Luxembourg Bill Creates 'Systemic Risk Committee'
by Ulrika Lomas, Lowtax.net, Brussels
18 February, 2014
Luxembourg's Council of Ministers has adopted a bill providing for the creation of a systemic risk committee.
The bill is intended to implement the recommendation of the European Systemic Risk Board (ESRB) from December 22, 2011, which urges member states to put in place a national macro prudential authority. Furthermore, the draft law implements the ESRB recommendation from April 4, 2014, on the intermediary objectives and instruments of macro-prudential policy.
As with the approach adopted in Germany and France, a systemic risk committee is to be established in the Grand Duchy, comprising authorities currently involved in the regulation and surveillance of the Luxembourg financial system, whose measures have an important influence on financial stability. These authorities include the ministry responsible for the financial center, the Central Bank of Luxembourg (BCL), the organization responsible for the supervision of the financial sector (CSSF), and the organization responsible for the supervision of the insurance sector (le Commissariat aux assurances).
The committee will be tasked with contributing to maintaining the stability of the Luxembourg financial system as a whole, in particular with strengthening the resilience of the financial system. The committee will, in a unanimous vote, issue advice and recommendations to authorities represented in the committee, or to any part of the financial system.
The committee is to be presided over by the member of Government responsible for the financial center, and, in their absence, by the general director of the BCL.
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