Securities Market Conduct Regulation

2016 10, November :Publication of Date 2021 19, May 1.4 Version

2021 19, May 1.4 Version 2016 10, November :Publication of Date 1 تاريخ النشر: تشرين الثاني ،10 2016 اصدار 1.4 ايار 19 2021, Contents of Table Introduction – A Part Purpose – 4001 Trading Insider of Prohibition – B Part information public-non inside of Definition – 4101 security of Definition – 4102 information inside on trading on Prohibition – 4103 information inside disclosing on Prohibition – 4104 Exceptions – 4105 insiders and issuers by Filings – 4106 issuers of periods Blackout – 4107 Manipulation Price of Prohibition – C Part deceptive or manipulative certain of Definition – 4201 practices or acts or acts deceptive or manipulative of Prohibition – 4202 practices Statements Misleading and False – D Part statements untrue on Prohibition – 4301 Approved of Conduct Market – E Part Institutions by trading insider and manipulation Market – 4401 clients priority Client – 4402 execution Timely – 4403 execution Best – 4404 transactions and orders of Records – 4405 allocation Timely – 4406 Churning – 4407 orders of Allocation – 4408 orders client of ahead Trading – 4409 research of ahead Trading – 4410 recommendation a to contrary Trading – 4411 1 transactions on period settlement The – 4412 Enforcement – F Part Authority the by Enforcement – 4501 َ َ َ َ َ َ ّ ّ ذي يضر بمصلحة العميل )Churning) 1 20/06/2018 dated 39 announcement by added was Article This 1 1 أضيفت هذه المادة بموجب اإلعالم رقم 39 تاريخ .2018/6/20

Regulation Conduct Market – 4000 Series 2 مجموعة 4000 – ّ نظام السلوكيات في األسواق المالية 4000 SERIES REGULATION CONDUCT MARKET Markets Capital In Introduction – A Part Purpose – 4001 :to is Regulation this of purpose The –1 ,markets securities the in conduct Regulate .i trading insider on prohibitions the of details out Set .ii ,manipulation market and in obligations’ institutions approved of details out Set .iii .market the in transactions out carrying conduct and ,in trading to applies Regulation This– 2 .securities traded ,in dealing to related Trading Insider of Prohibition – B Part information public-non inside of Definition – 4101 public-non inside “,Regulation this of purposes For– 1 :that information means” information or one to or securities traded more or one to relates .i ,security traded a of issuers more ,public made been not has .ii and ,nature accurate and precise a of is .iii .information material is .iv precise a of and material be to deemed is Information– 2 :if nature accurate and be reasonably may or ,exist that facts concerns it .i has that event an or ,existence into come to expected and ,occur to expected be reasonably may or ,occurred the on effect significant a have to likely be would it .ii related any of or securities traded more or one of price or ,public made was information the if ,security in investor an to relevant considered be would it .iii .security traded a sell or buy to decision a making not is but ,includes information public-non Inside– 3 relating information of types following the ,to limited :securities its or issuer an to ,losses or profits .i ,ventures joint or ,bids over-take ,acquisitions ,mergers .ii ,assets significant of value the in changes .iii ,discoveries or ,processes ,products innovative .iv or ,trademarks registered ,patents ,licenses new .v ,patent ,license a of rejections or approvals regulatory authority ,entity any by issued product or trademark ,body or .,g.e (suppliers or customers regarding developments .vi ,(contract a of loss or acquisition the َ َ َ َ

