Payment and Settlement Systems Act1
Passed 08.02.2023
Chapter 1 General Provisions
§ 1. Scope of Act
(1) This Act regulates access to a payment and settlement system and settlement services, the settlement of payment and securities transactions in a settlement system, protection of collateral securities in the case of insolvency, recognition of a payment system as a settlement system and oversight of payment and settlement systems.
(2) The provisions of the Administrative Procedure Act apply to the recognition of a payment system as a settlement system as prescribed in this Act, taking into account the specifications provided for in this Act.
§ 2. Application of Act
(1) This Act applies to:
1) a payment system the provision of whose services is organised by a person who has its head office in Estonia or the seat of whose management board or of a body substituting therefor is in Estonia and whose place of business is in Estonia;
2) a settlement system about which a notification has been submitted to the European Securities and Markets Authority pursuant to the procedure provided for in this Act and to a settlement system operated by Eesti Pank;
3) a participant in the settlement system specified in clause 2 of this subsection;
4) persons or institutions who have been established in Estonia and participate in a settlement system;
5) settlements made in a settlement system, including those made through linked systems between settlement agents, central counterparties, clearing houses or central banks and other participants in the settlement system and payment service providers;
6) collateral securities provided in connection with participation in a settlement system;
7) collateral securities provided in connection with the performance of duties falling within the competence of Eesti Pank, a central bank of a state which is a contracting party to the EEA Agreement (hereinafter EEA country) or the European Central Bank.
(2) This Act applies to transfers of securities made by the registrar of the Estonian Register of Securities on the basis of the Securities Register Maintenance Act.
(3) The provisions concerning a settlement system do not apply to a payment system unless otherwise laid down in this Act.
(4) The provisions of subsections 2–7 of § 19 and the provisions of § 22 of this Act apply in the case of insolvency of a person who has been established in Estonia and participates in a third country payment system the requirements applicable to which are equivalent to a substantial part to the requirements provided for in Directive 98/26/EC of the European Parliament and of the Council on settlement finality in payment and securities settlement systems (OJ L 166, 11.6.1998, p. 45–50).
§ 3. Settlement system, payment system and linked system
(1) Settlement system means a pool of organisational, technical and legal solutions agreed on between three or more participants in the settlement system (hereinafter also participant in the system or participant), none of whom acts in this system as the system operator, a central counterparty, a settlement agent, a clearing house or an indirect participant, for processing and settlement of transfer orders according to uniform rules and standardised arrangements, whether or not through a central counterparty, if both of the following conditions are met:
1) the settlement system is governed, by agreement between the participants, by the law of the EEA country where the head of office of at least one participant is located;
2) a notification about the settlement system has been submitted to the European Securities and Markets Authority in accordance with the law of the EEA country.
(2) For the purposes of this Act, settlement system also means a securities settlement system through which securities settlements, which fall within the scope of application of Regulation (EU) No 909/2014 of the European Parliament and of the Council on improving securities settlement in the European Union and on central securities depositories and amending Directives 98/26/EC and 2014/65/EU and Regulation (EU) No 236/2012 (OJ L 257, 28.8.2014, p. 1–72), are made.
(3) A settlement system is not deemed to include arrangements between two participants neither of whom is a central counterparty, a settlement agent, a clearing house or an indirect participant, except if Eesti Pank is of the opinion that this is warranted on grounds of systemic risk and Eesti Pank has recognised the arrangement as a settlement system.
(4) The participants may agree that their rights and obligations arising from a settlement system are governed by this Act if at least one of the participants in the settlement system has its head office in Estonia.
(5) Payment system means the payment system provided for in subsection 4 of § 3 of the Payment Institutions and E-money Institutions Act. The payment which complies with the requirements specified in subsection 1 of this section is a settlement system for the purposes of this Act.
(6) Linked system means two or more settlement systems whose system operators have entered into an arrangement with one another that involves execution of transfer orders between the settlement systems comprised by such linked system on uniform conditions and using uniform procedures.
(7) An arrangement entered into between settlement systems participating in a linked system does not constitute a settlement system.
§ 4. System operator
(1) System operator means a person who, in accordance with the settlement system rules (hereinafter also system rules) and contracts entered into with other participants in the system, ensures the continuous operation of the system and organises the execution of transfer orders and netting of claims between the participants.
