Resolution no. 20952

Order, pursuant to Article 7-octies, paragraph 1, letter b) of Legislative Decree no. 58/1998 ('Consolidated Law on Finance') to cease the infringement of Art. 18 of the Consolidated Law on Finance performed via the www.capitalfmi.com website

LA COMMISSIONE NAZIONALE PER LE SOCIETÀ E LA BORSA
[THE NATIONAL COMMISSION FOR COMPANIES AND THE STOCK EXCHANGE]

HAVING REAGARD to Law no. 216 of June 7, 1974, and subsequent amendments and additions;

HAVING REGARD to Legislative Decree no. 58 of February 24, 1998 ('Consolidated Law

on Finance') and subsequent amendments and additions;

HAVING ESTABLISHED that, from checks on the www.capitalfmi.com website, it emerged that:

i. the www.capitalfmi.com website, registered by an anonymous user, is also available in Italian;

ii. The potential investor, after registration to the said website and opening an account following a registration procedure that is also available to Italian users, is offered the opportunity to trade online in the Forex, CFDs, Options and Spread Betting on commodities, precious metals, currencies and indexes;

iii. in order to perform trading transactions, an investment of money is required, to be paid into the account opened online; in particular, there are various types of account available, with different names according to the minimum deposit to be made and the promised benefits, i.e., 'Micro', 'Standard', 'Silver' and 'VIP';

iv. By logging in in their 'Personal Area' using their credentials, users can also take advantage of a service called 'copy strategy';

v. In the footer of the pages of the said website, we read that the latter 'is owned by Global ES Ltd', with alleged office at Saint Vincent and The Grenadines, and 'powered by Sonartech OU', with alleged office in Tallinn (Estonia);

HAVING ESTABLISHED that the activity carried out via the said website can be classed as the provision of investment services as referred to in Art. 1, para. 5, of the Consolidated Law on Finance, insofar as clients are offered the opportunity of opening a trading account against which purchase and/or sale orders for financial instruments can be issued;

HAVING ESTABLISHED, moreover, that trading transactions can be carried out using the so-called 'copy strategy' function;

HAVING CONSIDERED that in a document dated June 22, 2012, the European Securities and Markets Authority - ESMA clarified that any 'automatic' execution of trading signals (so-called 'mirror trading') that involves financial instruments can be qualified as the provision of a portfolio management financial service;

HAVING CONSIDERED also that in Communication no. 12062946 of July 26, 2012, CONSOB pointed out that, with reference to the afore-mentioned clarification from ESMA, anyone who intends to provide a professional service for the automatic execution of trading signals to the Italian public, must be authorised by the competent Authority and comply with the rules of conduct laid out in the laws and regulations on investment services;

HAVING CONSIDERED that the aforementioned operations performed via the www.capitalfmi.com, website are still ongoing and are aimed at Italian investors, insofar as the website is also available in Italian;

HAVING CONSIDERED that the companies mentioned on the said website are not authorised to provide investment services to the Italian public, insofar as they are not registered on the dedicated register held by CONSOB pursuant to Art. 20 of the Consolidated Law on Finance,

HAVING REGARD TO the fact that the provision of investment services and activities is reserved for authorised entities as referred to under Art. 18, para. 1, of the Consolidated Law on Finance, pursuant to which, 'The professional provision of investment services and activities for the public is reserved for investment firms and banks';

HAVING ESTABLISHED that the operations in question can be classed as the professional provision of investment services involving financial instruments to the Italian public, in infringement of Art. 18, para. 1 of the Consolidated Law on Finance;

HAVING CONSIDERED that, pursuant to Art. 7-octies of the Consolidated Law on Finance - “Powers to counteract abuse” - CONSOB “may, with regard to anyone who offers or carries out investment services or activities through the Internet without being qualified therefor pursuant to this decree: a) make public, even by way of a precaution, the circumstance that the party is not authorised to carry out the activity indicated by article 1, paragraph 5; b) order that the infringement cease”;

CONSIDERING it therefore necessary, in the light of the foregoing, to adopt this resolution immediately for reasons of urgency;

HEREBY RESOLVES:

To order the cessation of the infringement of Art. 18 of Legislative Decree no. 58/1998 also performed via the www.capitalfmi.com website, consisting of the provision of investment services and activities to the Italian public.

This Resolution shall be brought to the attention of those whom it concerns and will be published in the CONSOB Bulletin.

This measure may be appealed before the Regional Administrative Court of Lazio within 60 days of the date of service.

June 4, 2019

THE CHAIRMAN
Paolo Savona