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Location: Central Bank of Bahrain Volume 5—Specialised Licensees > Specific Modules (By Type of Licensee) > Type 4: Administrators > Part A > Reporting Requirements > BR Administrators CBB Reporting Module
  • BR Administrators CBB Reporting Module

    • BR-A Introduction

      • BR-A.1 Purpose

        • Executive Summary

          • BR-A.1.1

            This Module sets out requirements applicable to administrators licenseesG regarding reporting to the Central Bank of Bahrain ('CBB'). These include the provision of financial information to the CBB, as well as notification to the CBB of certain specified events, some of which require prior CBB approval. This Module also outlines the methods used by the CBB in gathering information required in the supervision of administrators licenseesG .

            May 2011

        • Legal Basis

          • BR-A.1.2

            This Module contains the Central Bank of Bahrain ('CBB') Directive (as amended from time to time) regarding CBB Reporting requirements applicable to administrators licenseesG , and is issued under the powers available to the CBB under Article 38 of the Central Bank of Bahrain and Financial Institutions Law 2006 ('CBB Law').

            May 2011

          • BR-A.1.3

            For an explanation of the CBB's rule-making powers and different regulatory instruments, see section UG-1.1.

            May 2011

      • BR-A.2 Module History

        • Evolution of Module

          • BR-A.2.1

            This Module was first issued in May 2011. All subsequent changes to this Module are annotated with the end-calendar quarter date in which the change was made: UG-3 provides further details on Rulebook maintenance and version control.

            May 2011

          • BR-A.2.2

            A list of recent changes made to this Module is provided below:

            Module Ref. Change Date Description of Changes
            BR-3.1.1A and BR-3.1.1B 04/2012 Added Paragraphs to clarify Rules on power to request information.
            BR-3.3.1 and BR-3.4 04/2012 Minor corrections.
            BR-3.5 04/2012 New Section added to include material transferred from common Chapters EN-2 and AA-5
            BR-1.1.9 and BR-2.2.18 10/2012 Updated reference to CBB Rulebook Volume 7 (CIU).
            BR-1.1.13 01/2013 Clarified deadline to update IIS.
            BR-1.1.15 and BR-1.1.16 04/2013 Added new Paragraphs to include reporting requirements on controllers and close links as per Rules contained under Module GR.
            BR-3.5.14 07/2013 Amended numbering of referred appendix.
            BR-1.1.1A 10/2019 Added a new Paragraph on disclosure of financial penalties.

    • BR-B Scope of Application

      • BR-B.1 Scope of Application

        • BR-B.1.1

          The content of this Module applies to all administrators licenseesG authorised in the Kingdom of Bahrain, thereafter referred to in this Module as licenseesG .

          May 2011

    • BR-1 Reporting Requirements

      • BR-1.1 General Requirements

        • Audited Financial Statements

          • BR-1.1.1

            As specified in Article 62 of the CBB Law, a licenseeG must submit to the CBB its final audited financial statements within 3 months of the licensee'sG financial year-end

            May 2011

          • BR-1.1.1A

            In accordance with Paragraphs EN-B.4.5 and EN-5.2.2, licenseesG must disclose in their annual audited financial statements the amount of any financial penalties paid to the CBB, together with a factual description of the reason(s) given by the CBB for the penalty. LicenseesG which fail to comply with this requirement will be required to make the disclosure in the annual audited financial statements of the subsequent year and will be subject to an enforcement action for non-disclosure.

            Added: October 2019

        • Suspicious Transaction Reports (STR)

          • BR-1.1.2

            As per Rule FC-5.2.4, licenseesG must report all suspicious transactions or attempted transactions to the Financial Intelligence Unit at the Ministry of Interior and to the Compliance Directorate at the CBB.

            May 2011

          • BR-1.1.3

            As per Rule FC-1.8.2 licenseesG must make a suspicious transaction report to the Compliance Directorate at the CBB and the Financial Intelligence Unit at the Ministry of Interior, if they are approached by a shell bank or an institution they suspect of being a shell bank.

            May 2011

          • BR-1.1.4

            As per Rule FC-5.2.3, if licenseesG suspect that a person has been engaged in money laundering or terrorism financing, or the activity concerned is regarded as suspicious, the licenseeG must report the fact promptly to the Financial Intelligence Unit at the Ministry of Interior and copy the Compliance Directorate at the CBB. The reports must be made using the STR Form and related instructions, included in Part B of Volume 5.

