Regulatory Alerts2023-01-01
Circular Letter No. 1 Dated April 20, 2023 Regarding the Prohibition of Delegation or Authorization in Specialized Professions for Non-Egyptian Financial Activities
The Financial Regulatory Authority issued Circular Letter No. 1 on April 20, 2023, prohibiting licensed practitioners of specialized professions in non-Egyptian financial activities from delegating or authorizing their work to other licensed or unlicensed persons. The circular mandates that all licensees cancel existing delegations and conduct transactions directly with licensed professionals, while unlicensed entities are barred from operating under delegated authority to avoid legal liability. All supervised companies and institutions must strictly adhere to these direct-engagement requirements to ensure market stability, protect participants' rights, and enforce the personal nature of professional licenses under Law No. 10 of 2009.
Financial Regulatory Authority
FINANCIAL REGULATORY AUTHORITY
Chairman of the Authority
Circular Letter No. (1) Dated 20/4/2023
Regarding the Prohibition of Delegation or Authorization in Practicing Specialized Professions
in Non-Egyptian Financial Activities Supervised and Monitored by the Authority
In accordance with the role assigned to the Financial Regulatory Authority under Law No. 10 of 2009 regulating supervision over non-Egyptian financial markets and instruments, and working towards the safety and stability of these markets, protecting the rights and interests of market participants, and providing mechanisms, systems, and issuing rules that ensure their efficiency.
In light of the Authority's observation that some licensed persons practicing specialized professions in non-Egyptian financial activities have issued official powers of attorney or delegations to each other or to unlicensed persons, to transact on their behalf in the specialized professions licensed by the Authority.
Since licenses for practicing specialized professions in non-Egyptian financial activities are granted based on scientific qualifications, practical experience, and passing exams and interviews to verify suitability, in addition to the legal liability associated with practicing specialized professions if not performed according to established rules and standards, such that the granted license is personal in nature, attached to the licensed person's existence or absence.
Based on the foregoing, the Authority confirms the following:
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Licensed persons practicing specialized professions in non-Egyptian financial activities are prohibited from issuing any powers of attorney or delegations to each other or to any other person to transact on their behalf in the licensed specialized professions. They must cancel any such issued powers of attorney or delegations and take necessary steps to suspend their operation, to avoid legal liability resulting from such violation.
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Unlicensed persons practicing specialized professions in non-Egyptian financial activities are prohibited from performing such specialized work based on a power of attorney or delegation issued by a licensed person, as this constitutes practicing an unlicensed professional activity subject to legal liability.
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All companies and entities supervised and monitored by the Authority must adhere to the above, and their transactions must be directly with persons licensed to practice specialized professions in non-Egyptian financial activities.
Chairman of the Board
Financial Regulatory Authority
Dr. Mohamed Fared Saleh
ARAB REPUBLIC OF EGYPT Building Bridges not Walls
Smart Village, Building 137, Giza, Egypt Postal Code: 110 Telephone: +2023546030 Fax: +2023547087 WWW.FRA.GOV.EG