The National Bank of Georgia Publishes New Regulation on Fines for Securities Market Participants for Public Consultation

The National Bank of Georgia has published, for public consultation, a draft of the updated regulation on fines applicable to securities market participants.

In parallel with the growth in the scale and volume of Georgia's capital market, the need has emerged to update the existing regulation on the imposition of fines in order to ensure that sanctions are adequate and proportionate to the severity of violations and their potential impact.

The draft regulation establishes a differentiated approach to determining monetary fines, taking into account the nature of the violation, the type of entity, and the size of the violator.

According to the draft, the amount of a fine may be determined either as a fixed amount or as a percentage of the entity's revenue or regulatory capital, with the higher amount to be applied.

These principles for calculating fines have been developed taking into account the directives envisaged under the Association Agreement with the European Union, as well as the recommendations of international financial institutions.