Title: Amendment to Some Provisions of the Executive Bylaws of Law No. 7 of 2010 and their Amendments for the Purpose of Regulating Trading of Pre-emptive Rights

Kuwait, April 21, 2021 - The Capital Markets Authority issued on Wednesday April 21, 2021 its Resolution No. (52) of 2021 regarding amending some provisions of the Executive Bylaws of Law No. 7 of 2010 and their amendments for the Purpose of regulating Trading of Pre-emptive Rights. This decision amended Module One (Glossary), Module Eleven (Dealing in Securities) and Module Twelve (Listing Rules) of the Executive Bylaws of Law No. 7 of 2010 and their amendments. The CMA also approved the necessary amendments to the rules of Kuwait Clearing Company and Boursa Kuwait Securities Company to complete the legal and practical framework for the entry of Trading of Pre-emptive Rights into force.

As it is known, Pre-emptive Rights are an acquired right of shareholders of companies that give their bearer the right to subscribe to the shares offered when increasing the capital of listed companies. Therefore, this decision will allow the inclusion of Pre-emptive Rights in the Exchange temporarily during the subscription period only, which will allow the shareholders of the company to sell these rights in the Exchange, which in turn will transfer the right of subscription to the buyer.

These amendments come as an endeavor by the CMA to diversify the means of disposal of Pre-emptive Rights. In the event that Pre-emptive Rights are offered, the shareholder to whom those rights are assigned have the right to dispose of them by one or both of the following means:
a. Trading all or part of the Pre-emptive Rights pursuant to the Exchange’s rules.
b. Waiving the Pre-emptive Rights to another shareholder or others without return, pursuant to the rules of the Exchange and the Clearing Agency.

The offering of this investment tool is the result of a joint effort by the Capital Markets Authority, Boursa Kuwait Securities Company and the Kuwait Clearing Company. It also comes as a continuation of the efforts exerted in developing the capital market system by introducing securities on the Exchange. The CMA also affirms that these efforts will continue and intensify in order to diversify the investment tools in the Exchange and develop the capital market in the State of Kuwait.

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