Who does the decision apply to?
FRA Board Decision No. 2 of 2024 (as amended by Decision No. 33 of 12 February 2025) sets the licensing and continuation rules for Principal Functions at companies operating in Egypt's securities field. It supersedes Decision 24/2007 and clause 2 of Decision 125/2015.
The company's organisational chart must include the functions listed in Annex 1, with each function linked to the activity the company is licensed to practise (brokerage, securities custody, portfolio management, promotion and underwriting, investment funds).
The twenty Principal Functions
Twenty functions are listed: Managing Director; Internal Compliance Officer; AML Officer; Internal Audit Manager; Financial Manager; Risk Manager; Executing Trader; Accounts Manager (equities / bonds); Back-Office Operations Manager; Financial Analyst; Technical Analyst; Research Unit Manager; Principal Credit-Rating Analyst; Credit Analyst; Portfolio Manager or Investment Manager; Promotion Manager; Branch Manager; Margin-Operations Manager; HR Officer; and IT & Information Security Officer.
Multi-activity companies may, with FRA approval, have the same person occupy the Principal Function required for each activity — a practical way to keep the staffing envelope lean without breaching the rules.
Licensing conditions
Article 3 sets seven conditions: (1) good reputation and conduct; (2) full legal capacity; (3) a relevant higher degree from a recognised Egyptian institution or its foreign equivalent; (4) the Annex 2 specifics for the function; (5) no parallel employment at another entity that impairs the role; (6) no prior professional, judicial, or disciplinary removal within the last three years; (7) no conviction for a felony, dishonesty-related misdemeanour, or offence under the securities, banking, or AML laws within the last three years.
Application and decision
The application uses the FRA-issued form and must be accompanied by a copy of the national ID, a CV, proof of service-fee payment, and copies of the academic and professional qualifications. The FRA rules on the application within fifteen days of the examination/interview date, and the licence is issued by the FRA Chair. A refusal must be reasoned.
Duration and renewal
The licence is valid for three years, renewable for equal periods so long as the conditions continue to be met. Renewal may be conditioned on passing FRA-defined examinations or training courses, or on the holder's continuing professional education. The fee for examining an application or renewal is EGP 1,000 or its foreign-currency equivalent.
The renewal request must be filed within the three months preceding expiry. Failure to file within that window — without an acceptable excuse — voids the licence.
Licensee obligations
The licensee must notify the FRA when contracting with a securities company, when leaving (with reasons), when moving to another licensed company, and upon any criminal conviction. Notification is filed on the FRA-issued form within fifteen days, and the FRA may conduct an interview in the case of a move.
The company's register of Principal Functions
Companies must maintain a paper and electronic register containing the names, addresses, licensing and renewal dates, employment and termination dates of each function holder, along with any company-initiated proceedings or criminal judgments against them.
The company must verify that each function is held by a licensed individual and that renewals are timely. Each January, the company files with the FRA an updated list of function holders for approval, and any change must be notified within fifteen days. Supporting documents are kept for at least five years.
When a Principal Function becomes vacant
When a Principal Function is vacated, the company must fill it within three months unless the FRA accepts a justification. A board member, Managing Director, or employee whose experience matches the vacant role must be delegated to carry the duties until the position is filled. The FRA must be notified within ten days of the vacancy.
Cancellation and administrative measures
The licence is cancelled in four cases: (1) at the licensee's request; (2) failure to file for renewal within three months of expiry; (3) loss of any licensing condition; (4) proven invalidity of the documents on which the licence was issued.
Administrative measures escalate from a warning, to licence suspension for up to one year, to cancellation with a one-year bar on re-licensing, and finally to permanent cancellation. The measure may also require the licensee to pass FRA-specified training.
A practical summary for management
Three checks every brokerage, custodian, or portfolio manager should run annually: (a) the completeness of the Principal-Function chart against the licensed activities; (b) the validity and timely renewal of each function holder's licence; (c) the upkeep of the institutional register, with supporting documents retained for at least five years. A gap on any of these three opens the door to administrative measures even before any operational breach occurs.