1) The Central Bank may:

• a. Establish, develop, and/or operate one or more clearing or settlement systems for transfer of funds, and settlement of securities for securities issued by the Central Bank or the Public Sector and other obligations between Participant Persons in such systems, and may conduct such on its own or in partnership with any other party, or by outsourcing to third parties.
• b. Link the systems referred to in paragraph (a) of this item, to similar systems inside and outside the State.
• c. Establish and/or operate central securities depository for securities issued by the Central Bank or the Public Sector and data repository systems for monetary and financial transactions in the State, and link such systems to similar systems inside and outside the State.

2) The Central Bank shall coordinate with concerned other regulatory authorities and bodies in the State, in relation to the establishment of data repository systems for monetary and financial transactions referred to in paragraph (c) of item (1) of this article.

3) The Board of Directors shall issue the regulations related to the systems referred to in item (1) of this article, the rules of participation in these systems, and the rules to execute related operations.

Article (124 Bis 1)

Application for License of Financial Infrastructure System or Extension of its Scope

1. Based on the regulations set by the Board of Directors, any legal person may file an application with the Central Bank to obtain a license of financial infrastructure system or to expand the scope of a license previously issued.
2. The Board of Directors shall issue the regulations, rules, criteria and conditions pertaining to the licensing of the financial infrastructure system, including:
   a. Merit and eligibility criteria;
   b. Resources required for the system; and
   c. Control and supervisory systems.
3. The Board of Directors may require the license applicant to meet any further requirements or conditions at its own discretion and as he deems to be in the public interest.

Article (124 Bis 2)

Deciding on the Application for License of Financial Infrastructure System or Extension of its Scope

1. The application for license of financial infrastructure system or extension of its scope shall be decided on within a period not exceeding sixty (60) working days from the date of satisfying the requirements and conditions of the license. The lapse of such period without reply shall be deemed as rejection of the application.
2. The Central Bank may request the applicant to meet the requirements and conditions of the license within the period it determines.
3. The Central Bank may reject the application or request the expansion of the scope of the license of a financial infrastructure system at its sole discretion, in accordance with the absorptive capacity of the financial sector of the State and the requirements of the domestic market. The decision issued thereby in this regard shall be final and not appealable before the Grievances and Appeals Committee.
4. The applicant shall be notified of the substantiated rejection decision by means ofan official notice within a period not exceeding twenty (20) working days from the date of its issuance.

The Central Bank shall solely:

1) Have the authority to issue regulations, rules, and procedures relating to electronic banking operations, digital money, Stored Value Facilities, and shall regulate Retail Payment Systems and related electronic banking and financial services.

2) Take all measures and procedures it deems appropriate to reduce the risks to the State’s financial and economic systems associated with operations and systems referred to in item (1) of this article.

1) The Central Bank may designate any Financial Infrastructure System as systemically important if it considers, at its own discretion, that any malfunction or inefficiency in the operation of such system would negatively impact processing of the daily operations of financial institutions operating in the State, or the stability of the financial system in the State.

2) For a Financial Infrastructure System to be designated, it shall meet one of the following conditions:

• a. The concerned system is operating in the State;
• b. The concerned system has the capacity to accept clearing and settlement of financial Transfer Orders denominated in national Currency, without prejudice to provisions of Article (28) of this decretal law; or
• c. The concerned system has the capacity to provide transfer, clearing or settlement of financial Transfer Orders, for retail payment activities, denominated in any currency.

3) Should the Central Bank intend to designate any of the Financial Infrastructure Systems it licenses as systemically important, it shall:

• a. Notify the operator of the system, or its Settlement Institution, officially, of its intention to designate this system as systemically important, clarify grounds of such intention, in addition to other terms and conditions attached to such designation.
• b. Allow such period as specified in the notice referred to in paragraph (a) of this item, which shall not be less than ten (10) working days from date of notification, within which the system’s operator or its Settlement Institution may provide their opinions, or make representations, as to why the system should not be designated.
• c. Issue its decision on designation of the system, within a period not exceeding twenty (20) working days from date of receipt of responses from concerned parties, or expiry of the period stated in the notice, without response.