            May 2011

          • BR-1.1.5

            As per Section FC-8.1, when dealing with entities or persons domiciled in countries or territories which are identified by the FATF as being non-cooperative or notified to licenseesG from time to time by the CBB, whenever the licenseeG has suspicions about the transaction, these must be reported to the Financial Intelligence Unit at the Ministry of Interior and the Compliance Directorate at the CBB.

            May 2011

          • BR-1.1.6

            As per Rule FC-8.3.3, licenseesG must report to the Financial Intelligence Unit at the Ministry of Interior and the Compliance Directorate at the CBB, using the procedures contained in Section FC-5.2, details of any accounts or other dealings with persons and entities designated by the CBB as potentially linked to terrorist activity.

            May 2011

        • Reports Prepared by the MLRO

          • BR-1.1.7

            As per Rule FC-4.3.1(a) and (b), licenseesG must arrange for their MLRO to produce a report containing the number of internal reports made in accordance with Section FC-5.1, a breakdown of all the results of those internal reports and their outcomes for each segment of the licensee'sG business, and an analysis of whether controls or training need to be enhanced and a report, indicating the number of external reports made in accordance with Section FC-5.2 and, where a licenseeG has made an internal report but not made an external report, noting why no external report was made. These reports are to be submitted to the CBB by the 30th of April of the following year.

            May 2011

        • Report of Fraud or Attempted Fraud

          • BR-1.1.8

            LicenseesG must report any actual or attempted fraud incident (however small) to the appropriate authorities (including the CBB) (ref. FC-11.1).

            May 2011

        • Reports Required as per Volume 7 (CIU)

          • BR-1.1.9

            LicenseesG must comply with any reporting requirements applicable to them as stipulated in CBB Rulebook Volume 7 (CIU).

            Amended: October 2012
            May 2011

        • Reports Prepared by the External Auditor

          • BR-1.1.10

            As per Rule FC-4.3.1(d), licenseesG must arrange for their external auditor to produce a report as to the quality of the licensee'sG anti-money laundering procedures, systems and controls, and compliance with the AML Law and Module FC (Financial Crime) to be submitted to the CBB by the 30th of April of the following year.

            May 2011

        • Terrorist Financing

          • BR-1.1.11

            As per Rule FC-8.2.4, licenseesG must report to the Compliance Directorate at the CBB, details of:

            (a) Funds or other financial assets or economic resources they have with them which may be the subject of Article 1, paragraphs (c) and (d) of UNSCR 1373; and
            (b) All claims, whether actual or contingent, which the licenseeG has on persons and entities which may be the subject of Article 1, paragraphs (c) and (d) of UNSCR 1373.
            May 2011

        • Annual License Fee

          • BR-1.1.12

            LicenseesG must complete and submit Form ALF (Annual License Fee) to the CBB, no later than 30 April each year, together with the payment due under Rule AU-5.2.1.

            May 2011

        • Institutional Information System (IIS)

          • BR-1.1.13

            LicenseesG are required to complete online non-financial information related to their institution by accessing the CBB's institutional information system (IIS). LicenseesG must update the required information at least on a quarterly basis or when a significant change occurs in the non-financial information included in the IIS. If no information has changed during the quarter, the licenseeG must still access the IIS quarterly and confirm the information contained in the IIS. LicenseesG must ensure that they access the IIS within 20 calendar days from the end of the related quarter and either confirm or update the information contained in the IIS.

            Amended: January 2013
            May 2011

          • BR-1.1.14

            LicenseesG failing to comply with the requirements of Paragraph BR-1.1.13 or reporting inaccurate information are subject to financial penalties or other enforcement actions as outlined in Module (EN) Enforcement

            May 2011

        • Report on Controllers

          • BR-1.1.15

            In accordance with Paragraph GR-5.1.8, licenseesG must submit, within 3 months of their financial year-end, a report on their controllersG which must identify all controllersG of the licenseeG , as defined under Section GR-5.2.

            Added: April 2013

        • Report on Close Links

          • BR-1.1.16

            In accordance with Paragraph GR-6.1.3, licenseesG must submit within 3 months of their financial year-end, a report on their close linksG which must identify all undertakings closely linked to the licenseeG , as defined under Section GR-6.2.

            Added: April 2013

    • BR-2 Notifications and Approvals

      • BR-2.1 Introduction

        • BR-2.1.1

          All notifications and approvals required in this Chapter are to be submitted by licenseesG in writing.

          May 2011

        • BR-2.1.2

          In this Module, the term 'in writing' includes electronic communication capable of being reproduced in paper form.

          May 2011

        • BR-2.1.3

          A licenseeG must make the notifications and approvals required in Chapter BR-2 immediately it becomes aware, or has information which reasonably suggests, that any of the matters in Chapter BR-2 have occurred, may have occurred or may occur in the near future.

