Before establishing a subsidiary to provide auctioneering services, what must Alpha Brokers Ltd do?

• A. Notify in writing
• B. Separate authorisation
• C. Central Bank approval for directors
• D. Revised business plan

Answer: (A)

The main action is to notify the regulator in writing before establishing the subsidiary. This formal notice alerts the Central Bank to the planned structural change and lets it review how the new subsidiary might affect risk, governance, capital, and compliance. It creates a clear point of oversight and may trigger any further requirements if the activity requires additional licensing or conditions.

A separate authorisation would be needed only if the subsidiary’s activities themselves require stand-alone licensing, which isn’t automatically imposed just by forming a subsidiary. Central Bank approval for directors isn’t typically a universal initial step for setting up a subsidiary; director approvals or fit-and-proper checks may come as part of ongoing licensing or specific appointments. A revised business plan, while sensible to update for the new structure, isn’t the mandated first action the regulator requires before establishing the subsidiary.