4) The operator of the Designated System or the Settlement Institution may submit a grievance against the designation decision referred to in item (3) of this article by applying to the Grievances & Appeals Committee, in accordance with the provisions of Part V of this decretal law.

5) The Clearing and Settlement Systems established, developed, and/or operated, in accordance with the provisions of Article (124) of this decretal law shall be deemed as Designated Systems.

6) Should the Central Bank intend to designate any of the Financial Infrastructure Systems licensed by any of the other Regulatory Authorities in the State or in other jurisdictions as systemically important, it shall submit its opinion in this regard to the concerned regulatory authority. Should the concerned regulatory authority has no objection to such designation, it shall:

• a. Notify the operator of the system, or its Settlement Institution, officially of the intention to designate this system as systemically important, clarify grounds of such intention, in addition to other terms and conditions attached to such designation.
• b. Allow such period as specified in the notice referred to in paragraph (a) of this item, which shall not be less than ten (10) working days from date of notification, within which the system’s operator or its Settlement Institution may provide their opinions, or make representations, as to why the system should not be designated.
• c. Issue its final approval or disapproval decision on the Central Bank’s request to designate the concerned system, within a period not exceeding twenty (20) working days from date of receipt of responses from concerned parties, or expiry of the period stated in the notice, without response.

7) The Central Bank may revoke designation of a particular Financial Infrastructure System it licenses or request such action from the concerned regulatory authority, if it considered, at its own discretion, that the system is no longer of systemic importance. The concerned regulatory authority, the operator of the system, or its Settlement Institution shall be notified, officially, of such decision, as the case may be.

1) The Central Bank shall solely undertake oversight over operations of systems, which it licenses and shall ensure their soundness, in accordance with relevant international standards. For such purpose, the Central Bank may require the operators of systems or their Settlement Institutions to take required measures and procedures.

2) The Central Bank shall be responsible for monitoring the implementation of required additional oversight measures and procedures on Designated Systems, licensed by any of the other Regulatory Authorities, in the State or in other jurisdictions in collaboration and coordination with the concerned regulatory authority, and may request in this regard from the concerned regulatory authority:

• a. Require operators of the Designated Systems or their Settlement Institutions to comply with the instructions it issues in this respect and any relevant international standards.
• b. Ensure proper and regular functioning of Designated Systems.
• c. Ensure soundness of financial positions of operators of Designated Systems and their Settlement Institutions, when deemed necessary.
• d. Require the operators of the Designated Systems or their Settlement Institutions to provide it, with the information it deems appropriate for achievement of its objectives and discharge of its functions.

3) The Central Bank may appoint whoever it deems appropriate of experts and advisers specialized in financial infrastructure to assist the Central Bank in performing its duties and functions in accordance with the provisions of Part IV of this decretal law, and to keep in step with best international standards and practices in this area.

1)The Central Bank may suspend or revoke a license granted to a Financial Infrastructure System, in accordance with the provisions of article nos. (124) and (125) of this decretal law, via an official notice to the operator or the Settlement Institution of the concerned system and take necessary actions in this respect, as the case may be, if it considered that the system is no longer capable of conducting its operations. The Central Bank shall allow such period as specified in the notice referred to in this item, which shall not be less than twenty (20) working days from date of notification, within which the concerned system operator or its Settlement Institution may object to the Central Bank’s decision to suspend or revoke the license and provide their justifications for such objection, in accordance with the provisions of Part Five of this decretal law.

2)The Central Bank, if it considers that any Designated System licensed by any of the Regulatory Authorities in the State or in other jurisdictions is no longer capable of conducting its operations, may request the concerned regulatory authority, via an official notice, to suspend or revoke the license of this system and take necessary actions in this respect, as the case may be. The concerned regulatory authority shall have the right to approve or reject the request of the Central Bank. In case of approval, the procedures and controls in force by the concerned authority shall be applicable.

