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  • AU-4 AU-4 Information Requirements and Processes

    • AU-4.1 AU-4.1 Licensing

      • Application Form and Documents

        • AU-4.1.1

          Applicants for a license must fill in the Application Form 1 (Application for a License) online, available on the CBB website under Eservices/online Forms. The applicant must upload scanned copies of supporting documents listed in Paragraph AU-4.1.4, unless otherwise directed by the CBB.

          Amended: July 2019
          Amended: April 2018
          December 2010

        • AU-4.1.2

          Articles 44 to 47 of the CBB Law govern the licensing process. This prescribes a single stage process, with the CBB required to take a decision within 60 calendar days of an application being deemed complete (i.e. containing all required information and documents). See below, for further details on the licensing process and time-lines.

          December 2010

        • AU-4.1.3

          References to applicant mean the proposed licensee seeking authorisation. An applicant may appoint a representative — such as a law firm or professional consultancy — to prepare and submit the application. However, the applicant retains full responsibility for the accuracy and completeness of the application, and is required to certify the application form accordingly. The CBB also expects to be able to liaise directly with the applicant during the authorisation process, when seeking clarification of any issues.

          December 2010

        • AU-4.1.4

          Unless otherwise directed by the CBB, the following documents must be provided in support of a Form 1:

          (a) A duly completed Form 3 (Application for Approved Person status), for the individual proposed to undertake the controlled function (as defined in Rule AU-1.2.1 ) in the proposed licensee;
          (b) The detailed application information, addressing the matters described in Paragraph AU-4.1.5;
          (c) A copy of the company's current commercial registration or equivalent documentation;
          (d) A certified copy of a Board resolution of the applicant, confirming its decision to seek a CBB representative office license;
          (e) A letter of non-objection to the proposed license application from the applicant's home supervisor, together with confirmation that the group is in good regulatory standing and is in compliance with applicable supervisory requirements, including those relating to capital requirements;
          (f) A copy of the certificate of license issued by the Regulated Authority of the head office/parent company; and
          (g) Copies of the audited financial statements of the applicant (head office) for the three years immediately prior to the date of application.
          December 2010

        • AU-4.1.5

          The Detailed Application Information submitted in support of an application must explain:

          (a) An outline of the history of the applicant and its shareholders;
          (b) The reasons for applying for a license, including the applicant's strategy and market objectives;
          (c) The proposed type of activities to be carried on by the applicant in/from the Kingdom of Bahrain and an indication of the number of personnel to be assigned to the office;
          (d) The name and position of the officer in the applicant's head office to whom the representative office manager will report and an outline of how the activities of the representative office are to be monitored to ensure that the CBB conditions are met on an on going basis; and
          (e) Details of ownership of the applicant's head office in financial institutions located in Bahrain and an outline of the nature of the business carried on by those institutions.
          December 2010

        • AU-4.1.6

          All documentation provided to the CBB as part of an application for a license must be in either the Arabic or English languages. Any documentation in a language other than English or Arabic must be accompanied by a certified English or Arabic translation thereof.

          December 2010

        • AU-4.1.7

          Any material changes or proposed changes to the information provided to the CBB in support of an authorisation application that occurs prior to authorisation must be reported to the CBB.

          December 2010

        • AU-4.1.8

          Failure to inform the CBB of the changes specified in Rule AU-4.1.7 is likely to be viewed as a failure to provide full and open disclosure of information, and thus a failure to meet licensing condition Rule AU-2.7.2.

          December 2010

      • Licensing Process and Timelines

        • AU-4.1.9

          By law, the 60-day time limit referred to in Paragraph AU-4.1.2 only applies once the application is complete and all required information (which may include any clarifications requested by the CBB) and documents have been provided. This means that all the items specified in Rule AU-4.1.4 have to be provided, before the CBB may issue a license.

          December 2010

        • AU-4.1.10

          All potential applicants are strongly encouraged to contact the CBB at an early stage to discuss their plans, for guidance on the CBB's license categories and associated requirements. The Licensing Directorate would normally expect to hold at least one pre-application meeting with an applicant, prior to receiving an application (either in draft or in final).

          Amended: April 2018
          December 2010

        • AU-4.1.11

          Potential applicants should initiate pre-application meetings in writing, setting out a short summary of their proposed business and any issues or questions that they may have already identified, once they have a clear business proposition in mind and have undertaken their preliminary research. The CBB can then guide the applicant on the specific areas in the Rulebook that will apply to them and the relevant requirements that they must address in their application.

          December 2010

        • AU-4.1.12

          At no point should an applicant hold themselves out as having been licensed by the CBB, prior to receiving formal written notification of the fact in accordance with Rule AU-4.1.13 below. Failure to do so may constitute grounds for refusing an application and result in a contravention of Articles 40 and 41 of the CBB Law (which carries a maximum penalty of BD 1 million).

