As FRA is keen to develop the capital market, attract more investments and protect investors in a manner that maintains market’s efficiency and contribute to the growth of the Egyptian national economy, Judge Khaled El-Nashar – FRA’s Deputy Chairman reveals that FRA holds number of discussions and meetings with the market parties. He adds that FRA presents and receives proposals related to reducing fees on the Egyptian Exchange’s (EGX) transactions in order to encourage investment and create a competitive investment environment between global and regional financial markets.
El-Nashar emphasized that Capital Market’s Advisory Committee discussed – on FRA’s recommendation – during its meeting last week alternatives to reduce transactions costs borne by the investor.
FRA’s Deputy Chairman added that the committee recommended a reduction of services charges on trading operations charged by all market institutions. The recommendation included reducing services charges on trading operations by 20% to be 5 per 100,000 instead of 6.25 per 100,000 and a 20% reduction in clearing and settlement operations to be 10 per 100,000 instead of 12.5 per 100,000 and also by a 17% reduction to the stock market to be 10 per 100,000 instead of 12 per 100,000. In addition, the Committee also recommended reducing the fees of investor protection fund by 50% to be 5 per 100,000 instead of 1 per ten thousand. Also, reducing services charges on trading in listed bonds by 50%.
In this respect, FRA will study the committee’s recommendation and discuss it with market parties in preparation for taking appropriate action in this regard.
In this context, Ministerial Decree No. 2339 of 2019 was issued on 1 October 2019 approving FRA’s BOD proposal to amend the statute of Investor Protection Fund. The proposal reduced the amount charged by the Fund on transaction’s value to 1 per ten thousand instead of 2 per ten thousand, a reduction of up to 50% of what was previously paid.
The Ministerial Decree also extended the coverage of Fund’s compensations to non-commercial risks arising from listed companies and companies operating in the field of securities.