Finanstilsynet and EEA legislation
Published: 30 October 2020
Last updated: 10 March 2022
Information on supervisory cooperation in the EEA.
The 31 EEA countries have a coordinated system of financial supervision consisting of the national financial supervisory authorities and the following four EU authorities:
- EBA – European Banking Authority
- ESMA – European Securities and Markets Authority
- EIOPA – European Insurance and Occupational Pensions Authority
- ESRB – European Systemic Risk Board (macroprudential supervision)
In Norway, as in many other countries in the EEA, the national financial supervisory authority has the main responsibility for supervising financial institutions and markets. EBA, ESMA, EIOPA (the ESAs) and the ESRB are supranational EU authorities established after the financial crisis that are mandated to improve supervisory cooperation across national borders.
EBA, ESMA and EIOPA's Boards of Supervisors are composed of the heads of the national competent authorities (NCAs) in all EEA countries. In addition, each of the ESAs has sub-committees and project groups. Finanstilsynet is a member of both the Boards of Supervisors, sub-committees and several project groups in each of the three ESAs. We have the same rights and obligations as the EU states' NCAs, apart from voting rights. The ESAs cannot make binding decisions addressed to Finanstilsynet or Norwegian institutions.
The ESAs have both supervisory and regulatory tasks complementing the NCAs in Europe.
Supervisory cooperation in the EEA
An important task for the ESAs is to monitor and manage risks that may threaten financial stability in the EEA. This is done in cooperation with the NCAs. Another important task is to help the NCAs establish effective supervisory practices and to facilitate the work of supervisory colleges that supervise large cross-border groups.
In order to promote sound and harmonised supervisory practices in the EEA, the ESAs work out recommendations and guidelines that apply to the NCAs or to the industry. They also administer peer reviews across NCAs.
Regulatory development in the EEA
Through the EEA Agreement, the Norwegian financial industry and Norwegian consumers have access to the European single market for financial services. In order for such a single market to function well, efforts are made to ensure equal competitive conditions and harmonised consumer protection rules throughout the EEA, including provisions on sound financial institutions, good market behaviour and strong consumer protection.
The EEA Agreement regulates how EU rules become binding in Norway. Norway is not involved in the EU's decision-making process when new rules are adopted, but the Norwegian authorities are entitled to participate in the preparatory phase. When new legislation has been adopted in the EU, an assessed is made of whether it is covered by the EEA Agreement. If so, it is included in the EEA Agreement and transposed into Norwegian law. If major adaptations to EU legislation are required before incorporation into the EEA Agreement, there will be negotiations between the EU side and the EFTA side.
The ESAs, EBA, ESMA and EIOPA, assist the European Commission in developing draft legislation for the financial area. They can either advise the Commission or prepare a complete draft technical standard which can later be adopted by the Commission as binding legislation. The ESAs may also issue recommendations/guidelines on how the legislation is to be understood or supervisory practices conducted. Finanstilsynet participates in the regulatory work of the ESAs. This gives it an opportunity to identify Norwegian interests at an early stage, participate in the legislative process and gain insight into the purpose and content of future legislation that will later be implemented and enforced in Norway.