Egyptian Financial Supervisory Authority

Chairman of the Board of Directors

Resolution of the Board of Directors of the Authority No. (95) of 2017

Dated 2017/7/25

Regarding the Measures Taken by the Authority in Case of Violation by Central Securities Depository and Registration Companies and the Rules for Applying These Measures

The Board of Directors of the Egyptian Financial Supervisory Authority

Having reviewed the Constitution;
And the Capital Market Law issued by Law No. (95) of 1992 and the decisions issued to implement it;
And the Central Securities Depository and Registration Law issued by Law No. (93) of 2000 and its Executive Regulations and the decisions issued to implement it;
And Law No. (10) of 2009 regulating supervision over markets and non-banking financial instruments;
And Presidential Decree No. (191) of 2009 regarding the provisions governing the management of the Egyptian Exchange;
And its Financial Bylaws;
And the Statute of the Egyptian Financial Supervisory Authority issued by Presidential Decree No. (192) of 2009;
And the Memorandum of the General Administration of Legislation and Regulatory and Supervisory Directives dated 2017/7/19;
And the approval of the Board of Directors of the Authority in its session No. (8) held on 2017/7/25;

Resolved:

(Article One)

The Authority shall, in the event that a company licensed for the Central Securities Depository and Registration activity violates the provisions of Law No. (93) of 2000 or the decisions issued to implement it, or if it engages in acts that threaten market stability or the interests of its counterparties, have the right to take one or more of the following measures:

1. Issuing a warning to the company to rectify the violation within the period and under the conditions specified in the warning.
2. Requiring the Chairman of the Company's Board of Directors to convene the Board of Directors to consider the alleged violations against the company and take necessary action to rectify them, and prohibiting the meeting in this case for a period or periods determined by the Authority.
3. Removing one or more members of the Executive Board of Directors or other executives of the company, and requiring the company's General Assembly to convene to elect new Board of Directors members to replace those removed.
4. Compelling the company to deposit a guarantee with the Authority or increase it for the period determined by the Authority.

In cases where the violation relates to financial distress within the company that may render it unable to meet its obligations or perform its duties, the Authority may, in addition to the aforementioned, take one of the following additional measures:

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(Article Two)

The application of the measures referred to in the preceding Article to companies licensed for the Central Securities Depository and Registration activity shall be in accordance with the following rules:

1. A reasoned decision shall be issued by the Board of Directors of the Authority regarding the measures referred to in the preceding Article, based on a study by the competent technical administration of the Authority.
2. The company shall be notified of the decision issued regarding the application of the measure, and the Authority may also publish the decision through the means it deems appropriate.
3. In case the company fails to comply with the measures issued by the Authority in the specified manner and period, the matter shall be referred again to the Board of Directors of the Authority to take such other measures regarding the company or its management as it deems appropriate.

(Article Three)

This Resolution shall be published in the Egyptian Gazette and on the websites of the Authority and the Central Securities Depository and Registration Company, and shall take effect from the day following its publication in the Egyptian Gazette.

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Chairman of the Board of Directors
Sherif Samy

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