          May 2011

        • BR-2.1.4

          LicenseesG are required to provide the CBB with a range of information to enable it to monitor the licensee'sG compliance with Volume 5 of the CBB Rulebook. Some of this information is provided through regular reports, whereas others are in response to the occurrence of a particular event (such as a change in name or address). The following sections list the commonly occurring reports for which a licenseeG will be required to notify the CBB or seek its approval.

          May 2011

      • BR-2.2 Notification Requirements

        • Matters Having a Serious Supervisory Impact

          • BR-2.2.1

            A licenseeG must notify the CBB if any of the following has occurred, may have occurred or may occur in the near future:

            (a) The licenseeG failing to satisfy one or more of the Principles of Business referred to in Module PB;
            (b) Any matter which could have a significant adverse impact on the licensee'sG reputation;
            (c) Any matter which could affect the licensee'sG ability to continue to provide adequate services to its customersG and which could result in serious detriment to a customerG of the licenseeG ;
            (d) Any matter in respect of the licenseeG that could result in material financial consequences to the financial system or to other licenseesG ;
            (e) Any breach of any provision of the Rulebook (including a Principle);
            (f) A breach of any requirement imposed by the relevant law or by regulations or an order made under any relevant law by the CBB; or
            (g) If a licenseeG becomes aware, or has information that reasonably suggests that it has or may have provided the CBB with information that was or may have been false, misleading, incomplete or inaccurate, or has or may have changed in a material way, it must notify the CBB immediately (ref. BR-3.3.2).
            May 2011

          • BR-2.2.2

            The circumstances that may give rise to any of the events in Paragraph BR-2.2.1 are wide-ranging and the probability of any matter resulting in such an outcome, and the severity of the outcome, may be difficult to determine. However, the CBB expects licenseesG to consider properly all potential consequences of events.

            May 2011

          • BR-2.2.3

            In determining whether an event that may occur in the near future should be notified to the CBB, a licenseeG should consider both the probability of the event happening and the severity of the outcome should it happen. Matters having a supervisory impact could also include matters relating to a parent undertakingG or controllerG that may indirectly have an effect on the licenseeG .

            May 2011

        • Legal, Professional, Administrative or other Proceedings Against a Fund Administration Licensee

          • BR-2.2.4

            A licenseeG must notify the CBB immediately of any legal, professional or administrative or other proceedings instituted against the licenseeG , controllerG or a close linkG including a parent undertakingG of the licenseeG that is known to the licenseeG and is significant in relation to the licensee'sG financial resources or its reputation.

            May 2011

          • BR-2.2.5

            A licenseeG must notify the CBB of the bringing of a prosecution for, or conviction of, any offence under any relevant law against the licenseeG that would prevent the licenseeG from meeting the Principles of Business (Module PB) or any of its DirectorsG , officers or approved personsG from meeting the fit and proper requirements of Module AU.

            May 2011

        • Fraud, Errors and other Irregularities

          • BR-2.2.6

            A licenseeG must notify the CBB immediately if one of the following events arises and the event is significant:

            (a) It becomes aware that an employee may have committed a fraud against one of its customersG ;
            (b) It becomes aware that a person, whether or not employed by it, is acting with intent to commit fraud against it;
            (c) It identifies irregularities in its accounting or other records, whether or not there is evidence of fraud;
            (d) It suspects that one of its employees may be guilty of serious misconduct concerning his honesty or integrity and which is connected with the licensee'sG regulated or ancillary activities; or
            (e) Any conflicts of interest.
            May 2011

        • Insolvency, Bankruptcy and Winding Up

          • BR-2.2.7

            Except in instances where the CBB has initiated the following actions, a licenseeG must notify the CBB immediately of any of the following events:

            (a) The calling of a meeting to consider a resolution for winding up the licenseeG , a controllerG or close linkG , including a parent undertakingG of the licenseeG ;
            (b) An application to dissolve a controllerG or close linkG , including a parent undertakingG of the licenseeG or to strike the licenseeG off the Register of Fund Administrators;
            (c) The presentation of a petition for the winding up of a controllerG or close linkG , including a parent undertakingG of the licenseeG ;
            (d) The making of any proposals, or the making of, a composition or arrangement with any one or more of the licensee'sG creditors, for material amounts of debt;
            (e) An application for the appointment of an administrator or trustee in bankruptcy to a controllerG or close linkG , including a parent undertakingG of the licenseeG ;
            (f) The appointment of a receiver to a controllerG or close linkG , including a parent undertakingG of the licenseeG (whether an administrative receiver or a receiver appointed over particular property); or
            (g) An application for an interim order against the licenseeG , a controllerG or close linkG , including a parent undertakingG of the licenseeG under the Bankruptcy and Composition Law of 1987 or similar legislation in another jurisdiction.
            May 2011

        • Other Supervisors

          • BR-2.2.8

            A licenseeG must notify the CBB immediately if it becomes subject to or ceases to be subject to the supervision of any overseas supervisor (including a home supervisorG ).

