SCA licensing requirements and process:
The Broker Clearing Members intending to carry out trades on behalf of their Clients have to necessarily obtain the regulatory license granted by the SCA. Such Broker Clearing Members have to apply for a regulatory license from the Securities and Commodities Authority (SCA) and fulfill additional criteria as stipulated under SCA regulations.
DCCC Compliance will assist the Broker Clearing Members in the process of applying for the SCA license and will make the submission to SCA on behalf of its Broker Clearing Members.
A duly filled application form along with the requisite documents have to be submitted to SCA in accordance with the regulations stipulated under SCA regulations 157/R of 2005 (attached). By submitting these additional documentation, the Broker Clearing Member will be fulfilling the acceptance criteria, ongoing operations and reporting requirements.
SCA regulations Administrative Decision No. (34/R.T) of 2016
On 01 June 2016, SCA issued guidelines in relation to SCA licensed entities applying Fit & Proper, Outsourcing and Chinese wall arrangements. The guidelines are issued as “Administrative Decision No. (34/R.T) of 2016 (the “Regulations”)” concerning controls of financial activities and services.
These Regulations provide greater clarity on minimum staff requirements for clearing and non-clearing Members, minimum qualifications/experience of the key employees, financial obligations, and regulatory compliance requirement of Member Clearing firms that are outlined in SCA regulations 157/R of 2005.
DCCC Compliance will assist the Broker Clearing Members, at the time of applying for the SCA regulatory license, to fully understand the requirements stipulated under the Administrative Decision. Further, the existing Broker Clearing Members will be provided guidance to read and understand the administrative decision in conjunction with SCA regulation 157/R of 2005.
As the decision 34/R.T of 2016 has to be read in conjunction with SCA’s regulation 157 R of 2005, Foreign companies licensed by similar regulatory bodies in their countries to practice the brokerage activity shall be exempted from applying this administrative requirements provided that they have experience in the area of commodities and/or capital markets for not less than five (5) years.
Checklists outlining the documents and conditions to adhere to by the Broker Members can be found in this section below: