CMVM Regulation No. 23/2000
Voluntary Mediation in Disputes
Amongst the resources to be made available by the Portuguese Securities Market Commission to protect and promote the interests of investors, the Portuguese Securities Code has provided for the organisation of a dispute mediation service aimed at resolving private disputes in the field of the securities market (see articles 33 and 34).
This regulation establishes a number of procedures making it possible to apply a new model for the non-judicial resolution of conflicts to the particular characteristics of disputes in this area. The model is based exclusively on the search for agreement between the interested parties using the assistance of an impartial third party and is characterised by the speed and informality with which the procedures are carried out.
Since disputes may involve parties that differ widely in terms of knowledge and experience, the contents of this Regulation are aimed at complementing the investor support services already put in place by the CMVM, such as explanation and clarification, information, training schemes, publications and hearing and settling claims and complaints. The mediation of conflicts should be as flexible as the parties involved wish it to be, provided all parties are in agreement with respect to this matter.
The intervention of the Portuguese Securities Market Commission entails its making its services available and appointing a technically competent mediator whose task it is to do all such things as he/she considers appropriate to achieve, by consensus, the satisfaction of the injured party and the consequent extinction of the conflict.
Since this process is designed to contribute to the resolution of disputes, it cannot exclude provisions aimed at dealing with the possibility of mass disputes. For this reason the mediator may amalgamate and deal simultaneously with claims received from persons with identical or similar interests, without prejudice to the intervention of investor protection associations whether as principal or accessory in the proceedings.
Therefore, pursuant to article 34(1) of the Portuguese Securities Code approved by Decree-Law no. 486/99 of 13th November and article 9 sub-paragraph n) of Decree-Law no. 473/99 of 8th November, and following consultation with its Advisory Board, the Executive Board of the Portuguese Securities Market Commission, has approved the following Regulation:
1 - The voluntary mediation procedure in disputes arising from relations involving securities in which one of the parties is considered a non-institutional investor shall be governed by the principles enshrined in article 34 of the Portuguese Securities Code and by the provisions of this Regulation.
2 - In all such procedures, the mediator appointed by the Executive Board shall take such measures as, in each individual case and with respect for the law in force, he/she considers most appropriate to negotiating an agreement between the two parties.
Request for Mediation
1 - The voluntary dispute mediation process must begin with an express application from a non-institutional investor or an investor protection association to the CMVM in which the subject-matter of the dispute, the claim and the grounds, and the entity or entities against which the claim is brought, are described.
2 - The application for mediation must contain the name and address of the claimant and must be signed by said claimant or by an appointed representative.
3 - On receipt of a mediation application, the Executive Board of the CMVM shall appoint a mediator for each case where mediation is required.
4 - In each individual case, the mediator may reach agreement with the parties involved as to the procedural rules to be adopted, which the parties shall freely accept as binding, subject to the termination of the procedure in the event of non-compliance with the said rules.
Agreement to Mediation
1 - The party or parties against which the claim is brought shall be notified of the application and shall inform the Dispute Mediation Department as to whether or not it/they agree(s) to take part in the procedure.
2 - Should the entity in question fail to reply, the Dispute Mediation Department shall request a reply within a reasonable period of time, at the end of which the said department shall inform the applicant that the request was not agreed to.
3 - In cases in which the applicant's claims must be dismissed as manifestly unfounded, or where mediation is not appropriate, the Dispute Mediator must inform the applicant that its services are not available for the procedure in question.
1 - Whenever the Dispute Mediation Department notes that it has been approached by persons whose interests are similar to those of other parties in pending mediation proceedings, it may, with the latter's express agreement, inform the former of the existence of the said proceedings and the possibility of them joining it within a period to be determined by the aforementioned department.
2 - Multilateral mediation may also be used in relation to cases in which it is discovered, before the beginning of the proceedings, that other parties with similar interests exist.
Hearing the Interested Parties
1 - If mediation is agreed, the mediator shall interview the parties involved in order to determine straight away whether a prior agreement can be brokered or a schedule for the mediation procedure can be organised.
2 - Should the mediator be of the opinion that consensus can be achieved through informal contacts with the parties, he/she may dispense with the need for them to meet formally.
Termination of the Proceedings
1 - Mediation proceedings shall be terminated whenever any one of the parties shall inform the appointed mediator that it is withdrawing or wherever the mediator has good grounds for believing that the achievement of an agreement is impossible.
2 - Mediation proceedings shall end when the parties enter into a compromise agreement or, irrespective of any such agreement, when the applicant's claim has been satisfied.
Outcome of Mediation and Liability of Agents Involved
The outcome of mediation proceedings shall not exempt the parties involved from any liabilities they may otherwise have incurred, with the exception of civil liability, however the outcome shall be taken into consideration in accordance with the applicable legislation.
Entry into Force
This Regulation shall enter into force on the day immediately following that of its publication in the Diário da República, the Portuguese legal gazette.
Lisbon, 5 July 2000 - The Executive Board, Fernando Teixeira dos Santos (Chairman), Luís Lopes Laranjo (Vice-Chairman)