CmaBoardReleases
Title: Announcement Regarding Issuance of Disciplinary Board Resolution on Violation No. (26/2021 Disciplinary Board - 13/2021 Authority)
The Capital Markets Authority announces the issuance of Disciplinary Board Resolution passed in its meeting held on Tuesday May 25, 2021 on violation No. (26/2021 Disciplinary Board - 13/2021 Authority) filed against: Real Estate Trade Centers Company.
The operative part of the Resolution resulted in the aforementioned being convicted of violating the provision of paragraph (b) of Item (2) of Appendix (1) (Real Estate Assets Valuation) of Module Eleven (Dealing in Securities) of the Executive Bylaws of Law No. 7 of 2010 and their amendments, which stipulate the following:
“Persons licensed and listed companies in the Exchange shall comply with the following procedures and regulations for the purpose of evaluating real estate listed in their consolidated financial statements:
2. Procedures required for valuation local real estate listed in the consolidated financial statements and classified as fixed assets or others on the financial center statement:
b. Valuation shall be conducted by at least two authorities licensed and competent in real estate appraisal, one of which is a Kuwaiti bank, provided that the less value shall be taken into account.”
This is due to the Authority finding by reviewing the financial statements for the financial year ending on 31/12/2019 and the financial statements for the financial period ending on 30/06/2020 for the Real Estate Trade Centers Company that it includes real estate assets listed under the item "Real Estate under Development" with a total value of KWD 11,208,762 (eleven million, two hundred and eight thousand seven hundred and sixty-two Kuwaiti Dinars), which is represented in the Equestrian Academy and Resort project under development located in North Subhan in the State of Kuwait, as the Company did not evaluate its real estate asset by one of the Kuwaiti banks.
The decision included the infliction of the following penalty: -
“The Company is fined an amount of four thousand Dinars for the attributed violation”
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