          December 2010

      • Granting or Refusal of License

        • AU-4.1.13

          To be granted a license, an applicant should demonstrate compliance with the applicable requirements of the CBB Law and this Module. Should a license be granted, the CBB will notify the applicant in writing of the fact; the CBB will also publish its decision to grant a license in the Official Gazette and in two local newspapers (one published in Arabic, the other in English). The license may be subject to such terms and conditions as the CBB deems necessary for the additional conditions being met.

          Amended: October 2019
          December 2010

        • AU-4.1.14

          The CBB may refuse to grant a license if in its opinion:

          (a) The requirements of the CBB Law or this Module are not met;
          (b) False or misleading information has been provided to the CBB, or information which should have been provided to the CBB has not been so provided; or
          (c) The CBB believes it necessary in order to safeguard the interests of potential customers.
          Amended: October 2019
          December 2010

        • AU-4.1.15

          Where the CBB proposes to refuse an application for a license, it will give the applicant a written notice to that effect. Applicants will be given a minimum of 30 calendar days from the date of the written notice to appeal the decision, as per the appeal procedures specified in the notice; these procedures will comply with the provisions contained in Article 46 of the CBB Law.

          Amended: October 2019
          December 2010

      • Starting Operations

        • AU-4.1.16

          Within 6 months of the license being issued, the new licensee must provide to the CBB (if not previously submitted):

          (a) The registered office address and details of premises to be used to carry out the activities of the proposed licensee;
          (b) The address in the Kingdom of Bahrain where full business records will be kept;
          (c) The licensee's contact details including telephone and fax number, e-mail address and website;
          (d) A copy of the licensee's business card and correspondence material including letterhead, website, email indicating that the licensee is licensed by the CBB;
          (e) A copy of the Ministry of Industry and Commerce commercial registration certificate in Arabic and in English; and
          (f) Any other information as may be specified by the CBB.
          December 2010

        • AU-4.1.17

          New licensees must start their operations within 6 months of being granted a license by the CBB, failing which the CBB may cancel the license, as per the powers and procedures set out in Article 48 of the CBB Law.

          December 2010

        • AU-4.1.18

          The procedures for amending or cancelling licenses are contained in Sections AU-4.3 and AU-4.4 respectively.

          December 2010

    • AU-4.2 AU-4.2 Approved Person

      • Prior Approval Requirements and Process

        • AU-4.2.1

          Representative office licensees must obtain CBB's prior written approval before a person is formally appointed to a controlled function. The request for CBB approval must be made by submitting to the CBB a duly completed Form 3 (Application for Approved Person status) and Curriculum Vitae after verifying that all the information contained in the Form 3, including previous experience, is accurate. Form 3 is available under Volume 5 Part B Authorisation Forms of the CBB Rulebook.

          Amended: January 2016
          Amended: July 2015
          December 2010

        • AU-4.2.2

          When the request for approved person status forms part of a license application, the Form 3 must be marked for the attention of the Director, Licensing Directorate. When the submission to undertake a controlled function is in relation to an existing licensee, the Form 3 must be marked for the attention of the concerned Supervision Director.

          Amended: April 2018
          Amended: July 2015
          December 2010

        • AU-4.2.2A

          When submitting the Forms 3, licensees must ensure that the Form 3 is:

          (a) Submitted to the CBB with a covering letter signed by an authorised representative of the administrator licensee, seeking approval for the proposed controlled function;
          (b) Submitted in original form;
          (c) Submitted with a certified copy of the applicant's passport, original or certified copies of educational and professional qualification certificates (and translation if not in Arabic or English) and the Curriculum Vitae; and
          (d) Is signed by an authorised representative of the licensee and all pages stamped with the licensee's seal.
          Added: July 2015

        • AU-4.2.3

          [This Paragraph was deleted in July 2015.]

          Deleted: July 2015

      • Assessment of Application

        • AU-4.2.3A

          The CBB shall review and assess the application for approved person status to ensure that it satisfies all the conditions required in Paragraph AU-3.1.3 and the criteria outlined in Paragraph AU-3.1.5.

          Amended: January 2016
          Added: July 2015

        • AU-4.2.3B

          For purposes of Paragraph AU-4.2.3A, licensees should give the CBB a reasonable amount of notice in order for an application to be reviewed. The CBB shall respond within 15 business days from the date of meeting all regulatory requirements, including but not limited to, receiving the application complete with all the required information and documents, as well as verifying references.

          Amended: January 2016
          Added: July 2015

        • AU-4.2.3C

          The CBB reserves the right to refuse an application for approved person status if it does not satisfy the conditions provided for in Paragraph AU-3.1.3 and the criteria outlined in Paragraph AU-3.1.5. A notice of such refusal is issued by registered mail to the licensee concerned, setting out the basis for the decision.

          Amended January 2016
          Added: July 2015

        • AU-4.2.4

          [This Paragraph was deleted in January 2016.]

