Information disclosure system


Supervisory powers of CMVM with regard to market operators


The activity of operating securities markets and managing other financial instruments is, according to the type of market in question, exercised by regulated market operators (sociedades gestoras de mercados regulamentados – SGM) or non-regulated market operators.

The establishment of an SGM and the acquisition of controlling stakes in already established SGMs depend on the authorisation of the Minister of Finance, following a statement of opinion by CMVM. The law establishes which entities are permitted to hold stakes in the capital of these companies and also defines the powers of their boards of directors, in particular their regulatory, disciplinary and supervisory powers.

SGMs and non-regulated markets are subject to registration with CMVM, which includes the identification of the members of their corporate bodies and the necessary assessment of their fitness and professional experience, as well as the adequacy of the human, technical and material resources available for the exercise of the activity of the company. CMVM is also responsible for supervising the prudential rules and rules of good conduct imposed by law on these companies and the regulation of their duties to disclose information to CMVM and to the public. In addition, in the case of SGMs, the majority of changes to their articles of association require authorisation by CMVM and, furthermore, CMVM must be informed of the acquisition of qualifying holdings and receive regular information regarding the internal control of the company.

With regard to their regulatory powers, market operators approve a Code of Professional Conduct, which is then submitted to CMVM for registration and verification of its adequacy and conformity with the applicable laws and regulations. The Code of Professional Conduct regulates, in particular, the disciplinary mechanisms applicable to employees, market members and other entities intervening in the market in cases of violations of the duties established by law, in regulations or in the said Code of Professional Conduct.

The regulatory powers of the market operator also include the establishment, through the approval of market rules, of fundamental principles and rules applicable to the markets, as set forth in the Portuguese Securities Code and CMVM regulations. These rules, which are also subject to registration, establish the conditions for admission to the market, the listing, suspension and delisting of securities and operations and trading on the market, as well as conduct.

The boards of directors of SGMs are also responsible for making decisions with regard to the admission, suspension and exclusion of market members, the listing, suspension from trading or de-listing of securities and the accreditation of representatives of members. However, the operators may have recourse to CMVM to rule upon these matters, which, in turn, may have recourse to the administrative tribunals.

The monitoring of the regular functioning of the market, including the execution of operations and the conduct of members and other entities participating in it, is not only the responsibility of CMVM, but also of the operator of the market in question. In fact, the operator, being invested with regulatory, disciplinary and supervisory powers, is required implement internal control mechanisms and to adopt any measures necessary to the rectification of irregular situations, such as, by way of example, the application of disciplinary sanctions, the interruption of a trading session or the suspension from trading or de-listing of a financial instrument. If the market operator fails to act, CMVM may substitute it and adopt any measures it considers necessary, notwithstanding the fact that the power to discipline is solely invested in the market operator.

Basic legislation on market operators and markets:

  • Decree-Law no. 394/99, of 13 October, amended by Decree-Law no. 8-D/2002, of 15 January : Approved the legal requirements for the restructuring and reorganisation of operators of regulated and non-regulated securities markets and entities providing services related to the operation of these markets

  • Ministerial Order no. 1429/2001, of 19 December: Established the equity capital of operators of regulated and non-regulated markets, settlement systems and central securities depositaries

  • CMVM Regulation 5/2000: Markets (D.R. Series II 24.10.2001), amended by CMVM Regulations 5/2002 (D.R. Series II, 11.06.2004), 8/2003 (D.R. Series II, 15.10.2003), 3/2004 (D.R. Series II, 11.06.2004)