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New Amendments to the Listing and D

New Amendments to the Listing and Delisting Rules (Abolished)
The listing and delisting of securities in the Egyptian Stock Exchange is governed primarily by a decision from the Egyptian Financial Supervisory Authority (“EFSA”) – previously the Capital Market Authority – which was issued initially in 2002 and was amended several times since then. This is all within the context of the Capital Market Law No. 95 of 1992, the Central Depository Law No. 93 of 2000 and their respective Executive Regulations. Within this context the president of EFSA issued a new Decision No. 31 of 2012 amending once more the rules governing the listing and delisting of securities by replacing article 33 of the current rules (the “Decision”).[1]
Content of the Decision
According to the new Decision, a listed company in the Stock Market wanting to acquire twenty percent or more of the capital of a company not listed must present a study of the fair price of the securities of the company it wants to acquire, the said study must be made by an independent financial consultant listed in EFSA and attach to it a company auditor’s report and the meeting minutes of the Board of Directors of the company wanting to acquire ratifying the said study. It is worth noting that the Decision is applicable if the percentage of the stocks subject to the acquisition is less than twenty percent but the acquisition results in control of twenty percent or more of the right to vote in the acquired company. The same rule is also applied if the acquiring company is the same listed company or a subsidiary or a sister company.
Conclusion
The new Decision will increase transparency and disclosure to shareholders of the listed companies when their companies acquire a company that is not listed as it enables them to follow up and assess whether the acquisition was according to a fair price or not keeping in consideration that the independent financial consultant’s opinion is not binding.   [1] EFSA’s Decision No. 31/2012 amending the rules governing the listing and delisting of securities, Egyptian Gazette, Issue No. 251, 6 November 2012.
The listing and delisting of securities in the Egyptian Stock Exchange is governed primarily by a decision from the Egyptian Financial Supervisory Authority (“EFSA”) – previously the Capital Market Authority – which was issued initially in 2002 and was amended several times since then. This is all within the context of the Capital Market Law No. 95 of 1992, the Central Depository Law No. 93 of 2000 and their respective Executive Regulations. Within this context the president of EFSA issued a new Decision No. 31 of 2012 amending once more the rules governing the listing and delisting of securities by replacing article 33 of the current rules (the “Decision”).[1]
Content of the Decision
According to the new Decision, a listed company in the Stock Market wanting to acquire twenty percent or more of the capital of a company not listed must present a study of the fair price of the securities of the company it wants to acquire, the said study must be made by an independent financial consultant listed in EFSA and attach to it a company auditor’s report and the meeting minutes of the Board of Directors of the company wanting to acquire ratifying the said study. It is worth noting that the Decision is applicable if the percentage of the stocks subject to the acquisition is less than twenty percent but the acquisition results in control of twenty percent or more of the right to vote in the acquired company. The same rule is also applied if the acquiring company is the same listed company or a subsidiary or a sister company.
Conclusion
The new Decision will increase transparency and disclosure to shareholders of the listed companies when their companies acquire a company that is not listed as it enables them to follow up and assess whether the acquisition was according to a fair price or not keeping in consideration that the independent financial consultant’s opinion is not binding.   [1] EFSA’s Decision No. 31/2012 amending the rules governing the listing and delisting of securities, Egyptian Gazette, Issue No. 251, 6 November 2012.