Regulation on the Organization of a Special Regulatory Regime

1 Approved by the resolution of the Board of the National Bank of Tajikistan of 18.02.2019, No. 11

Regulation "On the Organization of a Special Regulatory Regime" The Regulation "On the Organization of a Special Regulatory Regime" (hereinafter referred to as the Regulation) is developed in accordance with Article 42 of the Law of the Republic of Tajikistan "On the National Bank of Tajikistan" and establishes the procedure for organizing and applying a special regulatory regime and the rules for its implementation.

CHAPTER 1. GENERAL PROVISIONS

1. The following basic concepts are used in this Regulation:

• special regulatory regime - under the control of the National Bank of Tajikistan, the conduct of an inspection in a limited environment of a new innovative product of credit financial organizations, which is not specifically regulated by current regulatory legal acts, aimed at improving the quality of financial services provided by law and allowing the provision of financial services through this new innovative product without legal risk;
• new innovative product - a new innovative product of providing financial services (banking operations) established by law, which does not contradict current regulatory legal acts, but is not specifically regulated;
• Applicant - a credit financial organization that has applied to the National Bank of Tajikistan for the application of a special regulatory regime in accordance with this Regulation, and for which the National Bank of Tajikistan has not applied operational corrective measures or impact measures;
• Co-applicant - a credit financial organization that meets the requirements of the Applicant in accordance with this Regulation, or a legal entity carrying out activities in accordance with the legislation of the Republic of Tajikistan, which jointly with the Applicant has applied to the National Bank of Tajikistan for the application of a special regulatory regime in accordance with this Regulation;
• consumers - individuals and legal entities using the new innovative product of financial services of credit financial organizations;
• letter of no objections - a letter from the National Bank of Tajikistan regarding the continuation of the practical application of the tested new innovative product in a limited space until the necessary changes and additions are made to the current regulatory legal acts or the development of a new regulatory legal act.

2. The organization and application of a special regulatory regime is carried out on the basis of an order of the Chairman of the National Bank of Tajikistan on permission to organize and apply a special regulatory regime and a letter from the National Bank of Tajikistan on consent to organize and apply a special regulatory regime.

3. The application of a special regulatory regime includes the following stages:

• submission by the Applicant to the National Bank of Tajikistan of an Application for the application of a special regulatory regime;
• preliminary consideration of the Application for the application of a special regulatory regime;
• permission to apply a special regulatory regime;
• organization of a special regulatory regime and its implementation;
• summarizing the results of the application of a special regulatory regime;
• submission of a letter of no objections (in case of a successful assessment of the inspection).

4. A special regulatory regime is organized for the purpose of conducting an inspection in a limited environment and in the mode of experimental testing of a new innovative product.

5. A special regulatory regime is organized on the basis of the principles of openness, transparency, accountability, and the application of restrictions regarding the Applicant and Co-applicant (if any).

6. The Applicant and Co-applicant (if any) during the period of application of a special regulatory regime must comply with the requirements of regulatory legal acts of the Republic of Tajikistan on combating the legalization (money laundering) of proceeds obtained criminally, terrorism financing, and financing of the proliferation of weapons of mass destruction.

7. In the event that the results of the preliminary consideration of the Application or the inspection determine that the new innovative product does not comply with the requirements of regulatory legal acts of the Republic of Tajikistan that are prohibitive, its further application until the elimination of the legal obstacle is not permitted.

8. Responsibility for non-compliance with the conditions of the special regulatory regime is borne by the Applicant.

9. The organization of a special regulatory regime and its application is carried out on the basis of charging a fee from the Applicant for services.

9.1. The amount of the fee for services for the organization of a special regulatory regime and its application for each Application is established taking into account actual expenses, time spent by members of the Working Group, and other expenses.

CHAPTER 2. SUBMISSION AND PRELIMINARY CONSIDERATION OF THE APPLICATION FOR THE ORGANIZATION OF A SPECIAL REGULATORY REGIME

10. The Application for the organization of a special regulatory regime (hereinafter referred to as the Application) is submitted by the Applicant to the National Bank of Tajikistan in accordance with Appendix No. 1 to this Regulation.

11. The following documents are attached to the Application:

• a copy of the license for banking activities;
• a description of the new innovative product being tested in accordance with Appendix No. 2 to this Regulation.

12. If, in accordance with this Regulation, the Co-applicant is a legal entity that is not a credit financial organization, the following documents are attached to the Application:

• notarized copies of the constituent documents of the Co-applicant indicating the declared amount of the charter capital;
• a certificate issued by the tax authorities confirming the absence of tax debt;
• an approved accounting report for the last reporting period.

13. If, in accordance with this Regulation, the Co-applicant is a credit financial organization, a copy of the license for banking activities is attached to the Application.

