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  • CRA-1 CRA-1 Licensing

    • CRA-1.1 CRA-1.1 License for crypto-asset service

      • CRA-1.1.1

        No person may market or undertake the activities, by way of business, within or from the Kingdom of Bahrain, comprised of regulated crypto-asset services without obtaining a license from the CBB.

        Added: April 2019

      • CRA-1.1.2

        For the purposes of Paragraph 1.1.1, undertake the activities, by way of business means:

        (a) Providing one or more of services specified in Paragraph CRA-1.1.6 for commercial gain;
        (b) Holding oneself out as willing and able to provide the services specified in Paragraph CRA-1.1.6; or
        (c) Regularly soliciting other persons to engage in providing the services specified in Paragraph CRA-1.1.6.
        Added: April 2019

      • CRA-1.1.3

        [This Paragraph was deleted in April 2023].

         

        Deleted: April 2023
        Added: February 2019

      • CRA-1.1.4

        For the purpose of this Module, any promotion, offering, announcement, advertising, broadcast or any other means of communication made for the purpose of inducing recipients to purchase, exchange, or otherwise acquire financial services in return for monetary payment or some other form of valuable consideration shall be considered "marketing" in accordance with Resolution No. (16) for the year 2012.

        Added: April 2019

      • CRA-1.1.5

        The activities will be deemed to be undertaken 'within or from the Kingdom of Bahrain', if, for example, the person concerned:

        (a) Is incorporated in the Kingdom of Bahrain;
        (b) Uses an address situated in the Kingdom of Bahrain for its correspondence; or
        (c) Directly solicits clients within the Kingdom of Bahrain.
        Added: April 2019

      • Regulated Crypto-Asset Services

        • CRA-1.1.6

          Regulated crypto-asset services means the conduct of any or any combination of the following types of activities:

          (a) Reception and Transmission of order: The reception from a client of an order to buy and/or sell one or more crypto-assets and the transmission of that order to a third party for execution.
          (b) Trading in crypto-assets as agent: Acting to conclude agreements to buy and/or sell for one or more crypto-assets on behalf of the clients.
          (c) Trading in crypto-assets as principal: Trading against proprietary capital resulting in conclusion of transactions in one or more crypto-assets.
          (d) Portfolio Management: Managing crypto-assets belonging to a client and the arrangement for their management are such that the licensee managing those crypto-assets has a discretion to invest in one or more crypto-assets.
          (e) Crypto-asset Custodian: safeguarding, storing, holding, maintaining custody of or arranging on behalf of clients for crypto-assets.
          (f) Investment Advice: Giving or offering, to persons in their capacity as investors or potential investors or as agent for an investors or potential investor, a personal recommendation in respect of one or more transactions relating to one or more crypto-assets. A "personal recommendation" means a recommendation presented as suitable for the client to whom it is addressed, or which is based on a consideration of the circumstances of that person, and must constitute a recommendation to buy, sell, exchange, exercise or not to exercise any right conferred by a particular crypto-asset, or hold a particular crypto-asset.
          (g) [This subparagraph was moved to CRA-1.1.6(f) in April 2019].
          (h) Crypto-asset exchange: means a crypto-asset exchange, licensed by the CBB and operating in or from the Kingdom of Bahrain, on which trading, conversion or exchange of:
          (i) crypto-assets for fiat currency or vice versa; and/or
          (ii) crypto-assets for another crypto-asset,
          may be transacted in accordance with the Rules of the crypto-asset exchange.
          (i) Digital token advisor: advise and guide a digital token issuer on all matters relating to offering of digital tokens, trading of digital tokens as well as on the responsibilities and obligations of the digital token issuer pursuant to the provisions of applicable law, rules and regulations.
          Amended: April 2023
          Added: February 2019

        • CRA-1.1.6A

          Licensees intending to offer regulated crypto-asset services which were not included in its application for licence and/or additional services which are not part of the regulated crypto-asset services specified in Paragraph CRA-1.1.6, must seek the CBB’s prior written approval before offering the service. Licensees must provide the CBB with detailed description of the new services, the resources required and the operational framework for such service.

