Chapter 3: Cancellation of License, Cessation of Operations Partially or Completely, and Deletion of Registration

1. A bank may not cease its operations partially or completely without prior approval from the Board of Directors of the Central Bank. Approval for complete cessation is issued only after verifying that the bank has provided sufficient guarantees or fully discharged its legal obligations; in particular, its obligations to depositors and other creditors, and the rights of employees.

2. The license may be cancelled and the bank's registration deleted by a decision of the Board of Directors of the Central Bank in the following cases:

3. If the bank commits a serious or repeated violation of the provisions of the Central Bank and Banking Supervision Law or the decisions issued in implementation thereof, and fails to rectify the violation within the period and under the conditions determined by the Board of Directors of the Central Bank.

4. If it pursues a policy that is likely to harm the public economic interest, monetary policy, the banking system, or the interests of depositors.

5. If it ceases to conduct its business or submits a request to suspend its business and liquidate it voluntarily.

6. If any of the conditions for considering the bank as distressed are met and the Central Bank deems it inappropriate to settle the affairs of the distressed bank and decides to liquidate it.

7. If it is established that the license for the bank was issued based on false data provided to the Central Bank.

8. If it loses one of the licensing conditions.

9. If a fundamental change occurs in the data on which the license was issued.

10. If the bank does not commence its business within twelve months for a bank in the form of an Egyptian joint-stock company and six months for a branch of a foreign bank, from the date of obtaining the license or from the date of ceasing to accept deposits after commencing its banking business.

11. If the bank is merged into another bank or if all or most of its assets are sold.

12. If the head office of the foreign financial institution to which the Egyptian joint-stock company or the branch of the foreign bank belongs ceases to conduct the business of accepting deposits.

13. In addition to the foregoing, the license of a branch of a foreign bank is cancelled in the following cases:

14. If any change occurs in the nationality, ownership, or founding contract or statutes of the foreign bank.

15. If the financial position of the foreign bank deteriorates, or if it is subject to sanctions or risks that the Central Bank deems serious.

16. If any change occurs that the Central Bank considers to negatively affect the activity of the foreign bank's branch in the Arab Republic of Egypt and the proper conduct of its business.

17. If it is established that the competent authorities in the country of the head office do not apply sound principles in the supervision of banking business.

18. The decision to cancel the license and delete the registration shall be published in the El-Waqa'ea El-Masryea (Official Gazette) within ten days from the date of its issuance and on the electronic website of both the Central Bank of Egypt and the concerned bank throughout the liquidation period.

Procedures and Required Documents for Cessation of Operations

1. Partial Cessation of Operations

1. A bank wishing to cease its operations partially must submit a request to the Central Bank to obtain approval for partial cessation of operations and to proceed with the procedures for complete cessation of operations, accompanied by the following documents:

2. Approval of the Extraordinary General Assembly of the bank, or approval of the head office abroad for a branch of a foreign bank, to cease operations.

3. The study prepared by the bank for the cessation of operations, including the justifications for doing so.

4. Evidence of notifying the supervisory authority in the country where the head office of the bank is located abroad, for a branch of a foreign bank.

5. A commitment by the bank or the head office of the bank, for a branch of a foreign bank, to provide sufficient guarantees or to discharge its obligations to depositors, other creditors, and employees' rights.

6. The Board of Directors of the Central Bank issues a decision approving the partial cessation of operations and proceeding with the procedures for complete cessation of operations, obliging the bank to publish an announcement of the cessation of its operations at least twice in two widely circulated daily morning newspapers, one of which is in Arabic, issued in the city where the head office of the bank or the main branch, for a branch of a foreign bank, is located in the Arab Republic of Egypt. The announcement must mention the bank's intention to submit a request to the Central Bank of Egypt to cease its operations in the Arab Republic of Egypt and the date of submitting this request. The announcement must also invite depositors and other creditors of the bank, and anyone who has a claim against the bank, to submit a statement to the Central Bank of Egypt no later than the date of submitting the request for complete cessation of operations, stating their rights that the bank has not fulfilled, if any.

7. At least fifteen days must elapse between the two announcements, and at least ninety days must elapse between the date of the last announcement and the date of submitting the request for complete cessation of operations to the Central Bank.