            May 2011

          • BR-2.2.9

            The supervisory regime and any legislative or foreign provisions to which that licenseeG , is subject, influence the CBB's approach to the supervision of the licenseeG .

            May 2011

        • External Auditor

          • BR-2.2.10

            A licenseeG must notify the CBB of the following:

            (a) Removal or resignation of auditor (ref. AA-1.2.1); or
            (b) Change in audit partner (ref. AA-1.3.3).
            May 2011

        • Approved Persons

          • BR-2.2.11

            A licenseeG must notify the CBB of the termination of employment of approved personsG , including particulars of reasons for the termination and arrangements with regard to replacement (ref. AU-4.3.5).

            May 2011

          • BR-2.2.12

            LicenseesG must immediately notify the CBB when they become aware of any of the events listed in Paragraph EN-8.2.3, affecting one of their approved personsG .

            May 2011

        • Capital Adequacy

          • BR-2.2.13

            In the event that a licenseeG fails to meet any of the requirements specified in Module CA (Capital Adequacy), it must, on becoming aware that it has breached the requirements, immediately notify the CBB in writing (ref. CA-1.1.5).

            May 2011

          • BR-2.2.14

            As specified in Article 58 of the CBB Law, a licenseeG must notify the CBB immediately of any matter that may affect its financial position, currently or in the future, or limit its ability to meet its obligations.

            May 2011

        • Outsourcing Arrangements

          • BR-2.2.15

            LicenseesG must immediately inform their direct supervisory contact at the CBB of any material problems encountered with an outsourcing provider.

            May 2011

        • Controllers

          • BR-2.2.16

            If, as a result of circumstances outside the licensee'sG knowledge and/or control, one of the changes to their controllersG specified in Paragraph GR-5.1.1 is triggered prior to CBB approval being sought or obtained, the licenseeG must notify the CBB as soon as it becomes aware of the fact and no later than 15 calendar days after the change occurs (ref. GR-5.1.4).

            May 2011

          • BR-2.2.17

            As specified in Article 52 of the CBB Law, a licenseeG must notify the CBB of the following events:

            (a) If effective control over a licenseeG takes place indirectly whether by way of inheritance or otherwise.
            (b) Gaining control directly as a result of any action leading to it; or
            (c) The intention to take any of the actions that would lead to control.
            May 2011

        • Other Notification Requirements

          • BR-2.2.18

            Licensees must comply with any notification requirements applicable to them as stipulated in CBB Rulebook Volume 7 (CIU).

            Amended: October 2012
            May 2011

      • BR-2.3 Approval Requirements

        • Change in Name

          • BR-2.3.1

            In accordance with Paragraph GR-2.1.1, a licenseeG must seek prior written approval from the CBB and give reasonable advance notice of a change in:

            (a) The licensee'sG name (which is the registered name if the licenseeG is a body corporate); or
            (b) The licensee'sG trade name.
            May 2011

          • BR-2.3.2

            The request under Paragraph BR-2.3.1 must include the details of the proposed new name and the date on which the licenseeG intends to implement the change of name.

            May 2011

        • Change of Address

          • BR-2.3.3

            As specified in Article 51 of the CBB Law, a licenseeG must seek approval from the CBB and give reasonable advance notice of a change in the address of the licensee'sG principal place of business in Bahrain.

            May 2011

          • BR-2.3.4

            The request under Paragraph BR-2.3.3 must include the details of the proposed new address and the date on which the licenseeG intends to implement the change of address.

            May 2011

          • BR-2.3.5

            As specified in Article 51 of the CBB Law, a licenseeG must seek approval from the CBB for its intention to carry on its business from new premises in Bahrain. This requirement applies whether or not the premises are to be used for the purposes of transacting business with customersG , administration of the business or as the head office in Bahrain of the licenseeG .

            May 2011

        • Change in Legal Status

          • BR-2.3.6

            A licenseeG must seek CBB approval and give reasonable advance notice of a change in its legal status that may, in any way, affect its relationship with or limit its liability to its customersG .

