CmaBoardReleases
Title: Circular No. (14) of 2021 to all Issuers of Securities
The Capital Markets Authority (CMA) draws your attention to the importance of complying with the provision of Article (156) of Law No. (1) of 2016 on the Promulgation of the Companies Law and its amendments stipulating the following: “The company shall have a special register to be held with a clearing agent, in which the names of the shareholders, their nationalities, their domicile and the number and type of shares owned by each one of them as well as the value paid for each share shall be recorded.
Any changes to the particulars recorded in the register shall be amended in the shareholders register in accordance with the particulars received by the company or the clearing agent.”
And the first paragraph of Article (234) that stipulates:
“……. The Authority shall set the rules of dealing in those shares and their disposal, and the regulations of safekeeping the shareholders’ record of this company, provided that these rules shall take into account that the transactions of trading, settlement, and clearing of these shares, and safekeeping them shall be through integrated technical systems,……”
And Article (49) of Law No. (7) of 2010 Regarding the Establishment of the Capital Markets Authority and Regulating Securities Activities and their amendments, which states the following: “No Person may incorporate a Clearing Agency, or manage, or assist in incorporating or assist in managing a Clearing Agency, or announcement thereof unless a Clearing Agency’s license is obtained and issued by the Authority in accordance with the conditions and restrictions set forth in the Bylaws of the Law and the license shall be published in the Official Gazette.”
In this regard, the CMA emphasizes on the importance of keeping the companies records exclusively with entities approved by the CMA.
The CMA warns against dealing with any entity that participates in any of the securities activities stipulated in Law No. (7) of 2010 and its Executive Bylaws and their amendments without a license from the CMA.
Prof. Ahmad A. Al-Melhem
Issued on: 07 September 2021