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As part of CMA’s regulatory responsibility to
regulate and develop the Capital Market and protect citizens and investors, the
Board has issued its resolution dated 02/07/1434H corresponding to 12/05/2013
to adopt the ratio of %10 (ten percent) of the stock price fluctuation limit of
listed companies in the Saudi Stock Exchange on its first day of trading.

 



http://www.cma.org.sa/en/News/Pages/CMA_N_1302.aspx

CMA board has issued its resolution approving the new Corporate Governance Regulations.
The new Regulations have paid heed to setting effective governance arrangements for the joint stock companies listed in the Saudi Stock Exchange to ensure the clarity of the relationship between shareholders and the company's board from one side, and between the board and the executive management team on the other side. The regulations also took care of the shareholders' rights in these companies, such as the right of fair and equal treatment of shareholders without discrimination and the right of accessing the information transparently to enable them to fully exercise their statutory rights. Moreover, the Regulations cover the rights of stake holders in these companies.
The Regulations have set detailed provisions on the composition of Board of Directors and committees in terms of competencies, responsibilities, meetings, members' rights and duties. These provisions emphasize the principle of active participation in decision making within the Board of Directors as they deal with the issues of conflicts of interest between board members and the company, and adopt honesty, truthfulness and care as a foundation and methodology for these boards.
The Regulations also included detailed provisions regarding companies' external auditors and internal control procedures compelling Boards of Directors to disclose all information the shareholders and dealers need to build their investment strategies or perform any transaction with the company in a fair and systematic manner for all parties.
The Regulations contribute to interacting with the set of national legislations under which companies operate and integrate to fulfil their objectives with efficiency and integrity. The benefits of Corporate Governance are not confined to companies, rather they directly outreach the national economy for the role played by governance-based companies' growth and continuity in boosting the economy and increasing the GDP in line with the Saudi Vision 2030. These Regulations were prepared in cooperation between the CMA and the Ministry; and come as part of the continuous coordination between them under the singed memorandum of cooperation to harmonise policies and procedures adopted for the implementation of the Companies Law to ensure integration and harmony in achieving the sough objectives; and in completion of the legislations issued by CMA in light of the new Companies Law such as the Regulatory Rules and Procedures issued pursuant to the Companies Law relating to joint stock companies listed in the Saudi Stock Exchange that regulates the Remunerations of board members in these companies, the Holding of general and special assembly meetings of shareholders and their participation therein through contemporary technology, Buy-back, sale and pledge of shares, Pledge of company's shares, Issuance, buy-back and conversion of preferred shares by the company, Dividend distribution to shareholders of the company, Issuance and sale of pre-emptive rights resulting from capital increase, and proxy procedures for attending general and special assemblies.
The Capital Market Authority’s Board of Commissioners has issued its resolution to adopt the updated Merger and Acquisition Regulations, thereby replacing the previously implemented Merger and Acquisition Regulations, which was adopted in 2007. This update comes in continuation of the Authority’s efforts to regulate mergers and acquisitions transactions in accordance with best international practices, and in line with the powers vested in the Authority by the new Companies Law with regards to merger transactions, of which a party is a listed company.
It is worth mentioning that the updated regulation aims to set the base for the principles of fairness, equality of treatment and equal opportunities amongst owners of securities who are the subject of a merger or an acquisition. In the light of this, the updated regulation included a number of examples to clarify cases in which a person will be considered as a related party and the obligations arising therefrom. Furthermore, it included a number of examples in which a group of persons are presumed to be Acting in Concert and as such their collective ownership in the listed company will be treated as that of a single person’s ownership.
The Capital Market Authority (CMA) announced that, as of 1st of January 2018, foreign investors would be granted direct access to invest in the Parallel Market "Nomu" on similar terms as those to local investors.
In 2015, the CMA started the deregulation process by allowing foreign financial institutions to invest directly in the Saudi capital market. These initial steps were followed by several further regulation and infrastructural developments that aimed to ease foreign investment access to the capital market. It is worth mentioning that the CMA is working in parallel with the country's General Investment Authority (SAGIA) to set up a framework for non-residential strategic investors to own strategic stakes in listed companies. This would augment the current QFI regime to create more options for foreign investors.
The eligibility criteria in order to trade and participate in the Parallel Market “Nomu" are any of the following persons:
1. Authorized Persons act for their own account
2. Clients of a person authorized by the CMA to conduct managing activities.
3. The Government of the Kingdom, any government body, any supranational authority recognized by the Authority or the Exchange.
4. Government-owned companies either directly or through a portfolio managed by a person authorized.
5. Companies and funds established in GCC countries.
6. Investment Funds.
7. Qualified Foreign Investors.
8. Any other legal persons allowed to open an investment account in the Kingdom and at the Depositary Center.
9. Natural person fulfil any of the following criteria
   a) conducted transactions in security markets of not less than 40 million Saudi riyals in total, and not less than ten transactions in each quarter during the last twelve months
   b) the average size of his securities portfolio shall exceed 10 million Saudi Riyals during the last twelve months,
   c) holds a professional certificate in securities which is recognized by the CMA or an accepted jurisdiction.
In addition, the CMA issued a guidance note for the investment of non-resident foreigners in the Parallel Market "Nomu", which aims at clarifying the mechanism of investment and related restrictions.
The CMA Board has issued its Resolution on amending the Resolution of Securities Disputes Proceedings Regulation (Regulation), by adding a chapter regulating the Class Action Suit, which the CMA has previously posted its draft on its website for (30) calendar days, to obtain the views and remarks of the public.
The regulation of class action suit within the Resolution of Securities Disputes Proceedings Regulation, aims to facilitate litigations proceedings where the plaintiff is a group of persons who share the same legal issues, merits and subject matter of requests, which is appropriate to the nature of the listed companies and the size of their shareholders. The amendment also aims to develop litigation mechanisms and procedures in line with the best international practices, all of which are to enhance the attractiveness of the Saudi capital market and reduce the risk of investing in it, in addition to its role in reducing the time required to resolve investor compensation issues, which in turn, facilitate the work of the committees on one hand and focuses the efforts of investors on the other.
The CMA has prepared an amended draft of the Rules for Qualified Foreign Financial Institutions Investment in Listed Securities.

The purpose of these Rules is to set out the procedures, requirements and conditions for the registration of qualified foreign investors with the Authority to invest in listed securities, and to specify their obligations and the obligations of authorized persons in this regard.

