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Location: Central Bank of Bahrain Volume 5—Specialised Licensees > Common Modules (Applicable to all Specialised Licensees) > Part A > Enforcement & Redress > EN Enforcement > EN-4 Directions > EN-4.2 CBB Policy > EN-4.2.3
  • EN-4.2 CBB Policy

    • 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 licenseeG 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'sG activities until those risks have been addressed – for instance, a ban on the acceptance of new customersG .

      October 2010

    • EN-4.2.2

      The CBB is conscious of the powerful nature of a Direction and, in the case of a licenseeG , 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.

      October 2010

    • EN-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 to customersG , 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.
      October 2010

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