            May 2011

        • Change in Authorised or Paid-up Capital

          • BR-2.3.7

            As specified in Article 57(3) of the CBB Law, a licenseeG must seek CBB approval before making any modification to its authorised or paid-up capital. In the case that a licenseeG has been granted approval to increase its paid-up capital, confirmation from the external auditor stating that the amount has been deposited in the licensee'sG bank account will subsequently be required.

            May 2011

        • Controllers and Close Links

          • BR-2.3.8

            In accordance with Section GR-5.1, licenseesG must seek CBB approval and give reasonable advance notice of any of the following events concerning the licenseeG :

            (a) A person acquiring control or ceasing to have control;
            (b) An existing controllerG acquiring an additional type of control (such as ownership or significant influence) or ceasing to have a type of control;
            (c) An existing controllerG increasing the percentage of sharesG or voting power beyond 10%, 20% or 50%; and
            (d) An existing controllerG becoming or ceasing to be a parent undertakingG .
            May 2011

          • BR-2.3.9

            Every licenseeG authorised in Bahrain is required to submit an annual report on its controllersG , as per Paragraph GR-5.1.8, and close linksG as set out in Paragraph GR-6.1.3.

            May 2011

        • Carrying out Business in Another Jurisdiction

          • BR-2.3.10

            As specified in Article 51 of the CBB Law, a licenseeG must seek CBB approval and give three months' notice of its intention to undertake fund administration activities in a jurisdiction other than Bahrain, prior to commencing that business and where the effect of commencing that business may have a significant impact on:

            (a) The licensee'sG business in Bahrain; or
            (b) The capital resources of the licenseeG .
            May 2011

        • Mergers, Acquisitions, Disposals and Establishment of New Subsidiaries

          • BR-2.3.11

            As specified in Article 57 of the CBB Law, a licenseeG incorporated in Bahrain must seek CBB approval and give reasonable advance notice of its intention to enter into a:

            (a) Merger with another undertaking; or
            (b) Proposed acquisition, disposal or establishment of a new subsidiary undertakingG .
            May 2011

          • BR-2.3.12

            LicenseesG will also need to consider the implications of a merger, acquisition, disposal or establishment of a new subsidiary undertakingG in the context of the controllersG and close linksG rules set out in Module GR.

            May 2011

        • Share Option Schemes

          • BR-2.3.13

            A licenseeG must seek prior approval from the CBB for any share option schemes it proposes to offer to its employees.

            May 2011

        • Outsourcing Arrangements

          • BR-2.3.14

            A licenseeG must seek prior approval from the CBB for the following:

            (a) Outsourcing of their internal audit function (ref. GR-9.4);
            (b) Material intra-group outsourcing (ref. GR-9.3); or
            (c) Outsourcing other material functions (GR-9.1).
            May 2011

        • Matters Having a Serious Supervisory Impact

          • BR-2.3.15

            A licenseeG must seek prior approval from the CBB for any material changes or proposed changes to the information provided to the CBB in support of an authorisation application that occurs after authorisation has been granted.

            May 2011

          • BR-2.3.16

            Any licenseeG that wishes, intends or has been requested to do anything that might contravene, in its reasonable opinion, the provisions of UNSCR 1373 (and in particular Article 1, Paragraphs c) and d) of UNSCR 1373) must seek, in writing, the prior written opinion of the CBB on the matter (ref. FC-7.2.2).

            May 2011

          • BR-2.3.17

            As specified in Article 57 of the CBB Law, a licenseeG wishing to modify its Memorandum or Articles of Association, must obtain prior written approval from the CBB.

            May 2011

          • BR-2.3.18

            In accordance with Paragraph GR-4.1.1, a licenseeG must seek prior written approval from the CBB before transferring any of its business to a third party.

            May 2011

        • Dividends

          • BR-2.3.19

            LicenseesG , must obtain a letter of no-objection from the CBB to any dividend proposed, before submitting a proposal for a distribution of profits to a shareholderG vote (ref. GR-3.1.1).

            May 2011

        • External Auditor

          • BR-2.3.20

            A licenseeG must seek prior approval from the CBB for the appointment or re-appointment of its external auditor (ref. AU-2.7.1 and AA-1.1.1).

            May 2011

        • Approved Persons

          • BR-2.3.21

            A licenseeG must seek prior approval from the CBB for the appointment of persons undertaking a controlled functionG in a licenseeG (ref. Article 65 of the CBB Law, AU-1.2 and AU-4.2.1).

            May 2011

          • BR-2.3.22

            LicenseesG must seek prior CBB approval before an approved personG may move from one controlled functionG to another within the same licenseeG (ref. AU-4.2.11).

