Regulations in the financial services sector have been evolving rapidly in recent years, and the adoption of new rules in this area within the European Union is a continuous process. In the context of European integration, the Union encourages Serbia to monitor developments in EU regulation and to gradually align its regulatory framework with the EU acquis. Accordingly, through the PLAC IV project, as one of the forms of EU technical assistance, support was provided to the Securities Commission in preparing secondary legislation important for the supervision of investment firms.
As the final step in this cooperation, a workshop entitled “Overview of delivered SEC regulations/guidelines aimed at ensuring the full implementation of the Capital Market Law”, was held on 11 March 2026 in the premises of the Securities Commission, bringing together the management and professional staff of the Commission and representatives of the Ministry of Finance. On this occasion, the results of the support provided by PLAC IV to the Commission in the area of supervision of investment firms (under Negotiating Chapter 9 – Financial Services) were presented, with a focus on the further alignment of the national regulatory framework with EU rules.
SUPPORT TO THE SECURITIES COMMISSION IN ALIGNING WITH EU RULES
Through the expert support provided by the PLAC IV project to the Securities Commission, drafts of 11 secondary legislative acts were prepared, relating to the conduct of business of investment firms, prudential supervision, the capital of market operators, accepted market practices, and equivalence decisions. These include draft acts governing the retention of communications with clients, client categorisation, the use of services of another investment firm, tied agents, prudential supervision, and the calculation of the capital of investment firms.
The results of the project’s work were presented by Petar-Pierre Matek, an expert in capital markets regulation engaged under the PLAC IV project, who also discussed with the workshop participants from the Commission the practical challenges involved in applying the new solutions.
IFD (Investment Firms Directive) EU rules on how investment firms are supervised.
IFR (Investment Firms Regulation) EU rules on the amount of capital investment firms must hold and the financial requirements they must meet.
NEW EU FRAMEWORK FOR THE SUPERVISION OF INVESTMENT FIRMS
IFR (Investment Firms Regulation) EU rules on the amount of capital investment firms must hold and the financial requirements they must meet.
One of the important messages conveyed during the workshop held at the Securities Commission was that, in the meantime, the EU has developed a specific prudential framework for investment firms, based on the understanding that investment firms are not banks and therefore require a different regulatory approach. While the banking framework may still apply to large investment firms, most investment firms in the EU are now subject to the IFD/IFR regime, which introduces more precise rules on capital, liquidity, risk management and reporting.
A particularly important novelty within this framework is the introduction of the so-called K-factors, i.e. a new model for calculating capital requirements. Under this approach, capital no longer depends solely on the size of the firm, but also on the risks arising from the activities carried out by the investment firm—towards the client, the market and the firm itself. It is precisely here that the need for further alignment of domestic legislation becomes apparent, since the current Capital Market Law still views capital requirements through the aggregate of market, credit and operational risk, without applying K-factors, without full preventive supervision, and without the concept of a group of investment firms.
TRANSFER OF PRACTICAL EXPERIENCE AND STRENGTHENING OF THE SECURITIES COMMISSION’S CAPACITIES
During the work on these secondary legislative acts, Petar-Pierre Matek also held several practical working sessions with colleagues from the Commission, sharing experience from EU Member States, including concrete examples from Croatia. In this way, the support was not limited only to drafting the text of the rulebooks, but also extended to strengthening the Commission’s capacity for their future practical implementation.
“The adoption of a new set of rulebooks in the area of supervision of investment firms represents an important step in the further alignment of Serbia’s regulatory framework with European Union standards. Part of these rulebooks provides additional elaboration and completion of requirements stemming from the MiFID II framework. At the same time, the most significant set of rulebooks represents an important preparatory step toward the future introduction of the prudential regime established under the Investment Firms Regulation (IFR) and the Investment Firms Directive (IFD). Their implementation in Serbia will require prior amendments to the Capital Market Law (ZTK), but they already lay the foundations for the gradual alignment of the domestic capital market with modern European prudential standards,“ highlighted Mr Matek.
Support provided by the PLAC IV project in this area contributes to the modernisation of capital-market supervision, stronger investor protection and greater stability of the financial system. At the same time, it represents another concrete step in fulfilling Serbia’s obligations in the process of accession to the European Union under Chapter 9 – Financial Services.
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