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  • TC-1.1 TC-1.1 Recruitment and Appointments

    • TC-1.1.1

      If an investment firm licensee recruits an individual to undertake a controlled function, it must satisfy itself, where appropriate, of such individual's relevant qualifications and experience.

      Amended: October 2013
      Adopted: July 2010

    • TC-1.1.2

      An investment firm licensee proposing to recruit an individual has to satisfy itself, of his/her relevant qualifications and experience. The investment firm licensee should:

      (a) Take into account the knowledge and skills required for the role, in addition to the nature and the level of complexity of the controlled function; and
      (b) Take reasonable steps to obtain sufficient information about the individual's background, experience, training and qualifications.
      Adopted: July 2010

    • TC-1.1.3

      In accordance with AU-1.1.24, a firm which is an Islamic investment firm licensee must maintain a Shari'a Supervisory Board to verify that its operations are Shari'a compliant, and must comply with relevant AAOIFI standards.

      Adopted: July 2010

    • TC-1.1.4

      Individuals occupying controlled functions (refer to Paragraphs AU-1.2.7 to AU-1.2.15) in an investment firm licensee must be qualified and suitably experienced for their specific roles and responsibilities. The controlled functions are those of:

      (a) Director;
      (b) Chief Executive or General Manager;
      (c) Head of function;
      (d) Compliance officer;
      (e) Money Laundering Reporting Officer ('MLRO');
      (f) [This Subparagraph was deleted in October 2013];
      (g) Member of Shari'a Supervisory Board (where applicable);
      (h) Financial instruments trader; and
      (i) Investment consultant or investment adviser.
      Amended: October 2013
      Adopted: July 2010

    • TC-1.1.5

      An investment firm licensee must take reasonable steps to ensure that individuals holding controlled functions are sufficiently knowledgeable about their respective fields of work to be able to guide and supervise operations that fall under their responsibilities. Competence must be assessed on the basis of experience and relevant qualifications described in Appendix TC-1 as a minimum. However, the CBB reserves the right to impose a higher level of qualifications as it deems necessary.

      Amended: October 2013
      Adopted: July 2010

    • Director

      • TC-1.1.6 [deleted]

        [Paragraph deleted in January 2011].

        Deleted: January 2011

      • TC-1.1.7

        The role of the director is to be accountable and responsible for the management and performance of the licensee, and is outlined in more details in Section HC-1.2.

        Amended: April 2011
        Adopted: July 2010

      • TC-1.1.8

        When taken as a whole, the board of directors of an investment firm licensee must be able to demonstrate that it has the necessary expertise, as outlined in Paragraph HC-1.2.4.

        Amended: April 2011
        Adopted: July 2010

    • Chief Executive or General Manager

      • TC-1.1.9 [deleted]

        [Paragraph deleted in January 2011].

        Deleted: January 2011

      • TC-1.1.10

        The chief executive officer or general manager (as appropriate) is responsible for the executive management and performance of the licensee within the framework or delegated authorities set by the Board, and is outlined in more details in Paragraph HC-6.3.4.

        Amended: April 2011
        Adopted: July 2010

    • Head of Function

      • TC-1.1.11 [deleted]

        [Paragraph deleted in January 2011].

        Deleted: January 2011

      • TC-1.1.12

        Heads of functions are responsible for tracking specific functional performance goals in addition to identifying, managing, and reporting critical organisational issues upstream. Certain functions require dealing directly with clients while others do not. Both categories of functions, however, require specific qualifications and experience to meet the objectives as well as compliance requirements of the investment firm licensee.

        Adopted: July 2010

    • Compliance Officer

      • TC-1.1.13 [deleted]

        [Paragraph deleted in January 2011].

        Deleted: January 2011

      • TC-1.1.14

        In accordance with Paragraph AU-1.2.16, an employee of appropriate standing must be designated by investment firm licensees for the position of compliance officer. The duties of the compliance officer, who must have Bahraini residency, are outlined in more details in Section HC-6.5 and include:

        (a) Having responsibility for oversight of the licensee's compliance with the requirements of the CBB; and
        (b) Reporting to the licensee's Board in respect of that responsibility.
        Amended: April 2011
        Adopted: July 2010

    • Money Laundering Reporting Officer (MLRO)

      • TC-1.1.15 [deleted]

        [Paragraph deleted in January 2011].