            May 2011

          • BR-2.3.23

            If a controlled functionG falls vacant, the licenseeG must appoint a permanent replacement (after obtaining CBB approval), within 120 calendar days of the vacancy occurring. A licenseeG making immediate interim arrangements for the controlled functionG affected, must obtain approval from the CBB for such arrangement (ref. AU-4.3.5).

            May 2011

    • BR-3 Information Gathering by the CBB

      • BR-3.1 Power to Request Information

        • BR-3.1.1

          LicenseesG must provide all information that the CBB may reasonably request in order to discharge its regulatory obligations.

          May 2011

        • BR-3.1.1A

          LicenseesG must provide all relevant information and assistance to the CBB inspectors and appointed expertsG on demand as required by Articles 111 and 114 of the CBB Law. Failure by licenseesG to cooperate fully with the CBB's inspectors or appointed expertsG , or to respond to their examination reports within the time limits specified, will be treated as demonstrating a material lack of cooperation with the CBB which will result in other enforcement measures being considered, as described elsewhere in Module EN. This rule is supported by Article 114(a) of the CBB Law.

          Added: April 2012

        • BR-3.1.1B

          Article 163 of the CBB Law provides for criminal sanctions where false or misleading statements are made to the CBB or any person/appointed expertG appointed by the CBB to conduct an inspection or investigation on the business of the licenseeG or the listed licensee.

          Added: April 2012

        • Information Requested on Behalf of other Supervisors

          • BR-3.1.2

            The CBB may ask a licenseeG to provide it with information at the request of or on behalf of other supervisors to enable them to discharge their functions properly. Those supervisors may include overseas supervisors or government agencies in Bahrain. The CBB may also, without notifying a licenseeG , pass on to those supervisors or agencies information that it already has in its possession.

            May 2011

      • BR-3.2 Access to Premises

        • BR-3.2.1

          A licenseeG must permit representatives of the CBB, or persons appointed for the purpose by the CBB to have access, with or without notice, during reasonable business hours to any of its business premises in relation to the discharge of the CBB's functions under the relevant law.

          May 2011

        • BR-3.2.2

          A licenseeG must take reasonable steps to ensure that each of its providers under material outsourcing arrangements deals in an open and cooperative way with the CBB in the discharge of its functions in relation to the licenseeG .

          May 2011

        • BR-3.2.3

          The cooperation that licenseesG are expected to procure from such providers is similar to that expected of licenseesG themselves.

          May 2011

      • BR-3.3 Accuracy of Information

        • BR-3.3.1

          LicenseesG must take reasonable steps to ensure that all information they give to the CBB is:

          (a) Factually accurate or, in the case of estimates and judgements, fairly and properly based after appropriate enquiries have been made by the licenseeG ; and
          (b) Complete, in that it should include everything which the CBB would reasonably and ordinarily expect to have.
          Amended: April 2012
          May 2011

        • BR-3.3.2

          If a licenseeG becomes aware, or has information that reasonably suggests that it has or may have provided the CBB with information that was or may have been false, misleading, incomplete or inaccurate, or has or may have changed in a material way, it must notify the CBB immediately. The notification must include:

          (a) Details of the information which is or may be false, misleading, incomplete or inaccurate, or has or may have changed;
          (b) An explanation why such information was or may have been provided; and
          (c) The correct information.
          May 2011

        • BR-3.3.3

          If the information in Paragraph BR-3.3.2 cannot be submitted with the notification (because it is not immediately available), it must instead be submitted as soon as possible afterwards.

          May 2011

      • BR-3.4 Methods of Information Gathering

        • BR-3.4.1

          The CBB uses various methods of information gathering on its own initiative which require the cooperation of licenseesG :

          (a) Representatives of the CBB may make onsite visits at the premises of the licenseeG . These visits may be made on a regular basis, or on a sample basis, for special purposes such as theme visits (looking at a particular issue across a range of licenseesG ), or when the CBB has a particular reason for visiting a licenseeG ;
          (b) Appointees of the CBB may also make onsite visits at the premises of the licenseeG . Appointees of the CBB may include persons who are not CBB staff, but who have been appointed to undertake particular monitoring activities for the CBB, such as in the case of Appointed ExpertsG (refer to Section BR-3.5).
          (c) The CBB may request the licenseeG to attend meetings at the CBB's premises or elsewhere;
          (d) The CBB may seek information or request documents by telephone, at meetings or in writing, including electronic communication; and
          (e) The CBB may require licenseesG to submit various documents or notifications, as per Chapter BR-2, in the ordinary course of their business such as financial reports or on the happening of a particular event in relation to the licenseeG such as a change in control.
          Amended: April 2012
          May 2011

        • BR-3.4.2

          When seeking meetings with a licenseeG or access to the licensee's premises, the CBB or the CBB appointee needs to have access to a licensee'sG documents and personnel. Such requests will be made during reasonable business hours and with proper notice. There may be instances where the CBB may seek access to the licensee's premises without prior notice. While such visits are not common, the prospect of unannounced visits is intended to encourage licenseesG to comply at all times with the requirements and standards imposed by the CBB as per legislation and Volume 4 of the CBB Rulebook.

