EN-4 EN-4 Directions
EN-4.1 EN-4.1 Legal Source
EN-4.1.1
Article 38 of the CBB Law empowers the CBB to issue Directions to
investment firm licensees or individuals. The powers conveyed allow the CBB to issue whatever Directions, it reasonably believes, are required to achieve its statutory objectives.Amended: October 2012
Adopted: January 2007EN-4.2 EN-4.2 CBB Policy
EN-4.1.1
The BMA may issue Directions to
authorised persons under supervisory powers granted to it by the BMA Decree — Law No. 23 of 1973 ("BMA Law"). These powers are broad in nature, and effectively allow the BMA to issue whatever Directions it reasonably believes are required to achieve its statutory objectives.EN-4.2.1
The types of Directions that the CBB may issue in practice vary and will depend on the individual circumstances of a case. Generally, however, Directions require a licensee or individual either to undertake or to stop specific actions in order to address or mitigate certain perceived risks. They may also include restrictions on a licensee's activities until those risks have been addressed — for instance, a ban on the acceptance of new
customers .Amended: January 2007EN-4.2.2
The CBB is conscious of the powerful nature of a Direction and, in the case of a licensee, the fact that it subordinates the role of its Board and management on a specific issue. The CBB will carefully consider the need for a Direction, and whether alternative measures may not achieve the same end. Where feasible, the CBB will try to achieve the desired outcome through persuasion, rather than recourse to a Direction.
Amended: January 2007EN-4.2.3
In considering whether to issue a Direction, the criteria taken into consideration by the CBB include the following:
(a) The seriousness of the actual or potential contravention, in relation to the requirement(s) concerned and the risks posed tocustomers , market participants and other stakeholders;(b) In the case of an actual contravention, its duration and/or frequency of the contravention; the extent to which it reflects more widespread weaknesses in controls and/or management; and the extent to which it was attributable to deliberate or reckless behaviour; and(c) The extent to which the CBB's supervisory objectives would be better served by issuance of a Direction as opposed to another type of regulatory action.Amended: January 2007EN-4.3 EN-4.3 Procedure
EN-4.3.1
Proposals to issue Directions are carefully considered against the criteria listed in Paragraph EN-4.2.3. They require approval of an Executive Director or more senior official of the CBB, and include the statement "This is a formal Direction as defined in Chapter EN-4 of Volume 4 of the CBB Rulebook".
Amended: January 2007EN-4.3.2
The subject of the Direction will normally be given 30 calendar days from the Direction's date of issuance in which to make representations to the CBB concerning the actions required. This must be done in writing, and addressed to the issuer of the original Direction. Should a representation be made, the CBB will make a final determination within 30 calendar days of the date of the representation, as specified in Articles 125(c) and 126 of the CBB Law.
Amended: January 2007EN-4.3.3
[This Paragraph was moved to Section EN-B.2 in April 2019].
Amended: April 2019
Amended: January 2007