Regulation Conduct Market – 4000 Series 3 مجموعة 4000 – ّ نظام السلوكيات في األسواق المالية ,management senior or body governing the in changes .vii qualified a or notification s’auditor an in change a .viii ,opinion ,securities s’issuer the to relating changes or events .ix ,securities debt or interest of payment-non including ,dividends in changes ,splits stock ,plans repurchase or public ,holders security of rights the to changes in changes and ,securities additional of sales private ,credit ,bankruptcy or receivership .x ,disputes legal significant .xi issuer the of security a in trade large a for order an.xii .executed is it before security of Definition – 4102 or security a ,only Part this of purposes the For– 1 financial following the of any means securities :instruments stock joint a by issued units or securities debt ,shares .i ,scheme investment collective a or company ,income whose instruments other or certificates any .ii or security another to linked are interest or dividends ,securities other indicator or ,derivative ,product structured any .iii or ,securities other or security another to related and ,securitization of type any from resulting other or certificates ,product structured any .iv ,buy to right the holders the give that instruments .(i (clause in listed security a underwrite or sell information inside on trading on Prohibition – 4103 directly ,trade a making from prohibited is insider An– 1 security related a or security traded a in ,indirectly or public-non inside of possession in while ,it to .security traded that to relating information public-non inside using from prohibited is insider An– 2 or ,dispose ,acquire to attempt ,acquire to information traded a of ,indirectly or directly ,dispose to attempt .to relates information such that security to subject is) insider an than other (person Any– 3 the if) 2 (and) 1 (articles sub in prohibitions the the that ,know should reasonably or ,knows person .information public-non inside is information trade a make to deemed is person a ,Regulation this In– 4 :(to limited not but (if security a in directly or ,interest an has he which in account an for trade a executes he .i .security the for offer or bid a makes he .ii trade a make to deemed is person a ,Regulation this In– 5 :(to limited not but (if security a in indirectly ,person another for trade a arranges he .i or ,person another of behalf on trade a executes he .ii person other any or agent an directs or for arranges he .iii .trade a execute to َ َ َ َ َ

Regulation Conduct Market – 4000 Series 4 مجموعة 4000 – ّ نظام السلوكيات في األسواق المالية information inside disclosing on Prohibition – 4104 public-non inside of possession in is who insider An– 1 :not must information in except ,person another to information that disclose .i or ,business of course necessary the to relation in person another to advice give or counsel .ii that security related a or security traded a in trade a acquiring to relation in or ,concerns information the .securities such in rights any of disposing or the to subject is) insider an than other (person Any– 2 ,knows person the if) 1 (article sub in prohibitions is information the that ,know should reasonably or .information nonpublic inside Exceptions – 4105 not do 4104 and 4103 articles in prohibitions The– 1 :to apply purposes for authority public a by made transaction a .i debt public and policy monetary Lebanese to relating or ,management of purpose the for exclusively made transaction a .ii issued security a of price the of stability the maintaining the that provided ,less or months two of period a for .transaction the of notice advance given is Authority insiders and issuers by Filings – 4106 must security traded a issued has that issuer An– 1 is who person each of list a date to up keep and maintain member ,)body governing the of member or (director a issuer the of auditor or ,management senior of the with list the of copy a file must issuer The– 2 within ,list the to update each of copy a and ,Authority .change any of date the of days working 10 governing the of member or (director a is who person A– 3 auditor or ,management senior of member ,)body must security traded a issued has that issuer an of all of manner prescribed the in Authority the notify in ,indirectly or directly ,made has he that transactions security related a in or issuer that of security traded a the of days working 10 within ,security traded that to .transaction the of date issuers of periods Blackout – 4107 member ,)body governing the of member or (director A– 1 any and ,issuer an of auditor or ,management senior of prohibited is ,persons such of person related closely traded a in ,indirectly or directly ,trade a making from ,it to security related any in or ,issuer the of security release the to prior days working 10 of period a for :of release the following days working two until ;results financial quarterly and annual s’issuer the .i and .statements financial complete s’issuer the .ii َ َ َ ً ً