          Amended: April 2012
          May 2011

        • BR-3.4.3

          The CBB considers that a licenseeG should:

          (a) Make itself readily available for meetings with representatives or appointees of the CBB;
          (b) Give representatives or appointees of the CBB reasonable access to any records, files, tapes or computer systems, which are within the licensee'sG possession or control, and provide any facilities which the representatives or appointees may reasonably request;
          (c) Produce to representatives or appointees of the CBB specified documents, files, tapes, computer data or other material in the licensee'sG possession or control as may be reasonably requested;
          (d) Print information in the licensee'sG possession or control which is held on computer or otherwise convert it into a readily legible document or any other record which the CBB may reasonably request;
          (e) Permit representatives or appointees of the CBB to copy documents of other material on the premises of the licenseeG at the licensee'sG expense and to remove copies and hold them elsewhere, or provide any copies, as may be reasonably requested; and
          (f) Answer truthfully, fully and promptly all questions which representatives or appointees of the CBB reasonably put to it.
          Amended: April 2012
          May 2011

        • BR-3.4.4

          The CBB considers that a licenseeG should take reasonable steps to ensure that the following persons act in the manner set out in Paragraph BR-3.4.3:

          (a) Its employees; and
          (b) Any other members of its group and their employees.
          Amended: April 2012
          May 2011

        • BR-3.4.5

          In gathering information to fulfill its supervisory duties, the CBB acts in a professional manner and with due regard to maintaining confidential information obtained during the course of its information gathering activities.

          May 2011

      • BR-3.5 The Role of the Appointed Expert

        • Introduction

          • BR-3.5.1

            The content of this Chapter is applicable to all licenseesG and appointed expertsG .

            Added: April 2012

          • BR-3.5.2

            The purpose of the contents of this Chapter is to set out the roles and responsibilities of appointed expertsG when appointed pursuant to Article 114 or 121 of the CBB Law (see EN-2.1.1). These Articles empower the CBB to assign some of its officials or others to inspect or conduct investigations of licenseesG .

            Added: April 2012

          • BR-3.5.3

            The CBB uses its own inspectors to undertake on-site examinations of licenseesG as an integral part of its regular supervisory efforts. In addition, the CBB may commission reports on matters relating to the business of licenseesG in order to help it assess their compliance with CBB requirements. Inspections may be carried out either by the CBB's own officials, by duly qualified appointed expertsG appointed for the purpose by the CBB, or a combination of the two.

            Added: April 2012

          • BR-3.5.4

            The CBB will not, as a matter of general policy, publicise the appointment of an appointed expertG , although it reserves the right to do so where this would help achieve its supervisory objectives. Both the appointed expertG and the CBB are bound to confidentiality provisions restricting the disclosure of confidential information with regards to any such information obtained in the course of the investigation.

            Added: April 2012

          • BR-3.5.5

            Unless the CBB otherwise permits, appointed expertsG should not be the same firm appointed as external auditor of the licenseeG .

            Added: April 2012

          • BR-3.5.6

            Appointed expertsG will be appointed in writing, through an appointment letter, by the CBB. In each case, the CBB will decide on the range, scope and frequency of work to be carried out by appointed expertsG .

            Added: April 2012

          • BR-3.5.7

            All proposals to appoint appointed expertsG require approval by an Executive Director or more senior official of the CBB. The appointment will be made in writing, and made directly with the appointed expertsG concerned. A separate letter is sent to the licenseeG , notifying them of the appointment. At the CBB's discretion, a trilateral meetingG may be held at any point, involving the CBB and representatives of the licenseeG and the appointed expertsG , to discuss any aspect of the investigation.

            Added: April 2012

          • BR-3.5.8

            Following the completion of the investigation, the CBB will normally provide feedback on the findings of the investigation to the licenseeG .

            Added: April 2012

          • BR-3.5.9

            Appointed expertsG will report directly to and be responsible to the CBB in this context and will specify in their report any limitations placed on them in completing their work (for example due to the licensee'sG group structure). The report produced by the appointed expertsG is the property of the CBB (but is usually shared by the CBB with the firm concerned).

