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B. The Board

1. Board structure.
  a. VASPs shall ensure the Board comprises suitably qualified individuals with the requisite skills, knowledge and expertise taking into consideration the scope of their responsibilities and the VA Activities carried out by the VASP. Each member of the Board must be assessed by the VASP and approved by VARA as being a Fit and Proper Person according to the criteria set out in Part III of this Company Rulebook.
  b. VASPs shall—
    i. adopt a clear and effective procedure for—
      1. selecting and appointing members to the Board, including the filling of any vacancies on the Board;
      2. removal of members of the Board; and
    ii. ensure that all procedures relevant to this Rule I.B.1.b of this Company Rulebook are included in the VASP’s constitutional documents.
  c. The Board shall assess and confirm each member of the Board is a Fit and Proper Person at least annually. If a VASP has reason to believe a member of the Board no longer remains a Fit and Proper Person at any time, the Board shall promptly assess such member. If such member of the Board no longer remains a Fit and Proper Person, the Board shall remove such member with written notice and appoint a successor in accordance with Rule I.B.1.b of this Company Rulebook.
  d. VASPs shall ensure that any changes to the constitution of the Board comply with Rules I.B.1.a and I.B.1.b of this Company Rulebook.
  e. The Board shall establish a process to elect a chairman. The chairman shall have the authority to oversee and be responsible for the overall effective functioning of the Board, and any committees it has established, in accordance with Rule I.B of this Company Rulebook.
  f. The Board shall carry out annual assessments, alone or with the assistance of external experts, of the Board as a whole, its committees and individual members to review relevant performances.
2. Responsibilities of the Board.
  a. The Board shall establish and regularly update the VASP’s procedural rules and other constitutional documents setting out its organisation, responsibilities and procedures.
  b. The Board and each of its members shall assume full responsibility for—
    i. the operation, business and affairs of the VASP, such that these are conducted in a manner which is conducive to the fair and orderly functioning of any market involving Virtual Assets;
    ii. the VASP’s compliance with all applicable laws and regulatory requirements [including but not limited to Regulations, Rules and Directives]; and
    iii. implementing a professional compliance culture within the VASP.
  c. The Board shall engage in regular and effective communication with relevant committees, Senior Management, Staff, any other individuals within the VASP and Group Entities to ensure that it is continually and timely apprised of the status of the business, operations and financial position of the VASP.
  d. The Board shall establish and maintain detailed and clear policies and procedures—
    i. to set out the process of authorisations within the Senior Management and its subordinates;
    ii. to identify the authority of each member of the Senior Management; and
    iii. to identify reporting lines of the Senior Management and its subordinates.
  e. In performing its duties in official capacity, the Board may delegate its authority to relevant committees and Senior Management. In doing so, the Board shall supervise its delegated authority and remain primarily responsible for its duties. The Board shall establish and maintain effective systems and procedures to supervise the Staff who act under the authority delegated by the Board.
  f. The Board shall, at least annually, review the performance of the VASP, the practical and professional experience and suitability of its members and the Senior Management in the context of the latest industry standards in the global Virtual Asset sector.
  g. The Board shall ensure that all Entities performing functions on behalf of the VASP and contractors hired by the VASP have access to, and understand adequate up-to-date information regarding, the applicable policies and procedures implemented within the VASP in acting in their official capacities.
  h. The Board shall—
    i. define clear reporting requirements to ensure that internal and external reports can be prepared in a timely manner; and
    ii. establish and maintain effective record retention policies to comply with all applicable laws and regulations and to enable the VASP, its auditors and other interested Entities such as VARA to carry out routine and ad hoc reviews or investigations.
3. Board training.
  a. VASPs shall ensure new Board members receive training programme[s] on their company structure, corporate governance, business and other subjects that would assist them in performing their duties, with a particular focus on—
    i. the background, strategy and objectives of the VASP;
    ii. the financial and operational aspects of the VASP’s business, including its VA Activities;
    iii. the obligations, duties, liabilities and rights of the members of the Board;
    iv. the functions and obligations of any Board committees; and
    v. key risks relating to the global Virtual Asset sector.
  b. The Board shall—
    i. review the scope of the training programme and the accuracy of its contents annually; and
    ii. revise the training programme if necessary.
  c. VASPs shall provide regular, timely and up-to-date training courses to all members of the Board in matters directly related to the interests of the VASP and Virtual Asset markets as a whole, including but not limited to matters set out in Rule I.B.3.a of this Company Rulebook.