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Ministry of Industries and Innovation

Financial Services and Markets - Act No. 99/1999 on the Payment of Costs for Public Supervision of Financial Activities

Article 1
General provisions

Parties subject to supervision as provided for in Article 5 shall pay the cost of operating the Financial Supervisory Authority in accordance with the provisions of this Act.
The supervision fee provided for in this Act shall accrue directly to the operations of the Financial Supervisory Authority and shall be collected by the Authority.

Article 2
Report on the levying of next year's fee

The Financial Supervisory Authority shall, no later than 15 September each year, submit a report to the Minister of Commerce on the estimated operational cost for the coming year. The report shall, furthermore, assess the development of its operations during the past three years, having regard for the time which can be estimated to have been spent on the different classes of parties subject to supervision in accordance with Article 5
The report of the Financial Supervisory Authority shall be accompanied by an opinion from the consultation committee of parties subject to supervision concerning the estimated scope of operations for the coming year together with the reaction of the Board of the Authority to this opinion. In order for the consultation committee to be able to give its opinion, the Financial Supervisory Authority must, no later than 15 August each year, provide it with information on the estimated scope of operations together with explanations of the main operating items.
If the conclusion of the report gives reason to change the percentage rate of the supervision fee, the Minister of Commerce shall submit a bill thereupon to the Althingi.

Article 3
Allocation of operating surplus or deficit

If the Financial Supervisory Authority appears likely to have an operating surplus for the current year, when the report for the next year is prepared, this shall be taken into consideration in determining the supervision fee for the following year. If the Financial Supervisory Authority appears likely to have an operating loss for the current year, when the report for the next year is prepared, this shall be taken into consideration in determining the supervision fee for the following year.

Article 4
Basis for assessment

The basis for assessing the supervision fee shall be the annual accounts of parties subject to supervision for the year preceding that in which the report of the Financial Supervisory Authority as provided for in Article 2 is compiled.
If two or more parties subject to supervision merge, their assessment shall be based on their combined annual accounts for the preceding year, as provided for in the first paragraph
If annual accounts are not available due to the fact that a party subject to supervision is beginning the activities subject to supervision, the assessment shall be based on the minimum fee provided for in Article 5. If annual accounts are available for previous activities by the enterprise in question, this may be used as the basis for assessment. The second paragraph of this Article may be applied as appropriate.

Article 5
Parties subject to fees, assessment base and fee levied

The following parties subject to surveillance shall pay a supervision fee derived from their assessment base in the ratios and amounts listed below:
1. Commercial banks, savings banks and credit institutions other than commercial and savings banks, shall pay 0.0145% of their total assets, but never less than ISK 250,000.
2. Insurance companies shall pay 0.28524% of their paid direct insurance pre-miums and 0.03573% of their paid reinsurance premiums received, but never less than ISK 250,000. For life assurances with saving part, however, a supervision fee shall be paid amounting to 0.00779% of the net difference when the portion of reinsurances is deducted from the unearned premiums.
3. A company or individual carrying out insurance brokerage shall pay 0.04581% of the amount of premiums handled in the preceding year, but never less than ISK 150,000.
4. Enterprises in securities services shall pay 0.08031% of their total assets, but never less than ISK 250,000. UCITS shall pay 0.01129% of their total assets, but never less than ISK 250,000. Companies operating UCITS shall pay 0.08031% of their total assets, but never less than ISK 150,000.
5. Stock exchanges and other regulated OTC markets shall pay 0.92353% of their operating income, but never less than ISK 250,000.
6. Pension funds shall pay a total of 0.00779% of their net assets for the payment of pensions. A fixed supervision fee of ISK 150,000 shall be paid for pension funds whose net assets for the payment of pensions are less than ISK one billion, ISK 300,000 for pension funds whose net assets for the payment of pensions are from ISK one to ten billion, and ISK 600,000 for pension funds whose net assets for the payment of pensions are in excess of that. Any amount then remaining to be paid as provided for in the first paragraph shall be paid in proportion to the number of active fund members.
7. Securities centres shall pay 0.92353% of their operating income, but never less than ISK 250,000.
8. The deposit sections of co-operatives and the Iceland Post postal giro division shall pay a fixed fee of ISK 150,000.
9. The New Business Venture Fund shall pay 0.01445% of total assets, but never less than ISK 250,000. The housing bond section of the Housing Loan Fund shall pay 0.00040% of total assets, but never less than ISK 250,000. The Quota Exchange shall pay a fixed fee amounting to ISK 150,000.
10. The Deposit Guarantee Funds of commercial banks and the Deposit Guarantee Fund of savings banks shall pay a fixed fee of ISK 150,000
Branches of foreign parties subject to supervision, which have obtained an operating licence in Iceland, shall pay a surveillance fee as provided for in the applic-able Point of the first paragraph.
Supervision fees shall be calculated to the nearest ISK thousand. For assessment purposes the assessment base shall also be expressed in ISK thousands.