            Added: April 2012

          • BR-3.5.10

            Compliance by appointed expertsG with the contents of this Chapter will not, of itself, constitute a breach of any other duty owed by them to a particular licenseeG (i.e. create a conflict of interestG ).

            Added: April 2012

          • BR-3.5.11

            The CBB may appoint one or more of its officials to work on the appointed experts'G team for a particular licenseeG .

            Added: April 2012

        • The Required Report

          • BR-3.5.12

            The scope of the required report will be determined and detailed by the CBB in the appointment letter. Commissioned appointed expertsG would normally be required to report on one or more of the following aspects of a licensee'sG business:

            (a) Accounting and other records;
            (b) Internal control systems;
            (c) Returns of information provided to the CBB;
            (d) Operations of certain departments; and/or
            (e) Other matters specified by the CBB.
            Added: April 2012

          • BR-3.5.13

            Appointed expertsG will be required to form an opinion on whether, during the period examined, the licenseeG is in compliance with the relevant provisions of the CBB Law and the CBB's relevant requirements, as well as other requirements of Bahrain Law and, where relevant, industry best practice locally and/or internationally.

            Added: April 2012

          • BR-3.5.14

            The appointed experts'G report should follow the format set out in Appendix BR-10, in part B of the CBB Rulebook.

            Amended: July 2013
            Added: April 2012

          • BR-3.5.15

            Unless otherwise directed by the CBB or unless the circumstances described in Section BR-3.5.19 apply, the report must be discussed with the Board of directors and/or senior managementG in advance of it being sent to the CBB.

            Added: April 2012

          • BR-3.5.16

            Where the report is qualified by exceptionG , the report must clearly set out the risks which the licenseeG runs by not correcting the weakness, with an indication of the severity of the weakness should it not be corrected. Appointed expertsG will be expected to report on the type, nature and extent of any weaknesses found during their work, as well as the implications of a failure to address and resolve such weaknesses.

            Added: April 2012

          • BR-3.5.17

            If the appointed expertsG conclude, after discussing the matter with the licenseeG , that they will give a negative opinion (as opposed to one qualified by exceptionG ) or that the issue of the report will be delayed, they must immediately inform the CBB in writing giving an explanation in this regard.

            Added: April 2012

          • BR-3.5.18

            The report must be completed, dated and submitted, together with any comments by directors or management (including any proposed timeframe within which the licenseeG has committed to resolving any issues highlighted by the report), to the CBB within the timeframe applicable.

            Added: April 2012

        • Other Notifications to the CBB

          • BR-3.5.19

            Appointed expertsG must communicate to the CBB, during the conduct of their duties, any reasonable belief or concern they may have that any of the requirements of the CBB, including the criteria for licensing a licenseeG (see Module AU), are not or have not been fulfilled, or that there has been a material loss or there exists a significant risk of material loss in the concerned licenseeG , or that the interests of customers are at risk because of adverse changes in the financial position or in the management or other resources of a licenseeG . Notwithstanding the above, it is primarily the licensee'sG responsibility to report such matters to the CBB.

            Added: April 2012

          • BR-3.5.20

            The CBB recognises that appointed expertsG cannot be expected to be aware of all circumstances which, had they known of them, would have led them to make a communication to the CBB as outlined above. It is only when appointed expertsG , in carrying out their duties, become aware of such a circumstance that they should make detailed inquiries with the above specific duty in mind.

            Added: April 2012

          • BR-3.5.21

            If appointed expertsG decide to communicate directly with the CBB in the circumstances set out in Paragraph BR-3.5.19, they may wish to consider whether the matter should be reported at an appropriate senior level in the licenseeG at the same time and whether an appropriate senior representative of the licenseeG should be invited to attend the meeting with the CBB.

            Added: April 2012

        • Permitted Disclosure by the CBB

          • BR-3.5.22

            Information which is confidential and has been obtained under, or for the purposes of, this chapter or the CBB Law may only be disclosed by the CBB in the circumstances permitted under the Law. This will allow the CBB to disclose information to appointed expertsG to fulfil their duties. It should be noted, however, that appointed expertsG must keep this information confidential and not divulge it to a third party except with the CBB's permission and/or unless required by Bahrain Law.

            Added: April 2012

        • Trilateral Meeting

          • BR-3.5.23

            The CBB may, at its discretion, call for a trilateral meetingG (s) to be held between the CBB and representatives of the relevant licenseeG and the appointed expertsG . This meeting will provide an opportunity to discuss the appointed experts'G examination of, and report on, the licenseeG .

            Added: April 2012

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