(2) The following may act as a securities settlement system operator:
1) Eesti Pank;
2) the central securities depository which has obtained an authorisation on the basis of Regulation (EU) No 909/2014 of the European Parliament and of the Council.
(3) A system operator may also act as a settlement agent, a central counterparty or a clearing house.
§ 5. Settlement agent, central counterparty and clearing house
(1) Settlement agent means a person providing to members of a system or to members of a system and to a central counterparty, settlement accounts through which transfer orders within the settlement systems are settled and, as the case may be, granting credit for settlement purposes.
(2) Central counterparty means a legal person as defined in Article 2(1) of Regulation (EU) No 648/2012 of the European Parliament and of the Council on OTC derivatives, central counterparties and trade repositories (OJ L 201, 27.7.2012, p. 1–59).
(3) Clearing house means a person responsible for the calculation of the net positions of members of a system and, where appropriate, also for the calculation of the net positions of a central counterparty or a settlement agent.
§ 6. Participant in settlement system
(1) A participant may be a system operator, a member of a settlement system (hereinafter member of a system), a settlement agent, a clearing house, a central counterparty and a clearing member of a central counterparty. According to the rules of the settlement system, the same participant may act as a central counterparty, a settlement agent or a clearing house or carry out part or all of their tasks.
(2) An indirect participant may be a system operator, a central counterparty, a settlement agent, a clearing house and a member of a system, who has a contractual relationship with a participant in the system, which enables the indirect participant to pass transfer orders through the settlement system, provided that the indirect participant is known to the system operator. Indirect participation does not limit the responsibility of the participant in the system through which the indirect participant passes transfer orders to the system.
(3) For the purposes of this Act, member of a system means the participant in a system which is responsible for discharging the financial obligations arising from transfer orders within that system. A member of a system may be:
1) a credit institution established in Estonia or in another EEA country;
2) an investment firm established in Estonia or in another EEA country, except for the person provided for in subsection 1 of § 47 of the Securities Market Act;
3) a person who has been established in a third country and is regarded as a credit institution or an investment firm;
4) Eesti Pank, a central bank of another EEA country or the European Central Bank;
5) a government authority, a legal person governed by public law, or a foundation established by the state.
(4) Clearing member of a central counterparty means the participant in a system as defined in Article 2(14) of Regulation (EU) No 648/2012 of the European Parliament and of the Council.
§ 7. Insolvency proceedings
(1) For the purposes of this Act, insolvency proceedings mean:
1) bankruptcy proceedings;
2) reorganisation proceedings;
3) taking the early intervention measures or the resolution proceedings provided for in the Financial Crisis Prevention and Resolution Act;
4) a moratorium established on a credit institution;
5) proceedings opened on the basis of foreign law to reorganise or wind up the operation of a participant in a system or of a person who has provided collateral security to a settlement system or to a participant or implementation of such measures involving the suspending of, or imposing limitations on, the discharge of transfer obligations.
(2) Opening of bankruptcy proceedings means the appointment of an interim trustee by the court in accordance with § 15 of the Bankruptcy Act. Establishment of a moratorium means making the decision to establish a moratorium as specified in subsection 31 of § 112 of the Credit Institutions Act. Resolution proceedings mean the application of the resolution tool or power provided for in the Financial Crisis Prevention and Resolution Act.
(3) In the event of insolvency of a participant in a settlement system, the rights and obligations of the participant arising from its participation in the settlement system are governed by the law applicable to the settlement system.
§ 8. Netting
(1) In order to satisfy financial claims between the participants in a settlement system, bilateral or multilateral netting of claims may be used pursuant to the procedure and in the cases determined by the system rules.
(2) Upon netting of claims, the net claims and obligations calculated pursuant to the system rules replace the earlier claims and obligations that served as a basis for the settlement thereof and the replacement made is deemed valid in respect of both the participants in the system and other persons.
§ 9. Collateral security
For the purposes of this Act, collateral security means all realisable assets provided under an agreement on pledge of proprietary rights, an agreement on sale thereof with the right of repurchase or another similar agreement, including as a financial collateral provided for in § 3141 of the Law of Property Act, or otherwise, for the purpose of securing rights and obligations arising from participation in a settlement system, or provided to Eesti Pank, to a central bank of another EEA country or to the European Central Bank in connection with these duties and operations.