Article 6
Levying of fees and collection

Levying of the supervision fee as provided for by this Act shall take place no later than 15 January each year. The Financial Supervisory Authority shall make the fee levied known to the parties subject to supervision in a letter.
The supervision fee shall be paid at four-month intervals in three equal instalments. It shall be paid as follows: the due date for the first four months shall be 1 February and final date for payment 15 February; the due date for the second four months shall be 1 May and the final date for payment 15 May; and the due date for the final four months shall be 1 September and the final date for payment 15 September.
Should a party subject to supervision commence activities after the fee has been levied as provided for in the first paragraph, it shall be assessed a supervision fee in accordance with the applicable Point of Article 5, cf. also the third paragraph of Article 4, with the assessment based on the next due date following the issuing of its operating licence. The amount of the fee shall take into consideration the period remaining of the operating year, as calculated from the next due date. The fee shall be paid on the remaining due dates. If all the due dates have passed the supervision fee shall not be assessed for the current operating year. If a party subject to supervision ceases its activities before the supervision fee is fully paid, that portion of the fee shall be cancelled which has not yet fallen due when the operating licence is cancelled.
If the fee for supervision is paid after the final date of payment for any instalment, penalty interest shall be calculated on the payment as of the due date as provided for in the Interest Act.
If a party subject to surveillance neglects to pay the supervision fee the Minister granting the operating licence for the activities concerned may revoke the operating licence, provided the Financial Supervisory Authority so proposes and six months have elapsed from the first due date in arrears.
The Financial Supervisory Authority may re-assess the supervision fee for spe-cific parties subject to supervision if the assessment base or other premises for the assess-ment prove to be incorrect.

Article 7
Payment for special actions

If the Financial Supervisory Authority deems that supervision of several parties subject to supervision is considerably more expensive and demands more personnel than the estimates on regular supervision assumed, it shall inform the Board of the Authority of such. The Board of the Financial Supervisory Authority may in such case decide that the concerned party subject to supervision shall pay as invoiced for the necessary extra supervision.
A tariff for supervision as provided for in this Article shall be approved by the Board of the Financial Supervisory Authority and published in the Official Journal of Iceland (Stjórnartíðindi).

Article 8
Appeal

The concerned party subject to supervision may refer a decision on assess-ment, assessment base and calculation of the supervision fee, and a decision on pay-ment for special actions, to an appeal committee subject to the Act on Public Super-vision of Financial Activities.
The time limit for appeal shall be 30 days. An appeal must be made in writing.
In other respects the handling procedure and ruling of the appeal committee shall be as provided for in the Act on Public Supervision of Financial Activities and Regulation issued by virtue of it.

Article 9
Entry into force, etc.

The Minister of Commerce may set detailed provisions for the implementation of this Act in a Regulation.
This Act shall enter into force at once. …

Temporary provisions

Assessment of the supervision fee for the year 1999, cf. Advertisement No. 5 of 6 January 1999, on the levying of a supervision fee on parties subject to the supervision of the Financial Supervisory Authority in 1999, shall be made as follows:
1. Each party covered by the provisions of Point 1 of the first paragraph of Article 5 of this Act shall be assessed 0.019425% of its total assets, as reported in its annual accounts for 1997, but not lower than ISK 150,000.
2. Each party covered by the provisions of Point 2 of the first paragraph of Article 5 of this Act shall be assessed 0.3135% of its paid direct insurance premiums and 0.038% of its paid reinsurance premiums, as these premiums were reported in its an-nual accounts for 1997, but not lower than ISK 150,000. For life assurances with savings part, however, a supervision fee shall be paid amounting to 0.00931% of the net difference remaining after deducting the portion of reinsurances from the un-earned premiums.
3. Each party covered by the provisions of Point 3 of the first paragraph of Article 5 of this Act shall be assessed 0.05035% of the amount of premiums handled in 1997, but not lower than ISK 150,000.
4. Those parties covered by the provisions of Point 4 of the first paragraph of Article 5 of this Act shall be assessed as follows: each enterprise offering securities services shall be assessed 0.1015% of its total assets as they were reported in its an-nual accounts for 1997,UCITS shall be assessed 0.05481% of their total assets as they were reported in the annual counts for 1997,and companies operating UCITS shall be assessed 0.093888% of their total assets, as reported in their annual accounts for 1997, but not lower than ISK 150,000 for each party.
5. Each party covered by the provisions of Point 5 of the first paragraph of Article 5 of this Act shall be assessed 1.85% of its operating income as reported in its annual accounts for 1997.
6. Each pension fund covered by the provisions of Point 6 of the first paragraph of Article 5 of this Act shall be assessed 0.0931% of its net assets for pay-ment of pensions, as they were at year-end 1997. A fixed supervision fee of ISK 150,000 shall be paid for pension funds whose net assets for the payment of pensions at year-end 1997 is less than ISK 1 billion, ISK 300,000 for pension funds whose net assets for the payment of pensions at year-end 1997 were from ISK one to ten billion, and ISK 600,000 for pension funds whose net assets for the payment of pensions at year-end 1997 were in excess of that. Any amount then remaining to be paid as provided for in the first sentence shall be paid in proportion to the number of active fund members at year-end 1997.
7. Each party covered by the provisions of Point 7 of the first paragraph of Article 5 of this Act shall be assessed 1.85% of its operating income, as reported in its annual accounts for 1997, but not lower than ISK 150,000.
The Minister shall approve the operating budget for the year and advertise in the Official Journal of Iceland the percentage rates of the assessed supervision fee for the individual classes of parties subject to supervision. The supervision fee shall be collected by the Financial Supervisory Authority and be used for its operations. The supervision fee shall be paid quarterly in four equal instalments. The due dates shall be 20 January, 1 April, 1 July and 1 October, with final dates for payment 1 February, 15 April, 15 July and 15 October respectively.
If annual accounts are not available due to the fact that a party subject to supervision is new on the market, the assessment shall be based on its operating budget for the coming year. The supervision fee for the first operating year of a new party subject to supervision shall be based on its operating budget for that year.

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Disclaimer: This section of the site details available translations on legislation relating to the Government Offices in Iceland. In case of any discrepancies between the translations and the original text in Icelandic, the original text as published in the Icelandic Legal Gazette prevails.

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