International Law

THE DUTCH SUPERVISION ON TRUST COMPANIES (III)

By Karel.Frielink

Policy rule on integrity testing

The integrity of those having a certain interest in, or control over, a trust office (such as managers, supervisory directors and persons who determine or help determine policy) will be tested and their antecedents investigated (Article 3 of the Dutch Act on the Supervision of Trust Offices; ?ASTO?). The test is set out in detail in the Policy Rule on Integrity Testing, which contains rules regarding the testing of the integrity of persons who (co-)determine, or are to be appointed to (co-)determine, the policy of supervised institutions, and of holders and prospective holders of qualifying holdings in supervised institutions (the so-called Policy Rule)(?Beleidsregel Betrouwbaarheidstoetsing?). The current Policy Rule is in force since 28 January 2005.

According to Article 1 (1) of the Policy Rule, ?integrity? shall mean, for the purposes of, amongst other things, the ASTO, the ?refrainment from one or more actions that, in the opinion of the DCB, are incompatible with a person fulfilling the function of (co-)determining policy or holding a qualifying holding?.

Further, in Article 1 (2) of the Policy Rules it is stated:

?The actions referred to shall include actions that give evidence of the person concerned not possessing qualities such as truthfulness, a sense of responsibility, law-abidingness, openness, sincerity, prudence, punctuality, honesty, discretion, and uprightness.?

Following Article 2 (1), the assessment of integrity shall take place by ?testing, on the basis of intentions, actions and antecedents (collectively referred to as ?Antecedents?), whether the person concerned gives or has given evidence of such actions that, in the opinion of the DCB, his or her integrity is not, or is no longer, beyond doubt?. ?Antecedents? should be understood to include financial and criminal history.

If the Dutch Central Bank has concluded that the integrity of a person is not, or is no longer, beyond doubt, and if no direct consequences arise from the ASTO itself, the DCB may exercise the powers assigned to it pursuant to the ASTO (Article 4 of the Policy Rule). This includes, for example, giving an order that such person shall no longer be allowed to determine or co-determine the trust office?s policy.

Karel Frielink
Attorney (Lawyer) / Partner

Full post as published by Karel's Legal Blog on September 02, 2008 (boomark / email).