The regulated markets
Involved public institutions are authorized to sell the shares of the companies that are subject to privatization, through one of the following methods:
Common rules applicable to the regulated markets
Only participants authorized by the CNVM may operate on the regulated markets. The conditions for obtaining and maintaining the capacity of member of a regulated market or the capacity of another type of participant are set out by the respective regulated market, through its own regulations authorized by the CNVM.
Only securities and other financial instruments registered with the OEVM are admitted on a regulated market. Also, to be transacted on regulated markets, securities and other financial instruments must ensure equal access of the investors to information.
Operations on the regulated markets
The category of securities that may be transacted on the regulated markets was extended by including other types of securities not regulated under the old legislation. Consequently, shares, state titles, bonds issued by the central or local public administration and companies, as well as other loan titles with a due date over one year, preference rights upon the subscription of shares and rights of conversion of claims into shares, other financial instruments qualified by the CNVM as securities, are all transacted on the regulated markets.
Any operation of sale, purchase, exchange, as well as any other ownership conveying operation, any conversion or exercise of a right having as subject securities or other financial instruments created with respect to the securities issued by publicly held companies, shall be carried out solely on regulated markets and through the companies for financial investment services or other brokers authorized by the CNVM. The operations that are exempted from this rule are expressly provided under the law.
All operations carried out on the regulated market are to be compulsory discounted through a discount system authorized by the CNVM.
Public offers issued by non-residents in compliance with the conditions provided under Romanian law may be conducted on the Romanian market. Any public offer referring to securities that are subject to the ordinance regarding securities and that are carried out by residents outside of Romania must be notified to the CNVM.
The markets regulated as stock exchanges are set up and function as public institutions with legal identity, under the decision of establishment and the functioning authorization issued by the CNVM.
The monitoring and control of the stock exchanges is done by the CNVM through the general inspector of the stock exchange, who ensures the strict and full compliance with the provisions of the provisions of the relevant legislation in this field.
The new regulation provides a series of minimum requirements that a publicly held company must meet to be listed on a stock exchange:
- To have an anticipated stock exchange capitalization of at least EURO 1 million, converted in ROL, or a share capital representing the ROL equivalent of at least EURO 1 million, inasmuch as the value of the stock exchange capitalization cannot be anticipated;
- To have functioned during the last three years prior to the listing and to have published annual financial records for this period;
- To have a minimum of 25 percent of its shares publicly held.
Currently, there exists only the Bucharest Stock Exchange (BVB), established in 1995.
Other regulated market
The regulation of other markets under the new legislation applicable to securities is intended to ensure real transparency, as well as increased protection for the investors on such markets.
The regulated markets, other than stock exchanges, are set up exclusively as joint-stock companies, and the minimumcapital of the same is regulated by a CNVM regulation.
According to the new regulation, at least two thirds of the share capital of a company representing a regulated market must be held by the companies for financial investment services, which companies become members of such market. A shareholder of a company representing a regulated market may not hold either directly or through affiliated persons, more than 5 percent of the shares of such market.
The authorizing of the establishment of a regulated market requires fulfillment of certain operational conditions regarding the method of organization, the management, the transacting process and the process of conclusion of transactions, the monitoring and control of the operations on the respective market, as set out by the CNVM regulations.
The regulated markets must ensure compliance with the norms regarding the transparency and the protection of the investors through the distribution of all information to investors, companies for financial investment services and other interested parties.
Currently, the only functioning over-the-counter market is S.C. RASDAQ, organized and functioning according to the model of the NASDAQ market in the United States. The RASDAQ market was established in 1996 to transact shares resulting from the mass privatization process. Pursuant to the amendment of the legislative background, the regulated market RASDAQ was to become a regulated market, as provided by the ordinance regarding securities, within a maximum of 12 months following the enforcement date of the new normative act S.C. RASDAQ SRL was transformed in a joint-stock company (S.C. RASDAQ S.A.) in April 2003.