Resolution of the Polish Financial Supervision Authority on the evaluation of the reliability of managing persons and shareholders of the Polish supervised entities which have connections with Russia and Belarus

The Financial Supervision Authority published a resolution adopted on April 14, 2022, regarding circumstances relevant to the assessment of guarantee in financial market cases in connection with the aggression of the Russian Federation against Ukraine. The supervisory authority indicates that it will treat any links of the licensed entity, its significant shareholders, and its managers with the Russian Federation or the Republic of Belarus as a material doubt that the licensed entity’s activities will be conducted in a proper manner, which may affect the denial or revocation of the license.

Guarantee of proper conduct of business

Financial service providers in Poland, such as banks, national payment institutions, national electronic money institutions, small payment institutions, SKOK, investment firms, including brokerage houses, or payment services bureaus are evaluated, among others, in terms of their guarantee of current and prospective stability before and during their operation on the financial market. In particular, the Polish Financial Supervision Authority evaluates the board members of such institutions and shareholders who exert a key influence on the activities of such institutions.

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Relations with Russia and Belarus

The Financial Supervision Authority stressed that since the Russian Federation and the Republic of Belarus have been recognized as countries that act against the fundamental principles of the rule of law, human rights, democratic values, and the principles of international law, entities, and persons coming from these countries cannot be treated as reliable and trustworthy.

The Financial Supervision Authority resolved that any affiliation of the licensed entity, its significant shareholders, and persons managing it with the Russian Federation or the Republic of Belarus, in the form of origin (citizenship) from those countries, the concentration of its social, professional, or business activity in those countries or close personal or business ties with entities concentrating their activity there, is and will be treated by the Financial Supervision Authority as a significant doubt that the activity of the licensed entity will be conducted in a correct manner – law-abiding, honest, transparent, prudent and stable. As a result, it is highly probable that in license or authorization proceedings, in which the assurance of proper conduct of business is a requirement for admission to and functioning on the financial services market or managing an entity operating on that market, this requirement will be deemed not fulfilled in the case of entities with such connections.

The KNF’s resolution is available at the link below:

https://www.knf.gov.pl/knf/pl/komponenty/img/Uchwa%C5%82a_111_2022_77789.pdf

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