14. The National Bank of Tajikistan has the right to request additional information and documents from the Applicant for the purpose of preliminary consideration of the Application.

15. The preliminary consideration of the Application is carried out by the relevant structural subdivision of the National Bank of Tajikistan, which is assigned the obligation of preliminary consideration, within a period of up to 60 (sixty) calendar days from the date of its receipt, and the results of the preliminary consideration of the Application are reported in writing to the Applicant.

16. During the preliminary consideration of the Application, the relevant structural subdivision of the National Bank of Tajikistan carries out the following actions:

• determines the compliance of the Applicant (Co-applicant) with the requirements established by this Regulation;
• determines the compliance of the Application with the requirements established by this Regulation;
• checks the compliance of the new innovative product with current regulatory legal acts;
• analyzes the new innovative product taking into account the interests of consumers.

17. If, during the preliminary consideration of the Application, non-compliance of the Applicant (Co-applicant) with the requirements established by this Regulation is revealed, the Applicant is notified in writing of the rejection of the Application with an indication of the grounds for rejection.

18. If, during the preliminary consideration of the Application, non-compliance of the Application with the requirements established by this Regulation is revealed, the National Bank of Tajikistan may request additional information from the Applicant.

19. If, during the preliminary consideration of the Application, it is established that the new innovative product under consideration can be applied within the framework of current regulatory legal acts without the organization and introduction of a special regulatory regime, the Applicant is sent an explanation of the provisions of current regulatory legal acts.

20. If, during the preliminary consideration of the Application, non-compliance of the new innovative product under consideration with current regulatory legal acts that are prohibitive is established, the Applicant is sent an explanation of the current provisions of regulatory legal acts that are prohibitive.

21. If, during the preliminary consideration of the Application, it is established that the new innovative product under consideration does not contradict current regulatory legal acts that are prohibitive, but is not specifically regulated within the framework of current regulatory legal acts, the Applicant is sent an explanation of the necessity of organizing and applying a special regulatory regime.

22. The Applicant and Co-applicant (if any), after familiarizing themselves with the results of the preliminary consideration of the Application, have the right to withdraw the Application or initiate the organization and application of a special regulatory regime.

CHAPTER 3. ORGANIZATION OF A SPECIAL REGULATORY REGIME

23. A special regulatory regime is formalized after informing the Applicant of the results of the preliminary consideration of the Application and on the basis of the Applicant's initiative to organize and apply a special regulatory regime, within 15 (fifteen) calendar days by an order of the Chairman of the National Bank of Tajikistan on the creation of a Working Group for the application of a special regulatory regime (hereinafter referred to as the Working Group).

24. The Working Group is formed at the expense of specialists of the relevant structural subdivisions of the National Bank of Tajikistan. The head of the working group is appointed from among one of the heads of the relevant structural subdivisions of the National Bank of Tajikistan. Control over the activities of the Working Group is carried out by the Deputy Chairman of the National Bank of Tajikistan (overseeing the structural subdivision responsible for regulating the financial services under consideration).

25. The Working Group carries out the following actions:

• establishes the indicators of the special regulatory regime in accordance with Appendix No. 3 to this Regulation and taking into account the conditions defined by this Regulation;
• makes a decision on the termination of the special regulatory regime;
• approves the report on the results of the special regulatory regime;
• based on the results of the application of the special regulatory regime, if necessary, gives recommendations on making changes and additions to current regulatory legal acts.

26. Based on the consideration of documents attached to the Application, the Working Group prepares the text of the Agreement on a special regulatory regime (hereinafter referred to as the Agreement) within a period of no more than 30 (thirty) calendar days from the moment of creation of the Working Group.

27. The mandatory conditions of the Agreement are:

• description of the new innovative product being tested with a description of the corresponding business process;
• a list of restrictions established regarding the Applicant and Co-applicant (if any) within the framework of the special regulatory regime in accordance with paragraph 31 of this Regulation;
• a list of obligations established regarding the Applicant and Co-applicant (if any) within the framework of the special regulatory regime in accordance with paragraph 32 of this Regulation;
• the term of the special regulatory regime with an indication of its start and end dates;
• a list of indicators for assessing the success of the inspection in accordance with Appendix No. 3 of this Regulation;
• mandatory actions of the Applicant and Co-applicant (if any) upon termination of the special regulatory regime (for example, the procedure for servicing clients or annulment of contracts, return of funds, and other conditions);
• the obligation of the Applicant and Co-applicant (if any) in case of non-compliance with the requirements of the Agreement, notification of the National Bank of Tajikistan about non-compliance with such rules, as well as consent that non-compliance with conditions may lead to early termination of the inspection;
• consent of the Applicant and Co-applicant (if any) that the special regulatory regime may be terminated at the initiative of the National Bank of Tajikistan in the event of situations posing a serious threat to economic and social stability;
• a list of measures to hold the Applicant and Co-applicant (if any) accountable for non-compliance with the conditions of the Agreement;
• the amount of commission of the National Bank of Tajikistan for the organization and application of a special regulatory regime.

