Professional Certification Of Regulatory Knowledge For Market Professionals: Autorité Des Marchés Financiers General Regulation Approved

The Order of 30 January 2009 approving amendments to the General Regulation of the Autorité des marchés financiers (AMF) was published in the Official Journal of the French Republic on 6 February 2009. The new measures, which concern Book III of the General Regulation (Investment Services Providers), deal specifically with setting up a system to ascertain that market participants have a specified minimum level of regulatory knowledge.

The amendments stem from the assignment carried out by AMF Board Member Jean-Pierre Pinatton to study the desirability and feasibility of creating a certification system in France. The findings of the public consultation that followed up on the assignment can be downloaded from the AMF website at: http://www.amf-france.org/documents/general/8715_1.pdf

The professional certification regime is based on the following principles:

introducing a system whereby investment services providers (ISPs) verify that employees in certain key functions have the appropriate level of regulatory knowledge with regard to a specified corpus;
identifying the key functions concerned by the new system, i.e. trader, sales personnel, financial analyst, asset manager, head of clearing and post-trade services, and compliance officer;
permitting ISPs to carry out the verification either in-house, by any means they see fit but in accordance with a formal procedure, or by checking that the employee has passed a certified external examination providing them a professional "passport", with a view to mutual recognition of qualifications between France and other countries;
creating a Financial Skills Certification Board tasked with advising the AMF on determining both the content of the minimum knowledge corpus needed by employees in key posts and the practical conditions for certifying examinations. The members of the Financial Skills Certification Board will be appointed by the AMF following consultation with industry groups and will be announced shortly.

The system will come into effect on 1 July 2010, with a grandfather clause¹ applicable to staff already carrying out the above functions at that time.

¹Under the clause, persons in key functions as at 1 July 2010 will be exempt from the verification requirements of the new system.