SENEGAL Law and Practice Contributed by: Franck Olivier Allessie, SCP Houda & Associés
They must also comply with the laws and regula - tions in force, including rules on governance, risk management and customer protection. In addition, banks must maintain sound internal control systems to prevent the risk of failure and protect depositors and the financial system in general. Lastly, the supervisory authorities may carry out audits or inspections to verify the institution’s compliance with regulatory requirements. 4. Governance 4.1 Corporate Governance Requirements Under Senegalese legislation, corporate govern - ance requirements are also regulated by the Law of 2008. The following conditions apply to banks. • Banks may be incorporated in two legal forms, namely as: (a) public limited companies with fixed capi - tal ( société anonyme ); or (b) co-operative or mutual companies with variable capital after special authorisation by the Minister of Finance. • They cannot take the form of a one-person company. • Exceptionally, they may take the form of other legal entities. • They must have their registered office in the territory of one of the member states of the West African Economic and Monetary Union (WAEMU). The following conditions apply to financial insti - tutions.
• Financial institutions may be incorporated as: (a) public limited companies with fixed capi - tal; (b) limited liability companies ( société anon - yme ); or (c) co-operative or mutual companies with variable capital. • They cannot take the form of a one-person company. • They must have their registered office in the territory of one of the member states of the WAEMU. Under Senegalese law, credit institutions are required to establish a corporate governance mechanism in line with good practice and adapt - ed to their size, their structure, and the nature and complexity of their activities (Article 4 of Cir - cular No 01-2017/CB/C of 27 September 2017 relating to the Governance of Credit Institutions and Financial Companies in the WAEMU). 4.2 Registration and Oversight of Senior Management The registration and oversight of directors and senior management is generally regulated by the Law of 2008 and more specifically by Circular No 02-2017/CB/C of 27 September 2017 on the Conditions of Exercise of the Functions of Directors and Officers in Credit Institutions and Financial Companies of the WAEMU. The provisions of the Law of 2008 regulate the status of directors and require the directors to be of Senegalese nationality or of the nationality of one of the other member states of the WAEMU. However, the Minister of Finance may, on advice of the Banking Commission, grant individual exemptions to the nationality requirement. In such a case, a director must hold at least a Mas - ter’s degree or an equivalent diploma and must
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