          Added: April 2023

      • Exclusions

        • CRA-1.1.7

          The following activities do not constitute regulated crypto-asset services:

          (a) the creation of crypto assets;
          (b) the development, dissemination or use of software for the purpose of creating or mining a crypto asset;
          (c) a loyalty programme; or
          (d) any other activity or arrangement that is deemed by the CBB to not constitute undertaking regulated crypto-asset services.
          Amended: April 2023
          Added: April 2019

        • CRA-1.1.8

          Depending on the type of regulated crypto-asset services that a person wishes to undertake, applicants may seek to be licensed by the CBB under one of the following 4 categories of license:

          Added: April 2019

      • Category 1

        • CRA-1.1.9

          Category 1 licensees may undertake one or more regulated crypto-asset service, as listed below:

          (a) Reception and transmission of orders;
          (b) Provide investment advice in relation to crypto-assets.
          Amended: April 2023
          Added: April 2019

        • CRA-1.1.10

          When undertaking the regulated crypto-asset services listed under Rule CRA- 1.1.9, Category 1 licensees:

          (a) Must not hold any client assets or client money;
          (b) Must refrain from receiving any fees or commissions from any party other than the client; and
          (c) Must not operate a crypto-asset exchange.
          Added: February 2019

      • Category 2

        • CRA-1.1.11

          Category 2 licensees may undertake one or more regulated crypto-asset services, as listed below:

          (a) Trading in crypto-assets as agent;
          (b) Portfolio Management;
          (c) Crypto-asset custody;
          (d) Investment advice.
          Amended: April 2023
          Added: April 2019

        • CRA-1.1.12

          When undertaking the regulated crypto-asset services listed under Rule CRA- 1.1.11, Category 2 licensees may hold or control client asset and client money but must not deal from their own account ("dealing as principal") or operate a crypto-asset exchange.

          Added: February 2019

      • Category 3

        • CRA-1.1.13

          Category 3 licensees may undertake one or more regulated crypto-asset services, as listed below:

          (a) Trading in crypto-assets as agent;
          (b) Trading in crypto-assets as principal;
          (c) Portfolio Management;
          (d) Crypto-asset custody;
          (e) Investment advice;
          (f) To act as a digital token advisor.
          Amended: April 2023
          Added: April 2019

        • CRA-1.1.14

          When undertaking regulated crypto-asset services listed under Rule CRA-1.1.13, Category-3 licensees may hold or control client assets and client money, may deal on their own account ("dealing as principal") but must not operate a crypto-asset exchange.

          Added: April 2019

      • Category 4

        • CRA-1.1.15

          Category 4 licensees may undertake one or more regulated crypto-asset service, as listed below:

          (a) Operate a licensed crypto-asset exchange;
          (b) Crypto-asset custody service;
          (c) To act as a digital token advisor.
          Amended: April 2023
          Added: April 2019

        • CRA-1.1.16

          Licensees offering crypto-asset exchange service (licensed crypto-asset exchange) must not execute client orders against proprietary capital, or engage in matched principal trading.

          Added: April 2019

        • CRA-1.1.16A

          Pursuant to Section CRA-15.4 (Trading and Settlement of Digital Tokens), licensees may undertake over-the-counter trading in digital tokens which are issued in accordance with the requirements of Chapter CRA-15. The requirements of Paragraph CRA-1.1.16 are not applicable to trading in digital tokens provided the CBB has provided the licensee with an approval to trade the digital token under the over-the-counter trading framework.

          Added: April 2023

        • CRA-1.1.17

          When undertaking the regulated crypto-asset services listed under Rule CRA-1.1.15, Category-4 licensees may hold or control client asset and client money.

          Added: April 2019

        • CRA-1.1.18

          Persons wishing to be licensed to undertake the activities of regulated crypto-asset services must apply in writing to the CBB in accordance with the requirements stipulated in CRA-1.2.

          Amended: April 2023
          Added: April 2019

        • CRA-1.1.19

          [This Paragraph was deleted in April 2023].

          Deleted: April 2023
          Added: April 2019

        • CRA-1.1.20

          [This Paragraph was deleted in April 2023].

          Deleted: April 2023
          Added: April 2019

        • CRA-1.1.21

          [This Paragraph was deleted in April 2023].

          Deleted: April 2023
          Added: April 2019

        • CRA-1.1.22

          Applicants seeking a regulated crypto-asset service license must satisfy the CBB that they meet, by the date of grant of license, the minimum criteria for licensing, as contained in Chapter CRA-2. Once licensed, the regulated crypto-asset service licensee must continue to meet these criteria on an on-going basis.

          Added: April 2019

        • CRA-1.1.23

          [This Paragraph was deleted in April 2023].

          Deleted: April 2023
          Added: April 2019

        • CRA-1.1.24

          [This Paragraph was deleted in April 2023].

          Deleted: April 2023
          Added: April 2019

        • CRA-1.1.25

          [This Paragraph was deleted in April 2023].

          Deleted: April 2023
          Added: April 2019

      • Combining Regulated Crypto-asset Services

      • Differentiation Between Intermediary Activity and Exchange Activity

        • CRA-1.1.26

          Category-1, Category-2 and Category-3 crypto-asset licensees intending to operate solely as a broker and/or dealer for clients (intermediary service) are not permitted to structure their broking / dealing service or platform in such a way that it would be deemed as operating a market i.e. a crypto asset exchange. The CBB would consider features such as allowing for price discovery, displaying a public trading order book (accessible to any member of the public, regardless of whether they are clients), and allowing trades to automatically be matched using an exchange-type matching engine as characteristic of a crypto-asset exchange.