§ 10. Transfer order
For the purposes of this Act, transfer order means an instruction by a participant in the system to:
1) place at the disposal of a recipient an amount of money by means of an entry on a settlement account of a credit institution, a central bank, a central counterparty or a settlement agent, or another instruction which results in the assumption or discharge of a payment obligation in accordance with the settlement system rules;
2) discharge an obligation arisen from a securities transaction or transfer the title to, or interest in, a security by means of an entry on a corresponding register.
§ 11. Settlement account
For the purposes of this Act, settlement account means an account at Eesti Pank, a central bank of an EEA country, the European Central Bank or a settlement agent or a central counterparty used to hold funds or securities and to settle claims and obligations arising from transfer orders between participants in a settlement system.
§ 12. Settlement date
For the purposes of this Act, settlement date means a period of time which covers the day and night-time settlements of a settlement system or linked system and encompasses all activities and events happening during the business cycle of the settlement system.
Chapter 2 Recognition of Payment System as Settlement System and Operation of Settlement System
Subchapter 1 Recognition of Payment System as Settlement System and Notification Thereof
§ 13. Recognition of payment system as settlement system
(1) The person organising the provision of services of a payment system (hereinafter payment system operator) who requests that the payment system be recognised as a settlement system submits the following information and documents to Eesti Pank:
1) an application for submitting the notification specified in subsection 1 of § 14 of this Act;
2) a copy of the articles of association or memorandum of association of the payment system operator;
3) information on the members of the management board and supervisory board of the payment system operator, including, for each person, the given name and surname, personal identification code or, in the absence thereof, date of birth, residence, educational background, a complete list of places of employment and positions and, for the members of the management board, a description of their area of responsibility;
4) rules and settlement procedure of the payment system, documentation on the economic, technical and legal principles of operation of the payment system, and sample contracts necessary for participating in the payment system or for using its services;
5) the business name, address of the seat and contact details of each known participant or indirect participant and, where necessary, information about the authorisation granted to the participant;
6) other documents that Eesti Pank considers necessary upon recognising a payment system as a settlement system.
(2) Eesti Pank assesses the principles of operation of the payment system and the rules organising its operation in order to identify whether the payment system is in compliance with the requirements established for a settlement system.
(3) A decision to submit or refuse to submit the notification specified in subsection 1 of § 14 of this Act is made by Eesti Pank within six months of obtaining all the necessary and proper information and documents.
(4) Eesti Pank may decide not to recognise a payment system as a settlement system and refuse to submit the notification specified in subsection 1 of § 14 of this Act if:
1) the payment system operator has not submitted all the required information and documents within three months of the submission of the application;
2) the rules organising the operation of the payment system are not in compliance with the requirements established for the system rules by this Act and the deficiencies have not been eliminated within a reasonable period of time of the submission of the application;
3) the recognition of the payment system as a settlement system is not warranted on grounds of systemic risk;
4) based on the information and documents submitted on the basis of subsection 1 of this section, it may be concluded that the reliable, secure and efficient operation of the payment system is not sufficiently ensured;
5) submission of the requested notification is within the competence of an institution or person of another country;
6) there is another good reason.
(5) Eesti Pank may recognise a payment system as a settlement system if the participants have chosen that the law applicable to the rights and obligations arising from the settlement system is Estonian law and Eesti Pank is of the opinion that no circumstances serving as a basis for refusing recognition exist.
(6) Eesti Pank may also recognise a payment system as a settlement system regardless of the application for recognition specified in subsection 1 of this section if Eesti Pank is of the opinion that recognition of such a payment system as a settlement system is warranted on grounds of systemic risk. In such an event, Eesti Pank consults the payment system operator concerned before submitting the notification specified in subsection 1 of § 14 of this Act.
(7) Recognition of a payment system as a settlement system is warranted on grounds of systemic risk, above all, if the failure to discharge the obligations of a participant therein or the operator thereof may affect the discharge of the obligations of other participants or the operator and, therethrough, the transfer of systemic risk may directly have an adverse impact on the stability and reliability of the financial system.
(8) The recognition provided for in this section does not apply to a payment system operated by Eesti Pank or to a securities settlement system.
(9) The central securities depository notifies the Financial Supervision Authority of the securities settlement system governed by Estonian law. The settlement system rules are added to the notification.
§ 14. Notification of settlement system
(1) After recognising a payment system as a settlement system, Eesti Pank gives a corresponding notification to the European Securities and Markets Authority. Eesti Pank also submits the aforementioned notification about the settlement system operated by it.
