Title: Circular Regarding Compliance with Law No. 1 of 2023 - Prevention of Conflicts of Interest
In light of the requirements of Law No. 1 of 2023 Regarding the Prevention of Conflicts of Interest, and in particular Article (4-2) of the same Law that stipulated: The following categories are subject to the provisions of this Law:
4- Companies’ employees, in the event that the state or one of the public authorities or institutions contributes in such companies by a percentage of not less than 25% of their capital. This percentage is determined pursuant to the total stakes of the state or the other public authorities or institutions.
And Article (4) of the same Law that stipulates: When the employing entity becomes aware of a case of conflict of interest by any person that reports to it, the entity shall notify the person in writing of the need to disclose the case of conflict of interest and address this conflict. If the that person fails to address the conflict upon notification, the employing entity shall inform the Public Prosecution or the Authority.
In all events, the employing entity shall take and follow-up all the necessary procedures to avoid and prevent conflicts of interest.
Accordingly, the Capital Markets Authority (CMA) confirms that all companies addressed by 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 that are subject to its supervision must comply with the provisions of Law No. 1 of 2023 Regarding the Prevention of Conflicts of Interest, concerning the written notification upon the occurrence of a case of conflicts of interest by any person that reports to the entity. It shall disclose the case of conflicts of interest and address such conflict or take the legal procedures thereon in case of abstention.