 

The CMA Board has issued its Resolution approving The Rules for Special Purposes Entities ("the Rules") and the Special Purposes Entity by-laws, and will enter into force starting from 15/7/1439H corresponding to 1/4/2018G.
The Rules aim to regulate the establishment and licensing of the special purpose entity; and to define the related monitoring and supervisory rules , taking into consideration all recommendations, observations and opinions, received from investors, specialists, and interested parties during the public consultation.
The resolution to adopt the Rules has been issued in conjunction with the approval of the outcomes of the CFI track within the Transition & Activation of Responsibilities Project (TAR), where the Rules On The Offer Of Securities And Continuing Obligations issued by resolution dated 9/4/1439H corresponding to 27/12/2017G, contain provisions regulating the issuance and trading of securities through a special purpose entity.
The CMA Board has issued its Resolution approving the Rules of Offering Securities and Continuing Obligations, and the updated Glossary Of Defined Terms Used In The Regulations And Rules Of The Capital Market Authority and approve the Listing Rules, and the updated Glossary Of Defined Terms Used In The Exchange Rules which will be effective from 15/7/1439H corresponding to 1/4/2018G, except for the definition of "Qualified Investor" set out in the updated Glossary Of Defined Terms Used In The Regulations And Rules Of The Capital Market Authority and the updated Glossary Of Defined Terms Used In The Exchange Rules, paragraph and (f) of article (71) of the Rules of Offering Securities and Continuing Obligations, and paragraph (b) of article (40) of the Listing Rules which will be effective starting from 31/12/2017G.
The resolution also included that the rules of offering securities and continuing obligations, starting from their effectivity date, shall replace the Offer of Securities Regulations issued under the Board Resolution no. (2-11-2004) dated 20/8/1425H, corresponding to 4/10/2004G, amended under Board resolution no. (3-151-2016) dated 22/3/1438H corresponding to 21/12/2016G, the Listing Rules issued under the Board Resolution no. (3-11-2004) dated 20/8/1425H corresponding to 4/10/2004, amended under Board resolution no. (1-64-2016) dated 19/8/1437H corresponding to 26/5/2016G, and the Parallel Market Listing Rules issued under the Board resolution no. (3-151-2016) dated 22/3/1438H corresponding to 21/12/2016G.
It's worth mentioning that the Rules of Offering Securities and Continuing Obligations aims to regulate the offering of securities in Saudi Arabia. It includes the conditions of the offer of securities, identifies the requirements of listing and offering, and the conditions and requirements of capital changes. In addition to regulating the continuing obligations on issuers whom their securities are listed in the Main Market, and the process of listing and offering shares in the Parallel Market.
Also, the Listing Rules aims to regulate the listing of securities, the continuing obligations on the issuers of listed securities, the suspension of trading listed securities and delisting of listed securities.


In continuance to the Capital Market Authority's role in regulating and developing the capital market, and based on the Companies Law issued by the Royal Decree number (M\3) dated 28/01/1437H, and in accordance with the powers vested in the Authority under the Capital Market Law, the Capital Market Authority's Board issued its resolution regarding the adoptions of the amended Corporate Governance Regulations, the Regulatory Rules and Procedures Issued Pursuant to the Companies Law relating to Listed Joint Stock Companies and the Guidance Note to the Regulatory Rules and Procedures issued pursuant to the Companies Law relating to Listed Joint Stock Companies, to be effective upon their publication date.
The amendments come in line with the amendments made to the Companies Law issued by the Royal Decree Number (M/79) dated 25/07/2018G, as these amendments granted the competent authorities to establish rules of authorisation for businesses or contracts that are made for the company, which a board member has direct or indirect interest in, and rules of authorization over the engagement of a Board Member in any business that may compete with the company or with one of its activity.
It's worth mentioning that the views of the public, specialists and interested parties were taken into consideration when preparing these amendments.

 


In continuance to the Authority’s role in regulating and developing the Capital Market, and in line with the Saudi Vision 2030, and in accordance with the Capital Market Law issued by Royal Decree number (M/30) dated 02/06/1424H, the CMA Board issued its resolution on 1/9/1440H corresponding to 6/5/2019G to publish the proposed amendments to the Rules on the Offer of Securities and Continuing Obligations, for public consultation, for a period of 30 calendar days ending on 2/10/1440H corresponding to 5/6/2019G.
The proposed amendments to the Rules on the Offer of Securities and Continuing Obligations comes in line with the Authority’s objectives to regulate and develop the Capital Market, and the efforts of the Authority and the Saudi Stock Exchange Company (Tadawul) to encourage foreign issuers to list their shares in the Main Market, promote the trading and listing in the Parallel Market and enable direct listing of shares in the Parallel Market. The amendments come at the same time with the proposed amendments to the Listing Rules issued by the Saudi Stock Exchange Company (Tadawul) to this regards, and which will be published for public consultation in concurrence with the publication of the Rules on the Offer of Securities and Continuing Obligations for the same purpose.
The most prominent amendments to the Rules on the Offer of Securities and Continuing Obligations are as follows:
 Regulating the registration of shares for direct listing in the Parallel Market by indicating the provisions and requirements related to the application for registration of shares in the Parallel Market and the information required upon submitting such application to Authority, and adding Annex 20(a) regarding the registration document and Annex 7(b) regarding the issuer’s acknowledgement upon applying for the registration of its shares in the Parallel Market.
 Changing the disclosure requirement of the first, second, and third interim financial statements of the financial year of an issuer whose shares are listed in the Parallel Market to the semi-annual interim financial statements of an issuer’s financial year.
 Adding a requirement obliging the issuer seeking registration and offering of its shares in the Parallel Market or the registration of its shares in the Parallel Market to submit along with its application to the Authority electronic copies of the acknowledgement and an undertaking signed by the board of directors of the issuer and by each proposed director of the issuer in the form set forth in Annex 8 of the Rules on the Offer of Securities and Continuing Obligations.
 Amending paragraph (c) of Article 69 of the Rules on the Offer of Securities and Continuing Obligations to include termination of a director's membership in the board of directors or director's dismissal from the board of directors, and termination of any of the audit committee's membership.
 Stating the provisions of the Rules on the Offer of Securities and Continuing Obligations, which a foreign issuer who submits an application for the listing its shares in the main market pursuant to the Listing Rules the, must comply with.

