QFCRA Corporate Governance

The QFC Regulatory Authority is the independent regulatory body of the Qatar Financial Centre (QFC). It has been established to regulate firms that conduct financial services in or from the QFC. It has a broad range of regulatory powers to authorise, supervise and, when necessary, discipline firms and individuals. The QFC Regulatory Authority regulates firms using principle-based legislation of international standard, modelled closely on the laws used in other major financial centres.

The Qatar Financial Centre Regulatory Authority (the "Regulatory Authority") is established by Law No.(7) of 2005 of the State of Qatar (the "QFC Law") .
The QFC Law and the QFC Financial Services Regulations ("FSR") provide for the Board of the Regulatory Authority, its constitution, membership, duties and powers.
On 5 September 2006 the Board of the Regulatory Authority adopted a Governance Resolution in respect of the governance of the Regulatory Authority.

That resolution:

• sets out the policy of the Board on various governance matters, reflecting the Board's intention that the business of the Regulatory Authority and the Board be conducted in accordance with the Regulatory Objectives, other applicable law, and principles of sound corporate governance;
• makes further provision for the regulatory and operational responsibilities of the Regulatory Authority;
• sets out the respective roles of the Board and the Chairman and Chief Executive Officer ("CEO");
• establishes an Audit and Risk Committee and a Nominations and Remuneration Committee;
• provides for certain delegations and decision-making within the Regulatory Authority; and
• contains various other matters of general application regarding the governance of the Regulatory Authority.

The following is a summary of key provisions of the Governance Resolution.

Role of the Board 

• The role of the Board, subject to the QFC Law and other applicable legislation, is to lead the Regulatory Authority.
• Schedule 4 of the QFC Law outlines the powers and duties of the Board. These can be accessed at http://www.complinet.com/file_store/pdf/rulebooks/QFCRA_2.pdf.

• In addition, the Board is to:
  
  • exercise such functions of the Regulatory Authority which under the QFC Law or other applicable QFC legislation only the Board can exercise;
  • make strategic decisions affecting the future operation of the Regulatory Authority;
  • oversee the discharge by the executive management of the day to day business of the Regulatory Authority;
  • set appropriate policies to manage risks to the Regulatory Authority's operations and the achievement of its regulatory objectives and seek regular assurance that the system of internal control is effective in managing risks in the manner it has approved;
  • maintain a sound system of financial control;
  • cause minutes to be made in books provided for the purpose of:
    
    • all appointments of officers;
    • the names of persons present at each meeting of the Board and of each committee of the Board; and
    • All resolutions and procedures at all meetings of the Board and of each committee of the Board.
      
  • take specific decisions which the Board or executive management consider to be of such significance as to require to be taken by the Board;
  • maintain high level relations with other appropriate organisations and authorities; and
  • provide an accountability mechanism for decisions of committees of the Board and executive management, including through periodic reporting to the Board.

Board Members 

• Each Board Member is to :
  • act in accordance with the QFC Law and other QFC legislation and (to the extent not inconsistent with the QFC Law and other legislation) the terms of that Board Member's appointment by the Council of Ministers ("CoM");
  • in particular, act in accordance with, and further, the Regulatory Objectives set out in Article 12 of the FSR ( http://www.qfcra.com/whatdo/Objectives1.php ).
  • act honestly, in good faith and in the best interests of the Regulatory Authority;
  • in relation to any particular matter, act in accordance with any applicable quasi-judicial or public or administrative law responsibilities applicable to that matter;
  • comply with the QFC Law, regulations, rules and powers issued by themselves and with all resolutions from time to time made by the board including, without limitation, in relation to conflicts of Interest, confidentiality and ethics; and
  • not bring the name or reputation of the Qatar Financial Centre, the Regulatory Authority, the QFC Authority or the Government of Qatar into disrepute by any act or omission of that Board Member, whether acting as a Board Member or in any other capacity, and irrespective of where the act or omission occurs.
• Each Board member is:
  • entitled to be supplied with relevant information (subject to any conflict of interest);
  • have access to professional advice in particular instances.

The Chairman and Chief Executive Officer 

• The QFC Law provides for the appointment of a Chairman and a CEO and further provides that the role of Chairman and CEO may be held by one individual for such period as the Council of Ministers may determine.
• The Council of Ministers has appointed one person to hold both the role of Chairman and CEO. The Resolution sets out whose responsibilities relate to the role of the Chairman and which relate to the role of CEO.

Audit and Risk Committee 

• The resolution establishes a Board Audit and Risk Committee ("ARC") comprising at least two independent Non-Executive Board Members, at least one of whom should have recent and relevant financial experience.
• The functions of the ARC are to assist the Board satisfying itself on specific matters including
  • the quality of the financial management of the Regulatory Authority and the adequacy of its system of internal controls
  • the identification and management of  the significant risks to the Regulatory Authority's objectives and outcomes
  • the internal and external audit function
  • the implication of any legal action being taken against the regulatory Authority, the adequacy of internal whistle-blowing arrangements, the operation of any code of conduct for Board Members or employees including in relation to dealings and conflicts of interest, and certain expense claims.

Nominations and Remuneration Committee 

• The resolution establishes a Board Nominations and Remunerations Committee ("NRC") comprising at least two independent Non-Executive Board Members.
• The function of the NRC is to consider and make recommendations regarding:
  
  • prospective Board appointees and Board succession planning
  • Board Members' remuneration and benefits and other terms of appointment including those of the Chairman and CEO)
  • broad policy on all aspects  of executive remuneration.

Review of performance and governance arrangements  

• The resolution provides for  the Board to undertake annually a review of:
  • its performance of and that of its committees and individual members
  • the Regulatory Authority's governance arrangements.
• The resolution provides for each of the ARC and NRC to annually review its effectiveness.

• The resolution provides for the Board to report annually to the Council of Ministers on the discharge by the Board of the Regulatory Authority's functions, the extent to which, in its opinion, the Regulatory Authority's objectives have been met; and other matters required by law.