Lebanon: Insurance & capital market regulators in cooperation pact
Source: Middle East Insurance Review | Jul 2017
The Insurance Control Commission (ICC) under the Ministry of Economy and Trade has signed a memorandum of understanding with the Capital Market Authority (CMA) to ensure that certain transactions carried out by insurers, in particular financial investments, are regulated by the CMA. The MoU aims to strengthen cooperation and organisation of supervisory work between the two agencies.
The MoU’s basic objectives include avoiding possible duplication of supervisory work and reducing regulatory gaps that may result from the lack of coordination in supervision.
Minister of Economy and Trade Raed Khoury said that the pact is the “first agreement of its type between two independent regulatory bodies”.
Mr Max Zaccar, President of the Association of Insurance Companies in Lebanon, welcomed the move which he said would be in the interest of consumers. “Certain products offered to customers have two components: conventional insurance, which is supervised by the Commission, and financial investments that will now be supervised by the CMA, which has a real competence in this field,” he said.
In a statement issued by the CMA, Mr Riad Salameh, Chairman of CMA and Governor of the central bank, Banque du Liban, said that the agreement strengthens the capacity of the regulatory bodies to provide “better protection of savings invested in various financial instruments” and to reduce systemic risk.
He also said that the agreement corresponds to membership requirements of the International Organization of Securities Commissions (IOSCO), which emphasises the comprehensiveness of regulatory aspects of financial markets. M