What are the cases in which Boursa Kuwait may stop trading a listed security?
The answer to this question is explained by the Capital Markets team at Al-Rashed, Al-Hadlaq and Al-Roudhan Advocates and Legal Consultants in accordance with the rules of Boursa Kuwait.
There are cases in which Boursa Kuwait may suspend one or more securities, or stop trading in any market, in the following cases:
- In cases of emergency conditions (natural disasters, crises, accidents, war situations, disturbances), based on the request of the Capital Markets Authority.
- At the request of the Capital Markets Authority or in the cases stipulated in the executive regulations of the law establishing the Capital Markets Authority and regulating securities activity.
Whereas, the regulation allowed the Capital Markets Authority to temporarily stop trading in the stock exchange and to stop trading any security listed on the stock exchange, in the following cases:
- Violation of any of the obligations imposed on the listed security by the laws and regulations in force with the Authority and the Stock Exchange.
- Disasters, crises and disturbances that may create severe adverse effects on the market.
- Achieving the protection of dealers in the markets.
- Refusal or delay of the listed company from paying the annual listing fees specified by the stock exchange.
- The existence of a technical defect or malfunction in the trading system in the Stock Exchange.
- Issuance of a decision to suspend the security by the Authority’s Disciplinary Board.
- Issuance of a decision to suspend the security by the Violations Committee at the Stock Exchange.
- In the event that the listed company breaches the obligations stipulated in the rules of Boursa Kuwait.
- In the event that the listed company achieves accumulated losses of 75% or more of the company’s capital.
- In the event of the listed company’s bankruptcy or liquidation.
- In the event that one of the reasons for the fund’s termination as stipulated in the Executive Regulations of the Law Establishing the Capital Markets Authority and Regulating Securities Activity is realized.
- Once announcing the optional or mandatory withdrawal, for an hour.
- When declaring reverse assimilation.
- At the request of the listed company, the Authority must be notified prior to stopping the trading of the security
- When announcing the agreement to enter into the merger client for an hour.
- The listed company’s refusal or delay from commenting on speculation, news, information or rumors, and the Authority must be notified before trading the security is suspended.
- Refusal or delay of the listed company from commenting on unusual trades, and the Authority must be notified before trading in the security is suspended.
- Based on the trading breaks system contained in the rules of the Kuwaiti Stock Exchange.
- If this is necessary to achieve fairness, integrity and efficiency of trading in the Stock Exchange, after the approval of the Authority.
The Stock Exchange shall cancel the transactions executed on the security in the following cases:
- Issuance of a decision to cancel the executed deals by the Authority.
- Issuance of a decision to cancel the executed deals by the Authority’s Disciplinary Board.
- Issuance of a decision to cancel the executed deals by the Violations Committee at the Stock Exchange in the event of a violation of the Stock Exchange rules.
In all cases, it is not permissible to cancel the deals that have been settled.
If you are looking for a Kuwaiti law firm that specializes in providing legal services to the securities, capital and stock market activities, you can count on us at Taqneen, Law Firm and Legal Consultations.
To book an appointment or request legal advice about the duties of securities companies in the optimal implementation of clients’ orders, we are pleased to receive your inquiries at (info@Taqneen.com).