transparency of the Spanish securities markets, the Correct formation of prices on these markets and the protection of investors by promoting Disclosure of any information necessary in order to attain these ends. 
Control functions of the CNMV
 • Ensure the transparency of markets. • Enforce compliance with the standards of conduct by all participants involved in the Securities markets.
• Make the necessary arrangements for the development and enforcement of adopted Rules in implementing the law. • Monitor the correct formation of prices.
Supervisory functions of the CNMV • Examine the requirements for Dealer-brokers or Brokers in order to become members Of the stock exchanges.• Verify the requirements to issue and admit securities to trading. • Receive information on acquisitions and transfers of shares in listed companies.
Advisory functions of the CNMV • Advise administration officials on the securities market. One of the functions of the CNMV is to advise the Government and the Ministry of Finance on matters relating to the securities markets. • Promote the dissemination of market information.
The basic organisational structure of the CNMV is illustrated above. The CNMV is Managed by the CNMV Board that consists of: • a president (appointed by the Government) and a vice-president, • Secretary General of Treasury and Financial Policy, • Deputy Governor of the Banco de España, and • three advisors
The CNMV Board shall exercise the powers assigned by law and assigned to it by the Government or the Ministry of Economy and Competitiveness. The organization also Includes Advisory Committee, Executive Committee and three Director Generals
The functions of the Board are the following: - To approve the Circular to which Article 15 of the Securities Markets Act refers.- To approve the Regulations of the internal regime of the CNMV. - To approve the draft budget of the Commission. - To constitute the Executive Committee

REFORM SECURITY MARKET
The main changes introduced by the 1988 Act, as indicated in the relevant preamble, are The following: ⇒ Creation of the National Commission of Securities Market, the CNMV, as a supervising And inspective entity of these markets. ⇒ Recognition of freedom to issue of securities without the need of prior approval. ⇒ Establishment of three categories of official secondary markets: the Stock Exchanges, The Public Debt Market represented by book entries (Mercado de Dueda Pública Representada mediante anotaciones en cuenta), and other official secondary markets.⇒ Dissolution of the official public stockbrokers’ associations (colegios oficiealses de Agentes de cambio y bolsa), which are replaced by Brokers-dealers (sociedades de Valores) and Brokers (agencias de valores), who as members of the stock exchange Will be the only entities authorised to intermediate in the stock exchangesCreation of an electronic trading system or electronic interconnection system (continuous market), which in fact had already begun its first steps. ⇒ Authorisation for deposit institutions and other intermediaries to be involved in Trading activities, but restricting trading securities in stock exchanges only to Brokerdealers And Brokers. ⇒ Incorporation of minimum standards of conduct to prevent insider trading, to defend The absolute priority of investors’ interests, and to ensure market transparency. ⇒ Extending the system of penalties, applicable to all persons and entities that are Related to the stock exchanges.

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