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RegTech and compliance management
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RegTech is composed of the words “regulatory” and “technology”. It is a collective term for the application of modern technologies, to get the increasing regulation in the banking- and financial sector under control both from an IT and a legal standpoint.
Introduction
Attitude of the country towards RegTech-services
The Romanian banking market is rather well-developed, and RegTech-services providers may encounter competition hindrances for entrance on the market. It should be noted that the Financial Supervisory Authority of Romania (the “FSA”) supports the development of the RegTech industry, according to its 2021-2023 strategy.
Legal affairs
Obligations and requirements to provide RegTech-services
Although there is no specific license or specific regulation for RegTech-services or companies under Romanian law, other licensing or compliance requirements may be applicable, depending on the category of services performed. Thus, the performance of RegTech-services may overlap legal areas such as personal data protection, digital signatures and identification, financial services (insurance included), electronic communications and e-commerce, consumer protection, anti-money laundering, etc. – which, however, are not specifically designed for RegTech companies (and setting aside common regulatory aspects such as corporate, employment, accounting, tax etc.). From this perspective, RegTech companies would need to consider a wide variety of generally applicable regulations before initiating business in Romania.
In addition, the contracting by credit institutions of RegTech services may be deemed as outsourcing of material activities, thus subject to notification to the National Bank of Romania.
Additional comments regarding the legal situation for RegTech-services or what RegTech’s must be aware of in this business area
N/A.
Economic conditions
Market size for RegTech-services and biggest companies in this business area
We haven’t identified any relevant available data.
Additional comments regarding the economic situation for RegTech-services or what RegTech’s must be aware of in this business area
Under the Romanian current legal framework of financial services, regulated entities are liable for regulatory compliance, including KYC verifications, in a rather tight legal and regulatory environment. Thus, any FinTech searching to provide services to such entities will need to consider rather significant liability aspects in contracting with Romanian regulated entities.