Regulatory Alerts2023-01-01
Decision of the Board of Directors No. (105) of 2023
The Financial Regulatory Authority issued Board Decision No. 105 of 2023 to grant a three-month grace period for eligible financial leasing, factoring, SME/microfinance, and consumer finance companies to increase their issued and paid-up capital as required by recent licensing regulations. The Authority retains the discretion to extend this capital increase deadline by up to one year upon receipt of valid justifications from the companies. This measure facilitates regulatory compliance for newly established or pending license applicants without delaying their operational authorization.
The Official Gazette - No. 110, Part (A) on May 18, 2023
The Financial Regulatory Authority
Board of Directors Decision No. 105 of 2023
Dated 10/5/2023
Regarding granting a grace period to increase the capital of companies wishing
to obtain a license from the Authority to practice any of the activities of
financial leasing, factoring, financing medium, small and micro-enterprises, or consumer finance.
The Board of Directors of the Financial Regulatory Authority
Having reviewed Law No. 10 of 2009 regulating supervision over markets and non-banking financial instruments;
And Law No. 141 of 2014 regulating the practice of financing medium, small and micro-enterprises;
And Law No. 176 of 2018 regulating the activity of financial leasing and factoring;
And Law No. 18 of 2020 regulating the activity of consumer finance;
And Decision No. 121 of 2018 of the Authority's Board regarding the conditions, rules and procedures for licensing companies practicing microfinance activities, amended by Decision No. 92 of 2023;
And Decision No. 137 of 2018 of the Authority's Board regarding the controls for granting and maintaining licenses to financial leasing and factoring companies, amended by Decision No. 91 of 2023;
And Decision No. 56 of 2020 of the Authority's Board regarding the conditions and controls for establishment and licensing to practice consumer finance activities, and the conditions and controls for licensing consumer finance providers, amended by Decision No. 94 of 2023;
And Decision No. 164 of 2020 of the Authority's Board regarding the rules and procedures for licensing companies wishing to practice financing medium and small enterprises, and companies wishing to practice financing medium and small enterprises and micro-enterprises, amended by Decision No. 93 of 2023;
And after the approval of the Authority's management in its session held on 10/5/2023;
Decided:
(Article One)
Companies that were established, or submitted establishment applications, or obtained preliminary approval for establishment to practice financial leasing, factoring, financing medium, small and micro-enterprises, or consumer finance activities, as well as companies that submitted applications to the Authority for a license to practice one or more of the aforementioned activities, prior to the implementation of the Authority's Board decisions numbered (91, 92, 93, 94) of 2023, are granted a grace period to increase their issued and paid-up capital for the activities for which licenses are sought, as stipulated in the aforementioned Board decisions referenced in this Article, within a period not exceeding three months from the date of obtaining the license to practice the activity.
The Authority may extend the aforementioned grace period for additional periods not exceeding one year, based on valid justifications submitted by the company.
(Article Two)
This decision shall be published in the Official Gazette and on the Authority's website.
Chairman of the Board
The Financial Regulatory Authority
Dr. Mohamed Fared Saleh