 

In continuance to the Capital Market Authority's (CMA) role to regulate and develop the capital market, and in its efforts to enhance the market's efficiency and attractiveness and to expand the institutional investments base, and in line with its strategic plan (Financial Leadership Program) and the objectives of (the Financial Sector Development Program) one of the Saudi 2030 vision programs, and based on the Capital Market Law issued under the Royal Decree Number (M/30) Dated 2/6/1424H, the CMA Board has issued its decision to adopt the Instructions for the Foreign Strategic Investors' Ownership in Listed Companies "instructions", to be effective as of the date of their publication, after the Draft Instructions were made available for public consultation on the Authority's website for a period of (30) calendar days. The aforementioned Board Decision further included amending subparagraph (a\2) of Article (14) of the Rules for Qualified Foreign Financial Institutions Investment in Listed Securities and paragraph (2) of Part (3) of the Guidance Note for the investment of Non-Resident Foreigners in the Parallel Market by adding the following statement: "except the foreign strategic investors pursuant to the Instructions for the Foreign Strategic Investors' Ownership in Listed Companies" to be read as follows: "The maximum proportion of the shares of any issuer whose shares are listed or convertible debt instrument of the issuer that may be owned by all foreign investors (in all categories, whether residents or non-residents, except the foreign strategic investors pursuant to the Instructions for the Foreign Strategic Investors' Ownership in Listed Companies) in aggregate is 49%. 

The Instructions aim to regulate the provisions, requirements and conditions for the foreign strategic investors' ownership of a strategic shareholding in listed companies, in addition to determining the foreign strategic investors' obligations and the obligations of the Authorised Persons in this regard. During the preparation of these Instructions, the CMA considered all recommendations, observations and opinions received from investors, specialists and interested parties during the public consultation.

 

The new Commercial Companies Law comes at a time the Sultanate of Oman is preparing for 2040 vision which focuses on enabling the private sector to take the lead in the production process and effectively contributing to the growth of the economy and creating employment opportunities for the citizens. Thus, the development of the legislative structure and creating investment friendly environment within this vision which aims to make the Sultanate of Oman attractive and encouraging to the local and foreign investment. The role of the Government will be complementary and supportive to the role of the private sector. It is an auspicious coincidence to issue this significant law at this time. 


Chairman of the Board of Directors of the Capital Market Authority has issued an administrative decision issuing the Take over and Acquisition Regulation for the public joint stock companies listed on the Muscat Securities Market (MSM) which was published in the Official Gazette on 19 May 2019 pursuant to Article 7 of the Capital Market Law.
The regulation aims to regulate take over and acquisition processes at not more than 25% of the shares of pubic joint stock companies and controlling percentage in the company to provide protection for shareholders and for fair, transparent and equitable treatment of all the parties and to provide exit in cases of acquisition. The Regulation is a government initiative in the economic persification process “Tanfeeth” supervised by the Unit of Implementation and Follow Up.
Al Salmi pointed out that the regulation stipulated the parties it applies to such as offeror and offeree, processes of acquisition and take over, timings and terms and conditions for take over and acquisition offers and percentages of take over offers.
He said the regulation ensures equal opportunities for all the shareholders to benefit from the take over and acquisition offers including the allowance paid for take over beside the fair and equitable treatment of all shareholders specifically minority shareholders with regard to compulsory take over and acquisition offer.
He explained that such procedures are necessary for the stock markets and applicable in most advanced markets. He added the regulation was prepared after reviewing the experiences of such market and consideration of the realities of the local market and recognized practices and adapting them with the requirements of the local market. The draft was offered for consultation by the public and all the public joint stock companies, law firms, audit firms and interested persons for their views, opinions and proposals which is a policy adopted by CMA in drafting all the laws and regulations regulating the capital market and insurance sector.
Article two of the regulation provides it apply to three cases:
The first: any person who acquires jointly or severally not less than 25% of the voting shares in the company and intends to acquire 25% or more of its shares.
The second : Any person acquiring jointly or severally 25% of the voting shares in the company and intends to acquire voting shares at more than (2%) every six months from the date of first purchase transaction.
The third : Any person acquiring jointly or severally 25% of the voting shares in any company controlling the company and intends to acquire voting shares in the company at more than 2% every six months from the date of first purchase transaction.
The regulation contains the terms and conditions for the persons involved in the take over and acquisition process which provides for robust standards of integrity, transparency and fairness for all the participants.

 


The Executive President of the Capital Market Authority confirmed that the Government agreed to suspend the income tax related to pidends on shares and interests at 10% imposed after the issuance of the Income Tax Law promulgated by Royal Decree No. 9/2017 for three years as from May 6, 2019 extendable.
He said the move was based on the approval of His Majesty Sultan Qaboos bin Said may Allah protect him to create an attractive environment for foreign investments for the development of the national economy and the national interests in view of the open doors policy adopted by the Sultanate with regard to the foreign investments and economic principles which would enable the private sector to play a greater role in the comprehensive development programs and policies.
HE concluded that such decision would provide more incentives and facilities to attract direct and indirect foreign investments and Oman would be attractive destination for global investment and robust securities market.

 

The Board of Directors of the Qatar Financial Markets Authority “QFMA” approved an important rules and regulations. This comes as a part of the QFMA’s initiatives for the capital market and its ongoing efforts to regulate and activate the capital market, protect its stability and its participants, and persify its investment tools and mechanisms supporting Qatar Stock Exchange “QSE”.
THE MOST IMPORTANT OF SUCH RULES AND REGULATIONS APPROVED BY THE BOARD ARE:
   1. Rules regulating the market maker activity, which is a new addition to the financial services activities. Such rules aim at activating trading and increasing liquidity in the market, as well as maintaining its stability and balance when the financial services companies, specialized in this activity licensed and regulated by the QFMA, provide continuous offer prices for buying and selling the securities traded in the market.
   2. Operating procedures for ETFs “Exchange Traded Funds”, including short selling transactions covering such fund’s units or index components. This is an addition of a new financial product to the Qatari market alongside shares, governmental treasury bills and bonds, which contributes in the persity of securities available for investors.
   3. Procedures for protecting minority and small investors as a result of the transformation of public shareholding companies to another type of companies as set forth in the Companies Law No. 11 of 2015. Through which such procedures, the QFMA aims to provide adequate protection as per the international best practices for all shareholders when public shareholding company listed on the QSE transforming to any other type of companies.
   4. Rules for employees’ incentive shares in public shareholding companies listed on the QSE, which allow the listed companies organizing incentive schemes for their employees while preserving the shareholders' rights of the company by granting them the right to approve such schemes and supervise their implementation through periodic reports presented annually to shareholders.


