Financial Regulatory Authority

FINANCIAL REGULATORY AUTHORITY

Chairman of the Authority

Board of Directors Decision No. (168) of 2020 dated 28/10/2020

Amending Board of Directors Decision No. (130) of 2014 regarding the valuation guidelines for management services companies for the net assets of investment funds and specifying the assets and securities requiring an independent specialist and financial advisor for valuation

The Board of Directors of the Financial Regulatory Authority Having reviewed the Capital Market Law issued by Law No. (95) of 1992 and its executive regulations; and the Law No. (10) of 2009 regulating supervision over non-banking financial markets and instruments; and Board of Directors Decision No. (130) of 2014 regarding the valuation guidelines for management services companies for the net assets of investment funds and specifying the assets and securities requiring an independent specialist and financial advisor for valuation; and Board of Directors Decision No. (98) of 2020 regarding the guidelines for investment funds' trading in derivatives; and after approval by the Authority's Board of Directors in its meeting held on 28/10/2020,

Article One

The following texts shall replace the provisions of Articles (One, Two – clause a – 4, Two – clause b) of the aforementioned Board of Directors Decision No. (130) of 2014:

Article One

The management services company for investment funds shall periodically value the unlisted assets and securities in which investment funds invest their funds, at least once every six months, with valuation occurring at least once every three months if the fund is listed on the exchange, while ensuring the appointment of specialized valuation entities, all in accordance with the guidelines set forth in this Decision.

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Article Two – Clause a – 4

• Contributions in companies whose shares are not listed on the exchange and whose real estate assets do not account for less than (80%) of the company's total assets, and the determination of fair value by the independent financial advisor regarding them must be based on a report prepared by one or more real estate valuation experts registered with the Authority, ensuring their independence and objectivity from related parties, in accordance with the real estate valuation standards issued by the Board of Directors of the Authority.

Article Two – Clause b

b- Determining the fair value of real estate assets for real estate investment funds by engaging one or more real estate valuation experts registered with the Authority, ensuring their independence and objectivity from related parties, in accordance with the real estate valuation standards issued by the Board of Directors of the Authority.

Article Two

A new clause (c) shall be added to Article Three of the aforementioned Board of Directors Decision No. (130) of 2014, with the following text: (c) Valuation of forward financial rights portfolios (other derivatives) based on the purchase price plus accrued interest up to the valuation date, calculated according to the yield based on the purchase price.

Article Three

This Decision shall be published in the Egyptian Gazette and on the Authority's website, and shall take effect from the day following its publication in the Egyptian Gazette.

Chairman of the Board of Directors of the Authority Dr. Mohamed Omran

Smart Village, Building No. B-136, Giza, Egypt Postal Code: 12577 Tel.: +202 35345350 - Fax: +202 35370036 info@fra.gov.eg

Smart Village, Building no. B-136, Giza Postal Code: 12577 Tel.: (00202) 35345350 - Fax: (00202) 35370036 www.FRA.gov.eg