Regulatory Rules No. 20 for Brokerage Companies Licensing 2023

Iraqi Securities Commission Regulatory Rules 2022 Based on Section 5 and Paragraph 12 of Section 12 of Legislative Decree No. 74 of 2004, we have issued the following regulations:

Regulatory Rules No. 20 for Brokerage Companies Licensing 2023

Article 1: Definitions: First - License: The approval granted by the Market with the Commission's endorsement for the company to practice the activity of broker for its own account and broker for others in the Market.

Second - The Commission: The Iraqi Securities Commission.

Third - The Market: The Securities Market licensed by the Commission.

Fourth - The Law: Legislative Decree No. 74 of 2004 or any other law replacing it.

Fifth - The License Applicant Company: The company established under Company Law No. 21 of 1997 or any other law under which it was established.

Sixth - The Applicant: The Managing Director of the license applicant company or someone authorized by it.

Article 2: License Application: First - A brokerage company wishing to practice this activity must submit a license application to the Market, including at least the following: A. Name and address of the license applicant and locations of its branches, if any. B. The company's contract and organizational structure. C. The nature of the applicant's work and the duration of their practice of this work. D. Names and addresses of management personnel (Managing Director, Board of Directors members) and a biographical sketch of their previous professional history in the securities field, and addresses of residence and work for their employees, stating the status and job title of each, along with a copy of their identity proof for each. E. That no owner, director, or Board of Directors member of the company has previously been convicted of a felony or misdemeanor involving dishonesty, and the Commission shall inquire about them from the competent authorities. F. Names of the company's owners and the shares of each if it is a limited liability company, or the name of each person owning 5% or more of the company's capital if it is a joint-stock company. G. The required financial data as of a date not exceeding three months prior to the date of submitting the application, and the last audited financial statements by the auditor, if available. H. Submission of a commitment from the applicant according to the form prepared for this purpose.

Iraqi Securities Commission Regulatory Rules 2022

I. Any other requirements deemed necessary by the Market or the Commission.

Second - The Market shall study the application and submit it to the Commission with a recommendation within a period of 15 days from the date of receipt.

Third - The Commission shall rule on the license application submitted by the Market within a period of 15 days for approval; otherwise, it shall be deemed an approval of the application.

Fourth - The license applicant may appeal the rejection of their application by the Market or the Commission in accordance with the provisions of the Law.

Article 3: Obligations of the License Applicant Company: First - The paid-up capital of the brokerage company applying for the license shall not be less than the minimum limit determined by the Commission.

Second - To provide trained and competent staff to work in the company, and they must pass exams approved by the Market and the Commission.

Third - To provide accounting systems (office back) approved by the Market and the Commission.

Fourth - To provide systems for combating money laundering and terrorist financing (AML) and to provide trained staff holding approved certificates in this field.

Fifth - To submit a guarantee letter for the amount of 50,000,000 Iraqi Dinars (Fifty Million Dinars) in favor of the Market.

Sixth - To provide the company's infrastructure according to the technical specifications determined by the Market.

Seventh - To notify the Market and the Commission of any changes in the company's owners and management personnel (Managing Director, Board of Directors members) for the purpose of the Commission taking verification measures before final approval.

Eighth - Any other obligations approved by the Market or the Commission.

Article 4: Membership and Annual Renewal Fees: The fees shall be paid by the license applicant company as follows:

First - The initial membership fee is an amount of 200,000,000 Iraqi Dinars (Two Hundred Million Dinars), paid equally to the Market and the Commission.

Second - The annual renewal fee is an amount of 500,000 Iraqi Dinars (Five Hundred Thousand Dinars), paid to the Market.

Third - Payment of any other fees determined by the Market according to its technical conditions.