As a part of developing the regulations to enhance the Qatari capital markets sector and regulate doing businesses related to financial securities, the board of directors of Qatar Financial Markets Authority "QFMA" issued Decision No. 5 of 2019 concerning the new "Financial Services Rulebook".
The Rulebook promotes to perform the financial services activities set out in Article (4) thereof, after obtaining the required license from the QFMA. The Rulebook obliges all concerned entities subject to the QFMA's jurisdiction to implement it.
The Rulebook provides less requirements than the previous one regarding the capital required for performing such activities, in order to enhance financial liquidity at Qatar Stock Exchange, attract and encourage foreign and local investment for better competitiveness. It will also improve the quality of the financial services provided to participants and investors of the capital market, which would in turn increase the competitiveness of Qatar's economy and increase economic growth rate in line with Qatar National Vision "QNV" 2030.
According to the Rulebook, for granting a license to perform financial services activities, the applicant shall meet a number of requirements, including what related to the paid up capital which is a minimum of QR 3 million for the executive broker, QR10 million for clearing brokers, and QR 20 million for comprehensive brokers. For other financial services companies licensed to perform all financial services activities (excluding margin trading, securities' lending and borrowing, execution of securities purchase and sale's orders for a third party, own securities' trading, market maker and liquidity provider), the minimum paid up capital shall be QR 25 million.

 


The Qatar Financial Markets Authority (QFMA) announced today the issuance of Governance Code for Listed Funds and Listing Rules for Funds' Units listed in the Qatar Stock Exchange (QSE).
This issuance comes as a part of the QFMA's ongoing development of its regulations to enhance attractiveness of investment environment of the capital market, as well as to increase persity of the financial products listed in QSE.
QFMA announced, "It will continue to strengthen its regulations to meet the investors' needs with adopting the best international practices related to investment funds and relevant governance. This is a significant step for QFMA while exerting efforts to develop the Qatari capital market, and strengthen the elements that attract local and international funds for listing in QSE.
QFMA added, "The revision and update of Listing Rules & Governance Code would provide a clear framework for local and international fund management companies to be listed in QSE and encourage the development of asset management in the State of Qatar."

 

In line with CMA’s endeavor to regulate securities activities according to Law No. 7 of 2010 Regarding the Establishment of the Capital Markets Authority and Regulating Securities Activities and its Executive Bylaws and their amendments, and in CMA’s pursuit of transparency, and its belief in the value of participation and the importance of benefiting from the expertise and capabilities of regulated entities, with respect to their valid aspirations and visions in the issued decisions and regulations relevant to the field of securities activities, which would fulfill common interests, support the implementation of CMA’s decisions and regulations when properly enforced, contribute to CMA’s success in achieving its goals, and consequently achieve public interest goals.
Thus, the CMA announced conducting an opinion poll for regulated entities on the draft amendment of the Executive Bylaws of Law No. 7 of 2010 Regarding the Establishment of the Capital Markets Authority and Regulating Securities Activities and their amendments, by adding Appendix 1 “Standards of Systems for Maintaining Records” to Module Eight (Conduct of Business). 
Based on the comprehensive vision of the Capital Markets Authority (CMA) to strengthen the legislative structure of the capital market, and in the framework of its efforts to activate its supervisory role and establish an effective regulatory system in line with the latest international standards and updates, it started to implement one of its strategic approaches “Preparation of the Capital Adequacy Rules for Licensed Persons", which represents a legal entitlement in accordance with the provisions of Law No. 7 of 2010 Regarding the Establishment of the Capital Markets Authority and Regulating Securities Activities, and its Executive Bylaws and their amendments, in particular item No. (2) of Article (66) of the Law, which stipulates that “A Person licensed to engage in the management of Securities activities shall comply with the regulations specified in the Bylaws and in particular as follows: 2- Maintain adequate capital”. Additionally, Article (6-4) of Module Six (Policies & Procedures of Licensed Persons) of the Executive Bylaws of Law No. 7 of 2010 Regarding the Establishment of the Capital Markets Authority and Regulating Securities Activities and their amendments, stipulates that “The Authority has the right to impose additional requirements or to make requests for specific reports to ensure that the Licensed Person has the ability to continue their business, particularly holding a sufficiency of capital, in a manner that is commensurate with the nature and volume of the Securities Activities that they carry out.” 
After the completion of the public consultation seminars on the first set of implementing regulations issued by the CMA in cooperation with World Bank experts in 2015, a specialized CMA working group has completed a rigorous translation process of the three implementing regulations into Arabic, thus allowing for the regulations to be published in the official gazette. The implementing regulations are already considered by CMA as set into force since the date of their publication.
A small brief on the published implementing regulations:

Licensing and Registration Regulation
In order to carry on a securities related business, an institution must be licensed by the CMA under Law 161/2011. Similar to banking business, licensing is critical to protecting customers and ensuring the safety and soundness of institutions operating in the capital markets. Licensed institutions are hence subject to ongoing supervision by the CMA.
Therefore, and as a direct result of this regulation, Banks, financial institutions and financial intermediaries with capital markets business will be “approved institutions” and subject to CMA regulations.

Business Conduct Regulation
“Business conduct” refers to how an approved institution governs and manages its business, its business operations, its systems and controls and its dealings with clients. Business conduct regulations are critical to investor protection, and to ensuring licensed institutions operate with integrity, sound management and effective controls.

Market Conduct Regulation
“Market conduct” refers to the standards of conduct applicable to trading by persons in securities markets. This regulation is critical to market integrity and ensuring fair and efficient markets. It applies to all persons involved in trading, except for item 4 below, which only applies to “Approved Institutions”.
FRA’s BOD decided that companies wishing to offer its shares, whether existing shares or capital increase shall be registered at FRA’s registry first before being listed at the Egyptian Exchange. Also, FRA’s BOD decision stated that companies shall meet the requirements set for calculating the fair value and approving prospectus or disclosure form for offering.

For its part, FRA will comply with standards of transparency and quality systems and companies’ requests shall be decided upon within fifteen days from the date of submitting the needed documents. In addition, Companies will be given a period of no more than one month to complete the offering and trading process in the Egyptian Stock Exchange. In this respect, investors will be aware of the timing of offering, listing and trading.

