Chairman of the Board

February 2, 2014

Circular Letter No. (2) of 2014

Regarding Regulating Controls and Procedures for Obtaining the Authority's Approval for Transactions by Directors, Employees, and Their Relatives with Companies Operating in the Securities Market

In pursuit of reinforcing the capital market work system and aiming to unify the controls and procedures for obtaining the Authority's approval for transactions by directors, employees, and their relatives with securities brokerage companies, bond brokerage and dealing companies, and securities portfolio formation and management companies, and in compliance with the provisions of Articles 236, 237, and 238 of the Executive Regulations of Capital Market Law No. 95 of 1992,

the persons addressed by this Circular in securities brokerage companies, bond brokerage and dealing companies, and securities portfolio formation and management companies (hereinafter referred to as the "Company"), namely: the Chairman of the Board, executive board members, board members assigned duties within the Company, managers, employees, and their relatives up to the second degree, or those bound by a commercial partnership relationship, or those they support, shall comply with the following:

First: General Obligations

Without prejudice to the provisions, rules, and decisions issued regarding insider trading and related groups of listed companies, the "Addressed Persons" and the "Company" when dealing on behalf of or for the account of any of them shall comply with the following:

1. Trading is prohibited for any of them in securities for which the Company possesses undisclosed information or data not required by other market participants, regardless of the nature and importance of such information or data.

2. Trading is prohibited for any of them in shares of companies with which they are related in ownership or management, or which are under the actual control of the same related persons, except after notifying the Authority in writing.

3. Addressed persons wishing to trade securities through another company must notify that other company of the nature of their work or affiliation with the Company they belong to.

Second: Regarding Securities Brokerage Companies and Bond Dealing and Brokerage Companies

1. The Company is obligated to obtain the Authority's prior approval for the transactions of the Addressed Persons within the Company for a period of six months, in accordance with what is stated in Item Four. Addressed persons are prohibited from trading securities except through a brokerage company designated by the Managing Member.

2. The Company must ensure that its dealings on behalf of the Addressed Persons are conducted through their personal accounts at the same Company, and the Company's Internal Auditor must establish internal control measures that ensure verification of compliance with all rules and procedures governing and organizing the transactions of these persons.

3. Addressed persons wishing to trade securities must submit a request to the Company's Internal Auditor, accompanied by a declaration that the trading will be from their own funds. The Internal Auditor shall review the submitted requests, verify the absence of any legal impediments to trading, and prepare a consolidated statement for presentation to the Managing Member for approval.

4. The consolidated statement shall be referred to the Company's Board of Directors for approval.

5. The Company is obligated to maintain a special register for the accounts of the Addressed Persons, indicating approvals issued by the Authority in accordance with Board of Directors approvals and the operations executed based on them.

6. This register shall be reviewed monthly by the Internal Auditor, who shall sign it to attest to the review. The Company shall provide the Authority with a periodic report at the end of the Authority's approval period, detailing any observations or errors regarding these transactions discovered, and outlining measures taken to prevent their recurrence in the future after presenting it to the Company's Board of Directors. The Authority shall be notified of the Board's conclusion within one week of its meeting.

Third: Regarding Securities Portfolio Formation and Management Companies

1. The Company is obligated to obtain the Authority's prior approval for the transactions of the Addressed Persons within the Company for a period of six months, in accordance with what is stated in Item Four. Addressed persons are prohibited from trading securities except through a brokerage company designated by the Managing Member.

2. Addressed persons wishing to trade securities must submit a request to the Company's Internal Auditor to notify them of their intention during the approval period, accompanied by a declaration that the trading will be from their own funds. The Internal Auditor shall review the submitted requests, verify the absence of any legal impediments to trading, and prepare a consolidated statement for presentation to the Managing Member for approval.

Fourth: Conditions for the Authority's Approval for Transactions by Addressed Persons of the Company

1. The Company shall submit to the Authority the following:

   • The minutes of the Company's Board of Directors meeting containing: a decision approving the transactions of all Addressed Persons in the Company at the time of the decision's issuance, in accordance with this Circular, without the need to include those names in the Board meeting minutes, and authorizing the Managing Member to submit a list
   • of the names of these Addressed Persons to the Authority. In case the Board decides to specify certain individuals authorized to trade, those names shall be included in a file attached to the Board meeting minutes.
   • A consolidated statement of the names of the Addressed Persons according to the aforementioned period, specifying names, titles, and the unified code, stamped with the Company's seal and signed by the Managing Member and the Internal Auditor.
   • A copy of the latest approval issued by the Authority on this matter and the latest update of the Company's commercial register.
   • The Company is obligated to notify the Authority of any changes, deletions, or additions to Item 1 above within a maximum of one week.
   • The Company is obligated to submit a renewal request for approval to the Authority in case of continued desire to trade no later than ten days before its expiration. In case the request is submitted after the previous approval period has expired, the Company is obligated to suspend trading for any of the participating persons during the period allocated for request review and until the Authority's approval is issued.
   • Addressed persons falling under this Circular for more than one of the companies covered by this Circular are obligated to obtain the Authority's approval to trade through only one of them.

Fifth: The Company is prohibited from trading securities on behalf of or for the account of Addressed Persons of another company operating in the same activity fields covered by this Circular, except after verifying that these persons comply with the conditions stated therein.

Sixth: The Authority shall issue its decision within five working days from the date of submitting the complete request. The approval shall be valid for six months from the date of its issuance. The concerned party may appeal the Authority's decision by submitting their request to the Regulations Committee stipulated in Chapter Five of Capital Market Law No. 95 of 1992.

Seventh: This Circular shall take effect from the day following its publication. Circular Letters Nos. 3 and 3 (duplicate) of 1998, and 37 and 47 of 2004 and 2009 are hereby repealed.

Chairman of the Authority

Sherif Samy

Ahmed Circular 2

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Egyptian Financial Supervisory Authority (EFSA) Smart Village, Building 15 - 84 B Km 28, Cairo/Alexandria Desert Road Giza Governorate, Postal Code: 12577

Telephone: +20 2 3537 0040
Fax: +20 2 3534 5222
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