Compliance is a crucial function that should be established in business entities supervised by regulatory authorities, such as the Central Bank of Kuwait, Capital Markets Authority and Insurance Regulatory Unit (IRU), and administrative authorities such as Ministry of Commerce and Industry, the Public Authority for Manpower and Ministry of Interior, to ensure business continuity without exposing the business entity to any risks such as imposing fines or suspending licenses.
What is Compliance Consulting?
Certain business entities, which have an organizational unit for compliance function along with its job structure, seek to engage the services of a consulting firm to obtain consulting compliance, where the employees of such organizational unit will implement and follow the deliverables of such advisory service.
What are the key regulatory authorities in the State of Kuwait that mandate business entities to follow their instructions?
- Central Bank of Kuwait: It supervises banks, financing companies, exchange companies, credit information companies and electronic payment business.
- Capital Markets Authority: It supervises listed companies and companies licensed to carry on securities business.
- Insurance Regulatory Unit: It supervises insurance companies, reinsurance companies, brokerage companies for insurance and reinsurance, and insurance related professions.
Why is the compliance function important in business entities supervised by the regulatory authorities?
The regulatory authorities in the State of Kuwait issues executive regulations and instructions regarding the business practice frameworks. Such regulations are applicable and enforceable immediately upon issuance or over different timeframes. The importance of the compliance function lies in ensuring that the business entities comply with the regulations and instructions in place since noncompliance would expose such entities to financial and other penalties that would amount to suspension of business.
What business entities should do to comply with the requirements of the regulatory authorities?
- Business entities should establish an organizational unit for compliance function and set up a job structure that will be able to meet the requirements of the regulatory authorities.
- Ensure compliance with the instructions issued by the relevant regulatory authorities supervising them, in particular the instructions issued by the Central Bank of Kuwait regarding the Corporate Governance Rules in Kuwaiti Banks under the Instruction dated 20 June 2012, as amended by Circular dated 15 September 2019; the Capital Markets Authority’s instructions regarding Corporate Governance set forth in Module 15 of the CMA Executive Bylaws; and the Insurance Regulatory Unit’s Instruction regarding Corporate Governance Rules issued under the Resolution No. 58 of 2023.
What is the added value to business entities from Compliance Consulting Services?
- Ensure that regulatory compliance is achieved including compliance with laws, regulations, resolutions, rules, and instructions issued by the regulators;
- Ensure compliance with the up-to-date international standards and practices, which are relevant to the entity’s business activities;
- Promote the stakeholders’ confidence in the business entities and enhance its reputation in the marketplace where it operates; and
- Utilize the expert knowledge and experiences brought through compliance consulting services.
What are the services offered by Baker Tilly Kuwait?
- Preparing Processes, Policies and Procedures Manual for the organizational unit in charge of compliance functions.
- Preparing the checklist of the regulators’ requirements related to the compliance function.
- Preparing an action plan for implementing and meeting the regulators’ requirements based on the prescribed deadlines.
- Outsourced compliance function
Why Baker Tilly?
- Extensive expertise in regulatory and administrative legislation
- Specialized advisory team in regulatory compliance
- Tailored solutions designed to meet each client’s specific needs
- Implementation of international best practices in risk management and regulatory compliance