CmaBoardReleases
Title: The Capital Markets Authority (CMA) Issues a Resolution Aimed at Protecting Dealers in Companies that have Material Notes in the Financial Statements
Kuwait, February 14, 2021 - As part of the CMA's endeavor to adopt and apply international best practice to develop capital markets in the State of Kuwait, and to promote principles of fairness, competitiveness and transparency that lead to achieving greater protection for dealers in accordance with the provisions of Law No. 7 of 2010 and its Executive Bylaws. Additionally, it aims at protecting dealers in companies listed in Boursa Kuwait Securities Company from companies whose financial statements are issued with material doubts about their soundness and accuracy, as well as motivating the company's management and the board of directors to address aspects related to its financial statements through continuous and detailed disclosure to the dealers.
The CMA has issued on Sunday February 14, 2021 Resolution No. (15) of 2021 regarding amending some provisions of the Executive Bylaws of Law No. 7 of 2010 Regarding the Establishment of the Capital Markets Authority and Regulating Securities Activities and their amendments. The Resolution amended: Module Ten (Disclosure and Transparency) and Module Twelve (Listing Rules) of the Executive Bylaws. Among the most prominent objectives that the CMA seeks to achieve through this amendment, are the following:
- Protecting investors from dealing with companies that have material notes in the announced financial statements.
- Raise the quality of financial data and enhance reliance on them.
- Raise the degree of response and cooperation of companies in providing data and documents that enable account auditors to perform the tasks assigned to them.
- Enhance the level of disclosure and transparency in announcing additional information in an updated and detailed manner, in the event that there are comments made by the auditor.
This Resolution includes some important amendments related to the suspension of trading on the shares of companies when the auditor provides an Adverse Opinion or Disclaimer of Opinion on their financial statements. Additionally, the company shall commit to providing detailed disclosure on these matters and announce the steps to resolve them, provided that the company resumes trading as soon as it has resolved these matters, or if the CMA decides to resume trading the shares, as the case may be. The Resolution also includes other amendments to develop some aspects related to the submission of financial statements.
We would like to point out that the listed companies and Boursa Kuwait Securities Company shall comply with the implementation of the new provisions related to the financial statements contained in the Resolution as of June 30, 2021.
In conclusion, the CMA is working continuously to improve and develop the provisions of the Executive Bylaws with regard to listed companies, guided by the best international rules and standards, which aim to provide protection for dealers in the market.
Ends-
Notes to Editors:
The Capital Markets Authority was established pursuant to Law No. 7/2010, approved by the Kuwaiti Parliament in February 2010. Pursuant to the Law, the CMA shall regulate and supervise the securities activities, achieve transparency and fairness, observe listed companies’ execution of Corporate Governance regulations, and protect investors from unfair practices which violate the CMA's Law.
Furthermore, the Law's provisions stipulate the supervision of mergers, acquisitions, and disclosure operations. The CMA also aims to provide awareness programs related to securities activities.
For further information, please contact:
Public Relations & Media Office
Tel: 22903062
Fax: 22903505
Email: pr-media@cma.gov.kw