Decision No. (32) of 2010

Amending Some Provisions of the Chairman's Decision of the General Authority for the Capital Market No. (41) of 2007 Regarding the Conditions for Registration in the Register of Financial Advisors at the Authority

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Chairman of the General Authority for Financial Supervision

Having reviewed the Law No. 159 of 1981 on Joint Stock Companies, Companies Limited by Shares, and Limited Liability Companies and its Executive Regulations, and the Capital Market Law No. 95 of 1992 and its Executive Regulations, and the Law No. 10 of 2009 Regulating Supervision of Non-Banking Financial Markets and Instruments and its Executive Regulations, and Investment Minister Decision No. (101) of 2007 Adding Securities Financial Consulting Activity to the Activities of Companies Operating in the Securities Sector, and Chairman of the General Authority for the Capital Market Decision No. (41) of 2007 Regarding the Conditions for Registration in the Register of Financial Advisors at the Authority, and the approval of the Authority's Board of Directors in its meeting No. (16) of 2010 dated 1/11/2010,

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Has Decided

(Article One)

The text of the first paragraph of Article One, items (2, 3, 4, 6) of Article Three, items (1, 5) of Article Four, and Article Six of the Chairman's Decision of the General Authority for the Capital Market No. (41) of 2007 are replaced with the following texts:

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Article One (First Paragraph)

The General Authority for Financial Supervision shall establish a registration register for independent financial advisors. Financial advisors refer to entities that provide consulting or studies in valuation fields in connection with capital increases, public or private offerings, acquisitions, mergers, or restructuring.

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Article Three: Items (2, 3, 4, 6)

2. The entity - or those responsible for managing its consulting operations - must have prepared or participated in preparing at least three studies related to financial valuation or fair value determination, whether in cases of capital increase, merger, acquisition, or restructuring, during the three years preceding the registration application.
3. It must have an internal auditor with at least five years of experience in the aforementioned fields, responsible for verifying that shareholders, board members, executive management, auditors, and their affiliated groups do not violate the fundamental standards of professional performance issued by a decision of the Chairman.
4. The Managing Director and the person responsible for actual management must undertake to comply with the fundamental standards of professional performance issued by a decision of the Chairman.
6. It must commit to paying the service fee determined by the Authority's Board of Directors.

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Article Four: Items (1, 5)

1. The curriculum vitae of board members, executive management, auditors, and the internal auditor of the company, according to the prescribed form.
5. A photocopy of the receipt for payment of the service fee.

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Article Six

The competent administration within the Authority shall handle all matters related to receiving registration applications and verifying the registration data of each financial advisor, as well as recording all observations and penalties imposed on each financial advisor. It shall also be obligated to prepare an annual statement for each financial advisor registered in this register, detailing their compliance with the duties stipulated in the Executive Regulations of Law No. 95 of 1992 and this Decision, as well as with the fundamental standards of professional performance issued by a decision of the Chairman. The Authority's Board of Directors may suspend or remove a financial advisor from this register in case of non-compliance with the conditions stipulated in this Decision.

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(Article Two)

Items (6, 7, 8) are added to Article Four of the Chairman's Decision of the General Authority for the Capital Market No. (41) of 2007, and a second paragraph is added to Article Five of this Decision, as follows:

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Article Four: Items (6, 7, 8)

6. Any declarations requested by the Authority, signed by both the Chairman of the Board and the Managing Director.
7. A certified true copy, stamped with the company seal, of three previous studies conducted by the company - or those responsible for managing its consulting operations - prior to the registration application, specifically regarding fair value determination, along with a certified copy of the engagement letters for preparing these studies.
8. A copy, signed by both the Chairman of the Board and the Managing Director and stamped with the company seal, of the work manuals demonstrating compliance with the fundamental standards of professional performance.

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Article Five (Second Paragraph)

Companies operating in the securities sector, licensed by the Authority for the independent financial advisor activity and registered in the aforementioned register, must restrict themselves to conducting only licensed activities without engaging in any others. They must provide the Authority with any data it requests and respond to inquiries and observations regarding this matter within the timeframe specified.

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(Article Three)

The last paragraph of Article Two and Article Seven of the Chairman's Decision of the General Authority for the Capital Market No. (41) of 2007 are repealed, along with any provision that conflicts with the provisions of this Decision.

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(Article Four)

This Decision shall be published on the Authority's website and shall take effect from the date of its publication.

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Dr. Ziad Bahaa El-Din
Chairman of the Authority

46076

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General Authority for Financial Supervision Egyptian Financial Supervisory Authority (EFSA)

Address:
Headquarters: Smart Village, Building 15 - 84 B Km 28, Cairo/Alexandria Desert Road 6th of October Governorate, Postal Code: 12577

Contact:
Phone: 02-225370040 - Fax: 02-225370041
Email: info@efsa.gov.eg
Website: www.efsa.gov.eg