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  • GR-10.1 GR-10.1 General Requirements

    • GR-10.1.1

      As specified in Articles 51 and 57 of the CBB Law, a Bahraini investment firm licensee incorporated in Bahrain must seek CBB approval and give reasonable advance notice of its intention to:

      (a) Enter into a merger with another undertaking;
      (b) Enter into a proposed acquisition, disposal or establishment of a new subsidiary undertaking;
      (c) Open a new place of business as a subsidiary undertaking or a branch within the Kingdom of Bahrain or other jurisdiction; or
      (d) Open a representative office in another jurisdiction.
      Amended: July 2013
      Added: April 2011

    • GR-10.1.1A

      The Rules in this Section apply to all Bahraini investment firm licensees proposing to establish a new subsidiary undertaking, either directly by way of holding majority shareholding or having majority voting control by virtue of direct ownership or indirectly, by proxy/nominee arrangements, or through a management agreement.

      Added: July 2013

    • GR-10.1.2

      Rule GR-10.1.1 applies whether or not the Bahraini investment firm licensee is required to be regulated locally in the jurisdiction where it proposes to undertake the investment business.

      Amended: July 2013
      Added: April 2011

    • GR-10.1.3

      The CBB will consider as one of its criteria to approve, impose additional requirements on the Bahraini investment firm licensee or refuse an application under Paragraph GR-10.1.1, the information related to Paragraph GR-10.1.2.

      Amended: July 2013
      Added: April 2011

    • GR-10.1.4

      Bahraini investment firm licensees will also need to consider the implications of a merger, acquisition, disposal or establishment of a new subsidiary undertaking in the context of the controllers and close links rules set out in Sections GR-5 and GR-6.

      Added: April 2011

    • GR-10.1.5

      [This Paragraph was deleted in July 2013]

      Deleted: July 2013
      Added: April 2011

    • Establishment of a Subsidiary

      • GR-10.1.6

        The purpose and objectives of a subsidiary undertaking referred to in Rule GR-10.1.1 must be limited to the permissible activities within the scope of the investment business license as defined under regulated investment services in Section AU-1.4.

        Added: April 2011

      • GR-10.1.7

        Bahraini investment firm licensees wishing to establish or acquire a subsidiary undertaking must submit the following information to the CBB as part of the approval process referred to in Paragraph GR-10.1.1:

        (a) Proposed name of subsidiary;
        (b) Country of incorporation;
        (c) Legal structure;
        (d) Proposed paid-up capital;
        (e) Proposed shareholding structure;
        (f) Purpose of establishing or acquiring the subsidiary;
        (g) Draft incorporation documents of the subsidiary;
        (h) Board Resolution approving the establishment or acquisition of the subsidiary;
        (i) Names of the board members of the proposed subsidiary and the relationship of the board member to the investment firm licensee;
        (j) Names of the authorised signatories of the proposed subsidiary;
        (k) An undertaking from the board of the investment firm licensee that the board will be held ultimately responsible for any misconduct or action committed by the proposed subsidiary; and
        (l) Any other information or documentation as required by the CBB.
        Amended: July 2013
        Added: April 2011

      • GR-10.1.7A

        Any change in the criteria listed under Rule GR-10.1.7, including any changes to the incorporation documents, are subject to the CBB prior written approval, prior to the change taking place.

        Added: July 2013

      • GR-10.1.8

        Bahraini investment firm licensees referred to in Paragraph GR-10.1.7 must comply with Paragraphs GR-6.1.3 (reporting requirements for close links), RM-B.2.2 (risk management of subsidiaries), CA-1.2.9 and CA-2.1.13 (impact of investment in subsidiaries on capital adequacy).

        Amended: July 2013
        Added: April 2011

      • GR-10.1.8A

        Bahraini investment firm licensees must ensure that the scope of their internal audit extends to the activities of their subsidiaries, to satisfy themselves of the compliance of the subsidiaries with all relevant internal and regulatory rules and regulations.

        Added: July 2013

      • GR-10.1.8B

        Bahraini investment firm licensees must submit to the CBB audited financial statements of their subsidiaries within 3 months of the year end of the subsidiary (ref. BR 1.4.6A).

        Amended: October 2016
        Added: July 2013

    • Establishment of a Branch or Representative Office

      • GR-10.1.9

        Investment firm licensees wishing to establish a branch or a representative office in a jurisdiction other than the Kingdom of Bahrain, must submit the following information to the CBB as part of the approval process referred to in Paragraph GR-10.1.1:

        (a) Name of the host supervisor;
        (b) Proposed license type of the branch;
        (c) Purpose of establishing the branch or representative office;
        (d) Board Resolution approving the establishment of the branch or representative office;
        (e) The minimum requirements of the host jurisdiction; and
        (f) Any other information or documentation as required by the CBB.
        Added: April 2011