Regulation 25 of the Nairobi International Financial Centre (NIFC) Regulations, 2021, defines general contraventions that may be committed by certified firms within the NIFC.
This article explores the various scenarios outlined in the regulation, shedding light on activities that constitute contraventions and the potential repercussions for non-compliance.
General Contraventions
Failure to Comply
Certified firms may commit a contravention if they fail to comply with:
(i) Prohibitions or requirements imposed by the Authority.
(ii) Undertakings given to the Authority.
(iii) Agreements made with the Authority.
Prohibited Activities:
Engaging in activities prohibited under, or contravening any legislation administered by the Authority constitutes a contravention.
Non-Compliance with Legislation:
Certified firms committing a contravention if they fail to comply with any requirements under legislation administered by the Authority.
Fraud and Fiduciary Duty:
Committing an act of fraud or abusing fiduciary duties owed to clients or other parties constitutes a serious contravention.
Deceptive or Dishonest Behavior:
Acting in a deceptive, misleading, or dishonest manner falls under the umbrella of contraventions.
Regulatory Framework:
Contraventions may extend to activities explicitly identified as such in regulations, guidelines, or rules formulated by the Authority.
Implications and Enforcement
Regulatory Oversight:
Regulation 25 underscores the Authority’s commitment to maintaining a high standard of regulatory oversight within the NIFC.
Compliance Obligations:
Certified firms must diligently adhere to prohibitions, requirements, and agreements stipulated by the Authority, ensuring comprehensive compliance.
Fraud Prevention and Ethical Conduct:
Addressing acts of fraud, preventing abuses of fiduciary duties, and promoting ethical conduct are crucial for upholding the integrity of financial activities within the NIFC.
Transparent and Honest Operations:
Certified firms must operate transparently, honestly, and avoid engaging in any deceptive or misleading practices to foster trust and credibility.
Conclusion
Regulation 25 establishes a framework for identifying general contraventions committed by certified firms within the NIFC. Upholding the stipulated requirements, preventing fraud, and maintaining ethical standards are paramount for fostering a secure and trustworthy financial environment. Certified firms are urged to remain vigilant, ensuring compliance with the regulations and guidelines set forth by the Authority.
