CTRL 2.2.9 Obligation relating to conflicts of interest

(1) An authorised firm's governing body must ensure that each part of the firm's corporate governance framework and risk management and internal controls framework is designed—
(a) to avoid conflicts of interest in relation to the framework (or, if this is not possible, to mitigate such conflicts); and
(b) to effectively deal with any conflict of interest.
(2) The framework must require that—
(a) any such conflict of interest that arises must be reported—
(i) to the senior management of the firm, or, if the firm is a branch, to the body that is responsible for the branch; and
(ii) if it is not addressed within a reasonable time by the senior management, to the firm's governing body; and
(b) every 6 months, the senior management must give to the firm's governing body a written summary of all conflicts of interest addressed by the senior management during the period.
(3) In this rule and rule 2.2.10, a reference to a firm's governing body is a reference to the board, membership, committee, body (whatever it is called) or person (however it might be delegated) that has responsibility for the firm's corporate governance framework and risk management and internal controls framework in relation to conflicts of interest and periodic review.

Examples for subrule (3)

For a firm that is part of a group, the governing body that might have responsibility for conflicts of interest might be—
•   a committee that has carriage for the place in which the firm is located; or
•   the individual approved to exercise the senior executive function for the firm; or
•   any other body or person that has such responsibility under the firm's governance arrangements.
Derived from QFCRA RM/2012-4 (as from 1st July 2013)