Internal systems of financial control of investment companies: European experience of regulation and possibilities for use on the national financial market
Keywords:investment companies, internal control, risk management, internal audit, system of compliance, European Securities and Markets Authority, The Markets in Financial Instruments Directive ІІ
Features of functioning are studied of European investment companies, the experience of financial regulators in the proceedings of supervision and their regulation in the organization of internal systems of supervision and control over their activities. Researching of the results of the introduction of the MIFID II directive, the ESMA standards, combined with the use of instruments of national financial regulators of the European Union state-members in the field of supervision of investment companies and funds will enable to analyze the effectiveness of such a combination and expediency of their implementation in the national stock market.
The aim lays in identification of key regulatory tools used in the European Union, improving the efficiency of the interaction of domestic investment companies' systems in order to determine their applicability in the national financial market in order to promotion the development of the national economic system in general.
- to investigate the normative provision of the processes of regulating the organizational requirements of the functioning of the internal systems of investment companies in the EU countries, the implementation of changes to them among the EU state-members and the possibilities of their implementation in Ukraine;
- to identify key objects of regulation of the internal systems of investment companies;
- to determine the peculiarities of functioning of the internal systems of investment firms of the EU countries;
- to study the specifics of the functioning of the internal audit (control) system of the investment company, their place and role in the implementation of the company's activities;
- to determine the possibility of applying European norms of regulation of the activity of internal systems of investment companies among professional participants in the national stock market.
Summary. Of point of view on types of operations and peculiarities of the organization and functioning of investment companies in the national stock market in comparison with the improved (in accordance with the directives of the European Mergers and Securities Market Supervision Authority and the EU Directive on Financial Instruments Market II) procedures for the definition, regulation, organization, legislative and institutional support taking into account peculiarities and scales of activity of investment companies of internal control services, internal audit, conformity activity legislation, risk management system can be concluded that the presence of these elements in some professional participants in the stock market, despite the frequency of their concentration in one department (person), in the form of - the compliance unit - the legal department (lawyer), or the merger - the internal audit unit (control), internal auditor (controller).The presence of similar institutional support in the organizational system of the activity of investment companies is not fully comply with the functional obligation established by the improved requirements in accordance with the guidelines of the European Management of Stock Exchange and Securities and the EU Directive "On Markets of Financial Instruments II", but it can be implemented and applied at the national the stock market, which will make it possible to apply wider oversight, internal audit and control procedures, avoid multiple violations of legislation in the conduct of their activities and, consequently, penalties as well as their consequences, improve the quality of investment services in the securities market, protect the rights of their users or investors.
The Law of Ukraine (2016), On the Basic Principles of State Supervision (Control) in the Field of Economic Activity», available at: http://zakon2.rada.gov.ua/laws/show/877-16.
MiFID II legal framework, legal structure of drafting (2016), Development Cooperation Project 348/2016, Strengthening Institutional and Operational Capacity of the National Commission on Securities and Stock Market of Ukraine, Kyiv (ukr).
Directive 2014/65/EU on markets in financial instruments (2004), available at: http://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX:32014L0065.
Directive 2004/39/EC on markets in financial instruments (2004), available at: http://eur-lex.europa.eu/legal-content/EN/TXT/?uri=celex:32004L0039.
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Copyright (c) 2017 Mykhaylo Kuzheliev, Mykola Boichuk
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