This decision will be followed by changes in many rules and executive procedures of listing rules prepared by the Authority, that is after consultations with the Egyptian Stock Exchange in preparation for its publication in the Egyptian Gazette and applying it from the next day of publication.
FRA’s Board approved number of important amendments to the Executive Regulations of the Capital Market Law. The amendments to the real estate investment trusts (REITs) included increasing the percentage in which the (REITs) may invest their funds in one project to be 50% if the size of the fund is 500 million pounds or less. In addition, if the fund size is more than 500 million pounds, then it will invest 30% of its funds as long as there is an acceptable feasibility study that is being disclosed to certificates holders. On the other hand, another restriction was amended regarding the fact that the total number of those who own 10% or more of the real estate investment trusts (REITs) shall not exceed75% of the total of fund’s certificate. If these funds are listed at the Stock Exchange, then it shall meet some listing requirements, namely, the minimum number of certificates’ holders and the ratio of tradable certificates. In addition, another restriction is amended and it is related to the fact that ratio of the contribution of the real estate investment trusts (REITs) in the capital of the unlisted real estate company shall not be less than two-thirds of its capital. The new amendments grant the Fund the right to set the percentage of contribution which is in the interest of certificates’ holders pursuant to the fund’s investment policies.
The amendments approved by the Board also allow Investment Manager to use intraday trading system provided that the transactions shall not exceed 15% of the daily volume of fund’s transactions.
Regarding charitable funds, the new amendments allow these funds to invest in various types of mutual funds and it not being limited to private equity funds or real estate investment trusts (REITs) in accordance with the regulations set by the Authority .

In order to facilitate the work of the open-ended funds, the proposed amendments allow banks and insurance companies to issue more than one issuance for open-ended funds.

 

FRA’s Board of Directors issued a regulatory decision after gaining the Board’s approval. The said decision requires obtaining the approval of the company’s General Assembly upon purchasing treasury shares where the percentage of ownership or voting rights of a shareholder or a related group exceeds the percentage set upon submitting a mandatory tender offer, besides the shareholder and the related persons will not participate in voting on purchasing decision in the General Assembly, that is due to the possibility of obtaining an exemption from the Authority upon submitting a mandatory tender offer.
The decision also regulates obtaining an exemption from the Authority regarding not submitting a mandatory tender offer in cases of capital increase whether in cash or through credit balances if the percentage of ownership or voting rights of a shareholder or related group exceeds the percentage set upon submitting a mandatory tender offer, on condition that this is not resulted from purchasing subscription rights in capital increase.

The Authority's decision no. 81 of 2013 was canceled in the light of what was stated in the new decision. Besides, rules of purchasing treasury shares stated in listing and delisting rules will be amended in line with the provisions of the said decision .

 

FRA agreed in principle on the Capital Market Advisory Committee’s recommendation to regulate the rules governing intraday trading mechanism, which increase the maximum limit of THE client to be 1/10000 instead of 20000/1 and allowing him to repeat dealing within the said percentage during intraday trading session. The said proposal shall be presented to the Board of Directors at the next meeting to proceed with the amendment procedures. Also, FRA approved the Committee’s recommendation regarding adding Index Fund certificates to List “ B” of marginable securities list and this shall be done concurrently with the updated lists which include shares that are allowed to be engaged in specialized activities.
FRA’s BOD approved the amendment to decision no. (17) of 2017 issued on 28/2/2017 regarding regulating trading rules and proof of ownership of unlisted securities. The new amendment extends the period in which brokerage companies can notify the Stock Exchange of the transactions required to transfer the ownership of the unlisted securities for one month from the date of the order instead of one week, taking into account the practical cases for such transactions that can exceed the set period stated in the said decision. In addition, extending the period of one week that is stated in the decision will grant greater flexibility that suits the nature of market’s transactions.
The said amendment also states that the purchaser may prove that he deposits the value of the transaction in the bank account for a period exceeding one month stipulated in the same decision in accordance with reasons estimated by the Authority.
In its session held by the end of last year, FRA’s BOD approved a new draft law to regulate consumer finance activity and moved forward to send it to the competent official authorities to issue the legislation. FRA’s Chairman emphasized that the draft law consisted of twenty nine articles regulating each activity aimed at providing financing to purchase goods and services for consumption purposes in Egypt. In addition, it included financing through commercial payment cards or payment systems.
Within the framework of FRA’s regulatory role to ensure the safety and stability of non-banking financial markets and enhance the efficiency of their transactions, FRA’s BOD approved the issuance of capital adequacy standards for financial leasing and factoring companies. The said standards will enhance the ability of companies to provide financing through credit risk management and facing operational risk management according to the best international practices of credit risk measurement methods.
Based on the principle of providing information on sound trading mechanism in the Egyptian Capital Market, the rules and procedures governing this market and facilitating access to them to make sound investment decisions, FRA’s Chairman revealed that the Authority has prepared an updated version of the Executive Regulations of Capital Market Law. He added that information is an indispensable necessity for securities market participants, relevant parties from companies operating in the field of securities as well as listed and unlisted companies.
FRA’s Chairman stressed the keenness of FRA’s Board of Directors to speed up the process of setting the rules, procedures and controls related to the formation of the first board of directors of “Policyholder Protection Funds”. The said rules will maintain the safety and stability of non-banking financial markets and protect consumer rights.
FRA’s BOD approved in its last session the statute of the Egyptian Securities Federation. The Board grants the Federation an independent legal personality which contributes to the development of the Capital Market and raises awareness of it. Also, FRA’s BOD stressed that members’ of the Federation shall abide by the code of ethics and rules governing the obligations and rights of the members. Besides, it shall develop the skills of those operating in the field of securities.
In order to add new mechanisms and increase liquidity on the Egyptian Stock Exchange, FRA issued regulatory decision no. (268) of 2019 on short selling rules and activating the mechanism. The Egyptian Stock Exchange, MCDR shall prepare and set up the automated systems and technical requirements related to short selling mechanism. Both parties shall inform the Authority before activating the mechanism.
Within the framework of FRA’s efforts to achieve the third objective of its comprehensive strategy for developing non-banking financial sector (2018-2022), namely "Enhancing national competitiveness and attractiveness for Foreign Investments", FRA’s Chairman revealed that FRA’s Board approved several procedures included amendments to listing and delisting on the Stock Exchange. The said amendments will stimulate Egyptian and foreign companies to move towards listing on the Egyptian Stock Exchange.
FRA’s Chairman issued a procedural decision to form a Founding Committee to elect the first board of the Egyptian Securities Federation under the chairmanship of Mr. Sulaiman Nazmi and the membership of four representatives of companies licensed to carry out securities activity or subjected to the provisions of Central Depository and Registry Law .
FRA’s Chairman stated that the said decision defined the functions of the Founding Committee in taking the necessary procedures upon joining the companies licensed by the Authority to practice one of activities related to the field of securities and subjected to the provisions of the Capital Market Law and the Central Depository and Registry Law. The committee shall follow the procedures for convening the first General Assembly of the Federation to elect the Board of Directors and this shall be within a period not exceeding six months from the date of the issuance of decision no. (375) of 2019.
FRA’s Chairman revealed that as part of FRA’s effort in developing and activating investment funds as a non-banking financial activity, and within the framework of facilitating the procedures of investment funds in general, and activating the role of Real estate investment trusts through removing the obstacles arising upon establishing the fund, In its session held mid-week, FRA’s BOD approved a draft amendment to some provisions governing Real estate investment trusts and stated in the Executive Regulations of the Capital Market Law.
FRA facilitated the establishment of a new futures company and allowed the Egyptian Stock Exchange to trade in derivative according to certain technical and regulatory determinants within the framework of implementing the roadmap set by the Authority to activate Futures Exchanges and trading in derivatives either through licensing the establishment of a new entity " Futures Exchanges" or granting license to the Egyptian Stock Exchange to engage in the activity without the need to establish a company,
FRA’s Chairman emphasized that FRA’s BOD approved in its last session a decision allowing the Authority to grant license to joint-stock companies to engage in futures contracts after ensuring that it meets all the procedures and conditions prescribed by law to establish companies operating in the field of securities and after obtaining FRA’s BOD approval.
In the framework of FRA’s efforts to practice its role in protecting minority investors and achieving the third objective of its comprehensive strategy for the development of non-banking financial sector (2018-2022), namely "Improving the competitiveness of the national economy and attractiveness to foreign investments", FRA’s Chairman emphasized that FRA’s Board of Directors has approved an amendment to listing and delisting rules by decision no. 43 of 2019. The said decision stipulated that in cases of conflict of interest, FRA’s Board may limit the vote on the optional delisting in the Extraordinary General Assembly of the Company to minority shareholders (Free-Trading Shares) without the vote of the principal shareholder/s and their related parties. 


