On Amending the Business Conduct Regulation Series 3000 and Market Conduct Regulation Series 4000

Notice No. 89
Concerning the Amendment of the Business Conduct Regulation Series 3000 and Market Conduct Regulation Series 4000 Pursuant to Law No. 161 dated August 17, 2011, concerning financial markets; Pursuant to Capital Markets Authority Board Decision No. 22/9/19, issued at its meeting held on November 8, 2022; Pursuant to Capital Markets Authority Board Decision No. 23/2/6, issued at its meeting held on February 28, 2023; We hereby inform you of the following:

First: Article 3318 of the Business Conduct Regulation Series 3000 is amended, to read as follows:
The licensed institution must send all reports, statements, and notices to clients in accordance with the regulations either in paper form, via email, or via SMS on mobile phones. When using electronic means and text messages, it must comply with all provisions of Law No. 81 dated October 18, 2018, concerning the regulation and preservation of messages in a manner ensuring their integrity, and the use of secure means that accompany electronic signatures with protection procedures approved by an accredited certification service provider.

Second: Paragraph 3 of Article 3521 of the Business Conduct Regulation Series 3000 is amended, to read as follows:
(3) The licensed institution must notify the client with a copy of his account statement, clearly showing the operations performed on and by his portfolio. This notification must be sent monthly to the postal address specified by him, or to the email address authorized by the client, or via SMS to his specified mobile phone number, while complying with Annex No. 6 regarding the content of periodic data for investment portfolios. The compliance department must ensure that the licensed institution sends the notification via the postal address, email address, or mobile phone number specified by the client and continuously designated by the compliance department/any responsible entity within the licensed institution. The client's right to object to any operation or document is preserved within a two-week period from the date of notification and/or from the date of sending the email and/or SMS. The licensed institution must, through its compliance department:

• Ensure notification is sent to the client as stated above;
• Obtain the client's signature on his portfolio at least once a year.
  The licensed institution may determine cases where an agent, where applicable, can sign and receive on behalf of the client according to the content of the power of attorney.

Third: Paragraph 8 of Article 4202 of the Market Conduct Regulation Series 4000 is amended, to read as follows:
(8) The licensed institution must, when opening an account and before conducting any transaction related to financial instruments with or for the client, obtain his signed and dated copy of the agreement containing clear disclosure of the schedule of fees and commissions borne by him. If the licensed institution decides to update the fee and commission schedule, it must:

• Notify the client of the updated schedule as soon as possible, via a notice sent to his specified postal address, or by email to his authorized email address, or by SMS to his specified mobile number.
• Grant the client a two-week period from the date of notification and/or email and/or SMS to object to the updated schedule, which will not apply to him until this two-week period expires without objection. The passage of this period without client objection is considered as his implicit approval of the updated schedule, allowing the licensed institution to collect fees and commissions according to the notified/updated/electronically transmitted/SMS-issued schedule without automatic client objection.
  The compliance department must ensure that the licensed institution sends the notification via the postal address, email, or mobile number specified by the client and continuously designated by the compliance department/any responsible entity within the licensed institution.

Fourth: This notice takes effect immediately upon its publication in the Official Gazette.

Beirut, March 8, 2023
Chairman of the Capital Markets Authority / Governor of Bank of Lebanon Riad Tawfiq Salameh