CMA LAW: Circular No. (12) of 2017 on General Assemblies of Listed Companies

Circular to all Listed Companies

Chairman of the Board of Directors

Greetings,

With reference to CMA’s Board of Commissioners Resolution No. (63) of 2017 on amending the Executive Bylaws of Law No. (7) of 2010 Regarding the Establishment of the Capital Markets Authority and Regulating Securities Activity and its amendments, and in particular the amendment of Article 1-6 of Module Twelve (Listing Rules) which provided that:
"A Listed Company shall provide a notification to the Authority, stating the agenda, date and place of the general assembly meeting - along with all documents relevant to the items listed on the agenda - prior to ten Business Days at least from the date of the commencement of the meeting."

And further to Circular No. (7) of 2017 concerning General Assemblies issued on 25/4/2017, the Authority draws your attention to the following:

First: In the event that the Company submits to the Ministry of Commerce and Industry a request for the convening of an Ordinary General Assembly, the following subjects shall be included in the agenda of the Ordinary General Assembly as minimum:
- Reciting both the Governance Report and the Audit Committee Report.
- Report of the Board of Directors on the company's activity and financial position for the ended financial year.
- The auditor's report on the financial statements of the company.
- In the case of listed companies licensed to operate in accordance with the provisions of Islamic Sharia, the external Sharia Audit Office reports on the extent to which the commercial and financial transactions of the licensed person comply with Sharia standards and the relevant resolutions of the Authority, without unlicensed listed companies, hear the report of the Sharia Supervisory Board.
- Report any irregularities monitored by the regulatory authorities, which led to imposing sanctions on the company.
- Financial statements of the company.
- Suggestions of the Board of Directors on the distribution of profits with a schedule.
- Discharge members of the Board of Directors from liability.
- Election or removal of board members.
- Proposals of the Board of Directors to determine their remuneration.
- Appointing the auditor of the company, determining his fees or delegating the board of directors to that, provided that the appointment is of the natural person registered in the auditors register with the Authority.
- In the case of listed companies licensed to operate in accordance with the provisions of the Islamic Sharia, appointing the external Sharia Audit Office, provided that it shall be registered in the register of the external Sharia Audit Offices at the Authority, and without the other listed companies that are not authorized to appoint the Sharia Supervisory Board.
- Transaction report made or to be made with the relevant parties, and the relevant parties shall be defined in accordance with IAS.

None of the following items shall be included in the agenda of the Ordinary General Assembly except after obtaining the approval of the Authority:
- Approval of the distribution of bonus shares with a schedule.
- Approve the publication of the Competitive Acquisition Offer document in the event that the listed company is the Offeree company.
- Approval of withdrawal or transfer of listing or listing on securities exchanges outside the State of Kuwait.

Second: In the event that the company submits to the Ministry of Commerce and Industry a request for convening an Extraordinary General Assembly, none of the following items shall be included in the agenda without obtaining the approval of the Authority:
- Adjusting the capital by increase or reduction with the schedule.
- Issue ordinary or premium shares with a specified schedule.
- Dissolution, merger, transformation or division of the company.

Based on the Memorandum of Understanding on Coordination of Cooperation between the Ministry of Commerce and Industry and the Capital Markets Authority signed on 21/11/2017, the Ministry shall undertake the procedures followed for the holding of Ordinary and Extraordinary General Assemblies, taking into account any comments that may be made by the Commission on the agenda.

Dr. Nayef Falah Al-Hajraf

Copy of the Official Document

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