Law No. 2017-044 amending certain provisions of Law No. 95-030 of February 22, 1996 on the activity and supervision of credit institutions

REPUBLIC OF MADAGASCAR

PRESIDENCY OF THE REPUBLIC

Law No. 2017-044 amending certain provisions of Law No. 95-030 of February 22, 1996 on the activity and supervision of credit institutions

STATEMENT OF REASONS

Law No. 95-030 of February 22, 1996 on the activity and supervision of credit institutions, commonly known as the "banking law," establishes the Banking and Financial Supervision Commission (CSBF), which is the supervisory and control authority for credit institutions within the territory of the Malagasy Republic.

Article 36 of the banking law defines the composition of the CSBF and designates the General Director of the Central Bank of Madagascar among the personalities who sit on the Commission.

However, following the entry into force of Law No. 2016-004 of July 29, 2016, amended by Law No. 2016-057 of February 2, 2017, Banky Foiben'i Madagascar is now endowed with a new organizational structure, notably including the creation of the Vice-Governor position and the abolition of the General Director position.

Thus, for the CSBF to continue to sit regularly, the terms of the banking law, particularly those relating to the composition of the CSBF, must be reviewed in accordance with the structural changes brought about by the new statutes of Banky Foiben'i Madagascar.

This is the purpose of the present law.

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REPUBLIC OF MADAGASCAR

PRESIDENCY OF THE REPUBLIC

Law No. 2017-044 amending certain provisions of Law No. 95-030 of February 22, 1996 on the activity and supervision of credit institutions

The National Assembly and the Senate adopted in their respective joint sessions on November 30, 2017 and December 13, 2017

THE PRESIDENT OF THE REPUBLIC,

• Having regard to the Constitution;
• Having regard to Decision No. 05-HCC/D3 of January 17, 2018 of the High Constitutional Court,

PROMULGATES THE LAW WHOSE TEXT FOLLOWS:

Article 1.- All references to "Central Bank" or "Central Bank of Madagascar" in the provisions of Law No. 95-030 of February 22, 1996 on the activity and supervision of credit institutions are replaced by "Banky Foiben'i Madagascar".

Article 2.- The terms of Articles 36 and 39 of Law No. 95-030 of February 22, 1996 on the activity and supervision of credit institutions are amended as follows:

"Article 36 – (new) The Banking and Financial Supervision Commission comprises:

members sitting ex officio:

• the Governor of Banky Foiben'i Madagascar, President;
• the First Vice-Governor of Banky Foiben'i Madagascar;
• the General Director of the Treasury;
• a member designated by the Minister in charge of Finance;
• a magistrate holding at least the rank of Counselor at the Supreme Court, designated by the First President of said Court;

as well as three members chosen for their expertise in banking and finance. They must be of Malagasy nationality and are appointed by decree taken in the Council of Ministers for a non-renewable term of 3 years, upon joint proposal of the Minister in charge of Finance and the Governor of Banky Foiben'i Madagascar.

In the absence of the Governor, the presidency of the Commission is ensured by the First Vice-Governor according to the rank attributed by the decree appointing the Vice-Governors of Banky Foiben'i Madagascar.

The President of the Professional Association of Credit Institutions or a representative thereof participates, without voting rights, in the Commission's debates concerning the examination of draft instructions within the Commission's jurisdiction in application of Article 41 of this law."

"Article 39 – (new) Banky Foiben'i Madagascar ensures, from its budget and with the assistance of its staff, the General Secretariat of the Commission.

To this end, the Governor designates, under the same conditions as the directors of Banky Foiben'i Madagascar, a person responsible for ensuring the functions of General Secretary.

The General Secretary of the Commission as well as one or more representatives of Banky Foiben'i Madagascar in charge of the monetary sector, the financial system, and financial stability attend, without voting rights, the meetings of the Commission.

The annual preliminary accounts and the definitive financial statements relating to the activity of the Commission and its General Secretariat are submitted, for opinion, to the Commission prior to their presentation to the Board of Directors of Banky Foiben'i Madagascar.

The institutions subject to supervision participate in the operating costs of the Commission and its General Secretariat through an annual contribution, based on the net banking income of each institution. The uniform rate of this contribution is fixed by order of the Minister in charge of Finance."

The remainder unchanged.

Article 3.- All provisions contrary to this law are hereby repealed.

Article 4.- NOT PROMULGATED in accordance with Decision No. 05-HCC/D3 of January 17, 2018 of the High Constitutional Court

Article 5.- This law shall be published in the Official Journal of the Republic. It shall be executed as a law of the State

Promulgated in Antananarivo on, January 25, 2018

RAJAONARIMAMPIANINA Hery Martial

FOR TRUE COPY Antananarivo, January 31, 2018

THE GENERAL SECRETARY OF THE GOVERNMENT

FARATIANA Tsihoara Eugène

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P.O. Box 550 Antananarivo (101) - Madagascar • Tel. (261) 20 22 217 51 / 20 22 234 65 • Fax (261) 20 22 345 32 Website: www.banque-centrale.mg • Email: banque-centrale@bfm.mg