          Added: April 2023

        • CRA-1.1.27

          Category 1, Category 2 and Category 3 crypto-asset licensees should design and structure their operations, user interface, website, marketing materials and any public or client-facing information such that it does not create the impression that it is running a licensed crypto asset exchange. In practice, category 1, category 2 and category 3 crypto-asset licensees must not:

          (a) Display any publicly-accessible information that may appear like a trading order book;
          (b) Provide for any price discovery; and
          (c) Give actual or potential clients the impression that they are interacting with a licensed crypto-asset exchange.
          Added: April 2023

    • CRA-1.2 CRA-1.2 Application for License

      • CRA-1.2.1

        Applicants for a license must submit a duly completed Form 1 (Application for a License), under cover of a letter signed by an authorised signatory of the applicant marked for the attention of the Director, Licensing Directorate. The application must be accompanied by the documents listed in Rule CRA-1.2.4, unless otherwise directed by the CBB.

        Added: April 2019

      • CRA-1.2.2

        This Paragraph was deleted in April 2023]

        Deleted: April 2023
        Added: April 2019

      • CRA-1.2.3

        References to applicant mean the proposed licensee seeking a license. 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 licensing process, when seeking clarification of any issues.

        Added: April 2019

      • CRA-1.2.4

        Unless otherwise directed by the CBB, the following documents must be provided in support of the application for license:

        (a) A duly completed Form 2 (Application for Authorisation of Shareholders) for each Shareholder of the proposed licensee;
        (b) A duly completed Form 3 (Application for Approved Person status), for each individual proposed to undertake a controlled function (as defined in Rule CRA-1.7.2) in the proposed licensee;
        (c) A comprehensive business plan for the application, addressing the matters described in Rule CRA-1.2.6;
        (d) [This Sub-Paragraph was deleted in April 2023].
        (e) A copy of the applicant's commercial registration certificate;
        (f) A certified copy of a Board resolution of the applicant, confirming its decision to seek a CBB crypto-asset service license;
        (g) In the case of applicants that are part of a group, a letter of non-objection to the proposed license application from the applicant's lead 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;
        (h) [This Sub-Paragraph was deleted in April 2023].
        (i) [This Sub-Paragraph was deleted in April 2023].
        (j) In the case of applicants that are part of a group, copies of the audited financial statements of the applicant's group, for the three years immediately prior to the date of application;
        (k) In the case of applicants not falling under (j) above, copies of the audited financial statements of the applicant's substantial shareholder (where they are a legal person), for the three years immediately prior to the date of application; and
        (l) A copy of the applicant's memorandum and articles of association (in draft form for applicants creating a new company).
        (m) [This Sub-Paragraph was deleted in April 2023].
        Amended: April 2023
        Added: April 2019

      • CRA-1.2.5

        The CBB, in its complete discretion may ask for a letter of guarantee from the applicant's controlling or major shareholders on a case by case basis as it deems appropriate/necessary as part of the required documents to be submitted pursuant to Paragraph CRA-1.2.4 above.

        Amended: April 2023
        Added: April 2019

      • CRA-1.2.6

        The business plan submitted in support of an application must include:

        (a) An outline of the history of the applicant and its shareholders including the Ultimate Beneficiary Owners (UBO);
        (b) A description of the proposed, current, and historical business of the applicant, including detail on the products and services provided and to be provided, all associated websites addresses, the jurisdictions in which the applicant is engaged in business, the principal place of business, the primary market of operation and the projected customer base;
        (c) The reasons for applying for a license, including the applicant's strategy and market objectives;
        (cc) Details of the KYC and customer on-boarding process;
        (d) The proposed Board and senior management of the applicant and the proposed organisational structure of the applicant along with the proposed organization chart and the reporting lines;
        (dd) Detailed full business cycle flow from end to end of the business model;
        (e) An assessment of the risks that may be faced by the applicant, together with the proposed systems and controls framework to be put in place for addressing those risks and to be used for the main business functions;
        (f) An opening balance sheet for the applicant, together with a three-year financial projection, with all assumptions clearly outlined, demonstrating that the applicant will be able to meet applicable capital adequacy requirements;
        (g) Details of all banking arrangements for fund transfer as well as any other alternative form of arrangements for transfer of funds;
        (h) A copy of its business continuity plan; and
        (i) A description of the IT system that will be used, including details of how the IT system and other records will be backed up.
        Amended: April 2023
        Added: April 2019

      • CRA-1.2.7

        The applicant's memorandum and articles of association must explicitly provide for it to undertake the activities proposed in the license application, and must preclude the applicant from undertaking other regulated services, or commercial activities, unless these arise out of its regulated crypto-asset services or are incidental to those.