Regulation Conduct Market – 4000 Series 5 مجموعة 4000 – ّ نظام السلوكيات في األسواق المالية announcement an making means” release) “1 (article sub In– 2 the in requirements with accordance in public the to .information the of disclosure for Regulations procedures and policies written establish must issuer An– 3 this with and) 1 (article sub with compliance ensure to .Part Manipulation Price of Prohibition – C Part deceptive or manipulative certain of Definition – 4201 practices or acts applied be shall part present the of provisions The– 1 in practices or acts deceptive or manipulative all to the ,to limited not are but ,include which Lebanon .article this in out set actions manipulative be to deemed are actions following The– 2 :proved is contrary the unless acts deceptive or or ,security traded a in trade fictitious a making .i no involves that security traded a in trade a making .ii the of ownership economic or beneficial the in change .security manipulative a constitute below mentioned acts The– 3 purpose the for out carried is act the if act deceptive or of impression misleading or false a) i (creating of a of price or for demand ,of supply ,activity trading price ask ,price bid artificial an) ii (or ,security traded :security traded a for price trade or traded a of purchase the for orders or order an entering .i or order an that knowledge prior the with security substantially at ,size same the substantially of orders for price same the substantially at and time same the ,entered be will or been has ,security that of sale the traded a of sale the for orders or order an entering .ii or order an that knowledge prior the with security substantially at ,size same the substantially of orders for price same the substantially at and time same the will or been has ,security traded that of purchase the ,entered be traded a ,purchase to offers or ,of purchases making .iii pattern a in or prices higher successively at security ,prices higher successively of security traded a sell to offers or of sales making .iv of pattern a in or prices lower successively at or ,prices lower successively of sale or purchase the for orders or order an entering .v :of purpose the for security traded a or price ask ,price sale predetermined a establishing– ,price bid or price ask ,price sale closing low or high a effecting– or ,price bid within price bid or price ask ,price sale the maintaining– or ,range predetermined a مصطنع لعرض )Price Bid )أو طلب )Price Ask )أو تداول ، ً

Regulation Conduct Market – 4000 Series 6 مجموعة 4000 – ّ نظام السلوكيات في األسواق المالية order an ,execution for intention an without ,entering .vi .security traded a for orders of series a or acts deceptive or manipulative of Prohibition – 4202 practices or participating or in engaging from prohibited is person A– 1 or act deceptive or manipulative any of use the in reasonably should or knows person the that practice :know or to up lead may or ,to contributes or to up leads .i impression misleading or false a forming ,to contribute price or ,for demand ,of supply ,activity trading the of ,security traded a of artificial an create to likely is or creating to up leads .ii ,security traded a for price trade or price ask ,price bid or a to relating person any on fraud a perpetrates .iii .security traded a in transaction or manipulative a of use the in participates person A– 2 that if) 1 (article sub under practice or act deceptive another ,with concert in acts or ,with colludes person .conduct such in engages that person ,indirectly or directly ,from prohibited is person A– 3 traded a in trade executing or order an entering :creating of purpose the for security ,activity trading of impression misleading or false a .i or ,security traded a of price or ,for demand ,of supply the for price trade or price ask ,price bid artificial an .ii .security related a or security traded times all at be should securities all in trading The– 4 applies This .market the of context the within approved the between executed transactions to related associates their and side one form institutions by managed schemes investment collective or parties .side other the from institutions approved the approved the including ,entity legal or person natural A– 5 is business securities out carries that institution ,securities Lebanese selling short from prohibited on client the by owned is sold be to security the unless .transaction the of date the as acting when ,must Institution Approved The– 6 transaction the execute ,customer a with principal would it than customer the for price better a at This .agent as order the executed it if obtained have investment collective a is client the if applies condition .Institution Approved the by managed fund ,associates its ,manager Scheme Investment Collective A– 7 proper their out carry to them by entrusted entity any trade to prohibited are associates s’entity the or tasks trading when counterparty as s/account own their for Schemes Investment Collective the for and behalf on .management their under market the of context ). ينسـحب هـذا األمـر علـى العمليـات selling )إال

Regulation Conduct Market – 4000 Series 7 مجموعة 4000 – ّ نظام السلوكيات في األسواق المالية 2 –8 client the in include must institution approved The prior s’that ,opening account of time the at agreement the of name the in or with transaction security any to schedule the of disclosure clear on article sub a ,client a; client the by paid be to commissions and fees of the by signed be must schedule this of version dated update to decides institution approved the If .client :must it ,commissions and fees of schedule the soon as schedule updated the of client the Notify - latest the to notice a sending either by possible as email an via or client the by indicated address postal provided address email the at purpose this for sent ,client the by date the from period week two a client the Grant - is email the date the from or /and notification of ,schedule updated the to objection an file to sent incurred be will that commissions and fees the as to apply not shall schedule updated the with along mentioned period week-two the unless client the to Failure .objection without passed has above updated the in result shall period that within object .approved implicitly as considered being schedule fees the charge then can institution approved The schedule updated the with line in commissions and with client the to emailed or /and notified was that .part his on objection no the that ensure shall department compliance The postal the to notice the sends institution approved and client the by indicated address email or address / department compliance the by constantly updated