(2) The Financial Supervision Authority maintains a list of the securities settlement systems, which are governed by Estonian law, and submits a notification about each settlement system entered on the list to the European Securities and Markets Authority.
(3) If Eesti Pank is of the opinion that a settlement system about which it has submitted a notification to the European Securities and Markets Authority is not in compliance with the requirements for recognition of a payment system as a settlement system as provided for in this Act and the non-compliance is not temporary, Eesti Pank will submit an application to the European Securities and Markets Authority for deleting the settlement system from the list.
Subchapter 2 Requirements for Settlement System Rules and Obligations of System Operator
§ 15. System rules
(1) The operation of a settlement system, including the issue and execution of transfer orders, is regulated by system rules.
(2) The system rules must include at least the following information:
1) a description of the settlement services offered;
2) the terms and conditions of becoming a participant in the system, the procedure for granting, suspending and terminating the status of a participant in the system, and obligations and responsibility of a participant in the system;
3) a description of the settlement facilities used to execute transfer orders;
4) the procedure for discharging the claims and obligations which have arisen on the basis of transfer orders, including the schedule for processing transfer orders and the procedure for executing transfer orders in the event that the operation of the settlement system is disturbed due to a technical failure and a failure by a participant in the system to discharge their obligations;
5) the methods of ensuring the execution of transfer orders, and the procedure for establishing and using collateral instruments;
6) the conditions of and procedure for ensuring the discharge of obligations arising from participation in the system;
7) the procedure for amending and contesting the settlement system rules;
8) the terms and conditions determining the finality of settlements;
9) the terms and conditions that must be met in order for a participant in the system to be allowed to intermediate the services of the system to third parties;
10) the law applicable to the system rules.
§ 16. Obligations of system operator
(1) A system operator implements legal, technical and organisational measures to ensure the security of settlement services as well as the resilience and reliable operation of a settlement system in accordance with this Act and other legislation, including European Union legislation as well as the international practices of operating settlement systems.
(2) A system operator implements system rules, internal rules regulating the operation of a settlement system and other appropriate procedures in order to manage the economic, technical and legal risks arising from a participant or the system operator. Such internal rules and procedures must be clear and transparent and cover at least the management and control system of the system operator in order to identify, realise and manage the risks related to the operation of the settlement system and ensure the continuous operation of the settlement system.
(3) The funds and processes used in operating a settlement system must ensure that transfer orders are executed in accordance with the system rules.
(4) A system operator will, within the scope and pursuant to the procedure prescribed by the system rules:
1) keep account of the claims and obligations to be discharged through the system on the basis of transfer orders;
2) organise and ensure the execution, including netting, of the mutual claims and obligations of the participants in the system that have arisen on the basis of transfer orders;
3) enter into contracts with operators of other settlement systems in order to organise settlements related to the execution of transfer orders;
4) hold settlement accounts of members of the system in order to organise settlements;
5) establish and dispose of funds of collateral instruments in order to ensure the execution of the claims and obligations of the participants in the system that are subject to execution through the settlement system and manage the risks related to the operation of the settlement system;
6) provide other services and perform transactions and operations in connection with ensuring the settlement or execution of transfer orders;
7) implement adequate internal control measures to manage risks related to the operation of the settlement system.
(5) A system operator notifies Eesti Pank within three working days of:
1) the business name, address of the seat and contact details of each participant and indirect participant in the system, as of the day the participant joins the system, as well as of any changes made in the aforementioned information, including concerning the participants in the system, as of learning of such a change;
2) amendments to the settlement system rules and to contracts entered into with participants in the system, as of the day such an amendment is made;
3) a decision to suspend or wind up the operation of a settlement system, as of the day such a decision is made;
4) participation in a settlement system governed by foreign law, as of the day an agreement on joining such a settlement system is entered into.
(6) The provisions of § 15 and this section of this Act do not apply to the securities settlement system specified in subsection 2 of § 3. Regardless of the provisions of the previous sentence, an operator of a securities settlement system is required to provide Eesti Pank, at the request of the latter, with the information specified in subsection 5 of this section.
Subchapter 3 Access to Payment and Settlement System and Settlement Services
§ 17. Access to payment and settlement system and settlement services
(1) If a person has a legitimate interest and a corresponding information request is received from the person, a participant in the system will provide information about its participation in the settlement system as well as about the rules and operation principles of the system.