        Added: April 2019

      • CRA-1.2.8

        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.

        Added: April 2019

      • CRA-1.2.9

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

        Amended: April 2023
        Added: April 2019

      • CRA-1.2.10

        Failure to inform the CBB of the changes specified in Rule CRA-1.2.9 is likely to be viewed as a failure to provide full and transparent disclosure of information, and thus a failure to meet licensing condition stipulated in Paragraph CRA-2.8.2.

        Added: April 2019

      • Licensing Process and Timelines

        • CRA-1.2.11

          Articles 44 to 47 of the CBB Law govern the licensing process which stipulate that the CBB will issue its decision within 60 calendar days of an application being deemed complete (i.e. containing all required information and documents). By law, the 60 days' time limit 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 CRA-1.2.4 have to be provided, before the CBB may issue a license.

          Amended: April 2023
          Added: April 2019

        • CRA-1.2.12

          The CBB recognises, however, that applicants may find it difficult to secure suitable senior management (refer CRA-1.2.4(b) above) in the absence of preliminary assurances regarding the likelihood of obtaining a license.

          Added: April 2019

        • CRA-1.2.13

          [This Paragraph was deleted in April 2023].

          Deleted: April 2023
          Added: April 2019

        • CRA-1.2.14

          [This Paragraph was deleted in April 2023].

          Deleted: April 2023
          Added: April 2019

        • CRA-1.2.15

          [This Paragraph was deleted in April 2023].

          Deleted: April 2023
          Added: April 2019

        • CRA-1.2.16

          Therefore, 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.

          Amended: April 2023
          Added: April 2019

        • CRA-1.2.17

          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.

          Added: April 2019

        • CRA-1.2.18

          An applicant must not hold himself out as having been licensed by the CBB, prior to the issuance of the CBB’s Resolution on granting the license. Failure to do so may constitute grounds for refusing an application and result in a contravention of Article 42 of the CBB Law (which carries a maximum penalty of BD 1 million).

          Amended: April 2023
          Added: April 2019

      • Granting or Refusal of License

        • CRA-1.2.19

          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: April 2023
          Amended: October 2019
          Added: February 2019

        • CRA-1.2.20

          The CBB may reject an application for a license if in its opinion:

          (a) The requirements of the CBB Law or the Rulebook 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 clients.
          Amended: April 2023
          Amended: October 2019
          Added: April 2019

        • CRA-1.2.21

          Where the CBB intends to refuse an application for a license, it must give the applicant 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.

          Amended: April 2023
          Amended: October 2019
          Added: February 2019

        • CRA-1.2.22

          Before the final approval is granted to a licensee, a confirmation from a retail bank addressed to the CBB that the minimum capital, as specified in this Module, has been paid in must be provided to the CBB.

          Added: April 2019

      • Readiness Assessment

        • CRA-1.2.23

          Prior to commencement of operation, a licensee must, after obtaining the CBB's prior written approval, appoint an independent third party to undertake a readiness assessment and submit a readiness assessment report.

          Added: April 2019

        • CRA-1.2.24

          The readiness assessment report must include the licensee's risk management system, capital adequacy, organisational structure, operational manuals, information technology, information system security, policies and procedures and internal controls and systems.

          Added: April 2019

        • CRA-1.2.25

          [This Paragraph was deleted in April 2023].

          Deleted: April 2023
          Added: April 2019

      • Commencement of Operations

        • CRA-1.2.26

          Prior to commencement of operation 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 business of the proposed licensee;
          (b) [This Sub-paragraph was deleted in April 2023];
          (c) The licensee's contact details including telephone and fax number, e-mail address and website;
          (d) [This Sub-paragraph was deleted in April 2023];
          (e) [This Sub-paragraph was deleted in April 2023];
          (f) A copy of the auditor's acceptance to act as auditor for the applicant;
          (g) A certificate from a retail bank operating in Bahrain certifying that the capital is deposited;
          (h) A copy of the licensee's professional indemnity insurance policy;
          (i) A copy of the applicant's notarized memorandum and articles of association, addressing the matters described in Paragraph CRA-1.2.9;
          (j) A copy of the commercial registration certificate in Arabic and in English from the Ministry of Commerce, Industry and Tourism;
          (k) [This Sub-paragraph was deleted in April 2023];
          (l) Any other information as may be specified by the CBB;
          (m) A written confirmation, addressed to the CBB, from a licensed retail bank, stating that necessary banking arrangements, including opening of accounts (both corporate account and client money account) has been made by the applicant; and
          (n) Where the licensee has entered into an agreement with a third party, other than a licensed bank, for the purpose of transfer of funds, a copy of the written agreement between the licensee and the third party.
          Amended: April 2023
          Added: April 2019

        • CRA-1.2.27

          Licensees must commence their commercial operations within 6 months of being granted a license by the CBB, failing which the CBB may cancel the license, in accordance with the provisions of the CBB Law.

