On 30 January 2024, the Amendment Decree Financial Markets 2023 (Wijzigingsbesluit financiële markten 2023) (the 2023 Decree) was published in the Dutch Government Gazette.
The 2023 Decree contains changes to legislation relevant to the Dutch financial markets, including, but not limited to the Decree on Conduct of Business Supervision of Financial Undertakings AFS (Besluit Gedragstoezicht financiële ondernemingen Wft, BGfo) and the Decree on Prudential Rules for Financial Undertakings AFS (Besluit prudentiële regels Wft, Bpr). The 2023 Decree is part of an annual cycle of changes to legislation relevant to the Dutch financial markets.
The most notable changes proposed in the 2023 Decree include amendments to the:
- inducement ban for insurance intermediaries and advisors; and
- intra-group outsourcing rules for banks, payment institutions and electronic money institutions (EMIs).
Inducement ban for insurance intermediaries and advisors
The 2023 Decree amends the inducement rules for insurance intermediaries and advisors and introduces the concept of “active inducement transparency”. Insurance intermediaries and advisors will be required to proactively inform consumers about the amount of inducements they will receive from insurers before the end of the provision of the service. The intention is to ensure consumers can assess the value of the services relative to the premiums charged and aims to encourage consumers to inquire about the services they are entitled to and to facilitate comparisons of costs.
Previously, consumers had to request information about inducements, but now intermediaries and advisors must actively disclose this information. Recognizing the challenge of determining the exact inducement amount beforehand, intermediaries are mandated to provide an accurate indication or a “fine-grained average” based on similar products.
The inducement rules will only apply to insurance agreements concluded after 1 July 2024.
Intra-group outsourcing for banks, payment institutions and EMIs
To align the Dutch legal framework on outsourcing with the relevant European legislation and the guidelines on outsourcing issued by the European Banking Authority (EBA), the Bpr is amended. Currently, the rules on outsourcing for banks, payment institutions and EMIs do not apply when such financial institution outsources activities to a company within the same group (intra-group outsourcing). However, according to the EBA guidelines, the risks associated with intra-group outsourcing by banks, payment institutions and EMIs are not necessarily smaller. The 2023 Decree amends this exception to reflect that financial institutions do need to consider intra-group outsourcing in their outsourcing policies and procedures. For payment institutions and EMIs, the rules on outsourcing only apply if “important activities” are outsourced.
The amendments in the 2023 Decree will be effective as of 1 July 2024.