          Deleted: January 2016

      • Appeal Process

        • AU-4.2.4A

          Licensees or the nominated approved persons may, within 30 calendar days of the notification, appeal against the CBB's decision to refuse the application for approved person status. The CBB shall decide on the appeal and notify the licensee of its decision within 30 calendar days from submitting the appeal.

          Added: July 2015

        • AU-4.2.4B

          Where notification of the CBB's decision to grant a person approved person status is not issued within 15 business days from the date of meeting all regulatory requirements, including but not limited to, receiving the application complete with all the required information and documents, licensees or the nominated approved persons may appeal to the concerned Executive Director of the CBB provided that the appeal is justified with supporting documents. The CBB shall decide on the appeal and notify the licensee of its decision within 30 calendar days from the date of submitting the appeal.

          Added: July 2015

      • Notification Requirements and Process

        • AU-4.2.5

          Representative office licensees must immediately notify the CBB when an approved person ceases to hold a controlled function together with an explanation as to the reasons why (see Paragraph AU-4.2.6). In such cases, their approved person status is automatically withdrawn by the CBB.

          Amended: July 2015
          December 2010

        • AU-4.2.6

          Representative office licensees must promptly notify the CBB in writing when a person undertaking a controlled function will no longer be carrying out that function. If a controlled function falls vacant, the representative office licensee must appoint a permanent replacement (after obtaining CBB approval), within 120 calendar days of the vacancy occurring. Pending the appointment of a permanent replacement, the representative office licensee must make immediate interim arrangements to ensure continuity of the duties and responsibilities of the controlled function affected. These interim arrangements must be approved by the CBB.

          December 2010

        • AU-4.2.7

          The explanation given for any such changes should simply identify if the planned move was prompted by any concerns over the person concerned, or is due to a routine staff change, retirement or similar reason.

          December 2010

        • AU-4.2.8

          Licensees must immediately notify the CBB should they become aware of information that could reasonably be viewed as calling into question an approved person’s compliance with CBB’s ‘fit and proper’ requirement (see AU3.1).

          Added: January 2021

    • AU-4.3 AU-4.3 Amendment of Authorisation

      • Licenses

        • AU-4.3.1

          Representative office licensees wishing to change their license must obtain the CBB's written approval, before effecting any such change.

          December 2010

        • AU-4.3.2

          Failure to secure the CBB approval prior to effecting such changes is likely to be viewed as a serious breach of a licensee's regulatory obligations, and may constitute a breach of Article 40(a), as well as Article 50(a), of the CBB Law.

          December 2010

    • AU-4.4 AU-4.4 Cancellation of Authorisation

      • Cancellation of License

        • AU-4.4.1

          Representative office licensees wishing to cancel their license must obtain the CBB's written approval, before ceasing their activities. All such requests must be made in writing to the respective Supervision Director, at the CBB, setting out in full the reasons for the request and how the business is to be wound up.

          December 2010

        • AU-4.4.2

          Representative office licensees must satisfy the CBB that their head office customers' interests are to be safeguarded during and after the proposed cancellation. The requirements contained in Module GR regarding cessation of business must be satisfied.

          December 2010

        • AU-4.4.3

          Failure to comply with Rule AU-4.4.1 may constitute a breach of Article 50(a) of the CBB Law. The CBB will only approve such a request where it has no outstanding regulatory concerns and any relevant customer interests would not be prejudiced. A voluntary surrender of a license will not be accepted where it is aimed at preempting supervisory actions by the CBB. A voluntary surrender will only be allowed to take effect once the licensee, in the opinion of the CBB, has discharged all its regulatory responsibilities to customers.

          December 2010

        • AU-4.4.4

          As provided for under Article 48(c) of the CBB Law, the CBB may itself move to cancel a license, for instance if a licensee fails to satisfy any of its existing license conditions or protecting the legitimate interests of customers or creditors of the licensee requires a cancellation. See also Chapter EN-7, regarding the cancellation or amendment of licenses, including the procedures used in such instances.

          Amended: January 2013
          December 2010

      • Cancellation of Approved Person Status

        • AU-4.4.5

          The CBB may also move to declare someone as not 'fit and proper', in response to significant compliance failures or other improper behaviour by that person: see Chapter EN-8 regarding the cancellation of 'fit and proper' approval.

          December 2010

    • AU-4.5 AU-4.5 Publication of the Decision to Grant, Cancel or Amend a License

      • AU-4.5.1

        In accordance with Articles 47 and 49 of the CBB Law, the CBB will publish its decision to grant, cancel or amend a license in the Official Gazette and in two local newspapers, one in Arabic and the other in English.

        Amended: October 2019
        Added: July 2017

      • AU-4.5.2

        For the purposes of Paragraph AU-4.5.1, the cost of publication must be borne by the Licensee.

        Added: July 2017

      • AU-4.5.3

        The CBB may also publish its decision on such cancellation or amendment using any other means it considers appropriate, including electronic means.

        Added: July 2017