(2) A payment system operator must grant a payment service provider the right to access the system, establishing to this end terms and conditions for joining the payment system (hereinafter also payment system rules), which must be objective and proportionate in respect of those joining the system and ensure equal treatment.
(3) Access to a payment system may only be restricted by the payment system rules on the basis of particular risks, above all in order to prevent a risk related to the settlement service, operational risk and business risk, and ensure financial stability, security and stable operation of the payment system.
(4) The following may not be established on payment service providers, clients of a payment service provider or other payment systems by the payment system rules:
1) restrictions that hinder participation in other payment systems;
2) terms and conditions that treat payment service providers unequally in respect of the rights and obligations thereof as participants in the payment system;
3) restrictions that are based on the institutional form of the participants in the payment system.
(5) If a participant in a system enables a payment service provider other than a participant to pass transfer orders through the settlement system, it must also enable, in accordance with the provisions of subsections 2 and 3 of this section, other payment service providers to do the same. A participant in the system must justify refusing the request for access to a payment service provider who requests access and to another person who wants to participate in the system.
(6) Subsections 2–4 of this section do not apply to:
1) settlement systems;
2) payment systems composed exclusively of payment service providers belonging to a group composed, in turn, of entities linked by capital where one of the linked entities enjoys effective control over the other linked entities;
3) payment systems operated by Eesti Pank, a central bank of an EEA country or the European Central Bank.
Chapter 3 Settlement Finality, Protection of Collateral Securities and Notification of Insolvency
§ 18. Entry of transfer orders into settlement system, irrevocability of transfer orders and legal consequence thereof
(1) The terms and conditions for entering transfer orders into a settlement system and for irrevocability of transfer orders are determined by relevant system rules.
(2) The system rules must determine the moments when a transfer order is deemed entered and irrevocable.
(3) A transfer order may not be revoked or amended by a participant in the system or a third party after the transfer order has become irrevocable. Operations performed after irrevocability for the purpose of amending or cancelling a transfer order are void.
(4) In the case of a linked system, the system rules of each operator participating therein must determine entry of a transfer order into the settlement system and irrevocability of a transfer order in a manner that is, to the greatest extent possible, in accordance with the rules of all the linked settlement systems and that enables to define the moments when a transfer order is deemed entered and irrevocable.
(5) A rule of one settlement system for deeming a transfer order entered or for irrevocability of a transfer order does not affect any rule of any other settlement system in the same linked system unless otherwise provided for in the rules of all the settlement systems participating in the linked system.
§ 19. Execution of transfer orders upon opening of insolvency proceedings against participant in system or linked system and notification obligation
(1) If bankruptcy proceedings are opened against a participant in a system or linked system or a moratorium is established on a participant in a system or linked system who is a credit institution, the operator of the system or linked system will immediately suspend the receipt of transfer orders from such participant pursuant to the procedure provided for in the settlement system or linked system rules.
(2) Transfer orders are executed and netting is performed and they are also legally binding on third parties if insolvency proceedings have been opened against a participant in a system, provided that the relevant transfer orders have been entered into the settlement system pursuant to the settlement system rules before opening of the insolvency proceedings. This subsection also applies, upon opening of insolvency proceedings, to a participant in a linked system and to a linked system operator who is not a participant in a system.
(3) Obligations assumed by participating in a settlement system or linked system before opening of insolvency proceedings may be discharged on the account of the collateral securities provided by the participant in the system or linked system or on the account of the collateral instruments of the settlement system or linked system.
(4) Where transfer orders are received after the moment of opening of insolvency proceedings against a participant in the system or linked system or against a linked system operator and are executed in accordance with the settlement system rules within the same settlement date during which the opening of the insolvency proceedings occurs, they will be legally binding on third parties if the system or linked system operator proves that it was neither aware, nor should have been aware, of the opening of the insolvency proceedings.
(5) In the event of bankruptcy of a participant in a system or linked system, the assets that have transferred out of the ownership of the participant as a result of executing a transfer order as specified in subsections 2 and 4 of this section are not included in the bankruptcy estate of the participant.
(6) In the event of bankruptcy of a participant in a system or linked system, the payments made by the participant to the fund of the collateral instruments of the settlement system or linked system pursuant to the system or linked system rules are not included in the bankruptcy estate of the participant to the extent of the amount which is necessary for executing the transfer orders entered by the participant before opening of the bankruptcy proceedings.
