International cooperation

Global cooperation

There is global cooperation between states and authorities to develop principles for regulations and supervision of financial institutions and financial markets. Finanstilsynet participates in a number of international organisations and working groups. The international organisations Finanstilsynet participates in are listed below.

European cooperation

About the European Supervisory Authorities

The extensive participation in the European supervisory cooperation is crucial to enable Finanstilsynet to carry out its tasks in line with the EEA obligations. The European financial supervisory system comprises the national financial supervisory authorities and:

• European Banking Authority (EBA)
• European Securities and Markets Authority (ESMA)
• European Insurance and Occupational Pensions Authority (EIOPA)
• European System Risk Board (ESRB)

Finanstilsynet is a member of the European Supervisory Authorities along with the other national financial supervisory authorities in the EEA countries. This is stipulated in the EEA Agreement. The supervisory authorities in the EEA EFTA States are not entitled to vote as members of the bodies that can make decisions, but otherwise have the same rights and obligations as the EU member states' representatives. The European Supervisory Authorities cannot make decisions directly aimed at the EEA EFTA States. This decision-making authority lies with the EFTA Surveillance Authority.

Finanstilsynet was represented at all meetings of the Boards of Supervisors of the EBA, ESMA and EIOPA in 2022. Finanstilsynet is also a member of a number of the EBA, ESMA and EIOPA sub-committees. Experts from the national financial supervisory authorities throughout the EEA participate in the sub-committee meetings, where matters to be decided by the Boards of Supervisors are prepared. Along with Norges Bank, Finanstilsynet also participated in all of the meetings of the ESRB's General Board in 2022, as well as in key sub-committees. 

Supervisory cooperation in the EEA is important to Finanstilsynet for a number of reasons. Through its participation in the European Supervisory Authorities, Finanstilsynet has the opportunity to participate at an early stage when EU rules, guidelines and recommendations are drawn up. Furthermore, many financial institutions operate across national borders in the EEA, and good cooperation between the national financial supervisory authorities is important to ensure supervisory convergence and effective supervision of both individual institutions and the financial market in general.

About the European Supervisory Authorities

There was a high level of activity in the European Supervisory Authorities in 2022 in connection with regulatory development, coordination of supervisory practices in the EEA and monitoring and management of investor risks, the market and financial stability. The war in Ukraine and geopolitical uncertainty had an impact on the work carried out in 2022. In addition, climate risk and the implementation of regulations on sustainable finance were high on the priority lists of the EBA, ESMA and EIOPA.

Throughout 2022, the EBA carried out a large number of AML-related activities, including an evaluation of Finanstilsynet's supervision of compliance with the AML legislation. Finanstilsynet regularly participates in the EBA's AML CFT Standing Committee and in various sub-groups.

Finanstilsynet participated in several peer reviews under the auspices of the EBA, including the processing of licence applications pursuant to the Payment Services Directive (PSD2) and the assessment of ICT risk in connection with Finanstilsynet's assessment of banks' overall risk level and capital requirements (SREP). Peer reviews are organised by the European Supervisory Authorities on a regular basis to examine, among other things, whether national supervisory authorities have adequate staff resources and expertise, and whether their supervision and enforcement of prevailing legislation is effective and consistent.

In 2022, the EBA carried out an assessment of whether Norwegian CET1 instruments meet the requirements of the Capital Requirements Regulations (CRR). The results of the assessment were published on Finanstilsynet's website in December 2022.

Recent market turbulence resulting from the crisis in the energy market has had an impact on ESMA’s work. In the electricity derivatives market, high prices combined with increased volatility have resulted in higher margin requirements for market players, and liquidity pressures have entailed a risk of derivative contracts not being fulfilled.

ESMA conducted various Common Supervisory Actions (CSAs) in 2022. All countries are thus required to conduct supervisory activities in the same way, at the same time and based on a common methodology. ESMA determines both the design, scope, implementation and reporting of such supervision. In 2022, Finanstilsynet participated in a CSA on valuation of mutual funds and alternative investment funds. One of the objectives of the CSA was to investigate whether the institutions complied with valuation principles and methods that ensure a correct and representative picture of the fund's financial positions under both normal and stressed market conditions.

During 2022, Finanstilsynet participated in a peer review under the auspices of ESMA that focused on the processes for reviewing and approving prospectuses.

Furthermore, Finanstilsynet was subject to several peer reviews under the auspices of EIOPA, which included the follow-up of outsourcing and fit and proper assessments. In 2022, EIOPA performed a stress test of European Institutions for Occupational Retirement Provision (IORPs), focusing on climate risk. Twelve Norwegian pension funds participated in the stress test.