1. institution approved the at charge in department Approved the ,principal or agent as acting Whether– 9 the writing in client the to disclose should Institution to related transaction any which to according process .executed been has account his one the than price better a at agent as acting When– 10 Institution Approved the ,orders s’client the in set price actual the account s’client the in reflect should .executed been has transaction the which in Statements Misleading and False – D Part statements untrue on Prohibition – 4301 a disseminating or making from prohibited is person A– 1 forecast or information ,statement misleading or false :of purpose the for security traded a to relating price the ,of impression false a creating or ,influencing .i ,security the of value or ,security a sell or buy to person another inducing .ii from refrain or exercise to person another inducing .iii ,security a under rights exercising :ِ ;6,2017 June dated 23 .No announcement by amended was article-sub This 2 2021 19, May dated 73 .No announcement by and

Regulation Conduct Market – 4000 Series 8 مجموعة 4000 – ّ نظام السلوكيات في األسواق المالية the that know should reasonably or knows person that if .misleading or false is forecast or information ,statement or false is forecast or information ,statement A– 2 :if misleading ,respect material a in inaccurate or false is it .i ,fact material a of misrepresentation a contains it .ii or ,omitted is fact material a .iii .fact a as opinion an presents it .iv information any means fact material a ,article this In– 3 :security a to relating its on effect significant a have to likely be would that .i or ,investors to known was it if value or price in investor an to relevant considered be would that .ii .security the sell or buy to decision a making Institutions Approved of Conduct Market – E Part clients by trading insider and manipulation Market– 4401 must person registered a or institution approved An– 1 exists evidence if order client a execute or accept not or manipulation market in engaging is client the that .(Regulation this in defined as (trading insider declines person registered or institution approved an If– 2 the) 1 article sub under order an execute or accept to and of circumstances the document must institution notify promptly must and decision the for reasons .decision the of Authority the has person registered a or institution approved an If– 3 made has client a that believe to grounds reasonable market involves that ,indirectly or directly ,trade a this in defined as (trading insider or manipulation Authority the notify must institution the ,)Regulation .days working 5 within transaction the of details the of made records any retain must institution approved An– 4 the of date the from years ten for article this under .record priority Client – 4402 must person registered a or institution approved An– 1 executing before security a for order client a execute .security that in account own his or its for order any type same the is that order an to applies article This– 2 an at and ,security same the in ,)sell or buy (order of .order client the as ,price equivalent execution Timely – 4403 or order client a accepts institution approved an If– 1 a for order an execute to discretion its in decides soon as order the execute must it ,account managed َ َ

Regulation Conduct Market – 4000 Series 9 مجموعة 4000 – ّ نظام السلوكيات في األسواق المالية otherwise unless ,circumstances the in practical is as .client the with agreed execution Best – 4404 order client a executes that institution approved An– 1 .order the of execution best provide must best provide to considered is institution approved An– 2 :if execution order the that ensures it ,client a for acting when .i the in available price overall best the at executed is of nature and size the for markets or market relevant ,order the in transaction the executes it ,client a for acting when .ii ,client the by directed manner a executes it ,only customer a with principal as acting when .iii it than customer the for price better a at transaction the in agent as order the executed it if obtained have would or ,)i subparagraph with accordance order an of execution for responsible is entity another .iv .execution best provide to agreed has entity that and transactions and orders of Records – 4405 of record a make promptly must institution approved An– 1 orders all ,client a from received orders all of details the managed a for discretion with acting when entered .account own its for entered orders all and ,account record a make promptly must institution approved An– 2 ,client a for executed transactions all of details the of .account own its for and account managed a for record a make promptly must institution approved An– 3 ,person another to sent orders all of details the of .execution or handling for ,entity foreign a including generated be may article this by required record A– 4 records all that provided system a in automatically and ,form printed in producible ,retrievable be must .years ten of minimum a for retained allocation Timely – 4406 transaction a executes that institution approved An– 1 transaction the that ensure must order client a on based .client that of account the to allocated promptly is discretionary a executes that institution approved An– 2 that ensure must account managed a for transaction account the to allocated promptly is transaction the .client relevant the of Churning – 4407 solicit or advise not must institution approved An– 1 make or ,transactions into enter to customer a a for investments managing when transactions the of size or number ,frequency the if ,customer as regarded be reasonably would transactions investment s’customer the on based excessive nature and size the and situation financial ,objectives .account his of ّ ّ ذي يضر بمصلحة العميل )Churning)

