Dispute resolution in the area of collective investment

As of 1 July 2011 the Financial Arbitrator has been competent, in accordance with Sec. 1 Par. 1 letter d) of the Act No. 229/2002 Coll., on Financial Arbitrator, as amended (hereinafter referred to as “the Financial Arbitrator Act”) to decide disputes in the area of collective investment.

Under the Financial Arbitrator Act, as amended as of 1 January 2015, the Financial Arbitrator is authorized, subject to further conditions set up by the Financial Arbitrator Act, to decide disputes between a person managing or administering a collective investment fund, or offering an investment in the collective investment fund or in a comparable foreign investment fund and consumer arisen in connection with managing or administering the collective investment fund, or with offering an investment in the collective investment fund or a comparable foreign investment fund.

The Financial Arbitrator is authorized to decide e.g. the following disputes:

  • settlement following the purchase/redemption/exchange of units,
  • purchase/redemption/exchange price of units,
  • malperformance of the demand of the unit-holder to purchase/redeem/exchange units by the investment intermediary,
  • fee for purchase/redemption/exchange of units,
  • damage caused in connection with collective investment counselling by a security trader or an investment intermediary,
  • failure to perform information duties.

The area of the collective investment shall be governed by the Act No. 240/2013 Coll., Act on Investment Companies and Investment Funds, implementing, inter alia, the 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. Legal relations founded before the above mentioned statute entered into effect shall be governed by the Act No. 189/2004 Coll., on Collective Investment, as amended. The offering or mediation of the collective investment shall be governed by the Act No. 256/2004 Coll., on Capital Market Undertakings, as amended. Additional rules to govern the area of collective investment are to be found in the implementing legislation, i.e. decrees of the Czech National Bank and Government regulations, as well as in the directly applicable EU legislation.

It is recommended to use a Complaint Filing Tutorial of a complaint form to file a complaint.

 

Disputes out of competence of the Financial Arbitrator

The Financial Arbitrator is not competent to decide disputes between the consumers and:

a) security traders (Security Traders List) in connection with providing or mediation of investment services other than collective investment;

b) investment intermediaries (Investment Intermediaries List) in connection with providing or mediation of investment services other than collective investment;

c) tied agents of the security traders or of the investment intermediaries (Tied Agents List) in connection with providing or mediation of investment services other than collective investment;

d) banks if providing investment services under the Act No. 256/2004 Coll., on Capital Market Undertakings under the bank licence (Banks List).

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