The Minister of Finance has recently announced further measures to strengthen the supervision over the AFM and DNB within the "twin peaks" supervisory framework, in which both supervisors are independently entrusted with the enforcement of legislation for the financial sector.
In his report 'Supervision from a distance' of 10 February 2011 the Minister defines the following supervisory principles: selectivity, decisiveness, cooperation, independence, transparency and professionalism. Supervision from a distance implies that the supervision on the AFM and DNB by the Minister of Justice takes the internal checks and balances within both supervisors as a starting point. Proper governance is substantiated by means of an appointment of a specific board member responsible for supervisory policy matters. In addition, AFM and DNB board members will be subject to continuing reliability and suitability tests.
In a letter to the chairman of the Second Chamber of the Dutch parliament, the Minister of Finance recommends introducing limited liability of the AFM and DNB. The Minister argues that limiting liability explicitly to wilful misconduct or gross negligence should enhance and encourage more open and critical supervision. Furthermore, a limitation of liability would be more in line with surrounding EU member states and recommendations of the Basel Committee on Banking Supervision, the International Association of Insurance Supervisors (IAIS) and the International Organisation of Securities Commissions (IOSCO). A legislative bill is currently expected to be submitted this August.