The Official Gazette - No. 15 Rec. (B) dated April 18, 2017

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Prime Minister's Decision No. 861 of 2017

Prime Minister

After reviewing the Constitution; And the Civil Law issued by Law No. 131 of 1948; And Law No. 111 of 1951 concerning the non-allowability of attaching salaries, pensions, or bonuses of employees or workers, or transferring them, except in special circumstances; And the Law on Supervision and Oversight of Insurance in Egypt issued by Law No. 10 of 1981 and its amendments; And the Central Audit Organization Law issued by Law No. 144 of 1988; And Law No. 10 of 2009 regulating oversight of non-banking financial assets and instruments; And the Civil Service Law issued by Law No. 81 of 2016; And Presidential Decision No. 282 of 2006 regarding the Government Insurance Fund for Guarantees of Custodians; And Prime Minister's Decision dated 8/2/1950 establishing the Government Insurance Fund for Guarantees of Custodians; And Minister of Finance Decision No. 71 of 1929 establishing a cooperative guarantee fund for pharmacists and collectors affiliated with the Royal Treasury Service; After obtaining the opinion of the Financial Regulatory Authority; And after approval by the Cabinet;

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Decided:

(Article 1)

The Government Insurance Fund for Guarantees of Custodians, established by the aforementioned Prime Minister's Decision dated 8/2/1950, shall be reorganized in accordance with the provisions of this Decision, and shall hereinafter be referred to as the "Fund". The Fund shall possess independent legal personality, its headquarters shall be in Cairo, and it shall be subordinate to the Minister of Finance.

(Article 2)

The Fund aims to establish a reserve fund used to insure employees of state administrative units, local administration units, public authorities, other public legal entities, and all other entities covered by the state general budget, who are required by laws, regulations, and financial instructions to provide guarantees for cash, stamp papers, tools, equipment, machines, supplies, or other items entrusted to them. The Fund shall conduct insurance operations in accordance with the provisions of the accompanying bylaws, under the conditions and premiums issued by a decision of the Minister of Finance based on a proposal from the Fund's Board of Directors, in accordance with the controls determined by the Board of Directors of the Financial Regulatory Authority.

(Article 3)

The Fund shall be managed by a Board of Directors composed of a chairman and four members, two of whom shall be heads of sectors at the Ministry of Finance and two shall be experts in the field of insurance. A decision from the Ministry of Finance shall be issued regarding the formation of the Board of Directors, and this decision shall specify the value of attendance allowances for board meetings. The term of office for board members shall be three years, renewable. The Fund's Board of Directors shall convene upon invitation from its chairman at least once every three months, or whenever necessary. A meeting shall not be valid unless at least four members are present, including the chairman. Decisions shall be adopted by a majority of the votes of those present, and in case of a tie, the chairman's vote shall prevail. The Minister of Finance may invite the Fund's Board of Directors to convene to discuss specific matters.

(Article 4)

The Fund's Board of Directors shall be responsible for managing its affairs, administering its resources, and determining its general policy, and may take the necessary decisions to achieve its objectives, including:

1. Approving necessary measures to secure and safeguard the entrusted items specified in Article 2 of this Decision, ensuring adequate security in this regard.
2. Determining procedures to be followed in case of damage, loss, fire, theft, or embezzlement of insured items.
3. Approving the compensation amount due upon the occurrence of the insured risk, and approving disbursement conditions and procedures.
4. Proposing terms and premiums for insurance operations handled by the Fund, based on an actuarial study approved by the Financial Regulatory Authority.
5. Determining investment avenues for the Fund's funds.
6. Establishing rules and procedures for recourse against the custodian or third parties for amounts the Fund bears after liability is established.
7. Determining the necessary records, forms, and additional memoranda for conducting the Fund's operations.
8. Selecting necessary staff for the Fund from employees of the Ministry of Finance and its departments, other ministries, government entities, and public authorities.
9. Proposing amendments to the Fund's bylaws.
10. Approving the Fund's annual financial statements and its draft budget.
11. Approving the Fund's organizational structure.
12. Taking safety measures for the Fund's assets and funds and preserving them.

(Article 5)

The Chairman of the Fund's Board of Directors shall represent the Fund before the courts and in dealings with third parties.

(Article 6)

The Fund shall have an Executive Director of at least General Manager rank, selected by the Board of Directors. Their appointment shall be issued by the competent authority in accordance with the Civil Service Law. The Executive Director shall manage daily operations, supervise Fund employees, implement Board decisions, and attend meetings without a voting right in deliberations.