In light of applying the amendments to the Capital Market Law issued by Law no. 17 of 2018, which includes regulating offering of financial instruments in the Egyptian market, determining the meaning of public offering and its provisions, the conditions and controls to be complied with upon issuing any securities or financial instruments through the private placement and setting a definition of what is meant by the public offering and private placement,
Dr. Mohammed Omran - FRA’s Chairman said that the Board of Directors approved at a meeting yesterday the issuance of the controls and procedures to be complied with at the public offering and private placement.
FRA’s Chairman added that the Egyptian capital market is currently witnessing a trend towards increasing the number of companies to be listed on the Stock Exchange, whether through private sector companies’ offerings and the state-owned companies' offerings program, which is expected to add about 35 new companies to the capital market. In this respect, 275 companies will be listed on the Egyptian Stock Exchange, and market capitalization will be increased to 1.6 trillion pounds by the end of 2022 according to FRA’s comprehensive strategy for non-banking financial activities 2018-2022.
FRA’s Chairman stated that FRA’s BOD decision no. (48) of 2019 stipulated that the company wishing to offer its securities shall enter into a contract with the Lead Manager to carry out the process of promoting, covering and executing the subscription. The contract shall specify the mechanism set for determining offering price, either on a fixed price basis or in accordance with the BOOK BUILDING ISSUE; this shall be disclosed in the prospectus of both public offering and private placement. In both cases, subscription requests and tender offers shall be received through ONLINE DISPLAY systems and will be only reviewed by the Authority and the Lead Manager.
He stressed that the Board was keen in its decision to reveal what is meant by qualified investor - closing the door of diligence in determining them - and restricting them in public legal persons from insurance funds , public and private pensions , fund companies , local, Arab, regional and international financial institutions. The decision defined the requirements that shall be met by these legal persons and natural persons who have liquid assets of 5 million EGP and preferably have experience in the field of securities for at least 5 years.
He noted that Leading Manager shall be responsible of verifying, proving and keeping documents to demonstrate the capital adequacy of private placement clients and meeting the definition and specifications included in the prospectus. That is besides checking the availability of a statement that shows if the client is using delivery against payment mechanism, custodian or the bank contracted. Also, he shall define the means and timing of cash payment to the buyers, means and timing of collecting cash for the sellers.
In addition, Lead Manager shall authenticate method of price determination. Also, he shall state any data related to the subscription, any amendments and timings in the register of BOOK BUILDING ISSUE mechanism. He shall determine the final price of the public offering in accordance with means stated in prospectus and send a copy to the Authority immediately after completing offering process.
FRA’s Chairman also confirmed that the decision included a package of obligations on the remaining parties in the offering. The decision obligated the recipient of the orders in the case of the private placement to take care of the concerned man to ensure that the orders that are included suit the client’s capital adequacy and his experience in order to achieve the seriousness of orders and the ability to pay. Subscription requests received by the broker shall be limited in quantity and price. Also, he shall collect sufficient information about the subscribed investors to ensure that they meet the requirements of the qualified investor and ensure that the investor is the final beneficiary of the subscription and independent of the issuing company and any party. In addition, he shall ascertain sources of client’s financing.
On the other hand, the decision prohibits brokerage companies in the case of public offering to grant financing to clients and to register non-covered purchase orders (at the fixed rate of payment) by the client's own resources.
Dr. Omran stated that in the private placement MCDR shall verify the payment of the entire value of purchased shares in parallel with the settlement process.
FRA’s BOD decision no. (48) of 2019 also stipulates the conditions and procedures to be followed at the public offering. As the company wishing to submit the offer is obliged to submit a fair value study if the offering is for the first time or if the company has listed securities but not active in accordance with the rules set by the Stock Exchange and approved by the Authority in this regard. The fair value study is prepared pursuant to Financial valuation Standards issued by FRA’s BOD no. 1 of 2017 and in accordance with the provisions of Article 85 of the Executive Regulations of Law 95 of 1992.
FRA’s Chairman stressed that companies wishing to offer its shares in public offering shall use price stability mechanism following the offering in accordance with a number of controls. This mechanism aims to support the stability of share price in the market for the benefit of the shareholders that is by dealing through the lead Manager.