3)In all cases, the suspension or revocation of a license granted to a Designated System in accordance with the provisions of this article, shall not affect any transaction cleared or settled in the concerned system prior to the effective date of suspension or revocation.

1) The Board of Directors shall issue regulations, instructions, rules, directives, and codes of conduct as it deems appropriate for the implementation of the provisions of Part Four of this decretal law, and to achieve the objectives of the Central Bank and discharge its functions, including:

• a. Regulations, conditions and rules relating to licenses, granted by the Central Bank in accordance with the provisions of article nos. (124) and (125) of this decretal law, to operators of Financial Infrastructure Systems or the Settlement Institutions for such systems and their Participant Persons.
• b. Regulations, rules and standards relating to the designation and oversight of Financial Infrastructure Systems, as per the provisions of article nos. (126) and (127) of this decretal law, monitoring operations of such systems and enforcing compliance requirements on Participant Persons thereof.

2) The Central Bank may exempt operators of Financial Infrastructure Systems it licenses, the Settlement Institutions of such systems or Participant Persons, in a general or specific manner, from the provisions of any of the regulations, instructions, rules, directives, and controls issued by it.

1) The Board of Directors shall issue regulations specifying types of violations pertaining to Financial Infrastructure Systems licensed by the Central Bank, and any of the following instances shall be considered a violation to the terms and conditions relating thereto:

• a. Violation of operational requirements of systems and related settlement rules and procedures.
• b. Failure of an operator of a system or its Settlement Institution to comply with a Central Bank request for information or documents.
• c. Failure to comply with Central Bank’s decisions and instructions, and failure to take a particular action, which the Central Bank considers necessary to render the system compliant with the criteria it sets.
• d. Failure, on the part of an operator of a system or its Settlement Institution to report any action taken under the systems Default Arrangements, in respect of a Participant Person.
• e. Failure, on the part of a Participant Person, to notify the system operator, its Settlement Institutions, and the Central Bank of issuance of judgement to declare it bankrupt or place it under liquidation.
• f. Operating a system without obtaining a license in accordance with the provisions of article nos. (124) and (125) of this decretal law.
• g. Failure of an operator of a system or its Settlement Institution to comply with any request from the Central Bank or any other government agency, relating to default, within a specified time period.
• h. Failure of an operator of a system to notify the Central Bank of issuance of judgment regarding declaration of bankruptcy or liquidation of any Participant Person.
• i. Providing the Central Bank with incorrect or misleading information.
• j. Adding an incorrect entry to any registration book or in any document related to a particular system, or causing alteration, deletion or obliteration of such entry.
• k. Any other related action to the clearing and settlement operations or to the retail payment operations the Central Bank considers a violation.

2) The Central Bank may take whatever actions it deems appropriate to correct any violations referred to in item (1) of this article, and determine settlement thereof.

3) The Central Bank shall officially notify the violating Person, in accordance of item (1) of this article, of any actions that shall be undertaken against it. The violating Person shall be allowed a period not exceeding ten (10) working days from date of notification to submit a grievance against the Central Bank decision. In case the grievance was rejected, the violating Person may escalate the matter to the Grievances & Appeals Committee in accordance with the provisions of this decretal law. The decision of the Grievances & Appeals Committee shall be final. Should the violating Person not respond to Central Bank’s decision within the period prescribed in this item, the decision of the Central Bank shall be final and binding.

1) All transactions conducted through a Financial Infrastructure System, which meets one of the designation conditions referred to in item (2) of Article (126) of this decretal law shall be final, irrevocable and irreversible, in any of the following cases:

• a. Transfer of funds from or to the account of a Participant Person.
• b. Settlement of a payment obligation.
• c. Settlement of an obligation to transfer, or the actual transfer of book- entry securities.

