NEW LAW ON CAPITAL MARKET HAS BEEN ADOPTED

Initial consideration

On 23 December 2021, the National Assembly of the Republic of Serbia adopted a new Law on the Capital Market (the „Law“).

The old Law on Capital Market (“Official Gazette of RS”, No. 31/2011, 112/2015, 108/2016, 9/2020 and 153/2020) ceases to be valid on the day of application of the new Law.

The new Law came into force on 5 January 2022.

It shall apply from 5 January 2023, except for certain provisions authorizing the adoption of regulations, general and other acts harmonizing the work and operations of certain entities (which shall apply from the date of entry into force).

Novelties

The provisions of the Law, in relation to the hitherto valid Law on Capital Market, additionally regulate:

• dematerialized securities and operations of persons authorized to perform transactions with financial instruments;
• conditions and forms of organized trading in financial instruments;
• in order to maximize transparency and reduce data fragmentation, the institute of data delivery service providers was introduced;
• Improved investor protection and improved the quality of information received by clients regarding investment services provided to them;
• with regard to technology development and infrastructure market, greater regulatory requirements are introduced, especially in relation to new trading platforms and high-frequency and algorithmic trading;
• the obligations of capital market participants are more precisely regulated in the part related to market abuses;
• In order to strengthen transparency, the reporting obligations of the Securities Commission have been increased and stricter measures and sanctions that can be taken against legal and natural persons participating in the capital market have been prescribed.

The goal of adopting the new Law

The goal of the Law is to introduce greater transparency and responsibility in business, creation and development of financial institutions offered on the capital market, and thus to create a more attractive market for both domestic and foreign investors. It was adopted in accordance with the Government Strategy for Capital Market Development for the period from 2021 to 2026, and the Action Plan for the implementation of this strategy.