 


In order to raise awareness of the requirements needed to apply E-Payment Law no.18 of2019 regulating the Use of Cashless Payment Methods - and clarify the obligations of those dealing in the non-banking financial activities, facilitate them through announcing a guiding plan and recommend the law’s rapid implementation, FRA’s Chairman issued periodical memo no. (2) of 2019 to regulate the Use of Cashless Payment Methods in financial transactions for all companies and entities subjected to FRA’s.
He emphasized that the periodical memo has defined the scope of compliance with Cashless Payment Methods in financial transactions. He added that entities and companies under FRA’s supervision shall settle their financial obligations - by using Cashless Payment Methods - when they exceed the limits specified in the Law’s Executive Regulations. Also, upon granting cash financing provided by Mortgage finance companies, financial leasing or factoring companies, microfinance companies or any non-banking financial institution or upon distributing the profits resulting from the contribution to companies’ capital or investment funds, payments to syndicates’ members and participants in private insurance funds and insurance compensation. Also, using Cashless Payment Methods upon granting subsidies and donations by NGOs or other private legal persons and establishments of various kinds. Also, upon paying fees in cases of purchase or rent or exploitation or use of land or real estate. Upon paying the dues of suppliers, contractors, service providers. Moreover, it is used upon paying the dues of employees, experts, heads, and members of boards of directors, committees and social insurance contributions. Also, whenever the number of employees or the total value of their monthly wages exceed the limits specified in the Executive Regulations of the said law.
FRA’s Chairman said that the other part of the obligations - stipulated in the periodical memo - is represented in collecting cash financing premiums, insurance premiums, syndicates’ subscriptions, private insurance fund subscriptions using Cashless Payment Methods, as well as subsidies and donations granted by NGOs and institutions, or granted by other private legal persons and establishments of various kinds, fees in cases of sale, rent, exploitation or use of land or real estate or express transport vehicles and fines and other receivables to companies and entities operating in non-banking financial activities whenever it exceeds limits stipulated in the Executive Regulations of the law.
He asserted that the Authority set a guiding model of six-phases for a reconciliation plan in its periodical memo. It calls upon the companies and entities under its supervision to implement this plan as soon as possible so as not to be exposed to the penalties and fines stipulated in Articles (7, 8) of E-Payment Law.
He added that the period of reconciliation will take six months from the date of applying the Executive Regulation of Law No. 18 of 2018. The reconciliation plan includes several stages. The first phase involves consultation process and choosing provider of cashless payment solutions to settle payments and receipts if the dealers do not have existing bank accounts or other Cashless Payment Methods such as credit and debit cards, payment using mobile phone, prepaid cards.
This is followed by signing a contract with provider of cashless payment solutions, and obtaining the prior approval of the Authority required only for those licensed to engage in microfinance activity in the matter to activate cashless payment transactions for its clients. Then, the third phase which is the experimental operation of all cashless payment services and starting the awareness plan for clients and stakeholders. The fourth phase is collecting cashless payments. The fifth phase witnesses the implementation of cashless transactions and finally, settling all payments (payment and collection) through cashless payment methods and addressing all obstacles facing the process.

 


FRA’s BOD approved in its session today a draft law on amending the provisions of Law No. (141) of 2014 on regulating microfinance. The new amendment will cover all financing activities granted for micro, small, and medium-sized enterprises (MSMEs). In this respect, this will enable the maximum number of target groups and SMEs to access various means of finance. The draft law will be sent to the Prime Minister for its issuance.
The draft law is a step that is taken by the regulator to comprehend the developments revealed by the actual application of the law over the past four years regarding the need to increase finance value granted to clients. In addition, the new amendments will provide a new finance ceiling for another category to facilitate the associations and civil institutions engaged in finance activity in light of the variables witnessed by the Egyptian economy.
The Egyptian constitution issued in 2014 has committed the Egyptian state to protect economic, productive, service and information activities as one of the basic components of the national economy. Since Financing SMEs – is held outside the banking sector- and is not subjected to an integrated legal regulation, besides a large part of it is practiced through informal mechanisms and customary practices that lack the legal basis. Consequently, the national economy loses advantages of efficiency, justice and stability in financing transactions in this field, despite it represents more than 80% of the structure of the Egyptian economy and % of private agricultural sector in Egypt.
He added that the new draft law will enable the maximum number of target groups and SMEs to access various means of finance, in a move to attract hundreds of thousands of jobs annually which contributes to the elimination of unemployment. On the other hand, the draft law regulates the work of entities granting finance, reduces risks, encourages the expansion of this activity and protects the rights of beneficiaries through putting microfinance entities under a strict regulatory system, pursuant to the best international practices in this regard.
The draft law’s legal framework includes an amendment to Microfinance Law to regulate SME finance along with microfinance activities in terms of rules and regulations set for the companies to practice both activities in a manner that achieves flexibility and ease of application. That is in addition to the possibility to amend and develop these rules in accordance with the needs of the industry and its development. The project also emphasizes that MSME finance is one of the non-banking financial tools and then subjected to the provisions of Law No. (10) of 2009.
The most important part of the draft law includes the following:
- Replace the title of Law No. (141) of 2014 on regulating microfinance activity, with the following title: “Law on regulating MSME finance”. The term "Microfinance" shall be replaced by the term “MSME finance” whenever it is mentioned in Law No. (141) of 2014 referred to.
- The licenses granted to companies, associations and NGOs to carry out microfinance activity shall continue to apply unless they are canceled in accordance with the provisions of the law.
- Add definitions related to MSMEs
- Issued and paid-up capital of companies operating in SME finance shall not be less than 20 million EGP and 5 million EGP for financing micro enterprises. On the other hand, companies wishing to engage in financing SMEs and microfinance activities together must meet the minimum issued and paid up capital for each of the two activities.
- The statute of the Egyptian Union of Microfinance - currently exist - shall be amended to include entities engaged in SME finance and changing its name to become “Egyptian Union of MSME finance”.
- Companies, associations and NGOs licensed by the Authority to engage in SME finance may operate in financial leasing activities, taking into account the provisions stipulated in Law No. 176 of 2018 promulgating the Law regulating Financial Leasing and Factoring activities.
It is worth mentioning that the draft law has witnessed several sessions of community dialogue in the past period with representatives of financial institutions operating in SME finance, the Micro, Small and Medium Enterprises Development Agency (MSMEDA), the Egyptian Union of Microfinance as well as companies and associations licensed to engage in microfinance activity.

