Regulatory Alerts2020-01-01
Board of Directors Decision No. (93) of 2020
The Financial Regulatory Authority (FRA) issued Board Decision No. (93) of 2020 to amend the executive corporate governance rules for licensed leasing and factoring companies. The decision mandates that these entities establish independent audit and risk committees comprising at least three members, with a majority drawn from independent or non-executive directors and at least one member possessing financial expertise. All licensed companies must align their internal arrangements with these revised standards no later than December 31, 2020.
Financial Regulatory Authority
FINANCIAL REGULATORY AUTHORITY
Chairman of the Authority
Board of Directors Decision No. (93) of 2020 dated 2/6/2020
Amending Board of Directors Decision No. (164) of 2018 Regarding the Executive Rules for Corporate Governance of Companies Licensed to Conduct Leasing and Factoring Activities
The Board of Directors of the Financial Regulatory Authority Having reviewed Law No. (10) of 2009 regulating supervision over non-banking financial markets and instruments; And Law No. (176) of 2018 regulating leasing and factoring activities; And Board of Directors Decision No. (164) of 2018 regarding the Executive Rules for Corporate Governance of Companies Licensed to Conduct Leasing and Factoring Activities; And after approval by the Authority's Board of Directors in its meeting held on 3/6/2020; Decided
(Article One)
Replacing the texts of clauses (2-1) and (2-3-1) of Board of Directors Decision No. (164) of 2018 regarding the Executive Rules for Corporate Governance of Companies Licensed to Conduct Leasing and Factoring Activities, with the following texts:
2-2 Audit Committee
The Board of Directors is required to form an audit committee consisting of an odd number of members, not less than three, drawn from non-executive board members. The committee may include members from outside the company. The majority of the committee members must be independent, with the committee chair drawn from among them. In all cases, committee members must be recognized for their competence and expertise in the company's field of activity, and at least one member must have experience in financial and accounting affairs. The committee may also invite the external auditor or any other suitable person to attend its meetings without being a member.
2-3 Risk Committee
The Board of Directors is required to form a risk committee consisting of an odd number of members, not less than three, with the majority drawn from non-executive board members and independent members. The committee may include members from outside the company, and the committee chair must be a non-executive or independent member.
(Article Two)
Companies conducting leasing and factoring activities existing on the effective date of this decision shall align their internal arrangements with its provisions within a maximum period of December 31, 2020.
(Article Three)
This decision shall be published in the Egyptian Gazette and on the Authority's website, and shall take effect from the day following its publication in the Egyptian Gazette.
Chairman of the Board of Directors Dr. Mohamed Omran
Smart Village, Building no. B-136, Giza Postal Code: 12577 Tel.: (00202) 35345350 - Fax: (00202) 35370036 www.FRA.gov.eg
Smart Village, Building B-136, Giza, Egypt Postal Code: 12577 Tel.: +202 35345350 - Fax: +202 35370036 info@fra.gov.eg