28. Taking into account specific situations established during the consideration of the Application, other provisions may be included in the Agreement upon the proposal of the Working Group.

29. The Agreement is signed by the Chairman of the National Bank of Tajikistan and the head of the Applicant in two copies having equal legal force.

30. The rules and conditions of the special regulatory regime indicated in the Agreement must comply with the requirements of this Regulation.

CHAPTER 4. CONDITIONS OF A SPECIAL REGULATORY REGIME

31. Within the framework of a special regulatory regime regarding the new innovative product being tested, one or more of the following restrictions must be established, including:

• on the number of clients (individuals, legal entities, and individual entrepreneurs) to whom financial services are provided within the framework of the inspection;
• on the number of operations carried out by the credit financial organization in providing financial services through the new innovative product being tested;
• on the place(s) of provision of financial services using the new innovative product being tested;
• on the volume of obligations of the credit financial organization to clients participating in the inspection of the new innovative product being tested;
• on the number of payment instruments provided or contracts concluded within the framework of the special regulatory regime;
• on the volume of operations carried out by one client through the new innovative product being tested within the framework of the special regulatory regime;
• on the volume of operations carried out by one client through the new innovative product being tested within the framework of the special regulatory regime during a set period of time (during the day, week, month, quarter);
• other restrictions that the Working Group deems necessary taking into account specific situations.

32. Within the framework of a special regulatory regime, the following obligations of the Applicant and Co-applicant (if any) must be established:

• submission upon request of the National Bank of Tajikistan of a report on the new innovative product being tested;
• providing representatives of the National Bank of Tajikistan with access to the information systems of the Applicant and Co-applicant (if any) to obtain the necessary information on the new innovative product being tested;
• selection of consumers and notification that financial services are provided in a special regulatory regime, as well as obtaining their written consent;
• mandatory compensation for operations conducted without the client's consent, including by error of the credit financial organization;
• other obligations agreed upon by the Working Group with the Applicant.

33. The term (duration) of the inspection may cover from 6 to 12 months.

34. No later than 1 (one) month before the end date of the special regulatory regime indicated in the Agreement, the Applicant may apply in writing to the National Bank of Tajikistan and request an extension of the term of application of the special regulatory regime with an indication of the reasons why the extension of the term is advisable. Such an application is considered by the Working Group within a period of no more than 15 (fifteen) calendar days. In case of extension of the term of the special regulatory regime, an additional agreement is concluded with the Applicant indicating the new end date of the inspection, but for a period of no more than 6 (six) months.

CHAPTER 5. APPLICATION OF A SPECIAL REGULATORY REGIME AND ITS TERMINATION

35. The Applicant must start the inspection within the framework of the special regulatory regime from the date indicated in the Agreement.

36. If the Applicant is unable to start the inspection within 30 (thirty) days from the date indicated in the Agreement, the Agreement ceases to be valid.

37. The conduct of a special regulatory regime may be terminated in the following cases:

• at the initiative of the Applicant;
• at the initiative of the National Bank of Tajikistan, in case of non-compliance by the Applicant with the conditions of the Agreement, the discovery of facts of untruthfulness of data indicated in the Application, or the emergence of situations posing a serious threat to economic and social stability;
• in case of expiration of the inspection term indicated in the Agreement or in cases provided for in paragraph 34 of this Regulation, indicated in the additional agreement.

38. In cases provided for in the first paragraph of paragraph 37 of this Regulation, the Applicant no later than 30 (thirty) days before the termination of the inspection of the new innovative product sends a corresponding notification to the National Bank of Tajikistan indicating its reasons.

39. In case of a successful assessment of the inspection results, the Working Group submits the Applicant's report to the management of the National Bank of Tajikistan with an attachment of its detailed positive conclusion indicating the compliance of the tested new innovative product with current regulatory legal acts or recommendations on the necessity of making changes and additions to current regulatory legal acts.

40. In the case provided for in the third paragraph of paragraph 37 of this Regulation, the Working Group approves the "Report on the Results of the Inspection" (hereinafter referred to as the Report).

