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How to keep on top of laws and regulations relevant to your organisation
Date:December 14, 2021
To provide financial services and products in the Netherlands, you must obtain a licence under the Financial Supervision Act from the Dutch Authority for the Financial Markets (AFM) or the Dutch Central Bank (DNB). If the regulator grants you a licence, you are expected to comply with all applicable laws and regulations. Even when laws change and become more complex, you must respond in a timely manner and adjust your business operations accordingly. A failure to meet your obligations may result in the regulator imposing a fine, for example, or even revoking your licence.
How do you ensure that your organisation continues to satisfy the conditions of your licence? Below, we show how to keep on top of all the relevant laws and regulations in five simple steps.
1. Determine the applicable laws and regulations
Carefully research the current requirements applying to your licence. For example, do you have a licence for the provision of investment services? In that case, conditions regarding the control structure, equity capital and the propriety of policymakers apply. The applicable laws and regulations depend on the service that is provided or the product that is offered. The underlying requirements are set out in the Financial Supervision Act (abbreviated as Wft in Dutch), the Anti-Money Laundering and Anti-Terrorist Financing Act (Wwft), the Sanctions Act and elsewhere. It is also important to be aware of relevant European regulations and guidelines from European regulators.
2. Identify the implications for your organisation
Create an overview of your organisation’s activities, services and products. Based on your determination in step 1, you can then identify the implications for your organisation and establish a legal framework: an overview of the laws and regulations that apply to your activities, services or products. Tip: Ensure the framework is succinct and clear by sorting the applicable rules into themes.
3. Conduct a gap analysis
For each theme, ascertain whether your organisation’s current policies and procedures comply with the relevant laws and regulations, as identified in the legal framework established in step 2. An investment firm, for example, must have a proper policy to prevent conflicts of interest and should comply with Know Your Client (KYC) guidelines. A gap analysis will clarify whether your organisation satisfies all applicable requirements.
4. Ensure you are fully compliant
Have you identified any gaps in step 3? If, for example, you are an investment firm, have sufficient measures been taken in relation to your legal duty of care towards your clients? You must address any shortcomings by taking concrete actions to become fully compliant. In this specific case, you need to draw up and implement procedures to obtain a good understanding of your clients. This will also provide you with carefully established documentation.
5. Aim for awareness
Build support for your policies and procedures by increasing employee awareness. Clarify why the measures are important. You can use training courses and workshops to raise awareness within your organisation about the importance of certain regulations.
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