2. Complete Cessation of Operations

1. A bank that has obtained approval to take procedures for partial cessation of operations must submit a request for complete cessation of operations, accompanied by the following documents:

2. Evidence of publishing an announcement of the cessation of its operations at least twice in two widely circulated daily morning newspapers, one of which is in Arabic, issued in the city where the head office of the bank or the main branch, for branches of foreign banks, is located in the Arab Republic of Egypt. The announcement must mention the bank's intention to submit a request to the Central Bank to cease its operations in the Arab Republic of Egypt and the date of submitting this request. The announcement must also invite depositors and other creditors of the bank, and anyone who has a claim against the bank, to submit a statement to the Central Bank no later than the date of submitting the request for cessation of operations, stating their rights that the bank has not fulfilled, if any.

3. At least fifteen days must elapse between the two announcements, and at least ninety days must elapse between the date of the last announcement and the date of submitting the request for cessation of operations to the Central Bank.

4. A certificate from the requesting bank stating that it has provided sufficient guarantees or has fully discharged its obligations to depositors, other creditors, and employees, signed by the Chairman of the Board of Directors of the bank or the Managing Member or the Responsible Manager for branches of foreign banks, and authenticated by the auditors. Accompanied by the following documents:

• A certificate from the competent tax authority stating that no stamp taxes are due from the bank up to the date of cessation.

• A certificate from the competent tax authority stating that no corporate taxes, capital or movable property taxes, business profits taxes, or any other taxes are due from the bank up to the date of cessation.

• A copy of the inquiry statement issued by the National Organization for Social Insurance stating that there are no outstanding balances due from the bank to the organization.

• A copy of the announcement published in two widely circulated morning newspapers, one of which is in Arabic, regarding the bank's transfer of balances of account holders who could not be located to another bank, and providing the Central Bank with an irrevocable commitment letter issued by one of the banks operating in Egypt to fulfill any obligations due from the bank or the branch of the foreign bank to depositors or other creditors (including tax dues, National Organization for Social Insurance dues, etc.).

• A certificate stating that all judicial disputes between the bank and customers or any other party have been concluded, or that a guarantee has been provided for any obligations that may arise as a result of those disputes, to be determined by both the person responsible for the concerned bank and the Central Bank.

4. A statement certified by the bank's auditors confirming that it has fulfilled all its obligations to depositors, other creditors, and employees. In case of any unpaid obligations, sufficient guarantees for these obligations must be provided, authenticated by the auditors and acceptable to the Central Bank.

5. The Board of Directors of the Central Bank issues a decision regarding the request for cessation of operations within ninety days from the date of submission of the request with the required documents, after verifying that the bank has provided sufficient guarantees or has fully discharged its obligations to depositors, other creditors, and employees.

6. The decision issued regarding the request for cessation of operations is notified to the requesting bank within fifteen days from the date of its issuance by any means determined by the Central Bank.

The issuance of a decision to completely cease operations results in the issuance of a decision by the Board of Directors of the Central Bank to delete the bank, and the decision is published in the Official Gazette within ten days from the date of its issuance.

Cancellation of License of a Representation Office

1. The Central Bank may cancel the license granted to a representation office in any of the following cases:

2. Failure to commence work within a period of six months from the date the license was granted, unless this period is extended by a decision of the Governor.

3. Ceasing work without obtaining prior approval.

4. Carrying out work or practicing any unauthorized activities, or practicing any activity that is likely to harm the Egyptian economy or economic security.

5. Violating the provisions of these rules, laws, or regulations related thereto, or the conditions of the license.

6. The bankruptcy of the bank abroad that the office represents, or its final cessation of work.

7. Any other reasons deemed appropriate by the Board of Directors of the Central Bank.

8. In case the office violates the licensing conditions mentioned above, the Central Bank notifies it of any means of defense within fifteen days from the date of notification, by any means the Central Bank deems appropriate. If the violation is established, a warning is issued to it, or the activity is suspended for a period not exceeding one year, or the license is cancelled and the registration is deleted from the register.

9. The bank abroad submits a request to the Central Bank for the temporary suspension or cancellation of the license of the office in the Arab Republic of Egypt, provided that the office fulfills all its obligations. The Central Bank must be notified before the suspension, whether temporary or cancellation of the license, at least thirty days in advance.

10. The office is deleted from the register of representation offices at the Central Bank.