ES-A ES-A Introduction
ES-A.1 ES-A.1 Purpose
Executive Summary
ES-A.1.1
The purpose of this Module is to:
(a) Provide an overview of the structure of Volume 4 (Investment Business);(b) Provide a summary of each Module; and(c) Outline the transition rules for the implementation of Volume 4.Amended: January 2007ES-A.1.2
The Central Bank of Bahrain ('CBB'), in its capacity as the regulatory and supervisory authority for all financial institutions in Bahrain, has as its mission:
(a) To ensure monetary and financial stability in the Kingdom of Bahrain; and(b) To regulate, develop and maintain confidence in the financial sector.Amended: January 2007ES-A.1.3
As the single regulator, the CBB ensures the consistent application of regulatory standards in banking, insurance and capital markets, as well as encourages an open and cooperative approach in dealing with financial institutions.
Amended: January 2007ES-A.1.4
The supervision of the investment business sector in the Kingdom pays particular regard to the standards set by the International Organisation of Securities Commissions (IOSCO). The CBB plays an important role in meeting stakeholders' expectations — the principal stakeholders of the CBB are the Government of the Kingdom of Bahrain, regulated financial institutions, their clients, IOSCO and other relevant international organisations.
Amended: January 2007ES-A.1.5
To carry out its responsibilities in relation to the investment business sector, the CBB has four supervisory objectives, namely to:
(a) Promote the stability and soundness of the sector;(b) Provide an appropriate degree of protection to investors and clients ofinvestment firms ;(c) Promote transparency and market discipline; and(d) Reduce the likelihood ofinvestment firms being used for financial crime (including money laundering activities).Amended: January 2007Legal Basis
ES-A.1.6
This Module contains the CBB's Directive (as amended from time to time) relating to transition rules and is issued under the powers available to the CBB under Article 38 of the Central Bank of Bahrain and Financial Institutions Law 2006 ('CBB Law'). The Directive in this Module is applicable to all
investment firm licensees (including theirapproved persons ).Amended: January 2011
Amended: October 2009
Amended: January 2007ES-A.1.7
For an explanation of the CBB’s rule-making powers and different regulatory instruments, see Section UG-1.1.
Added: January 2007ES-A.2 ES-A.2 Module History
Evolution of Module
ES-A.2.1
This Module was first issued in April 2006 by the BMA, as part of the first phase of Volume 4 (Investment Business). Any material changes that have subsequently been made to this Module are annotated with the end calendar quarter date in which the change was made: Chapter UG-3 provides further details on Rulebook maintenance and version control.
Amended: January 2007ES-A.2.2
When the CBB replaced the BMA in September 2006, the provisions of this Module remained in force. Volume 4 was updated in July 2007 to reflect the switch to the CBB; however, new calendar quarter dates were only issued for Module ES where the update necessitated changes to substance (as opposed to merely updating 'BMA' to 'CBB', and similar references).
Added: January 2007ES-A.2.3
A list of recent changes made to this Module is provided below:
Module Ref. Change Date Description of Changes ES-A.1 07/2007 New Rule ES-A.1.6 introduced, categorising this Module as a Directive. ES-1.2 07/2007 Text amended to reflect changes to Module UG. ES-1.3 07/2007 Text amended to reflect changes to Module AU. ES-1.4 07/2007 Text amended to reflect changes to Module PB. ES-1.5 07/2007 Updated to reflect issue of Module HC in July 2007. ES-1.11 07/2007 Updated to reflect issue of Module RM in July 2007. ES-1.15 07/2007 Updated to reflect issue of Module BR in July 2007. ES-2.1, ES-2.3 &
ES-2.407/2007 Changes to reflect slight delay in release of Phase 2 contents of Volume 4: implementation deadline for Modules HC, RM and BR — released in July 2007 — now set as 1 January 2008. ES-2.4.1A 07/2008 Further transition period granted for requirements of Chapter BR-1, Prudential Reporting. ES-A.1.6 10/2009 Reference to registered administrators removed. ES-1.1.1 10/2009 Reference to administrator removed. ES-1.1.5 10/2009 Updated to reflect issue of Modules. ES-1.3 10/2009 Updated to reflect changes to Module AU. ES-1.3.9 10/2009 Reference to registration of administrators removed. ES-1.8 10/2009 Updated to reflect changes to Module CA. ES-2.4.1A 10/2009 Updated to reflect issue of Form QPR. ES-1.1, ES-1.3, ES-1.5.3, ES-1.6.1, ES-1.7, ES-1.15-3, ES-2.2.7, ES-2.3.2 07/2010 Updated and corrected typos. ES-1.13 07/2010 Updated to reflect the issuance of Module TC ES-2.5 07/2010 New section added to reflect transition rules for Module TC. ES-A.1.6 01/2011 Clarified legal basis. ES-1.5 04/2011 Amended to reflect new structure of Module HC. ES-1.6.1 01/2012 Deleted reference to reporting accountants to be in line with October 2011 amendment. ES-1.6.3 01/2012 Deleted reference to Module FC. ES-1.14 01/2012 Deleted Section on Module GS (Group Supervision). ES-1.18 01/2012 This Section was deleted as it is included in Chapter BC-3. ES-2.6 01/2012 Added Section on transitional Rules for Section BC-3 dealing with customer complaints procedures. ES-1.3.6 10/2013 Removed reference to Deputy Money Laundering Officer to be aligned with the Rule under Paragraph AU-1.2.2 that was amended in January 2011. ES-1.7.1, ES-1.13.1 and ES-2.5.2 10/2013 Removed reference to appointed representatives. ES-1.8.5 10/2014 Added new guidance for capital for underwriting purposes. Superseded Requirements
ES-A.2.4
This Module does not supersede any previously issued circulars or other regulatory instruments.
Amended: January 2007ES-A.2.5
Guidance on the implementation and transition to Volume 4 (Investment Business) is given in Chapter ES-2.
Amended: January 2007
