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  • AU-1.2 Approved Persons

    • General Requirement

      • AU-1.2.1

        Insurance licensees must obtain the CBB's prior written approval for any person wishing to undertake a controlled function in an insurance licensee. The approval from the CBB must be obtained prior to their appointment, subject to the variations contained in Paragraph AU-1.2.3.

        Amended: January 2016
        Amended: July 2007

      • AU-1.2.2

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

        (a) Director (for Bahraini insurance licensee only);
        (b) Chief Executive or General Manager;
        (c) Head of function;
        (d) Head of risk management;
        (e) Compliance officer;
        (f) Money Laundering Reporting Officer;
        (g) Member of Shari'a Supervisory Board (where applicable);
        (h) Internal Shari'a reviewer (where applicable);
        (i) Unit-linked investment adviser (where applicable); and
        (j) Signing Actuary(where the function is undertaken by a Director or an employee of the insurance firm).
        Amended: January 2016
        Amended: April 2014
        Amended: October 2007
        Amended: July 2007

      • AU-1.2.3

        Controlled functions may be combined with any other functions, subject to the CBB's prior written approval and such combination must not result in any possible conflict of interest.

        Amended: April 2014
        Amended: October 2007
        Amended: July 2007

      • AU-1.2.4

        [This Paragraph was deleted in April 2014.]

        Deleted: April 2014
        Amended: October 2007
        Amended: July 2007

      • AU-1.2.5

        [This Paragraph was deleted in April 2014.]

        Deleted: April 2014

    • Basis for Approval

      • AU-1.2.6

        Approval under Paragraph AU-1.2.1 is only granted by the CBB, if it is satisfied that the person is fit and proper to hold the particular position in the licensee concerned. 'Fit and proper' is determined by the CBB on a case-by-case basis. The definition of 'fit and proper' and associated guidance is provided in Sections AU-3.1 and AU-3.2 respectively.

        Amended: July 2007

    • Definitions

      • AU-1.2.7

        Director is any person who occupies the position of a Director, as defined in Article 173 of the Commercial Companies Law (Legislative Decree No. 21 of 2001).

        Amended: July 2007

      • AU-1.2.8

        The fact that a person may have 'Director' in their job title does not of itself make them a Director within the meaning of the definition noted in Paragraph AU-1.2.7. For example, a 'Director of Marketing', is not necessarily a member of the Board of Directors and therefore may not fall under the definition of Paragraph AU-1.2.7.

        Amended: July 2007

      • AU-1.2.9

        The Chief Executive or General Manager means a person who is responsible for the conduct of the licensee (regardless of actual title). The Chief Executive or General Manager must be resident in Bahrain. This person is responsible, alone or jointly, for the conduct of the whole of the firm, or, in the case of an overseas insurance licensee, for all of the activities of the branch.

      • AU-1.2.9A

        The Chairman of the Board may not act as the Chief Executive or General Manager. However, in the case of appointing a Director on the Board as the Managing Director of the insurance licensee, such person:

        (a) Should be fully responsible for the executive management and performance of the insurance licensee, within the framework of delegated authorities set by the Board;
        (b) Must devote full-time working hours to the insurance licensee; and
        (c) Must not be employed at any other firm.
        Added: April 2011

      • AU-1.2.10

        Head of function means a person who exercises major managerial responsibilities, is responsible for a significant business or operating unit, or has senior managerial responsibility for maintaining accounts or other records of the licensee.

      • AU-1.2.10A

        The head of risk management is responsible for the management of all risk exposures arising from the activities of the insurance firm.

        Added: April 2014

      • AU-1.2.11

        Whether a person is a head of function will depend on the facts in each case and is not determined by the presence or absence of the word in their job title. Examples of head of function might include, depending on the scale, nature and complexity of the business, a deputy Chief Executive; heads of departments such as Underwriting, Claims, Risk Management, Compliance or Internal Audit; the Chief Financial Officer; or a Signing Actuary (where that person is a Director or employee of the insurance firm concerned).

        Amended: July 2007

      • AU-1.2.11A

        All insurance 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 2011

      • AU-1.2.11B

        The internal Shari'a reviewer in a Takaful firm is responsible for the examination and evaluation of the adequacy and effectiveness of the Takaful firm's system of internal Shari'a control. The internal Shari'a review function must comply with AAOIFI Governance standard for Islamic Financial Institutions No. 3.

        Added: April 2014

      • AU-1.2.12

        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.

        Amended: July 2007

      • AU-1.2.13

        A unit-linked investment adviser refers to the function of advising clients on contracts that are, by their nature, investment products, including, but not limited to pension and retirement products. The unit-linked investment adviser function is a controlled function.

        Amended: July 2007

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