الهيئة العامة للرقابة المالية

FRA Amends Investment Regulations for Insurance “Allocated Funds”– Saturday 7 February 2026

• The deadline to submit remediation plans for policyholder obligations is reduced from 6 months to 3 months.
• Deficit remediation now starts at the financial statement date instead of FRA notification date.

Financial Regulatory Authority (FRA), chaired by Dr. Mohamed Farid, has issued new amendments to the investment regulations governing the “Allocated Funds” of insurance and reinsurance companies. The primary goal of this update is to significantly bolster the protection of policyholders’ and beneficiaries’ rights.

FRA resolution No. 3 of 2026 stipulates that if a company’s Allocated Funds – mandatory reserves held specifically to pay out insurance claims – are found insufficient to cover its obligations, the company must immediately fill the gap using its Free Funds. If a company’s Free Funds cannot cover the shortfall, it is granted a 3-month grace period to resolve the deficit. This is a major shift from the previous regulation, which offered a 6-month window.

Allocated Funds are the compulsory reserves an insurer must hold to guarantee it can fulfill its immediate commitments to its policyholders.

FRA has eliminated regulatory delays by shifting to an automatic deficit-remediation trigger based on financial reporting dates. By halving the compliance window to three months and requiring immediate recovery plans, the Authority is accelerating intervention to safeguard policyholder interests.

Free Funds are defined as non-allocated resources not designated for direct policyholder obligations. They represent a company’s safety margin and additional financial capacity, typically consisting of equity, retained earnings, or general reserves.

Insurance companies have fully complied with FRA’s December 2024 resolution regarding minimum capital requirements. By raising the floor to EGP 600 million per company, the sector witnessed a total capital injection of approximately EGP 10 billion.

Additionally, FRA mandated that insurance and reinsurance companies shall invest between 2.5% and 20% of their paid-up capital in open-ended funds targeting listed equities. The sector successfully met these mandates by allocating a further EGP 2.6 billion toward open-ended funds throughout 2025.

FRA Allows Brokerage Firms to Promote Services Via Digital Platforms – Saturday 7 February 2026

• New regulations enforce rigorous data protection standards for the digital handling of client orders.

Dr. Mohamed Farid- FRA Chairman:

• The initiative aims to democratize access to capital markets by enabling mobile-first investment solutions.
• Platform accreditation standards and required technical infrastructure.
• Integration of comprehensive service encryption and a digital portal for logging technical complaints.
• A rigorous prohibition on the use of Artificial Intelligence to generate investment advice or influence investor decision-making.
• The platform’s role is strictly promotional; it may not facilitate transactions or enter into binding agreements on behalf of the brokerage firm.
• All digital platform management contracts require prior approval from FRA.

Financial Regulatory Authority (FRA), chaired by Dr. Mohamed Farid, has issued a new resolution permitting brokerage firms to market their services through digital platforms. This first-of-its-kind move comes in response to the rapid growth of financial technology within the non-banking financial services sector.

Dr. Mohamed Farid, FRA Chairman, commented: “Our objective is to streamline secure access to capital market services for all citizens, empowering them to manage investments directly via their mobile.”

 FRA Chairman emphasized that while the resolution embeds fintech into the heart of financial services, it enforces rigorous safeguards. These controls protect investor data privacy and prevent biased influence, ensuring a secure and inclusive digital financial ecosystem.

Under resolution No. 332 of 2026, a ‘Digital Platform’ is defined as FRA-certified business model that facilitates the encrypted transmission of client securities orders directly to brokerage firms for execution.

The resolution aims to provide brokerage firms the opportunity to benefit from the wide reach of various digital platforms – including, but not limited to, e-payment apps – significantly enhancing the scale and efficiency of their marketing efforts.

The platform must maintain full infrastructure compliance by adhering strictly to the technical standards established in resolution No. 139 of 2023. Regarding security, the system is required to implement end-to-end encryption across all platform-based services. Additionally, companies must maintain a comprehensive digital log designed to systematically track, manage, and resolve all technical complaints.

Pursuant to the new resolution, digital platforms are restricted to the promotion of brokerage services following an agreement with the respective firms.

