Legislative Basics

Know Your Customer

JSC “Rietumu Asset Management” IMC operates in accordance with the legal acts of the European Union and the Republic of Latvia and follows recommendations of international financial organizations and workgroups (unofficial translation of titles of main laws and regulations is provided):

General regulations:

• The law of the Republic of Latvia about International Convention for the Suppression of the Financing of Terrorism (In force since 09.10.2002)
• The law of the Republic of Latvia on the Prevention of Money Laundering and Terrorism and Proliferation Financing (In force since 13.08.2008)
• The law of the Republic of Latvia on International Sanctions and National Sanctions of the Republic of Latvia (In force since 01.03.2016)
• Regulations of Cabinet of Ministers No. 550 "Rules on the procedure and content of the submission of suspicious transaction reports and threshold declarations" (In force since 01.10.2021)
• Directive (EU) 2015/849 of the European Parliament and of the Council of 20 May 2015 on the prevention of the use of the financial system for the purposes of money laundering or terrorist financing, amending Regulation (EU) No 648/2012 of the European Parliament and of the Council, and repealing Directive 2005/60/EC of the European Parliament and of the Council and Commission Directive 2006/70/EC
• Wolfsberg principles
• Basel Committee recommendations
• USA Patriot Act
• FATF Recommendations

Field specific regulation:

• AS Rietumu Asset Management IPS is a member of the investor protection system in accordance with the Investor Protection Law of the Republic of Latvia.

  If the Society cannot fulfil its liabilities to the Client, the Client is entitled to receive compensation. From year 2008 a compensation of 90 percent (Ninety percent) of the irrevocably lost Financial Instruments or loss incurred due to the investment services within 20 000 EUR (Twenty thousand Euro) is guaranteed to every client.
  An application for receiving the compensation has to be submitted within a year after the Client becomes aware that the Society cannot fulfil its obligations towards the Client; however, no later than 5 (Five) years from the date of the failure to fulfil these obligations.
  The compensation is not paid to the Client if the Client is:

  • a participant of the investor protection system, an insurance company, investment company, or an investor who has informed of the fact that he/she is a professional investor or is recognised as such;
  • a pension fund;
  • a state or a local government.

  Investor protection is not applied if the Client has suffered loss due to changes in the prices of the Financial Instruments or if the Financial Instruments owned by the Client have become non- liquid.

• The law on the Financial Instruments Market (In force since 01.01.2004.)
• The law on Investment Management Companies (In force since 01.07.1998.)
• Directive (EU) 2014/65/EU of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments and amending Directive 2002/92/EC and Directive 2011/61/EU (MiFID II)
• Directive 2009/65/EC of the European Parliament and of the Council of 13 July 2009 on the coordination of laws, regulations and administrative provisions relating to undertakings for collective investment in transferable securities (UCITS)