Title: Announcement regarding issuance of Disciplinary Board Resolution No. (68/2023 Disciplinary Board) (82/2023 Authority) and imposition of a fine against: Dar Al Thuraya Real Estate Company, Chairman of the Board of Directors, Vice Chairman of the Board of Directors, CEO, Members of the Board of Directors, for violating the Rules of Listing, and Corporate Governance

Announcement regarding issuance of Disciplinary Board Resolution No. (68/2023 Disciplinary Board) (82/2023 Authority) and imposition of a fine against:

Dar Al Thuraya Real Estate Company, Chairman of the Board of Directors, Vice Chairman of the Board of Directors, CEO, Members of the Board of Directors.

for violating the Rules of Listing, and Corporate Governance.

For the following reasons:

First: Dar Al Thuraya Real Estate Company violated the provision of Article (1-14) of Module Twelve (Listing Rules) of the Executive Bylaws of Law No. 7 of 2010 and its amendments:

It was proven to the Authority through reviewing the financial statements of Dar Al Thuraya Real Estate Company for the year ending 31/12/2022, the Company did not comply with the implementation of International Accounting Standard No. “IAS40” for “Investment Properties”, as the Company listed a property worth KWD 1,603,000 (one million six hundred and three thousand Kuwaiti Dinars) is included in the item “Investment Properties” that was obtained through real estate financing that was not concluded directly between the Company or its subsidiaries, as real estate financing is concluded between the financing party and a related party (a major shareholder in the parent company), and that the revenues and liabilities of the aforementioned property are received and debited through the bank account of the related party.

Second: Chairman of the Board of Directors, Vice Chairman of the Board of Directors, CEO, Members of the Board of Directors violated (the first five) of the provision of Item (5) of Article (3-7), and (six) of Item (4) of Article (3-10) of Module Fifteen (Corporate Governance) of the Executive Bylaws of Law No. 7 of 2010 and its amendments:

The Company’s Board of Directors and CEO failed to carry out their duties regarding Dar Al Thuraya Real Estate Company’s non-compliance with applying the International Accounting Standard No. “IAS40” for “Investment Properties”, as the company listed a property worth KWD 1,603,000 (one million six hundred and three thousand Kuwaiti Dinars) listed in the item “Investment Properties” was obtained through real estate financing that was not concluded directly between the Company or its subsidiaries, as the real estate financing is concluded between the financing party and a related party (a major shareholder in the parent company), and the revenues and obligations of the aforementioned property are received and debited through the bank account of the relevant party.

The Resolution included the infliction of the following penalty: -

First: Levying a fine on Dar Al Thuraya Real Estate Company in an amount of KWD 10,000 (ten thousand Dinars) for the attributed violation.

Second: Levying a fine on the Chairman of the Board of Directors, Vice Chairman of the Board of Directors, Members of the Board of Directors in an amount of KWD 2000 (two thousand Dinars) each of them for the attributed violation.

Third: Levying a fine on the CEO of Dar Al Thuraya Real Estate Company in an amount of KWD 4000 (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.