Title: Announcement regarding issuance of Disciplinary Board Resolution No. (124/2022 Disciplinary Board - 115/2022 Authority) (27/2023 Disciplinary Board – 1-5/2023 Authority) and imposition of a fine against: Land United Real Estate Company, Chairman of the Board of Directors, Vice Chairman of the Board of Directors, CEO, Members of the Board of Directors, and Head of Financial Sector of the Company for violating the Rules of Disclosure and Transparency, Dealing in Securities, and Corporate Governance

Announcement regarding issuance of Disciplinary Board Resolution No. (124/2022 Disciplinary Board - 115/2022 Authority) (27/2023 Disciplinary Board – 1-5/2023 Authority) and imposition of a fine against: Land United Real Estate Company, Chairman of the Board of Directors, Vice Chairman of the Board of Directors, CEO, Members of the Board of Directors, and Head of Financial Sector of the Company for violating the Rules of Disclosure and Transparency, Dealing in Securities, and Corporate Governance.

For the following reasons:

First: Land United Real Estate Company violated the following:
1) Provision of Article (4-2-1) of Module Ten (Disclosure and Transparency)
This is due to its delay to disclose a number of material information for several days.
2) Provision of Article (4-4-1) of the mentioned Module:
This is due to the Company’s failure to respond on the interview published on 26/09/2022 in a newspaper under the topic of (The assets of “Land Real Estate” are not in the name of the Company).
3) Provision of Article (4-6-3) of the mentioned Module:
This is due to the inaccuracy of the Company’s response dated 16/10/2022 on the interview published in a newspaper on 12/10/2022 under the topic of (The rights of “Land Real Estate’s” shareholders are protected by the clarity of its audited statements … and its unrealized losses). The interview included several unrealistic matters which make the company’s response a misleading response.
4) Provision of Paragraphs (b and d) of Item (2) of Appendix (1) of Module Eleven (Dealing in Securities) of the Executive Bylaws of Law No. 7 of 2010 and amendments thereto:

The following was proven to the CMA:
a) The Company evaluated one of its local real estates listed in its financial statements for the period that ended on 31/12/2021 that is classified as asset by one competent authority only,
b) The Company evaluated its real estate assets listed in its financial statements after the end of one month from the date of financial statements for the period that ended on 31/12/2021.

Second: each of the following:
1. Chairman of the Board of Directors of Land United Real Estate Company.
2. Vice Chairman of the Board of Directors of Land United Real Estate Company.
3. Member of the Board of Directors of Land United Real Estate Company.
4. Member of the Board of Directors of Land United Real Estate Company.
5. Member of the Board of Directors of Land United Real Estate Company.

They violated the following:
1) Provision of Article (3-1) of Module Fifteen (Corporate Governance) of the Executive Bylaws of Law No. 7 of 2010 and their amendments:

The following was proven to the CMA:
a) The Company’s Board of Directors failed to take any procedures for ensuring the protection of the shareholders’ interest with regards to the Company’s real estates listed in its combined financial statements classified as assets, as they were registered under the names of parties related to the Company according to documents submitted by them, noting that the Board of Directors and Executive Management contented themselves with waivers signed by the mentioned parties on papers undocumented from the official and legal entities in the country for the Company’s interest. This may result in legal and financial difficulties and risks in the future as well as the loss of the Company’s shareholders’ rights.

b) The Company’s Board of Directors deposited all the revenues of the local real estates mentioned in table above in the accounts of the persons with which the bank has contracted regarding the real estates mentioned in table above and not in the account of the Company. It is worth mentioning that the Company only has waivers signed by the owners of the mentioned accounts on papers undocumented from the official and legal entities in the Country for the Company’s interest, which may result in legal and financial risks for the Company in the future as well as the loss of its shareholders’ rights.

2) Provision of Item (15) of Article (3-7) of the same Module (Governance):
This is due to the failure of the Company’s Board of Directors to sign a work contract with the current executive agency chairman, as it provided the CMA with a work contract signed between him and the Company on 16/08/2009.

Third: each of the following:
1) The CEO of Land United Real Estate Company.
2) Head of the Financial Sector of Land United Real Estate Company.

They violated Provision of Item (5) of Article (3-10) of the same Module (Governance):
The following was proven to the CMA:

a) The Company’s Board of Directors failed to take any procedures for ensuring the protection of the shareholders’ interest with regards to the Company’s real estates listed in its combined financial statements classified as assets, as they were registered under the names of parties related to the Company according to documents submitted by them, noting that the Company’s Board of Directors and Executive Management contented themselves with waivers signed by the mentioned parties on papers undocumented from the official and legal entities in the country for the Company’s interest. This may result in legal and financial difficulties and risks in the future as well as the loss of the Company’s shareholders’ rights.

b) The Company’s Board of Directors deposited all the revenues of the local real estates mentioned in table above in the accounts of the persons with which the bank has contracted regarding the real estates and not in the account of the Company. It is worth mentioning that the Company only has waivers signed by the owners of the mentioned accounts on papers undocumented from the official and legal entities in the Country for the Company’s interest, which may result in legal and financial risks for the Company in the future as well as the loss of its shareholders’ rights.

The Resolution included the infliction of the following penalty: -

“First: Lawsuit No. 124/2022 Disciplinary:
Levying a fine on Land United Real Estate Company in an amount of KWD 50,000 (fifty thousand Dinars) for the attributed violation.

Second: Lawsuit No. 27/2023 Disciplinary:
Levying a fine on Land United Real Estate Company in an amount of KWD 15,000 (fifteen thousand Dinars) for the first, second, and third violations due to correlation, and an amount of KWD 6000 (six thousand Dinars) for the fourth attributed violation in its two parts.

Third: Lawsuits No. 124/2022 and 27/2023 Disciplinary:
1) Levying a fine on each of: 
1. Chairman of the Board of Directors of Land United Real Estate Company.
2. Member of the Board of Directors of Land United Real Estate Company.
3. Member of the Board of Directors of Land United Real Estate Company.
4. Member of the Board of Directors of Land United Real Estate Company.
In an amount of 50,000 (fifty thousand Dinars) on each one of them for the attributed violations.
2) Levying a fine on each of: 
1. Vice Chairman of the Board of Directors and the CEO of Land United Real Estate Company.
2. Head of the Financial Sector of the Company.
In an amount of 50,000 (fifty thousand Dinars) on each one of them for the attributed violations and due to correlation of the first.

Fourth: Obliging the members of the Company’s of the Board of Directors -jointly- to pay the amount of KWD 3,560,553 (three million, five hundred and sixty thousand, five hundred and fifty-three Dinars). This amount represents the losses incurred by the Company due to the exclusion of the real estates subject of the lawsuits.”

In this regard, the CMA emphasizes the implementation of CMA Law and its Executive Bylaws on all persons dealing in securities activities, and urges them to comply with these Laws in order to promote investors' confidence, create a sound investment environment, and implement the Law according to the principles of fairness, transparency, and integrity in line with the best international practice.