SENEGAL Trends and Developments Contributed by: Franck Olivier Allessie, SCP Houda & Associés
Legal clarifications on the status of mandated intermediaries Article 7 of the Uniform Law clearly specifies the status of mandated intermediaries by address- ing the categories of mandated intermediaries, their operating conditions and the activities they carry out. It specifies the conditions governing access to the profession of mandated intermedi - ary, the responsibilities of mandating institutions and their obligations. Mandated intermediaries fall into two categories, namely banking agents and payment service agents. Banking agents are approached by credit insti - tutions with the principal activity of presenting, offering or assisting in the conclusion of all or part of banking transactions or carrying out all preparatory work and advice. They are author - ised to carry out intermediary activities covering all banking transactions within the limits of their mandate, on a regular professional basis and without acting as del credere. Payment service agents, on the other hand, are called upon by payment service providers to promote the services they provide and to can - vass customers on their behalf within the limits of their mandate. Specific rules may be imposed by the BCEAO on each category depending on the nature of their activities and the risks incurred. It should be noted that the 2008 Banking Law does not deal in detail with mandated interme- diaries. It merely allows credit institutions to operate via intermediaries, but does not provide a rigorous framework for supervising the spe - cific obligations of banking or payment service agents.
This new legislative framework therefore aims to better regulate these players while ensuring that the principal institutions remain responsible for the actions of their intermediaries, thereby strengthening transparency and consumer pro - tection. The legal possibility of setting up an intermediary financial holding company Senegal’s 2008 Banking Law, although it laid down the fundamental principles of banking supervision in the country, did not include spe - cific provisions for the creation of intermediate financial holding companies. The banking activi - ties of financial groups were governed by the general rules applicable to credit institutions, limited to compliance obligations and supervi - sion focused on each individual banking entity. Banking holding companies and other inter - mediary structures designed to group together the financial holdings of groups did not benefit from any particular legal framework or specific supervisory rules, which limited the ability of the authorities to carry out consolidated and co- ordinated risk supervision. On the other hand, the Uniform Law includes provisions allowing banking groups to set up intermediary financial holding companies in the WAMU area. These entities are subject to prior authorisation by the Banking Commission and must comply with strict prudential rules and reporting obligations specified by the BCEAO or the WAMU Banking Commission. The creation of these intermediate financial hold - ing companies is not automatic, however, as it is subject to prior authorisation by the WAMU Banking Commission. The purpose of this requirement is to ensure that these entities com - ply with the prudential standards in force and to
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