(7) Recovery of a transfer order in bankruptcy proceedings does not result in invalidity of netting, including multilateral netting, performed pursuant to the settlement system rules.
(8) A participant in a system or linked system immediately notifies either the system or linked system operator and Eesti Pank of opening of bankruptcy proceedings and declaration of bankruptcy against it or of the establishment of a moratorium on it. The same obligation also rests with an interim trustee in bankruptcy, trustee in bankruptcy and moratorium administrator with respect to a participant.
(9) Eesti Pank immediately notifies the European Systemic Risk Board, the European Securities and Markets Authority, the system operator and competent authorities of other EEA countries of insolvency proceedings of a participant in the system or linked system if the participant has its head office in Estonia. If information about the insolvency proceedings of a participant is communicated to Eesti Pank by a competent authority of the EEA country where the participant has its head office, Eesti Pank will notify the system operator concerned of the insolvency proceedings against this participant.
(10) A competent authority is deemed to be the institution of an EEA country which is authorised or required to communicate the information provided for in this Act or in other legislation about insolvency proceedings of a participant or a system operator as well as a person or an institution which is competent to exercise oversight of a payment or settlement system.
(11) A person who participates in a payment system of a third country and against whom insolvency proceedings have been opened on the basis of Estonian law, or an interim trustee in bankruptcy, trustee in bankruptcy or moratorium administrator submits, after opening of the insolvency proceedings, a request for applying the provisions of subsections 2–7 of this section and the provisions of § 22 to the transfer orders of the aforementioned person and to the collateral securities provided for the execution thereof if the requirements applicable to such a payment system are equivalent to a substantial part to the requirements of Directive 98/26/EC of the European Parliament and of the Council.
§ 20. Execution of transfer orders upon opening of bankruptcy proceedings against system or linked system operator and notification obligation
(1) If bankruptcy proceedings have been opened against a system or linked system operator, it will immediately suspend the receipt of transfer orders.
(2) If bankruptcy proceedings have been opened against a system or linked system operator, all transfer orders issued to it before opening of bankruptcy proceedings will be subject to execution.
(3) In the event of bankruptcy of a system or linked system operator, the assets delivered to it by a participant in the system or linked system, including by an operator of another settlement system, for executing or securing the execution of transfer orders are not included in the bankruptcy estate of the system or linked system operator.
(4) A system or linked system operator immediately notifies the Financial Supervision Authority and Eesti Pank of opening of bankruptcy proceedings or declaration of bankruptcy against them. The same obligation also rests with an interim trustee in bankruptcy and trustee in bankruptcy with respect to a system or linked system operator.
(5) Eesti Pank immediately notifies the European Systemic Risk Board, the European Securities and Markets Authority and competent authorities of other EEA countries of bankruptcy proceedings of a system or linked system operator.
§ 21. Collateral instruments of settlement system
(1) If a system operator has the obligation to organise the discharge of obligations related to participation in a settlement system, the system operator must establish a fund of collateral instruments or implement other relevant measures which ensure that the discharge of the obligations related to participation in the system is sufficiently secured to the extent provided for in the system rules.
(2) A fund of collateral instruments may comprise any realisable assets, including a financial collateral provided for in § 3141 of the Law of Property Act.
§ 22. Protection of collateral securities
(1) Insolvency proceedings do not affect the rights of a system operator, participant in the system, Eesti Pank, central bank of an EEA country or the European Central Bank to the collateral security provided in connection with a settlement system or any linked system or in connection with the discharge of duties falling within the competence of Eesti Pank, a central bank of an EEA country or the European Central Bank. Such collateral security may be realised in accordance with an agreement that served as a basis for providing the collateral security.
(2) The provisions of subsection 1 of this section apply upon opening of insolvency proceedings against:
1) a participant in the system or linked system concerned;
2) the system operator which participates in a linked system and is not a participant;
3) a counterparty to Eesti Pank, a central bank of an EEA country or the European Central Bank;
4) another person who provided the collateral security.
(3) Where a system operator has provided collateral security to another system operator in a linked system, the rights of the providing system operator to that collateral security will not be affected by opening of insolvency proceedings against the receiving system operator.
(4) Where a registered security or a right to such a security is provided as collateral security and the collateral security has been entered into a corresponding register, account or central securities depository system maintained in an EEA country, the collateral security and the rights of the recipient of the collateral security, including the person safekeeping the collateral security for the recipient, will be governed by the law of the EEA country where such a register, account or system is maintained.
