Regulatory Alerts2021-01-01
Board of Directors Decision No. 61 of 2021
The General Authority for Financial Supervision issued Board Decision No. 61 of 2021 to amend Decision No. 67 of 2014 by establishing maximum limits for securities margin purchases at 30% or 15% of freely circulating and total shares, respectively, whichever is higher. The decision further caps margin purchases for a single client and its affiliated group at 5% or 3% of those share bases, obligating brokerage firms and custodians to halt margin purchases once these thresholds are reached. Additionally, it mandates the Central Deposit and Registration Company to implement necessary automated systems, periodically disclose margin purchase ratios per company, and automatically suspend trading capabilities upon threshold attainment, with the amended rules taking effect on January 1, 2022.