BaFIN

15.11.2018

The BaFin Supervisory Authority was established on May 1, 2002 as a controlling element fully subordinate to the German Government. At the same time, the organization is obliged to coordinate its actions with the central bank of the Federal Republic of Germany. Furthermore, upon making decisions, it relies on the Financial Supervision Decree of the Federal Statute.

The Basic Premise

Before the establishment of this organization, there were no less than three controlling elements coexisting in the state, each given specific powers. BAV maintained control over insurance companies, BAKred was engaged in supervision of credit organizations and credit transactions in other authorized companies, BAWe was focused on monitoring various companies engaged in the stock market sector. With the advent of BaFin, new establishment replaced all three former organizations, being empowered to conduct all the above mentioned operations.

 

Generally speaking, objectives and targets of the BaFin Authority include:

The BaFin regulator not only possesses a fairly wide range of rights and powers, it also holds the entitlement to conduct an unannounced inspection of the work of any bank or financial institution in Germany, and this, in its turn, is a sufficiently rigid element of control. At the same time, this fact effects to a large extent the standing of the Authority before subsidiary organizations. Moreover, there were precedents in the history of BaFin activities when such unscheduled inspections would result in some non-negligible penalty charges.

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