Chapter 4 Oversight
§ 23. Duties of Eesti Pank in exercising oversight of payment and settlement systems
(1) Eesti Pank exercises oversight of payment and settlement systems (hereinafter jointly in this Chapter systems) pursuant to the procedure provided for in this Chapter.
(2) As the overseer, Eesti Pank:
1) collects information about the participation of persons offering payment services in Estonia in the systems, including the systems governed by the law of another EEA country or of a third country;
2) analyses the structure, operation and risks of the systems;
3) may give instructions and recommendations for improving the structure of the systems, for more efficient organisation of the transmission and receipt of transfer orders, for reducing risks and for ensuring the continuous operation of payment services;
4) gives assessments of the rules and principles of the systems.
(3) Eesti Pank may establish more detailed terms and conditions of and procedure for exercising oversight of systems, including a list of the information to be submitted about the systems, and the periodicity and form of transmission thereof.
(4) An overview of the principles serving as a basis for oversight is published by Eesti Pank on its website.
§ 24. Cooperation of Eesti Pank with Financial Supervision Authority in organising oversight
(1) In exercising supervision, Eesti Pank cooperates with the Financial Supervision Authority. Eesti Pank has the right to transmit to the Financial Supervision Authority the information, documents and other data collected for the purpose of recognising a payment system as a settlement system and for exercising oversight of systems.
(2) To improve the discharge of the duty to exercise oversight, Eesti Pank may enter into a cooperation agreement with the Financial Supervision Authority in which the parties agree on the terms and conditions of exchange of information necessary for discharging the duty to exercise oversight, the division of duties of the parties and other important terms and conditions related to the discharge.
(3) Eesti Pank notifies the Financial Supervision Authority of deviations from the regular or lawful operation of the systems or of a failure of their resilience if Eesti Pank is of the opinion that the deviation or failure is not temporary and if it may harm reliable and efficient operation or if the systemic risks may also transfer to other financial market infrastructure or significantly increase the risks that the operation of the systems entail to participants established in Estonia.
(4) Eesti Pank may make a proposal to the Financial Supervision Authority for managing the risks related to the participation in the systems in the following cases:
1) the settlement system in which a payment service provider established in Estonia or a branch of a foreign payment service provider in Estonia participates is not in compliance with the requirements of this Act or of other legislation or of legislation issued on the basis thereof or with internationally accepted practices;
2) based on the documents and information submitted to Eesti Pank, a position may be adopted that the reliable and efficient operation of a payment or settlement system is not sufficiently ensured;
3) due to the payment or settlement system operator or a participant in such a system, the oversight of the payment or settlement system is not sufficiently ensured.
§ 25. Rights in providing and obtaining information
(1) Eesti Pank has the right to transmit the information, documents and other data collected for discharging an obligation or another duty of Eesti Pank provided for in this Act or in other legislation or in legislation issued on the basis thereof to a competent authority of another EEA country as well as to another person or institution if this arises from legislation.
(2) In order to recognise a payment system as a settlement system on the basis of this Act and exercise oversight of systems, Eesti Pank has the right to obtain information, documents and explanations from the operator of the systems, a participant in the systems, government authorities, supervisory bodies and state and local government databases free of charge.
Chapter 5 Amendment of Acts
§ 26. – § 36. [Provisions amending other Acts have been omitted from the translation.]
§ 37. Entry into force of Act
(1) This Act enters into force pursuant to the general procedure.
(2) Clause 1 of § 35 and clause 2 of § 36 of this Act enter into force on 30 April 2023.
1 Directive 98/26/EC of the European Parliament and of the Council on settlement finality in payment and securities settlement systems (OJ L 166, 11.6.1998, p. 45–50), as amended by Directives 2009/44/EC (OJ L 146, 10.6.2009, p. 37–43) and 2010/78/EU (OJ L 331, 15.12.2010, p. 120–161), Regulations (EU) No 648/2012 (OJ L 201, 27.7.2012, p. 1–59) and (EU) No 909/2014 (OJ L 257, 28.8.2014, p. 1–72) and Directive (EU) 2019/879 (OJ L 150, 7.6.2019, p. 296–344).
Jüri Ratas
President of the Riigikogu
Facebook
Twitter