Following the adoption of the Rules on listed financial instruments and transaction value subject to obligatory reporting of OTC Transactions to the stock exchange as of 1 July 2013, Croatian Financial Services Supervisory Agency (HANFA) decided to introduce 12 July 2013 as the beginning of implementation of obligatory OTC Transactions Reporting, altering the former deadline 30 September 2013.
Parties responsible to report OTC Transactions are defined in the Amendments to the Capital Market Act. In general, the reporting obligation is on the buyer, if the buyer is one of the following: investment company; credit institution; other financial institutions authorised by the competent authority in accordance with the provisions governing their operation; insurance undertakings; collective investment schemes and management companies of such schemes; pension fund and management companies of such funds; pension insurance undertakings; commodity and commodities derivative dealers; local firms; other institutional investors whose main activity is not covered by previous indents and which are required to be authorised or regulated to operate in the financial market; a legal person who, in relation to the previous year, meets at least two of the following conditions: total assets amounting minimum of HRK 150 million, net income in the amount of at least HRK 300 million, equity capital of at least HRK 15 million; other institutional investors whose main activity is to invest in financial instruments, which are not required to be authorized or regulated to operate in the financial markets by the regulatory Authority, including entities established for the purpose of asset securitization. If the buyer is none of above mentioned, then it is the seller’s obligation to report OTC Transactions.
Pursuant to the Capital Market Act, fine in the amount ranging from HRK 100.000 to HRK 1.000.000 will be imposed on a legal person if not reporting OTC Transactions.
Impact on investors: OTC Transactions Reporting obligatory as of 12 July 2013. Operational procedures on obligatory OTC Transactions Reporting to be available upon the official confirmation of the Zagreb Stock Exchange expected in following days.
Related Newsflashes: NEWSFLASH CROATIA – Update on OTC Transactions Reporting