The final Law Update of 2022 is here, and it’s packed full of articles. The double edition features two focus areas, first is a spotlight on Energy and Resources and second we feature a collection of articles on Transport and Logistics. The developments occurring in these sectors in the MENA region are unprecedented and our lawyers cover vast themes for you.
The Energy and Resources focus features topics such as diversifying energy resources, solar PV, mining in the Middle East, renewable energy and green hydrogen. From a transport perspective, we draw attention to the Bahrain metro project, discuss the challenges and remedies associated with the repossession of an aircraft, and there is advice on what to consider should a party vary the terms of a shipping contract.
This edition navigates you through updates from across jurisdictions such as, Oman, Jordan, Saudi Arabia, Egypt, Iraq, Qatar, and the UAE. Each article is timely and provides insights into legal issues and cases that are affecting these sectors across the region.Read the full edition
Abdullah Rauf Puri - Associate - Banking and Finance
On 2 September 2021, the Central Bank of Bahrain (“CBB”) issued new requirements in respect of ‘dormant accounts’ and ‘unclaimed balances’ in Bahrain under a new section BC-4.20 of the Business and Market Conduct Module of Volume 1 and Volume 2 of the CBB Rulebook. These new requirements are issued with the aim to meet two key objectives – consumer protection on the one hand and safeguards against internal and external frauds on the other. This article provides an overview of the new requirements in respect of ‘dormant accounts’ and ‘unclaimed balances’ in Bahrain.
Banks must treat customer accounts as dormant accounts in the following cases:
Banks must notify the customer by mail, e-mail or other communication channel, when any of their accounts becomes inactive and must ensure that no withdrawal or transfer or outward clearing cheque is permitted from dormant accounts.
Banks must comply with the following additional requirements in transactions relating to dormant accounts:
Banks must treat the following balances that remain unpaid due to operational or other reasons as unclaimed balances:
Banks are required to make attempts to periodically contact the relevant customers or the rightful parties to return the unclaimed balances through different communication means. The licensee must maintain documentary evidence of such attempts.
Banks must report the particulars of dormant accounts and unclaimed balances in the relevant section of the Prudential Information Return. Conventional retail bank licensees must not transfer any of the balances in dormant accounts or unclaimed balances to their income statements.
Banks are required to establish policies and procedures to deal with dormant accounts and unclaimed balances which must include measures to contact the customer concerned, activation of the accounts where appropriate, return of the moneys to the customer and control measures to prevent frauds and misuse of such accounts. The policies must be approved by the board of directors of the CBB while the procedures must be approved by senior management.
The new rules clearly specify what activities may or may not be undertaken by banks in Bahrain in relation to the dormant accounts and unclaimed balances.