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Article 1 Of Chapter 1
Section: Definitions

The following words and terms - wherever used in this Law - shall have the meanings assigned to them here below:

The Competent Minister: The Minister of Commerce and Industry.

The Authority: The Capital Markets Authority.

The Board: The Board of Commissioners of the Capital Markets Authority.

Bylaws: The executive bylaws of this Law.

Exchange: A Securities Exchange or Securities Market.

Members of the Exchange: Listed Companies and funds traded at an Exchange, and Brokers.

Clearing Agency: An entity which carries out clearing and settlement operations in respect of securities, and one which provides the central custody of securities, and one which provides other related services.

Person: A natural individual or corporate entity.

Issuer: A corporate entity that is authorized to issue securities.

Listed Company: A shareholding company listed in the Exchange.

A Security: Any instrument - in any legal form - that evidences ownership of a share in a financial transaction and that is negotiable pursuant to a license from the Authority, such as: a) Shares issued or proposed to be issued in the capital of a company b) Any instrument that creates or acknowledges a debt issued or to be issued by a company c) Loans; bonds; Sukuk; and other instruments that can be converted to shares in the capital of a company d) All public debt instruments that are tradable and issued by the various government entities or public institutions and authorities e) Any right, option or derivative relating to Securities f) Units in a collective investment Scheme g) Any paper or instrument considered by the Authority as a Security for the purposes of implementing this Law and the Bylaws

Not to be considered as Securities are commercial papers such as cheques, promissory notes, bills of lading, letters of credit, cash transfers and instruments negotiated by banks exclusively between each other, insurance policies and rights arising from retirement funds established for the benefit of the beneficiaries therefrom.

Dealing in Securities: A Person’s dealing in Securities for his/her own account or for the account of others by sale or purchase, or by submitting an offer of sale or purchase or acquisition regarding the same, or issuance, or public offer, or subscription, or waiver of the right to subscribe, or marketing, or promoting, or undertaking to cover the subscription, or custody, or listing, or depositing, or settling, or financing the dealing of, or lending, or short sale, or pledge or waiver of Securities or any other transaction that the Authority considers as Dealing in Securities.

Trader: A Person who engages in the purchase and sale of Securities for his/her own account. Broker: A corporate entity which conducts the business of the purchase and sale of Securities for the account of others in consideration of a commission.

Investment Portfolio: Any client account with a licensed Person authorized to practice the activity of investment portfolio management which includes cash, or Securities, or other assets owned by the client in accordance with the Authority’s rules. An investment portfolio is either a custody portfolio, or a portfolio managed by a portfolio manager or by the client.

Investment Portfolio Manager: A Person entrusted with managing investment portfolios on behalf of clients or for the benefit of the clients or the benefit of the company in which he/she is employed.

Investment Advisor: A corporate entity which provides advisory services related to Securities for a commission.

Collective Investment Scheme: An entity which facilitates the investment of investors’ funds in various investment instruments.

Custodian: A corporate entity licensed by the Authority to be responsible for the safeguarding of the assets comprised in Collective Investment Schemes according to the provisions of this Law and the Bylaws.

Subscription Agent: A Person who offers or sells Securities for the benefit of their Issuer or its associate or obtains Securities from an Issuer or its associate for the purpose of remarketing them.

Insider: Any Person who, by virtue of his position, is in possession of information or data that has or may have a material effect on a Listed Company which is not available to the public.

Initial Public Offering: The process of addressing an invitation to the public to subscribe or purchase Securities through various media.

Private Placement: An invitation addressed to a certain group or to certain Person or Persons to subscribe in a Security.

Ally: A Person who is affiliated with another Person or Persons or is subject to their authority.

Competent Court: The Capital Markets Authority’s court provided for in this Law.

Actual Control: Every situation, agreement or ownership of shares or proportion regardless of the percentage, that leads to control of the appointment of the majority of the members of a Board of Directors or the resolutions taken by a Board of Directors or by the general assemblies of the relevant company.

Market Maker: A Person who ensures the availability of supply and demand for one or more Securities according to such controls as may be laid down by the Authority.

Option Contracts: A contract or agreement whereby the buyer acquires the right - but not the obligation - to purchase or sell a Security or a group of Securities, but without the rights of ownership of the Securities.

Financial Derivatives: Financial instruments which derive their value from the value of the relevant assets such as shares, bonds, commodities, and currencies, and which can be purchased or sold or traded in a similar method as the trading of shares or of any other financial assets.

Ask Offer: An expression of interest to dispose of a Security listed in the Exchange and through the Exchange for cash consideration.

Bid Offer: An expression of interest to acquire ownership of a Security listed in the Exchange and through the Exchange for cash consideration.

Related Person: An individual who occupies the position of a member in the Board of Directors, executive or supervisory management of a Broker or investment advisor, or works as a manager or occupies a supervisory position in the above mentioned entities, or works as an employee or representative of any such entity who deals with the public, or has the freedom to dispose of Securities or funds, as part of his/her duties at an entity which is licensed to operate in the field of Securities.

Secondary Market: The market or markets where the sale and purchase of Securities transactions are executed and ownership is transferred in accordance with the bylaws, regulations and laws that govern the same.

Investment Controller: A corporate entity licensed to practice the activity of supervision over Collective Investment Schemes.

Credit Rating Agency: A corporate entity licensed to practice the activity of credit rating or the activity of rating credit information. Insider Information: Information or data not disclosed to the public, which if disclosed would affect the price or the trading of Securities.


* Article (1) is amended pursuant to Law No. 22 of 2015 Amending Some Provisions of Law No.7 of 2010 regarding the Establishment of the Capital Markets Authority & Regulating Securities Activities.

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