Financial Regulatory Authority

FINANCIAL REGULATORY AUTHORITY

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Decision of the Board of Directors of the Financial Regulatory Authority

No. (80) for the Year 2018, dated 28/05/2018

Regarding the Regulation of Venture Capital Companies Financing Leasing Contracts for Targeted Companies

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Board of Directors of the Financial Regulatory Authority

Having reviewed the Capital Market Law issued by Law No. 95 of 1997 and its Executive Regulations; and the Financial Leasing Law issued by Law No. (95) of 1995 and its Executive Regulations; and Law No. (10) of 2009 regarding the regulation of supervision over non-banking financial markets and instruments; and the Statute of the Financial Regulatory Authority issued by Presidential Decree No. 192 of 2009; and the Board of Directors Decision No. 45 of 2011 regarding the criteria for calculating the maximum ratio of liabilities to equity for financial leasing companies; and the memorandum prepared by the competent department at the Authority dated 20/05/2018; and the approval of the Authority's Board of Directors in its meeting held on 28/05/2018;

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Has Decided

(Article One)

Venture capital companies, within the scope of their activities, may finance certain financial leasing contracts concluded by financial leasing companies, through a sub-leasing agreement concluded by the company with the financial leasing company and the lessee (the targeted companies and projects seeking financing from the venture capital company). Pursuant to this agreement, the venture capital company shall finance the financial leasing company, with the financial leasing company's role limited to collecting lease installments from the lessee and acting as a collateral agent on behalf of the venture capital company, and the lessee shall be obligated to make payments directly to the venture capital company without recourse to the financial leasing company.

(Article Two)

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.

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Chairman of the Board of Directors of the Authority

Dr. Mohamed Omran

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Financial Regulatory Authority
Office of the Chairman

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

Smart Village, Building 136, B, Giza, Egypt Postal Code: 12577 Tel.: +202 35345350 - Fax.: +202 35370036 info@fra.gov.eg