        Deleted: January 2011

      • TC-1.1.16

        In order to carry out the function of MLRO effectively, investment firm licensees must ensure that their MLRO:

        (a) Is a member of senior management of the licensee and has a sufficient level of seniority within the licensee, has the authority to act without interference from business line management and has direct access to the Board and senior management (where necessary);
        (b) [Subparagraph (b) combined with (a) in January 2011];
        (c) Has sufficient resources, including sufficient time and (if necessary) support staff, and has designated a replacement to carry out the function should the MLRO be unable to perform his duties;
        (d) Has unrestricted access to all transactional information relating to any financial services provided by the licensee to that customer, or any transactions conducted by the licensee on behalf of a customer;
        (e) Is provided with timely information needed to identify, analyse and effectively monitor customer accounts;
        (f) Has access to all customer due diligence information obtained by the licensee; and
        (g) Is resident in Bahrain.
        Amended: October 2013
        Amended: January 2011
        Adopted: July 2010

      • TC-1.1.17

        As outlined in Paragraph FC-3.2.1, the role and responsibilities of the MLRO involve, but are not limited to, the following:

        (a) Establishing and maintaining the investment firm licensee's Anti-Money Laundering (AML)/Combating the Financing of Terrorism (CFT) policies and procedures;
        (b) Ensuring compliance with the AML Law, any other applicable AML/CFT legislation as well as rules and guidance pertaining to Module FC;
        (c) Ensuring day-to-day compliance with the licensee's own internal AML/CFT policies and procedures;
        (d) Acting as the licensee's main point of contact for internal suspicious transaction reports from the licensee's staff, (refer to Section FC-4.1), and as the main contact for the Financial Intelligence Unit, the CBB and other concerned bodies regarding AML/CFT;
        (e) Making external suspicious transaction reports to the Financial Intelligence Unit and Compliance Directorate (refer to Section FC-4.2);
        (f) Taking reasonable steps to establish and maintain adequate arrangements for staff awareness and training on AML/CFT matters (whether internal or external), as per Section FC-5;
        (g) Producing annual reports on the effectiveness of the licensee's AML/CFT controls, for consideration by senior management, as per Paragraph FC-3.3.1;
        (h) On-going monitoring of what may, in his opinion, constitute high-risk customer accounts; and
        (i) Maintaining all necessary customer due diligence (CDD), transactions, suspicious transaction reports (STR) and staff training records for the required periods (see Section FC-6.1).
        Amended: January 2016
        Amended: October 2013
        Adopted: July 2010

    • Member of the Shari'a Supervisory Board

      • TC-1.1.18 [deleted]

        [Paragraph deleted in January 2011].

        Deleted: January 2011

      • TC-1.1.19

        As outlined in AAOIFI's governance standard No.1, the Shari'a Supervisory Board is entrusted with the duty of directing, reviewing and supervising the activities of the Islamic financial institutions in order to ensure that it is in compliance with Islamic Shari'a Rules and Principles.

        Adopted: July 2010

    • Financial Instruments Trader

      • TC-1.1.20 [deleted]

        [Paragraph deleted in January 2011].

        Deleted: January 2011

      • TC-1.1.21

        In accordance with Rule AU-1.2.12, the role of financial instruments traders, who must be knowledgeable of various areas within the financial industry and any significant market developments, involves:

        (a) Buying financial instruments; or
        (b) Selling financial instruments.
        Adopted: July 2010

    • Investment Consultant or Investment Adviser

      • TC-1.1.22 [deleted]

        [Paragraph deleted in January 2011].

        Deleted: January 2011

      • TC-1.1.23

        In accordance with Rule AU-1.2.13, investment consultants or investment advisers are responsible for:

        (a) Arranging deals in financial instruments; and/or
        (b) Providing advice to clients with regards to financial instruments.
        Amended: October 2013
        Adopted: July 2010

      • TC-1.1.24

        Individuals holding the position of investment consultant or investment adviser must comply with the rules and guidance set forth in Module BC, particularly the Investment Business Code of Practice ('the Code')

        Amended: October 2013
        Adopted: July 2010

    • Record Keeping

      • TC-1.1.25

        An investment firm licensee must make and retain records of its recruitment procedures. Such procedures should be designed to adequately take into account proof of the candidates' knowledge and skills and their previous activities and training.

        Adopted: July 2010

      • TC-1.1.26

        The recruitment record keeping procedure should include, but is not limited to, the following:

        (a) Results of the initial screening;
        (b) Results of any employment tests;
        (c) Results and details of any interviews conducted;
        (d) Background and references checks; and
        (e) Details of any professional qualifications.
        Adopted: July 2010