• Dr. Omran: FRA’s Board of Directors issues a decision on listing and delisting rules of entities licensed to perform financial valuation and prepare fair value studies
• Dr. Omran: Granting a period of six months to adjust positions and meet listing requirements
• Dr. Omran: Compliance with the Egyptian Financial valuation Standards is a condition for continuing listing at financial valuation registry and fair value studies
Within the framework of introducing new amendments to Capital Market Law promulgated by Law no. (17) of 2018, Dr. Mohammed Omran – FRA’s Chairman issued decision no. (114) dated 16/7/2018 after gaining the approval of FRA’s Board at its last session to establish a registry to list entities licensed to perform financial valuation and prepare fair vale studies in accordance with some listing and delisting rules.
Dr. Mohammed Omran – FRA’s Chairman said that the Board’s decision was issued with the aim of protecting investors and translating the Authority’s keenness to achieve the disclosure element and in an integrated manner for the securities fair value in all cases required by the capital market law , its Executive Regulations and issued decisions, that is in cases of issuance of new shares , tender offers and acquisition, and in other cases required by listing and delisting rules in the Stock Exchange.
On the other hand, Dr. Omran said that in light of the Authority’s keenness to protect the rights of dealers and raise their awareness of the new regulatory procedures, FRA is organizing today the first series of panel discussions on the duties and functions of independent financial advisors in accordance with the provisions of the Capital Market Law and FRA’s decisions.
FRA’s Chairman added that the workshop’s activities stressed that FRA’s Board decision stated that fair value studies should not be carried out except through listed entities that meet listing requirements, foremost of which are the fulfillment of the terms of expertise and professional competence that must be met by the certified financial appraiser who signs the report and determine the fair value in addition to those who participate in preparing the study, who must not be less than three individuals. The most important conditions of experience and efficiency included in the Board’s decision is to obtain a professional certificate in areas related to financing or investment , besides passing FRA’s tests in topics related to the financial valuation, as well as participating in the preparation of three studies before applying for listing at the said registry.
Also, Dr. Omran noted that the Board’s decision set conditions for continuing listing of the companies and entities referred to. The most important of these is the compliance with the Egyptian Financial valuation Standards issued by Board’s decision no. (1) of 2017 , also it is not allowed to perform financial valuation for two or more parties at the same time and stop dealing on securities that the valuation entity included in the study during the next three years of the valuation date.
Dr. Omran revealed that the Board’s decision set a period of three years for being listed at the registry, which may be renewed for other similar periods provided that the listing rules shall be met. In addition, the decision allowed FRA’s Board of Directors to take a number of penalties and administrative measures if the financial valuation standards were violated and accordingly this may lead to delisting or cancelling the granted license besides a period of six months shall be granted to adjust the positions and meet listing requirements .