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  • AU-2.3 AU-2.3 Condition 3: Controllers and Close Links

    • AU-2.3.1

      Investment firm licensees must satisfy the CBB that their controllers are suitable and pose no undue risks to the licensee. Investment firm licensees must also satisfy the CBB that their close links do not prevent the effective supervision of the investment firm licensee by the CBB and otherwise pose no undue risks to the licensee.

      Amended: July 2007

    • AU-2.3.2

      For Category 1 and Category 2 investment firm licensees, at least one of the controllers of an investment firm licensee must be a reputable financial institution of financial soundness, operating within a regulated jurisdiction, with a legal structure, all of which must be acceptable to the CBB.

      Amended: January 2012
      Amended: October 2009
      July 2007

    • AU-2.3.3

      Chapters GR-5 and GR-6 contain the CBB's requirements and definitions regarding controllers and close links.

      Amended: October 2009

    • AU-2.3.4

      In summary, controllers are persons who directly or indirectly are significant shareholders in an investment firm licensee, or who are otherwise able to exert significant influence on the investment firm licensee. The CBB seeks to ensure that controllers pose no significant risks to the licensee. In general terms, controllers are assessed in terms of their financial standing, their judicial and regulatory record, and standards of business and (where relevant) personal probity.

      Amended: October 2009
      July 2007

    • AU-2.3.5

      An investment firm licensee has close links with its subsidiaries, with its parent undertakings, and with subsidiaries of its parent undertakings. It also has close links with any entity in which the licensee, its subsidiaries, its parent undertakings, and the subsidiaries of its parent undertakings has an equity interest of more than 20% (either in terms of capital or voting rights). The CBB seeks to ensure that these closely linked entities do not pose any material financial, reputational or other risks to the licensee. The CBB also seeks to ensure that the structure and geographical spread of the group is such that it is subject to adequate scrutiny at group level.

      Amended: July 2010
      Amended: October 2009
      Amended: July 2007

    • AU-2.3.6

      In all cases, when judging applications from existing groups, the CBB will have regard to the reputation and financial standing of the group as a whole. Where relevant, the CBB will also take into account the extent and quality of supervision applied to overseas members of the group and take into account any information provided by other supervisors in relation to any member of the group.

      Amended: October 2009
      July 2007