          Amended: April 2023
          Added: April 2019

        • CRA-1.2.28

          [This Paragraph was deleted in April 2023].

          Deleted: April 2023
          Added: April 2019

    • CRA-1.3 CRA-1.3 Cancellation or Amendment of License

      • Voluntary Surrender of a License

        • CRA-1.3.1

          In accordance with Article 50 of the CBB Law, licensees wishing to cease carrying out all the approved regulated services, must obtain the CBB's written approval, before ceasing their activities. All such requests must be made in writing to the Director, Capital Markets Supervision, setting out in full the reasons for the request and how the business is to be wound up.

          Amended: April 2023
          Added: April 2019

        • CRA-1.3.2

          Licensees must satisfy the CBB that their clients' interests are to be safeguarded during and after the proposed cancellation.

          Added: April 2019

        • CRA-1.3.3

          The CBB will approve a request for cancellation of license by a licensee where there is no outstanding regulatory concerns and client interests would not be prejudiced. A voluntary surrender will only be allowed to take effect once the licensee, in the opinion of the CBB, has discharged all its regulatory obligations towards clients.

          Amended: April 2023
          Added: April 2019

      • Cancellation of a License by the CBB

        • CRA-1.3.4

          Pursuant to Article 48 (c) of the CBB Law, the CBB may cancel a license, for instance if a licensee fails to satisfy any of its existing license conditions or in order to protect the legitimate interests of clients or creditors of the licensee. The CBB generally views the cancellation of a license as appropriate only in the most serious of circumstances, and generally tries to address supervisory concerns through other means beforehand.

          Amended: April 2023
          Added: April 2019

        • CRA-1.3.5

          The procedures for cancellation of a license are contained in Articles 48 and 49 of the CBB Law.

          Amended: April 2023
          Added: April 2019

        • CRA-1.3.6

          The CBB will only effect the cancellation once a licensee has discharged all its regulatory responsibilities to clients. Until such time, the CBB will retain all its regulatory powers towards the licensee and will direct the licensee so that no new regulated crypto-asset services may be undertaken whilst the licensee discharges its obligations to its clients.

          Amended: April 2023
          Added: April 2019

      • Amendment to the scope of regulated services under the license or Amendment of the license

        • CRA-1.3.7

          Licensees wishing to vary the scope of the regulated services under their existing license, whether by adding or ceasing some services, must obtain the CBB’s prior written approval. The CBB’s prior written approval must also be sought in relation to an amendment to the licensee’s license category.

          Added: April 2023

    • CRA-1.4 CRA-1.4 Publication of the Decision to Grant, Cancel or Amend a License

      • CRA-1.4.1

        In accordance with Articles 47 and 49 of the CBB Law, the CBB must 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: February 2019

      • CRA-1.4.2

        For the purposes of Paragraph CRA-1.4.1, the cost of publication must be borne by the Licensee.

        Added: April 2019

      • CRA-1.4.3

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

        Added: April 2019

    • CRA-1.5 CRA-1.5 Licensing Application Fees

      • CRA-1.5.1

        Applicants seeking a regulated crypto-asset service license from the CBB must pay a non-refundable license application fee of BD 100 at the time of submitting their formal application to the CBB.

        Added: April 2019

      • CRA-1.5.2

        [This Paragraph was deleted in April 2023].

        Deleted: April 2023
        Added: April 2019

    • CRA-1.6 CRA-1.6 Annual License Fees

      • CRA-1.6.1

        Licensees must pay the relevant annual license fee to the CBB, on 1st December of the preceding year for which the fee is due.

        Added: April 2019

      • CRA-1.6.2

        The relevant fees are specified in Rule CRA-1.6.3 below. The fees due on 1st December are those due for the following calendar year, but are calculated on the basis of the firm's latest audited financial statements for the previous calendar year: i.e. the fee payable on 1st December 2013 for the 2014 year (for example), is calculated using the audited financial statements for 2012, assuming a 31st December year end. Where a licensee does not operate its accounts on a calendar-year basis, then the most recent audited financial statements available are used instead.