(Article 7)

The Fund shall maintain an income and expenditure account. Income shall include collected insurance premiums, returns on Fund investments, amounts recovered from custodians or third parties in settlement of paid compensations, and other revenues. Expenditures shall include paid compensations, all required provisions, specifically provisions for pending risks and provisions for compensations for incidents that occurred but were not reported, and expenses necessary for managing the Fund. Without prejudice to Article 10 of this Decision regarding deducting surplus income to form a reserve fund, this shall be after considering the provision for pending compensations to cover reported claims before the end of the fiscal year that have not yet been paid. This provision must be sufficient to cover entity claims.

(Article 8)

The Fund's resources shall consist of:

1. Insurance premiums.
2. Returns on Fund investments.
3. Recovered compensations.
4. Any other revenues approved by the Fund's Board of Directors.

(Article 9)

The Fund's fiscal year begins and ends with the state's fiscal year. The Fund shall prepare a planning budget four months before the start of the fiscal year, which shall be submitted to the Fund's Board of Directors for approval. The Fund shall also maintain a special account at a bank supervised by the Central Bank where its funds shall be deposited. The Fund's funds shall be considered public funds.

(Article 10)

The Fund shall conduct an actuarial valuation once a year to determine appropriate technical reserves, with any surplus transferred to the state general treasury in exchange for its commitment to cover any actuarial deficit the Fund may face. The Fund shall conduct an actuarial examination whenever requested by the Financial Regulatory Authority and shall submit the results to the Authority.

(Article 11)

The Fund shall prepare, no later than the end of April each year or whenever requested by the Financial Regulatory Authority, a report on its activities and operational results, including its financial position data and other analytical data. The Fund shall also prepare, within four months following the end of the fiscal year, a financial position statement, an income and expenditure account, and a report on its financial position and activities during the year. The two reports mentioned in the preceding paragraphs shall be submitted to the Board of Directors of the Financial Regulatory Authority, and the Fund shall submit to the Authority any other reports and data required to conduct oversight of its operations.

(Article 12)

The Fund shall conduct an actuarial valuation within one month from the effective date of this Decision to determine appropriate technical reserves, with any surplus transferred to the state general treasury.

(Article 13)

The Fund shall be subject to the oversight of the Central Audit Organization, and shall make available to auditors any records, documents, and data they deem necessary to complete the audit.

(Article 14)

The Financial Regulatory Authority shall continue to manage the Fund in accordance with the decisions and regulations applicable to it on the date of this Decision, until its Board of Directors is formed, the Executive Director is selected, and necessary staff are appointed, within a maximum period of six months from the effective date of this Decision.

(Article 15)

The provisions of the Civil Service Law issued by Law No. 81 of 2016 and executive regulations shall apply to the Fund's employees.

(Article 16)

Employees of the Fund's Central Administration shall continue working at the Financial Regulatory Authority unless they request transfer to work at the Fund under the Ministry of Finance, in which case the transfer shall be executed under the same employment conditions within one month from the effective date of this Decision.

(Article 17)

All provisions conflicting with this Decision are hereby repealed.

(Article 18)

This Decision and its accompanying bylaws shall be published in the Official Gazette and shall take effect from the day following their publication. Issued at the Prime Minister's Office on 21 Rajab 1438 AH (Corresponding to April 18, 2017 AD) Prime Minister Eng. Sherif Ismail

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Bylaws of the Government Insurance Fund for Guarantees of Custodians

(Article 1)

In applying the provisions of these bylaws, the following words and phrases shall have the meanings indicated alongside them:

Entrusted Items: Cash and its equivalents, stamp papers, stamps, tools, supplies, means of transport, or other items entrusted to a custodian or other entrusted items that the Fund's Board of Directors deems appropriate to add or cover.

Custodian: Any person holding the position of cashier, collector, warehouse keeper, driver, or any other position involving entrusted items, whether permanent or temporary employees. Collectors affiliated with the Real Estate Tax Service are excluded, as they are governed by Minister of Finance Decision No. 71 of 1929 establishing a cooperative guarantee fund for pharmacists and collectors affiliated with the Royal Treasury Service.

The Fund: The Government Insurance Fund for Guarantees of Custodians established by the Prime Minister's Decision dated 8/2/1950.

(Article 2)

The provisions of these bylaws shall apply to state administrative units, local administration units, public authorities, other public legal entities, and all other entities covered by the state general budget. Their provisions shall also apply to units, authorities, and entities that laws or decisions concerning them contain special rules for matters not specifically addressed in these laws or decisions. The units, authorities, public entities, and entities to which these bylaws apply shall be referred to as the administrative authority or authorities, as appropriate.