 

 

In recognition of the effective role played by Holding Companies in establishing new companies and increasing their capital in a manner that increase the economic activity, In order to facilitate these companies to enable them to achieve their objectives, FRA’s Chairman issued decision no. 74 of 2019 on exempting Holding Companies - that engaged in company incorporation or capital increase in accordance with requirements stated in Capital Market Law and related decisions- from abiding by the conditions stated in the ownership structure which shall be met by the companies upon establishment and licensing.

FRA’s Chairman emphasized that the decision came in accordance with FRA’s BOD approval at its meeting last week to grant Holding Companies a facilitation upon its establishment due to the effective role it plays in establishing new companies and increasing their capital in order to provide new job opportunities. That is besides its role in increasing the production of goods and services, which in turn is reflected in the GDP growth rate.
FRA’s Chairman explained that decision no. (74) of 2019 contributes to the implementation of the Sustainable Development Strategy (SDS): Egypt Vision 2030, as Holding Companies play an active role in increasing direct investment.

 

As FRA seeks the development of the legislative structure of non-banking financial activities in order to absorb the changes that occur in the capital market and to strengthen the competitiveness of the national economy and investors’ protection,

FRA’s Chairman revealed that FRA’s BOD approved at its last meeting last week a proposal to amend some provisions of the Central Depository and Registry Law to become a comprehensive law regulating clearing and settlement transactions both in the present and future markets. That is besides some provisions governing clearing and settlement of derivatives, commodities, other financial instruments or indicators. The new law will include clearing and settlement of all securities, namely government securities, whether treasury bills or government bonds.
In order to activate Futures Exchanges and to update its system of work, the proposed amendment allows companies to be licensed by the Authority to carry out clearing and settlement of futures contracts, whether this license is granted to central depository and registry companies or through a new company established for this purpose.
FRA’s Chairman said that one of the most important issues dealt with in the amendment was to allow the Central Bank of Egypt to establish a joint stock company wholly owned by it or with others to carry out clearing and settlement of government bonds and treasury bills. He pointed out that FRA’s BOD should issue the necessary conditions, controls and procedures for granting the license and practicing the activity.
He added that in light of the Central Depository and Registry Law, the central depository activity deals with depository and registration of securities, clearing and settlement of financial centers arising from trading and transfer of ownership of securities including registering the right of pledge. He noted that it was important that the proposed amendments include provisions regulating securities pledge between the pledgor debtor and pledgee creditor.
FRA’s Chairman affirmed that the proposal established a unified law regulating clearing and settlement, whether for the present market represented in securities and government securities or for future market represented in futures contracts. In this respect, investors will refer to one legislation that includes all the provisions governing Central Depository and Registry and the rules to be followed upon clearing and settlement of securities and contracts subject to its provisions.
The proposed amendments include the following:
1- Granting license to companies authorized by the Authority to carry out clearing and settlement of contracts traded on the Futures Exchanges, whether it is a license for the depository companies or through a new company established for this purpose. The Authority shall manage the conditions, controls and procedures necessary for granting the license and practicing the activity.
2- Allowing the Central Bank of Egypt (CBE) to establish a joint stock company wholly owned by it or with others, to carry out clearing and settlement operations for government bonds and treasury bills
3. Regulating securities pledge between the pledgor debtor and pledgee creditor.
4. Allowing MCDR, in the event of bankruptcy by one of its members, to finalize and settle the final orders ordered by such member and to settle the financial centers. Besides, allowing the Authority to cancel such transactions and orders if accompanied by fraud. In this respect, the bankrupt member is obliged to pay a compensation to activate FRA’s role in regulating the market and protecting investors of goodwill.
It is worth mentioning that the Central Depository and Registry Law. (93) of 2000 was issued to regulate the central depository and registration activity in the present market. The said law discussed in details the provisions related to the central depository, registration, clearing and settlement of securities in order to settle the legal centres arising from dealing in securities. In addition, the said law specified the rights and obligations of those who deal in these securities. The law also regulated the provisions of establishing and managing the company licensed by FRA to carry out the activities of central depository and registration.
In 2018, pursuant the amendments to the Capital Market Law under Law no. (17) of 2018, the Law stipulated the establishment of Futures Exchanges and other indicators determined by the Authority. noting that Futures Exchange’s clearing and settlement transactions shall be carried out in accordance with the provisions of the Central Depository and Registry Law through MCDR licensed by the Authority.

 

FRA’s Chairman stressed on FRA’s keenness to develop and activate real estate investment trust (REITs), facilitate their work and reduce their burdens to carry out their activities in order to play their vital role in promoting the construction industry as it is in the international markets.

FRA’s Chairman said ministerial decree no. (1347) of 2019 on amending some provisions of the Executive Regulations of the Capital Market Law stipulated that Management Services Company shall conduct periodical valuation of the REITs’ total assets every six months at least (instead of every three months) ). This shall be applied on (REITs) that are not listed at the Stock Exchange in order to reduce the financial burden on the Fund, given the nature of some (REITs) targeting long-term investment in unlisted real estate assets or securities. Meanwhile, if the Fund is listed at the Stock Exchange, the valuation shall be conducted quarterly.
FRA’s Chairman added that the amendments have taken into account "further facilitation and easing of financial burdens so that the REITs’ assets will be valuated by one or more of the Real Estate Appraisal Experts listed at FRA’s registry - rather than requiring that the valuation be made by two experts - who must be independent of either party. Upon the preparation of the report, real estate appraisers shall abide by the Egyptian Financial valuation Standards issued by FRA’s BOD. The report shall only be sent to the Auditor without interfering with valuation tasks.
He emphasized that the Authority is - currently- in consultation with officials of the Ministry of Finance to prepare some tax incentives to encourage engaging in real estate investments through REITs.
FRA’s Chairman noted that the amendment was issued to avoid conflicts of interest. In this respect, it was required to obtain the approval of Certificate Holders Group if the REITs’ funds are directed to any investments or real estate owned directly or indirectly by any related parties by an amount not exceeding (25%) of the Fund’s assets. In addition, two real estate appraisers who are list at FRA’s registry shall valuate the assets; afterwards Fund’s auditors shall approve the valuation.

 

 

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