Additionally, digital platforms are prohibited from performing any actions on behalf of the brokerage firm. This includes providing investment recommendations, arranging, ranking, or prioritizing securities, or utilizing predictive modeling and Artificial Intelligence tools intended to influence client behavior or show bias toward specific brokerage services.

The resolution mandates that brokerage firms obtain prior approval from the Authority before contracting with a Digital Platform Manager to receive and transmit client orders to the brokerage firm via encrypted channels. The Platform Manager must be registered with the Authority.

The resolution defines a Digital Platform Manager as an Egyptian joint-stock corporation registered in the Outsourcing Register, responsible for the creation and management of the digital platform.

Furthermore, brokerage firms are obligated to open client accounts and execute orders independently. They may not delegate any of their core functions to the digital platform and must provide direct digital communication channels between the firm and its clients.

Furthermore, brokerage firms are mandated to maintain transparent, real-time disclosures on the digital platform. This includes comprehensive details regarding service, fees and commissions, and the inherent risks of electronic trading. To bolster investor protection and mitigate technological threats, firms must also supply educational resources that empower clients to navigate platforms safely and safeguard the confidentiality of their access credentials.

FRA Regulates Entry of Foreign Insurance& Reinsurance Rep Offices for the First Time – Thursday 5 February 2026

Dr. Mohamed Farid– FRA Chairman:

• These rules catalyze InsurTech transfer and bolster local risk management frameworks.
• Licensed offices must register with FRA and renew their license annually.
• The new rules simplifies the process for international firms to enter the Egyptian market.
• Existing offices have six months to comply with the new regulations.
• Offices are restricted to market research and liaison duties between the local market and global headquarters.

In a move to enhance the competitiveness of the Egyptian insurance market and attracting international expertise, Financial Regulatory Authority (FRA), chaired by Dr. Mohamed Farid, issued resolution No. 321 of 2025. This resolution establishes, for the first time, a comprehensive regulatory framework for licensing and registering representative offices of foreign insurance and reinsurance companies within the Arab Republic of Egypt.

The resolution specifies licensing requirements for establishing these offices, details the mandatory registration with the Authority, and defines the formal procedures for evaluating and approving applications.

 Dr. Mohamed Farid, FRA Chairman emphasized that these regulations complement the Authority’s ongoing efforts to develop the legislative infrastructure of the insurance sector under the Unified Insurance Law. He noted that the presence of global representative offices will facilitate the transfer of the latest insurance technologies and significantly enhance risk management mechanisms in the local market.

Applicants must be overseen by a comparable regulatory body in their home country and provide formal proof that their home regulator approves their entry into the Egyptian market.

The resolution mandates that foreign companies provide a formal pledge to restrict activities exclusively to market research, public relations, and liaison services. Serving solely as a technical bridge to their global headquarters, these offices are strictly prohibited from engaging in any direct or indirect insurance or reinsurance operations, ensuring the integrity of the regulated market remains uncompromised.

Licensed representative offices must be registered in FRA register. This database will contain essential data including the company’s legal details, the office’s commencement date, and the credentials of manager-in-charge.

To secure a license, companies must follow a structured application process using FRA’s prescribed forms. The submission must include the parent company’s global headquarters details, the local office’s address, and an Arabic-translated copy of the Articles of Incorporation. Financial transparency is ensured through the requirement of audited financial statements and auditor reports for the two most recent fiscal years.

 FRA mandates the appointment of a manager-in-charge with at least five years of insurance industry experience. This must be accompanied by a strategic roadmap detailing the office’s objectives, feasibility, and organizational structure, including staff headcount. Finally, applicants are required to disclose their credit rating (if applicable) and provide a formal, binding pledge to adhere to all Egyptian laws and regulatory frameworks.

 FRA will decide on licensing within 30 days of receiving a complete application and reserves the right to conduct field inspections. Registration requires annual renewal, with applications and a performance report due two months before expiry.

Furthermore, FRA must be notified within 10 days of any changes to office data or management. If a company decides to suspend activities, it must notify the Authority at least two months in advance.

Existing representative offices have a six-month window to align their operations with the new rules, effective immediately from the resolution’s implementation date.

To maintain market discipline, FRA retains full regulatory authority and may strike an office from the register for non-compliance. Such action may be taken if an entity fails to rectify a violation within 30 days of a formal warning or fails to meet the annual renewal deadline.