        Added: April 2019

      • CRA-1.6.3

        The variable annual license fee payable by licensees is 0.25% of their relevant operating expenses, subject to a minimum and maximum as per the table below:

        S1. No.
        Licensing Category
        Minimum Fees (BD)
        Maximum Fees (BD)
        1.
        Category-1
        2,000
        6,000
        2.
        Category-2
        3,000
        8,000
        3.
        Category-3
        4,000
        10,000
        4.
        Category-4
        5,000
        12,000
        Added: February 2019

      • CRA-1.6.4

        Relevant operating expenses are defined as the total operating expenses of the licensee concerned, as recorded in the most recent audited financial statements available, subject to the adjustments specified in Rule CRA-1.6.5.

        Added: April 2019

      • CRA-1.6.5

        The adjustments to be made to relevant operating expenses are the exclusion of the following items from total operating expenses:

        (a) Training costs;
        (b) Charitable donations;
        (c) CBB fees paid; and
        (d) Non-executive Directors' remuneration.
        Added: April 2019

      • CRA-1.6.6

        For the avoidance of doubt, operating expenses for the purposes of this Section, do not include items such as depreciation, provisions, interest expense, and dividends.

        Added: April 2019

      • CRA-1.6.7

        The CBB would normally rely on the audited accounts of a licensee as representing a true and fair picture of its operating expenses. However, the CBB reserves the right to enquire about the accounting treatment of expenses, and/or policies on intra-group charging, if it believes that these are being used artificially to reduce a license fee.

        Added: April 2019

      • CRA-1.6.8

        Licensees must complete and submit Form ALF (Annual License Fee) to the CBB, no later than 15th October of the preceding year for which the fees are due.

        Added: April 2019

      • CRA-1.6.9

        Licensees are subject to direct debit for the payment of the annual fee and must complete and submit to the CBB a Direct Debit Authorisation Form by 15th September available under Part B of Volume 6 (Capital Markets) CBB Rulebook on the CBB Website.

        Added: February 2019

      • CRA-1.6.10

        For new licensees, the first annual license fee is payable when the license is issued by the CBB. The amount payable is the minimum amount stipulated in Paragraph CRA-1.6.3 for each category of license.

        Added: April 2019

      • CRA-1.6.11

        For the first full year of operation, the licensee would calculate its fee as the floor amount. For future years, the licensee would submit a Form ALF by 15th October of the preceding year for which the fees are due and calculate its fee using its last audited financial statements (or alternative arrangements as agreed with CBB, should its first set of accounts cover an 18-month period).

        Added: April 2019

      • CRA-1.6.12

        Where a license is cancelled (whether at the initiative of the firm or the CBB), no refund is paid for any months remaining in the calendar year in question.

        Added: April 2019

      • CRA-1.6.13

        [This Paragraph was deleted in April 2023].

        Deleted: April 2023
        Added: April 2019

    • CRA-1.7 CRA-1.7 Approved Persons

      • General Requirements

        • CRA-1.7.1

          Licensees must obtain the CBB's prior written approval in relation to any person wishing to undertake a controlled function in a licensee. The approval from the CBB must be obtained prior to their appointment.

          Amended: April 2023
          Added: April 2019

        • CRA-1.7.2

          Controlled functions are those functions occupied by board members and persons in executive positions and include:

          (a) Director;
          (b) Chief Executive or General Manager;
          (c) Head of function;
          (d) Chief Information Security Officer;
          (e) Compliance Officer; and
          (f) Money Laundering Reporting Officer (MLRO).
          Added: April 2019

        • CRA-1.7.3

          [This Paragraph was deleted in April 2023].

          Deleted: April 2023
          Added: April 2019

        • CRA-1.7.4

          [This Paragraph was deleted in April 2023].

          Deleted: April 2023
          Added: April 2019

        • CRA-1.7.5

          The CBB may grant an exemption from appointment of some of the controlled functions contained in Paragraph CRA-1.7.2, provided the licensee appoints at least the following controlled functions (i) Directors, (ii) Chief Executive or General Manager, (iii) Compliance Officer and (iv) Money Laundering Reporting Officer.

          Amended: April 2023
          Added: April 2019

        • CRA-1.7.6

          Pursuant to CRA-1.7.5, a licensee seeking exemption from appointment of persons to specific controlled functions should provide in writing to the satisfaction of the CBB:

          (a) Nature, scale and complexity of their business and how performance of the controlled function to which no appointment is to be made will be managed;
          (b) Provide alternative arrangements which should ensure sound and prudent management and adequate consideration to the interest of clients and the integrity of the market; and
          (c) Confirmation that the individual entrusted with additional responsibilities pertaining to a controlled function is of sufficient good repute, possesses sufficient knowledge, skill and experience and ability to commit sufficient time to discharge the additional responsibility.
          Amended: April 2023
          Added: April 2019

      • Fit and Proper

        • CRA-1.7.7

          Licensees seeking an approved person authorisation for an individual, must satisfy the CBB that the individual concerned is ‘fit and proper’ to undertake the controlled function in question.

          Amended: April 2023
          Added: April 2019

        • CRA-1.7.8

          Each applicant applying for approved person status and those individuals occupying approved person positions must comply with the following conditions:

          (a) Has not previously been convicted of any felony or crime that relates to his/her honesty and/or integrity unless he/she has subsequently been restored to good standing;
          (b) Has not been the subject of any adverse finding in a civil action by any court or competent jurisdiction, relating to fraud;
          (c) Has not been adjudged bankrupt by a court unless a period of 10 years has passed, during which the person has been able to meet all his/her obligations and has achieved economic accomplishments;
          (d) Has not been disqualified by a court, regulator or other competent body, as a director or as a manager of a corporation;
          (e) Has not failed to satisfy a judgement debt under a court order resulting from a business relationship;
          (f) Must have personal integrity, good conduct and reputation;
          (g) Has appropriate professional and other qualifications for the controlled function in question. All persons proposed to undertake any controlled functions must meet the relevant examination and qualification requirements of the CBB.; and
          (h) Has sufficient experience to perform the duties of the controlled function.
          Amended: April 2023
          Added: April 2019

        • CRA-1.7.8A

          In assessing the conditions prescribed in Paragraph CRA-1.7.8, the CBB will take into account the criteria contained in Paragraph CRA-1.7.8B. The CBB reviews each application on a case-by-case basis, taking into account all relevant circumstances. A person may be considered ‘fit and proper’ to undertake one type of controlled function but not another, depending on the function’s job size and required levels of experience and expertise. Similarly, a person approved to undertake a controlled function with a licensee may not be considered to have sufficient expertise and experience to undertake nominally the same controlled function but in a much bigger licensee.

          Added: April 2023

        • CRA-1.7.8B

          In assessing a person’s fitness and propriety, the CBB will also consider previous professional and personal conduct (in Bahrain or elsewhere) including, but not limited to, the following:

          (a) The propriety of a person’s conduct, whether or not such conduct resulted in a criminal offence being committed, the contravention of a law or regulation, or the institution of legal or disciplinary proceedings;
          (b) A conviction or finding of guilt in respect of any offence, other than a minor traffic offence, by any court or competent jurisdiction;
          (c) Any adverse finding in a civil action by any court or competent jurisdiction, relating to misfeasance or other misconduct in connection with the formation or management of a corporation or partnership;
          (d) Whether the person, or anybody corporate, partnership or unincorporated institution to which the applicant has, or has been associated with as a director, controller, manager or company secretary been the subject of any disciplinary proceeding, investigation or fines by any government authority, regulatory agency or professional body or association;
          (e) The contravention of any financial services legislation;
          (f) Whether the person has ever been refused a license, authorisation, registration or other authority;
          (g) Dismissal or a request to resign from any office or employment;
          (h) Whether the person has been a Director, partner or manager of a corporation or partnership which has gone into liquidation or administration or where one or more partners have been declared bankrupt whilst the person was connected with that partnership;
          (i) The extent to which the person has been truthful and open with supervisors; and
          (j) Whether the person has ever entered into any arrangement with creditors in relation to the inability to pay due debts.
          Added: April 2023

        • CRA-1.7.8C

          With respect to Paragraph CRA1.7.8B, the CBB will take into account the length of time since any such event occurred, as well as the seriousness of the matter in question.

          Added: April 2023

        • CRA-1.7.8D

          Approved persons undertaking a controlled function must act prudently, and with honesty, integrity, care, skill and due diligence in the performance of their duties. They must avoid any conflict of interest arising whilst undertaking a controlled function.

          Added: April 2023

        • CRA-1.7.8E

          In determining where there may be a conflict of interest arising, factors that may be considered will include whether:

          (a) A person has breached any fiduciary obligations to the licensee or terms of employment;
          (b) A person has undertaken actions that would be difficult to defend, when looked at objectively, as being in the interest of the licensee and its clients; and
          (c) A person has failed to declare a personal interest that has a material impact in terms of the person’s relationship with the licensee.
          Added: April 2023

      • Prior Approval Requirements and Process

        • CRA-1.7.8F

          An application for approval for a person occupying a controlled function under Paragraph CRA-1.7.2 must be made by submitting to the CBB a duly completed Form 3 (Application for Approved Person Status) and Curriculum Vitae after verifying that the information in the Form 3, including previous experience is accurate. Form 3 is available under Volume 6 Part B Authorisation Forms CRA Forms of the CBB Rulebook.

