1. 1 M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union Working Group for Chapter 9 – Financial services Bilateral screening: Chapter 9 PRESENTATION OF MONTENEGRO Brussels, 10-11 June 2013

2. FINANCIAL SERVICES 2 M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union Chapter 9: Financial Services PROSPECTUS PROSPECTUS Ivana Marković Securities and Exchange Commission of Montenegro imarkovic@scmn.me

3. FINANCIAL SERVICES OUTLINE OF THE PRESENTATION LEGAL FRAMEWORK: THE LEVEL OF COMPLIENCE; RATIONALE FOR THE CURRENT FRAMEWORK; DYNIMICS OF CONVEREGENCE. 3 M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union Chapter 9: FINANCIAL SERVICES

4. LEGAL FRAMEWORK: – DIRECTIVE 2003/71/EC OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 4 November 2003 on the prospectus to be published when securities are offered to the public or admitted to trading and amending Directive 2001/34/EC; – LAW ON SECURITIES; – RULES ON THE CONTENT OF PROSPECTUS FOR PUBLIC ISSUING OF EQUITY AND LONG TERM DEBT SECURITIES; – RULES ON CONTENT OF ABBREVIATED PROSPECTUS AND ON THE MANNER AND PROCEDURE OF RECORDING CLOSED OFFERING OF EQUITY AND LONG TERM DEBT SECURITIES 4 M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union Chapter 9: FINANCIAL SERVICES

5. 5 M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union Chapter 9: FINANCIAL SERVICES Article 34 P1 Law on securities The prospectus shall be a public invitation to subscribe for and pay securities, which must contain all the information necessary for the investor to form a realistic picture of the property and obligations, profit and loss, financial position, and prospects of the issuer and concerning the rights contained in the securities to which the prospectus pertains.

6. FINANCIAL SERVICES 6 M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union Chapter 9: FINANCIAL SERVICES The prospectus must be approved by the Commission. By approving the prospectus, the Commission confirms that the prospectus contains all the data required by this law. During the procedure of a public offer of securities the issuer shall provide that the prospectus is made available to the public, free of charge, at a specified address, from the time the securities are first offered until the end of the period during which the offer remains open. The prospectus must not be published before the decision is made to approve the prospectus or before expiration of the period prescribed for making such decision. The main details from the prospectus shall be published in the form of public invitation for the subscription and payment of securities. A public invitation for the subscription and payment of securities shall not be published before the prospectus has been approved and before the location where it can be reviewed has been specified. The prospectus shall be made available to the public no later than simultaneously with the publication of the public invitation for the subscription and payment of the securities to which it pertains.

7. FINANCIAL SERVICES 7 M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union Chapter 9: FINANCIALSERVICES Article 3 of the Rules on the content of prospectus for public issuing of equity and long-term debt securities describes the contents of the prospectus when securities are issued through public offering. The subscription of securities on the basis of public offer shall last for no longer than three months from the date of publishing a public invitation for the subscription and payment of the securities. (Article 38 P.1 Law on securities)

8. FINANCIAL SERVICES A THE PROCEDURE EVALUATING THE SUCCESSFULNESS OF PUBLIC ISSUE OF SHARES IS INITIATED AFTER THE DEADLINE FOR REGISTRATION AND PAYMENT OF SECURITIES. 8 M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union Chapter 9: FINANCIAL SERVICES

9. 9 M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union Chapter 9: FINANCIAL SERVICES The issue of shares shall be considered as successful if a number of shares determined by the prospectus was subscribed and paid on the basis of the public offering, within the deadline from Article 38 of this Law. If the public offer is not successful, the issuer must ensure the refund of the amount received within 8 days of the close of the subscription and payment period.

10. FINANCIAL SERVICES 10 M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union In addition to the public offering, the law prescribeds closed bids. Concept of Closed Offering Article 44a Closed offering shall mean the offer for the purchase of equity and long-term debt securities not based on a public invitation for subscription and payment of such securities. The issue of equity and long-term debt securities may be done through the closed offering only in the cases when the issuer offers securities for sale to: the existing shareholders on the basis of the pre-emptive right to purchase; founders, in the case of simultaneous establishment of a joint stock company; professional investors that are, under this Law, the following: investment funds, pension funds, authorized participants performing dealer activities, banks and insurance companies; at the most 30 persons determined beforehand who have committed themselves to buy the entire issue, who are conversant with investment risks and business results of the issuer; or in the scope not greater than EUR 40,000. Issuer that issues long-term securities through closed offering shall prepare an abbreviated prospectus, whose detailed contents shall be established by the Commission. The issuer shall not be obliged to publish a prospectus in the case of issuance of long-term securities through the closed offering. Chapter 9: FINANCIAL SERVICES

11. 11 M O N T E N E G R O Negotiating Team for the Accession of Montenegro to the European Union Chapter 9: FINANCIAL SERVICES Current status: Partial Complience with Directives: 2003/71/EC Full compliance shall be achieved with adoption of the new Law on capital markets(this law will be adopted by the end of the fourth quarter of 2013.) Dynamics of convergence: until the end of the fourth quarter of 2013.

12. 12 Thank you for your attention! QUESTIONS