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Monday, 22 January 2018

FRA drafting Insurance Act, 80% done with Capital Market Act regs

LEGISLATION WATCH- The Financial Regulatory Authority (FRA) is drafting an all-encompassing Insurance Act. A draft of the bill — which will cover everything from car insurance to policies for companies and private equity funds — will be put up for “national dialogue” at the end of February before it’s passed along to the various ministries to review, FRA Deputy Chairman Reda Abdel Moaty tells Al Mal. Actuarial studies to back the bill are now underway. Some of the proposals currently under study include amending capital requirements for insurance companies to a minimum of EGP 120 mn, compared to EGP 60 mn currently. The FRA is also considering setting a payout floor of EGP 60-70,000 (up from EGP 40,000) on life insurance policies for victims of traffic accidents, Abdel Moty adds.

In other news from FRA, the executive regulations to the new Capital Markets Act are 80% complete and should be ready by the time MPs are done revising the bill by the end of February, FRA Deputy Chairman Khaled El Nashar also said. In addition to introducing penalties for financial crimes and new rules governing taxes for the sector, the law — which is currently before the House of Representatives’ Economics Committee — is expected to introduce a number of new financial instruments to the market, including futures trading, a commodities exchange, and short-selling. An FRA committee is currently drafting the mechanisms through which short-selling will be implemented and these will be used to complete drafting the executive regulations.

Also on legislative docket, the House Planning and Budgeting Committee has approved extending the Tax Dispute Resolution Act for only one year, Vice Minister of Finance Amr El Monayer said, Al Borsa reports. Cabinet had agreed back in November to extend the act’s mandate, which expired in September, for an additional two years.

Elsewhere in parliament, the House Culture and Media Committee is set to resume discussions on part two of the Press and Media Act today. The second part of the bill, which had been divided into two in 2016, focuses exclusively on setting regulations and guidelines for those working in the media, while the first had been concerned with setting up the three main industry regulators.

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