          Added: April 2023

        • CRA-1.7.8G

          When the request for approved person status forms part of a license application, it must be marked for the attention of the Director, Licensing and Policy Directorate. When the submission to undertake a controlled function is in relation to an existing licensee, except if dealing with a MLRO, it must be marked for the attention of the Director, Capital Markets Supervision Directorate. In case of the MLRO, Form 3 must be marked for the attention of the Director, Compliance Directorate.

          Added: April 2023

        • CRA-1.7.8H

          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 licensee, seeking CBB approval;
          (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) Signed by an authorised representative of the licensee and all pages stamped with the licensee’s seal.
          Added: April 2023

        • CRA-1.7.8I

          Licensees seeking to appoint Board Directors must seek CBB approval for all the candidates to be put forward for election/approval at a shareholders’ meeting, in advance of the agenda being issued to shareholders. CBB approval of the candidates does not in any way limit shareholders’ rights to refuse those put forward for election/approval.

          Added: April 2023

        • CRA-1.7.8J

          For existing licensees applying for the appointment of a Director or the Chief Executive/General Manager, the authorised representative should be the Chairman of the Board or a Director signing on behalf of the Board. For all other controlled functions, the authorised representative should be the Chief Executive/General Manager.

          Added: April 2023

      • Assessment of Application

        • CRA-1.7.8K

          The CBB shall review and assess the application for approved person status to ensure that it satisfies all the conditions required in Paragraph CRA-1.7.8 and the criteria outlined in Paragraph CRA-1.7.8B.

          Added: April 2023

        • CRA-1.7.8L

          For purposes of Paragraph CRA-1.7.8I, 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 required conditions and regulatory requirements, including but not limited to, receiving the application complete with all the required information and documents, as well as verifying references.

          Added: April 2023

        • CRA-1.7.8M

          The CBB reserves the right to refuse an application for approved person status if it does not satisfy the conditions provided for in Paragraph CRA-1.7.8 and the criteria outlined in Paragraph CRA-1.7.8B. A notice of such refusal is issued to the licensee concerned, setting out the basis for the decision.

          Added: April 2023

      • Appeal Process

        • CRA-1.7.8N

          Licensee 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: April 2023

        • CRA-1.7.8O

          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 required conditions and 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 Executive Director, Financial Institutions Supervision 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: April 2023

      • Notification Requirements and Process

        • CRA-1.7.9

          Licensees must promptly notify the CBB in writing when a person undertaking a controlled function will no longer be carrying out that function together with an explanation as to the reasons for not undertaking the controlled function. In such cases, their approved person status is automatically withdrawn by the CBB. If a controlled function falls vacant, the 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 licensee must make immediate interim arrangements to ensure continuity of the duties and responsibilities of the controlled function affected, provided that such arrangements do not pose a conflict of duties. These interim arrangements must be approved by the CBB.

          Amended: April 2023
          Added: April 2019

        • CRA-1.7.10

          The notification should 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.

          Added: April 2019

        • CRA-1.7.10A

          Licensees must immediately notify the CBB in case of any material change to the information provided in a Form 3 submitted for an approved person.

          Added: April 2023

      • Amendment of Authorisation

        • CRA-1.7.10B

          Licensees must seek prior CBB approval before an approved person may move from one controlled function to another within the same licensee.

          Added: April 2023

        • CRA-1.7.10C

          For the purposes of Paragraph CRA-1.7.10B, a new application should be completed and submitted to the CBB. A person may be considered ‘fit and proper’ for one controlled function, but not for another, if for instance the new role requires a different set of skills and experience.

          Added: April 2023

      • Cancellation of Approved Person Status

        • CRA-1.7.11

          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.

          Amended: April 2023
          Added: April 2019

        • CRA-1.7.12

          [This Paragraph was deleted in April 2023].

          Deleted: April 2023
          Added: April 2019

        • CRA-1.7.13

          [This Paragraph was deleted in April 2023].

          Deleted: April 2023
          Added: April 2019

        • CRA-1.7.14

          [This Paragraph was deleted in April 2023].

          Deleted: April 2023
          Added: April 2019

        • CRA-1.7.15

          [This Paragraph was deleted in April 2023].

          Deleted: April 2023
          Added: April 2019

        • CRA-1.7.16

          [This Paragraph was deleted in April 2023].

          Deleted: April 2023
          Added: April 2019

        • CRA-1.7.17

          [This Paragraph was deleted in April 2023].

          Deleted: April 2023
          Added: April 2019

        • CRA-1.7.18

          Where a firm is in doubt as to whether a function should be considered a controlled function it must discuss the case with the CBB.

          Added: April 2019

        • CRA-1.7.19

          Licensees must designate an employee, of appropriate standing and resident in Bahrain, as compliance officer. The duties of the compliance officer 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.
          Added: April 2019