Regulatory Bylaw No. 7: Opening Branches for Financial Brokerage Companies

Regulatory Bylaws of the Securities Commission for the Year 2022 Regulatory Bylaw No. (7): Opening Branches for Financial Brokerage Companies

Article (1) The broker shall submit a request to the Market Council within the Iraq Securities Market, expressing its desire to establish a branch for its company registered in the Iraq Securities Market, accompanied by the General Assembly resolution of the company, and including at least the following:

a. Submission of an economic feasibility study prepared by a specialized consulting office, approved by the Council and the Commission. b. Approval from the Companies Registration Department to open the branch. c. Approval from the competent authorities in the country where the branch is being opened, along with a certified copy of the lease contract for the designated premises, authenticated by the relevant authorities. d. Appointment of a person to manage the branch, who must have passed one of the qualification courses for Authorized Manager or Deputy Authorized Manager organized by the Market. e. Appointment of a full-time internal audit manager for the company to ensure the proper application of the Law and the regulatory bylaws issued thereunder and in force at the Market.

Article (2) The paid-up capital of the brokerage company wishing to open a branch shall not be less than what is specified in the Regulatory Bylaw for Capital Adequacy issued by the Commission, plus 50 million Iraqi dinars for each branch.

Article (3) The guarantee letter submitted to the Market shall be increased by an amount of (20) million Iraqi dinars for each branch.

Article (4) The conditions that must be met by the brokerage company wishing to open a branch:

a. It must have been continuously engaged in trading activities for a period of not less than one year prior to the date of submitting the request. b. A declaration stating that no decision has been issued to suspend the company's trading activities during the two years preceding the submission of the request.

Article (5) Commitments and Undertakings

a. The Authorized Manager of the brokerage company shall bear full responsibility for the branch's operations and undertakes to bear all legal and financial consequences of any actions or violations committed by the branch. b. Duties of the Branch Manager: First: Providing a qualified staff to manage the branch. Second: Providing the screens, computers, and devices required by the Market according to specifications. Third: Not engaging in any other work or commercial activity except brokerage operations, coordinated with the main headquarters of the company. Fourth: Submitting a weekly report on all branch operations to the company, which shall be subject to Market supervision. c. Submission of a list of employees' names in the branch, along with certified copies of residence permits and work permits for the branch outside Iraq, to the Market and the Commission. The number of employees shall not be less than three persons at any time.

Regulatory Bylaws of the Securities Commission for the Year 2022 d. The company's annual subscription fee shall be increased by 25% for each branch. e. The remote trading network maintenance fee shall be increased by 25% for each branch. f. Compliance with the Anti-Money Laundering and Combating the Financing of Terrorism Law, and ensuring dealings with investors only through banks, without conducting any direct cash settlements. g. All buy and sell settlements shall be conducted through the company's main branch in accordance with the controls and regulatory bylaws in force at the Market.

Article (6) General Matters

a. The Board of Governors shall conduct a written evaluation of the brokerage company's performance and capability to open a branch and its eligibility for doing so. b. These bylaws shall not apply to governorates or provinces that permit the Securities Commission to issue securities, except after approval from that Market to grant the license. c. The Market may, with the Commission's approval, close the branch in the following two cases: First: If the company loses one of the approved conditions for opening the branch. Second: Upon the request of the brokerage company, provided it has premises that the Commission and the Market are satisfied with.