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FRA puts the first list of independent international environmental auditors – Sunday 1/9/2019

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• Dr. Omran: The initial list of independent environmental auditors includes eleven international organizations to prepare environmental audit reports
• Dr. Omran: Four basic criteria were used upon selecting the initial list of independent environmental auditors

Dr. Mohammed Omran – FRA’s Chairman revealed that FRA’s BOD approved the initial list of independent international environmental auditors, in which parties wishing to issue green bonds can choose from to activate the issuance of green bonds within the Egyptian economy.

This step comes within the framework of activating Article 35 bis of the Executive Regulation of the Capital Market Law. The said article stipulates the preparation of study reports to evaluate and test environmentally friendly projects (green projects). That is besides, ensuring the compatibility of projects financed by the proceeds of green bonds with the requirements of clean environment. In addition, the article stated that periodic reports shall be prepared in coordination with the Ministry of Environmental Affairs.

Dr. Omran emphasized that upon preparing the initial list of international environmental auditors, FRA relied on four core criteria, including international reputation, credibility, past global experience, Green Bond Initiative standards. In addition to certificates awarded by the Climate Bonds Initiative (CII) to be eligible to act as external auditors and other certificates by higher-rated institutions according to the Climate Bonds Initiative’s report. It is worth mentioning that the list included 11 international organizations.

FRA’s Chairman also explained that the legal framework for issuing bonds complies with the provisions of the Capital Market Law No. 95 of 1992 and its Executive Regulations. He added that the most important of which are Articles no.  (4) and (12) of the Law, which obliges those dealing in the market to comply with the controls issued by FRA’s BOD upon issuing any securities or financial instruments in a public offering or private placement according to the type of security. It also stipulated that no legal person, Egyptian or non-Egyptian, of any nature may issue securities or financial instruments in a public subscription except on the basis of a prospectus approved by the Authority, pursuant to the forms prepared by it and in accordance with the terms and procedures defined by the Executive Regulations.

It is worth mentioning that green bonds are one of the financing instruments available to governments and companies that use their proceeds in environmentally friendly projects. Green bonds based on respecting environmental standards and aiming at using clean energies and mitigating factors that contribute to global warming.  In addition, green projects targeted by green bonds include new and renewable energy projects, climate change adaptation projects, energy efficiency projects, pollution prevention project, green building projects and clean transport projects such as electric transportation.

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Regulator Information

Abbreviation: FRA
Jurisdiction: Egypt

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