CHAPTER 6. SUMMARIZING THE RESULTS OF ORGANIZATION AND APPLICATION OF A SPECIAL REGULATORY REGIME

41. Within a period of no more than 15 (fifteen) calendar days after the end of the inspection, the Applicant submits to the National Bank of Tajikistan a draft Report, which indicates the following information:

• information on quantitative indicators achieved during the inspection in accordance with the norms of success assessment indicated in the Agreement;
• description of problems faced by the Applicant during the inspection;
• assessment of consumer needs for using the tested new innovative product;
• indication of provisions of current regulatory legal acts contradicting the presentation of the tested new innovative product;
• information on statements and complaints from consumers regarding the use of the tested new innovative product;
• information on risks arising during the inspection and measures taken to minimize these risks.

42. If, as a result of the inspection, the Applicant receives quantitative indicators of the norms indicated in the Agreement, the Working Group considers the results of this inspection successful; otherwise, the inspection is considered unsuccessful.

43. Within a period of no more than 15 (fifteen) calendar days from the date of receipt of the draft Report, the Working Group prepares and approves its conclusion on the success or failure of the inspection with an indication of its reasons. The Working Group has the right to request additional information from the Applicant for the purpose of approving the Report. A copy of the approved Report is sent to the Applicant.

44. In case of a successful assessment of the inspection results, the Working Group submits the Applicant's report and its positive conclusion on the tested new innovative product to the management of the National Bank of Tajikistan, as well as recommendations on the necessity of making changes and additions to current regulatory legal acts.

45. In the case provided for in paragraph 44 of this Regulation, the National Bank of Tajikistan, having submitted a letter of no objections, gives consent to the Applicant for the practical application of the tested new innovative product until the moment of making changes and additions to current regulatory legal acts or the development of a new regulatory legal act.

CHAPTER 7. RULES OF A SPECIAL REGULATORY REGIME

7.1. ENSURING OPENNESS OF A SPECIAL REGULATORY REGIME

46. In order to ensure openness in the organization and application of a special regulatory regime, the National Bank of Tajikistan publishes a registry of special regulatory regimes on its website on the Internet.

47. The following information is entered into the registry of special regulatory regimes:

• a list of Applicants;
• a specific description of the tested new innovative product;
• the date of conclusion of the Agreement;
• the date of the start of the inspection under the special regulatory regime;
• the date of the end of the inspection under the special regulatory regime (as well as an indication of the extension of the inspection term, in case of extension);
• an assessment of the success or failure of the results of the inspection under the special regulatory regime with an indication of the date of the corresponding decision;
• the official website of the Applicant on the Internet.

48. The information indicated in paragraph 47 of this Regulation is entered into the registry no later than the next working day following the signing of the Agreement or the decision on the success or failure of the inspection.

7.2. REQUIREMENTS FOR THE PROTECTION OF CONSUMER RIGHTS

49. In order to protect consumer rights, the Applicant in the process of organizing and applying a special regulatory regime must ensure funds in its correspondent account at the National Bank of Tajikistan in an amount covering the daily average turnover on all operations of the new innovative product being tested.

50. To accept applications and complaints from clients in the process of organizing and applying a special regulatory regime, the Applicant must ensure a communication line with trust line numbers (contact center).

51. In the process of organizing and applying a special regulatory regime, the Applicant must use systems that ensure the protection and confidentiality of client information.

Appendix No. 1 to the Regulation "On the Organization of a Special Regulatory Regime" (on the official letterhead of the Applicant)

APPLICATION

I request to consider my application for the organization of a special regulatory regime for

---

(full name and legal address) and to test the following new innovative product:

---

(brief description of planned financial services)

1. Responsible person for receiving additional information related to this application: (surname, first name, patronymic, position, phone, email address of the responsible person).
2. Information on the presence of a Co-applicant: (full name and legal address).
3. The following are attached to this application:

---

Signature of the head and seal of the organization "__" ______________________ 20 year

Appendix No. 2 to the Regulation "On the Organization of a Special Regulatory Regime"

DESCRIPTION OF A NEW INNOVATIVE PRODUCT FOR THE PROVISION OF FINANCIAL SERVICES

Information about the Applicant Full name of the Applicant Legal address License number for banking operations Date of issue of the license Taxpayer Identification Number (TIN) Applicant's website on the Internet Department/Division responsible for the new innovative product Surname, first name, and patronymic of the head of the department/division responsible for the new innovative product Surname, first name, and patronymic of the person responsible for the new innovative product Email address of the person responsible for the new innovative product Phone number of the person responsible for the new innovative product

Information about the Co-applicant Full name of the Co-applicant Legal address Certificate number for carrying out organizational activities/license number for banking operations Date of issue of the certificate/license Taxpayer Identification Number (TIN) Co-applicant's website on the Internet Department/Division responsible for the new innovative product

INFORMATION ABOUT THE NEW INNOVATIVE PRODUCT FOR THE PROVISION OF FINANCIAL SERVICES Detailed description of the new innovative product Description of financial services (not more than 500 words, if necessary, additional information can be provided in a separate