"Circular to All Persons Licensed to Practice the Activity of Investment Portfolio Manager"

Chairman of the Board of Directors 

Greetings,

With regard to CMA’s objectives that stipulate that the Authority aims to “Ensure compliance with the rules and regulations related to securities activities”, as well as the competence of the Board of Commissioners that stipulate that it shall “Provide appropriate systems to protect traders and work towards minimizing improper and unfair practices in the Securities Activities.”, and within the framework of ensuring investment portfolio manager’s compliance with Appendix (11) (Authorization of Trading in Securities) of Module Eleven (Dealing in Securities) of the Executive Bylaws of Law No. (7) of 2010 on the Establishment of the Capital Markets Authority and Regulating Securities Activities and their amendments.

The CMA would like to draw the attention of licensed persons who practice the activity of an investment portfolio manager that the authorization of trading in listed and unlisted securities for clients of investment portfolios of securities is only for portfolios whose management mechanism is “by client”, through the form prepared by the Kuwait Clearing Company according to the provisions of the aforementioned Appendix.

Whereas investment portfolios whose management mechanism is ”by company ” does not require an authorization in trading securities for others, since the investment portfolio manager (the licensed person) is the one authorized to manage the investment portfolio. Additionally,  the investment portfolio that is ”for custody”  shall not require an authorization to trade for others, since this type of portfolio serves the client's goal of maintaining securities in the medium or long term by keeping them with the investment portfolio manager.

We hope that you will abide by the guidelines stated in this Circular.