Regulation Conduct Market – 4000 Series 10 مجموعة 4000 – ّ نظام السلوكيات في األسواق المالية orders of Allocation – 4408 a aggregate not must institution approved An– 1 the with or clients other of those with orders s'client the with except ,orders own s'institution approved .client the of consent written written a establish must institution approved An– 2 in trades allocating of method its out setting policy between and ,orders client among security same the .account own its for orders and orders client orders client of ahead Trading – 4409 employed person any and ,institution approved An– 1 ,trade a making from prohibited is ,it for acting or by related a or security traded a in ,indirectly or directly public-non from profit to order in ,it to security in trade a make to order s’client a about information .executed is order client the before security traded that profit to order in trade a make to deemed is person A– 2 if order s’client a about information public-non from change to expected be reasonably would order that .security traded the of price market the research of ahead Trading – 4410 group corporate its of one or institution approved an If– 1 recommendation investment an issue to intends traded a to relating analysis or report research a or corporate its and institution approved the ,security own its for trade a make knowingly not must group until security related any or security that in account or recommendation the receive who clients the trading during hours 24 least at had have research .release its following it on act to days the if apply not does) 1 (article sub in restriction The– 2 be reasonably not would research or recommendation or security subject the of price the affect to expected .security related any recommendation a to contrary Trading – 4411 or ,client a advise not must institution approved An– 1 security traded a in ,client a of behalf on trade a make current s’institution that of any to contrary is that the discloses it unless ,recommendations research the providing before client the to recommendation .trade the making or advice an for made trade a to apply not does) 1 (article Sub– 2 .account only-execution its for trade a make not must institution approved An– 3 its of any to contrary is that security a in account own :it if except ,recommendations research current ,maker market a as acting is .i or ,order client unsolicited an to liquidity providing is .ii )unsolicited)،

Regulation Conduct Market – 4000 Series 11 مجموعة 4000 – ّ نظام السلوكيات في األسواق المالية a as acting when assumed it position a unwinding is .iii unsolicited an to liquidity providing or maker market .order client transactions on period settlement the 4412. :on trading the settle shall Institution Approved The– 1 of types other all and Eurobonds Republic Lebanese- i foreign any in Lebanon in party any by issued bonds the from period days working two a within currency (2 + T (trading of date bonds of types other all and bonds Republic Lebanese - ii Pounds Lebanese in Lebanon in party any by issued (+2T (of period maximum a within done not was transaction the of settlement the If– 2 section of) i (section-sub in specified period the within by extended be shall period settlement the ,above) 1( (7 + T (days business five with accordance in occur not did settlement the If– 3 take shall Institution Approved the ,above) 2 (section the of regulations the in for stipulated measures the with) ICMA (Association Market Capital International all and ,Eurobonds Republic Lebanese the to respect Lebanon in party any by issued bonds of types other .currency foreign any in counterparty the or Institution Approved the case In– 4

• T (.e.i – time settlement extended the exceeded Lebanese on transactions of settlement the for -) 7 bonds of types other all and Eurobonds Republic ,currency foreign any in Lebanon in party any by issued the settle to) 2 + T (period maximum the for and all and bonds Republic Lebanese the on transactions Lebanon in party any by issued bonds of types other shall Institution Approved the ,Pounds Lebanese in Capital the of Unit Control Financial the inform following day working the on ,Authority Markets the includes that report a with ,date settlement the have that steps the and transaction the of details of settlement a reach to taken be will or taken been .transaction the Enforcement – F Part Authority the by Enforcement – 4501 its upon force in enter shall regulation present The– 1 institution however ,Gazette Official the in publication business securities on carry to licensed previously January until granted be will Liban du Banque the by of requirements the with comply fully to 2017 ,nd2 impose may Authority The .regulation present the violates who person any on sanctions administrative with accordance in ,Regulation this of provisions the of 160 Law under imposed be may that sanctions the

161. Law or 17/8/2011 مبنــي علــى اســتقطاب )unsolicited). )+2T) Association Market Capital International .2011/8/17