Board of Trustees Decision No. 1 of 2016 on Conditions, Rules, and Procedures for Regularizing Microfinance Activities of Associations and Civil Institutions Prior to Law No. 161 of 2016

General Authority for Financial Supervision
Microfinance Activity Supervision Unit for Associations and Civil Institutions Board of Trustees Decision No. 1 of 2016 Dated 21/12/2016 Regarding the Conditions, Rules, and Procedures for Regularizing the Status of Associations and Civil Institutions Engaging in Microfinance Activities Prior to the Implementation of Law No. 161 of 2016

The Board of Trustees of the Microfinance Activity Supervision Unit for Associations and Civil Institutions, having reviewed: the Law Regulating the Supervision of Non-Bank Financial Markets and Instruments issued by Law No. 10 of 2009; Law No. 161 of 2016 Regulating Microfinance Activities; Presidential Decree No. 192 of 2009 Issuing the Statutes of the General Authority for Financial Supervision; Board of Directors Decision No. 108 of 2016 of the General Authority for Financial Supervision Regarding the Determination of Microfinance Fields and Values; Board of Directors Decision No. 109 of 2016 of the General Authority for Financial Supervision Regarding the Statutes of the Microfinance Activity Supervision Unit for Associations and Civil Institutions; Board of Directors Decision No. 170 of 2016 of the General Authority for Financial Supervision Regarding the Formation of the Board of Trustees of the Microfinance Activity Supervision Unit for Associations and Civil Institutions; Board of Directors Decision No. 171 of 2016 of the General Authority for Financial Supervision Regarding the Rules for Registration, Continuation of Registration, and Striking Off in the Register of Auditors for Microfinance Companies and Licensed Associations and Civil Institutions; and upon approval by the Board of Trustees of the Microfinance Activity Supervision Unit for Associations and Civil Institutions in its meeting No. (1) dated 21/12/2016;

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Decision:

(Article One)
Definitions
Microfinance: Any financing for productive economic, service, or commercial purposes, ensuring the recipient's participation in the project activity either through effort or financing commensurate with the nature of the project, not exceeding one hundred thousand Egyptian pounds, all in accordance with Board of Directors Decision No. 108 of 2016 of the General Authority for Financial Supervision. The Unit: The Microfinance Activity Supervision Unit for Associations and Civil Institutions established pursuant to Law No. 161 of 2016, with its statutes issued by Board of Directors Decision No. 109 of 2016 of the General Authority for Financial Supervision. The Board of Trustees of the Unit: The Board of Trustees of the Microfinance Activity Supervision Unit for Associations and Civil Institutions. The Legal Representative of the Association or Civil Institution: The Chairman of the Board of Directors/Trustees, the Competent Director, or the Authorized Manager of the Association or Civil Institution, as applicable.

(Article Two)
Temporary Licensing
The Unit shall issue a temporary license to any association or civil institution licensed by the competent ministry applying the Law on Associations and Civil Institutions, which engages in microfinance activities prior to November 16, 2013 (the effective date of Law No. 161 of 2016), subject to meeting the conditions stipulated in Article Three of this Decision. Obtaining a temporary license shall constitute the first step in regularizing the status of the association or civil institution. This shall be in accordance with decisions issued by the Board of Trustees of the Unit on this matter.

(Article Three)
Conditions for Temporary Licensing
The following conditions must be met by associations and civil institutions seeking to obtain a license from the Unit to engage in microfinance activities:

1. They must be licensed by the competent ministry applying the Law on Associations and Civil Institutions.
2. Their statutes must include microfinance, loan provision, or economic development activities.
   License applications shall be submitted to the Unit on the form prepared by the Unit, accompanied by the following documents and papers:
   (a) An official extract of the license of the association or civil institution.
   (b) The statutes of the association or civil institution.
   (c) A declaration from the legal representative of the association or civil institution confirming that no amendments have been made to the submitted data and documents, or notifying the Unit of such amendments if they occur. (d) The latest approved financial statements and the auditor's report thereon. (e) A declaration from the legal representative committing to regularize the status of the association or civil institution in accordance with decisions regarding the rules and guidelines for conducting the activity. (f) Proof of payment of the temporary license application inspection fee, fixed at five hundred Egyptian pounds, in accordance with Board of Directors Decision No. 171 of 2016 of the General Authority for Financial Supervision. The Unit shall issue a receipt certificate for the submitted documents and attachments, or specify any other documents required. License application files may be submitted through one of the branches of the Social Fund for Development, to be delivered to the Unit by the Fund, in accordance with the system established by the Fund.

(Article Four)
Licensing Rules
The Unit shall examine the license application to verify the fulfillment of the stipulated conditions, and shall rule on the application within a period not exceeding two weeks from the date of completing the required documents. In all cases, the temporary license shall remain valid until the association or civil institution completes the regularization of its status in accordance with the rules issued by the Board of Trustees, within a period not exceeding May 13, 2015.

(Article Five)
This Decision shall be published in the Egyptian Gazette and on the website of the General Authority for Financial Supervision, and shall take effect from the day following its issuance. Chairman of the General Authority for Financial Supervision and Chairman of the Board of Trustees Sherif Samy