In September 2022, the ESRB issued a warning to the member states on increased vulnerabilities in the financial system. The ESRB stresses the importance of preserving or enhancing the resilience of the financial sector so that it can continue to support the real economy if and when serious incidents occur.

Collaboration on audit oversight

In 2022, Finanstilsynet was an observer in the European collaboration between audit regulators, the Committee of European Auditing Oversight Bodies (CEAOB). In addition to cooperation on supervisory methods and harmonised practices, the committee registers findings made at inspections of auditors in a common European database, which is a useful basis for the supervision of the largest auditing firms and for communication with the standard setters for audit oversight.

EU legislation becomes EEA obligations and Norwegian legislation

The major part of EU legislation in the financial area is EEA-relevant and will be incorporated into the EEA Agreement and implemented in Norwegian law. Finanstilsynet assists the Ministry of Finance with the preparations, inter alia through its participation in the EFTA cooperation, where the EEA EFTA States consider whether the regulations are EEA-relevant and whether there is a need for adaptations when they are incorporated into the EEA Agreement.

In 2022, a number of regulations implementing supplementary regulations in Norwegian law, so-called level 2 legislation, were adopted. These have been incorporated into the EEA Agreement. Several of the regulations were adopted by Finanstilsynet in keeping with the authority delegated by the Ministry of Finance.

Around 80 legal acts in the financial area were incorporated into the EEA Agreement in 2022. The backlog of EU legal acts waiting to be incorporation into the EEA Agreement often presents challenges for market players. At the end of 2022, 150 legal acts in the financial area had been adopted in the EU but had yet to be incorporated into the EEA Agreement. 

Nordic and Nordic-Baltic cooperation

A number of financial institutions offer services in other Nordic countries through subsidiaries and branches and through cross-border operations. In such an integrated Nordic financial market, close cooperation between supervisory authorities is important. The financial supervisory authorities in the Nordic countries normally have annual meetings at top management level, for the various supervisory areas, for legal and administrative matters and for a number of other special areas.

There are also regular cooperation meetings with other Nordic supervisory authorities in the field of auditing. In most other countries, the national financial supervisory authority is not responsible for audit oversight.

Finanstilsynet participates in the Nordic-Baltic Stability Group. This group has representatives from the finance ministries, central banks and financial supervisors in the Nordic and Baltic countries. The group has drawn up a framework for coordination of measures in the various countries in the event of a crisis situation at systemically important cross-border financial institutions.

Finanstilsynet participates in the Nordic-Baltic Macroprudential Forum (NBMF) and NBMF sub-groups. The forum brings together the top management at central banks and financial supervisors and discusses macroprudential surveillance and other supervisory activity in the Nordic-Baltic area.

Along with the other supervisory authorities in the region, Finanstilsynet participates in a Nordic-Baltic anti-money laundering working group and in a Nordic-Baltic working group on PSD2 and fintech.

International organisations and committees in which Finanstilsynet participated in 2022

Cross-sectoral

• European Systemic Risk Board (ESRB)
• The Joint Committees of the EBA, ESMA and EIOPA
• EFTA Working Group on Financial Services
• Nordic-Baltic Macroprudential Forum
• Nordic-Baltic Stability Group
• Nordic-Baltic Anti-Money Laundering Working Group
• Nordic-Baltic Working Group on PSD2 and Fintech
• Financial Stability Board (FSB), Regional Consultative Group for Europe
• Financial Action Task Force (FATF) – the international forum for measures for combating money laundering and terrorist financing, with its secretariat in the OECD
• LEI ROC, Regulatory Oversight Committee, Global Legal Entity Identifier (LEI) System
• Integrated Financial Supervisors Conference (IFSC) – annual conference
• Network for Greening the Financial System (NGFS)
• European Forum for Innovation Facilitators (EFIF)

Banking and finance

• European Banking Authority (EBA)
• Basel Consultative Group
• Policy and Standards Group – Basel Committee

Insurance and pensions

• European Insurance and Occupational Pensions Authority (EIOPA)
• International Association of Insurance Supervisors (IAIS)
• International Forum of Insurance Guarantee Schemes (IFIGS)

Securities area

• European Securities and Markets Authority (ESMA)
• International Organization of Securities Commissions (IOSCO)
• Enlarged Contact Group on Supervision of Collective Investment Funds (ECG)

Auditing

• Committee of European Auditing Oversight Bodies (CEAOB)
• International Forum of Independent Audit Regulators (IFIAR)

ICT supervision

• Information Technology Supervision Group (ITSG)
  ICT risk in the financial sector
• Financial Information Sharing and Analysis Center (FI-ISAC) – forum where the banking sector, prosecuting authorities and computer emergency response teams (CERTs) share information on cybercrime in the financial sector