2) No transfer or settlement pertaining to the transactions referred to in item (1) of this article shall be cancelled, set aside, re-paid, or reversed, nor shall it be rectified, whether by a court judgement order, or by law

1) None of the following operations and procedures carried out through Financial Infrastructure Systems, which meet one of designation conditions referred to in item (2) of Article (126) of this decretal law, shall be regarded, as to any extent, invalid on the grounds of commencement of realization of assets of a Person under liquidation, insolvency, financial restructuring, or bankruptcy:

• a. A Transfer Order.
• b. Any disposition of property in pursuance of such Transfer Order.
• c. The Default Arrangements of such systems.
• d. The rules of such systems as to the settlement of Transfer Orders not dealt with under their Default Arrangements.
• e. Any arrangements for the purpose of realizing collateral security in connection with participation in such systems, other than its Default Arrangements.

2) The relevant insolvency officer or any Person appointed to manage the insolvency procedures in cases of bankruptcy or liquidation, shall not take any actions or procedures contrary to the provisions of this decretal law, or preclude or interfere with Default Arrangements of systems referred to in item (1) of this article.

3) An obligation arising out of a Transfer Order, which is the subject of an action taken under Default Arrangements of systems referred to in item (1) of this article, shall not be proved in a bankruptcy or liquidation procedures, until completion of the transfer or payment order.

4) A debt or other liability, which by virtue of item (3) of this article may not be proved, shall not be taken into account for the purposes of any set-off, offset, or net out of debt or obligations until the completion of the action taken under the Default Arrangements of such systems.

1) The operator of a Financial Infrastructure System, which meets any of the designation conditions referred to in item (2) of Article (126), may effect Netting of all obligations owed to or by a Participant Person in this System, which incurred before the point of time where the competent court has made an order for bankruptcy or liquidation of the concerned Participant Person.

2) In case Netting has been effected as provided in item (1) of this article, then:

a. The obligations that are netted shall be disregarded in the bankruptcy or liquidation proceedings and

b. Any net obligation owed to or by the Participant Person that has not been discharged is payable to the Participant Person and may be recovered for the benefit of his creditors or is provable in the bankruptcy or liquidation, as the case may be.

3) Netting operations processed by the concerned system’s operator in accordance with item (1) of this article shall not be cancelled during a bankruptcy or liquidation process, nor any financial transfers already paid in accordance with paragraph (a) of item (2) of this article.

1) Except to the extent that it expressly provides, this decretal law shall not operate to limit, restrict or otherwise affect:

a. Any right, title, interest, privilege, obligation or liability of a Person resulting from the underlying transaction in respect of a Transfer Order that has been entered into a Financial Infrastructure System, which meets any of the designation conditions referred to in item (2) of Article (126).

b. Any investigation, legal proceedings or remedy in respect of any such right, title, interest, privilege, obligation or liability.

2) Nothing in item (1) of this article shall be construed to require:

a. The unwinding of any Netting done by the operator of the concerned system, whether pursuant to its Default Arrangements or otherwise;

b. The revocation of any Transfer Order given by a Participant Person which is entered into the concerned system; or

c. The reversal of a payment or settlement made under the operating rules of the concerned system.

1) A Participant Person in a Financial Infrastructure System, which meets any of the designation conditions referred to in item (2) of Article (126) shall notify the operator of the system or its Settlement Institution, the concerned regulatory authority, and the Central Bank, as soon as practicable if there comes to his knowledge any of the following events occurring in the State or in other jurisdictions:

a. Presentation of a plea for declaration of his bankruptcy or liquidation;

b. Issuance of a judgement for declaration of his bankruptcy or liquidation; or

c. The making of owners, shareholders, or management of a Participant Person voluntary winding up statement in his respect.

2) A Participant Person failing to notify of a relevant event referred to in item (1) of this article within the required timeframe is not in contravention if:

a. He took reasonable steps to comply with the provisions of item (1) of this article or

b. The agencies referred to in item (1) of this article were already aware of the relevant event by the time the Participant Person was required to notify the operator under the provisions of this article.