Ministry of Investment

The Minister

Decision

Minister of Investment No. (129) for the year 2009

Regarding

Amendment of certain provisions of Chapter Ten of the Executive Regulations of the Capital Market Law No. 95 of 1992, added by Minister of Investment Decision No. 46 of 2004

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Minister of Investment, Having reviewed the Capital Market Law issued by Law No. 95 of 1992, and its Executive Regulations and amendments, and the Central Depository and Registration of Securities Law issued by Law No. 93 of 2000, and its Executive Regulations and amendments, and Minister of Investment Decision No. 46 of 2004, and based on what was presented by the Board of Directors of the Capital Market Authority.

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Decided

(Article One)

The provisions of Articles Nos. 301, 302, 303, 304, 306, 310, 315 of Chapter Ten of the Executive Regulations of the Capital Market Law, added by Minister of Investment Decision No. 46 of 2004, are replaced with the following:

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Article No. (301)

The license for a securitization company to conduct its business activities is subject to a fee payable to the Authority amounting to ten thousand pounds, and the license application must be submitted accompanied by, in addition to the documents specified in Article No. 135 of these Regulations, the following:

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(a)

A certificate from the company's external auditor confirming the availability of the accounting system and the documentary circulation system necessary for managing the securitization process, in accordance with the controls issued by a decision of the Authority's Board of Directors.

(b)

Evidence confirming the availability of the necessary expertise and competence to manage the securitization process among the directors and employees in key positions at the securitization company, as determined by a decision of the Authority's Board of Directors.

(c)

Evidence confirming the existence of an undertaking from the owner of a portfolio of financial rights to assign those rights to the securitization company, and such undertaking must be valid for at least six months. The undertaking agreement may include a statement that the assignment shall become effective and final upon the full subscription of the bonds. The underwriting and marketing of securitization bonds shall be conducted in agreement with one of the companies licensed to do so.

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Article No. (302)

Ownership of any percentage of the shares of the securitization company may be held by a custodian, or by a person chosen by it, or by a party related to it by agreement, or by an affiliated group, provided that this is disclosed to the Authority when submitting the application to establish the securitization company. The securitization company is prohibited from concluding an assignment agreement for a securitization portfolio with an originator whose contribution, whether individually or with an affiliated group, exceeds (20%) of its capital. The Authority's Board of Directors may exempt the securitization company from this restriction due to circumstances and reasons it deems appropriate. The affiliated group refers to persons who are subject to the actual control of the same natural persons, or the same legal entities, or those who are bound by an agreement relating to participation in the securitization company.

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Article No. (303)

The notification for the issuance of securitization bonds shall be submitted accompanied by the following:

1. The public subscription prospectus or information memorandum.
2. The agreements concluded between the securitization company and the custodian.
3. Additional guarantee agreements, if any.
4. The preliminary assignment agreement concluded between the securitization company and the originator.
5. An agreement guaranteeing the subscription of the bonds, unless the notification and prospectus include it.
6. Evidence that the assignment shall not become effective and final until the subscription is fully covered.
7. The agreement concluded between the securitization company and the entity responsible for collecting the local rights.
8. A certificate from the external auditor regarding the net value of the portfolio and its valuation basis.
9. The expected cash flows of the securitization portfolio and the basis of their preparation, endorsed by the securitization company along with a report from its external auditor.
10. Other documents and data issued by a decision of the Authority's Board of Directors.

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Article No. (304)

The subscription prospectus for securitization bonds or the information memorandum must include, in addition to the data prescribed in these Regulations regarding the issuance of bonds, the following:

1. A statement of the name, address, license number, and paid-up capital amount for the securitization company, the underwriting and marketing company for securities (if agreed upon), and the custodian responsible for operational requirements related to bondholders' rights.
2. A summary of the assignment agreement, which must include at least a statement of the value of the securitization portfolio and the rights it contains in detail, including commercial papers and other documents evidencing these rights, the associated guarantees, their diversification in terms of value, maturity dates, geographic distribution, default rates corresponding to those rights, the average maturity of the portfolio, and its valuation basis.
3. The volume of bonds issued corresponding to the portfolio, their yield rate, maturity date, and other issuance terms.
4. The credit rating of the bonds, which must not be lower than the level indicating the ability to meet obligations, in accordance with the rules specified by the Authority's Board of Directors.

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(5)

The risks that bondholders may bear and the measures taken or guarantees obtained to mitigate them.

(6)

Identification of the entity responsible for underwriting or guaranteeing the securitization bonds, if any.

(7)

Identification of the entity responsible for collecting the amounts due for the local rights, and specifying the duties and obligations incumbent upon that entity according to the agreement concluded between it and the securitization company.

(8)

A statement indicating whether there is any type of affiliation between the parties to the securitization process and the elements of such affiliation, if any.

(9)

Specification of the payment dates for bondholders' dues, commissions, and expenses deducted from the proceeds of the local rights, the dates of their deduction, and the rules for disposing of the surplus of the securitization portfolio.

(10)

A declaration from the legal advisor for the securitization process confirming that the securitization portfolio belongs to the originator at the time of the assignment agreement, and that there are no lawsuits or disputes affecting the originator's ownership of the portfolio and their right to dispose of it, as well as a declaration that the assignment agreement has been prepared in accordance with the provisions of the Law and these Regulations, and that the assignment under it is effective, final, and unconditional, covering all local rights and guarantees, unless it is stipulated that it will be implemented upon full subscription of the bonds. The aforementioned data must be endorsed by the Chairman of the Board or Managing Director of the securitization company, the local company, the marketing and underwriting company, as well as by the external auditor of the securitization company and the local company, and the legal advisor for the securitization process, as applicable.

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Article No. (306)

The securitization company is prohibited from issuing any bonds or financing instruments other than the securitization bonds stipulated in this Chapter, except with the approval of the Authority's Board of Directors. The nominal value of the securitization bonds shall not exceed the present value of the portfolio and its yield, calculated based on a discount rate equal to the yield rate of the securitization bonds.

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Article No. (310)

The custodian shall not use the proceeds from the rights arising from the securitization portfolio for anything other than paying the dues of securitization bondholders, after deducting commissions, expenses, and related earnings, and not exceeding what has been specified in the subscription prospectus or issuance terms, as applicable. The custodian must notify the originator, the guaranteeing entities for payment (if any), and the bondholders immediately upon the occurrence of any event that may hinder or delay the payment of their dues on the scheduled dates. The custodian, after obtaining the securitization company's approval, may invest surplus deposited amounts in Treasury bills or deposits with banks registered with the Central Bank of Egypt, and may entrust this to one of the securities portfolio management companies if the subscription prospectus for securitization bonds permits it. The custodian must exercise the care of a prudent person in performing its duties related to the rights of securitization bondholders. The termination of the agreement concluded between the securitization company and the custodian, or the amendment of its terms, shall not become effective and produce its legal effects until the Authority's approval is obtained.

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Article No. (315)

The provisions of Articles (304), (305), (306), (307), (309), and (310) of these Regulations shall apply to the companies referred to in Article (314) regarding the securitization of portfolios of rights and receivables, and shall also apply to the custodian and the duties and obligations of custodians in this Chapter.

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(Article Two)

This Decision shall be published in the Egyptian Gazette and shall take effect from the day following its publication date.

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Ministry of Investment Date: 19 Rabi' al-Awwal 1427 AH 17 April 2006 AD

Deputy Minister (Sayed Solouk)

Copy sent to Mr.

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