Czech Securities Commission

As of 1 April 2006, the activities of the Czech Securities Commission were taken over by the
Czech National Bank

The Czech Securities Commission ceased to exist from 1 April 2006

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Mission - Archive as of 31 March 2006

The capital market fulfils two fundamental functions. It is a place where businesses raise funds for their further development by means of issuing shares and bonds (an allocation function), and at the same time the capital is evaluated by demand and supply (a pricing function). The preconditions for fulfilling these functions are sufficient liquidity arising from a wide supply of investment instruments and, above all, general trust in the financial system as a whole. Investor trust plays a key role in determining the attractiveness of the capital market as a full-value alternative of business funding.

The capital market regulation consisting in establishing clear barriers within which the financial market participants can operate is a necessary part of the financial market working. An independent and professional authority which guarantees compliance with legal regulations has to supervise the capital market correctness. With effect from 1 April 1998 the Parliament of the Czech Republic instituted the Czech Securities Commission (CSC) as the capital market independent administrative authority on the basis of the Act No. 15/1998. The Ministry of Finance of the Czech Republic was the CSC's predecessor as a state supervisory body.

The CSC shall contribute to the capital market development and protection within its legal competence. The CSC itself established a strategic objective - to eliminate systemic risk and the failure probability of the regulated system and entities operating within it to a maximum extent. The CSC's activities need to be based on real and realizable objectives and priorities, and it must strictly act in accordance with its competence and jurisdiction. At the same time it is not possible to omit the fact that to prevent individual entities from failure and to remove all risk connected with doing business and investing in the capital market to a full extent is not and cannot be the CSC's objective and the purpose of regulation. The regulation can never replace the investigative, prosecuting and adjudicating bodies' actions as well as the real responsibility of the regulated entities' management. A different definition of the CSC's mission is not only impossible but also undesirable.

The CSC's objectives include: