The Bahrain Stock Exchange (BSE) announced yesterday the launch of new guidelines for key persons in shares and securities listed on the BSE.
The guidelines, which were approved by the board of directors of the BSE, have been prepared by the BSE to go in line with the exchange's efforts to enhance the trading environment and increase its turnover.
The director of the bourse Fouad Rashid announced the salient features of the guidelines yesterday and explained the scope and implementation of the new procedures.
The BSE will organise a workshop early next month for the listed companies, licensed brokers at the BSE and other related parties to explain the details of the new guidelines and the requirements for implementing them.
Fouad Rashid said, according to the new guidelines which are expected to be effective as of October 1, 2010, key persons will be allowed to buy and sell shares and securities issued by listed companies on the BSE throughout the year.
The close period that prohibits the trading of insiders 15 days before the end of each financial year and each related quarter, until the company publishes its quarterly and annual financial statements will no longer be applied. The guidelines also do not oblige issuers to form a committee in order to monitor the dealings of key persons in listed companies. Instead, a representative appointed by the board of directors of companies will have to maintain and monitor a register which includes basic personal data of key persons and information on their holdings and dealings, and submit it to the BSE.
Fouad Rashid clarified that the term "Key Persons" refers to members of an issuer's board of directors, senior management, the issuer itself, and such other persons as decided by the issuer's board of directors.
"The new guidelines allow listed companies to issue the key person dealing policy without BSE's approval taking in consideration that the policy should comply with the requirements of the BSE's guidelines and the requirements mentioned in Volume 6 in regards to Markets Abuse and Manipulation Module issued by the Central Bank of Bahrain," he added.
"The objective of the guidelines is to facilitate the dealing of key persons in shares and securities listed on the BSE, and will also reduce the administrative burden on issuers of securities and key persons.
The new guidelines are also intended to establish greater transparency at the BSE and ensure a fair environment for the trading of all investors in the market," he added.
The new guidelines permit trading in securities of an issuer throughout the year, given that key persons do not possess or are aware of any inside information that might affect a share's price at the market.
"The new guidelines will require key persons in companies to inform the appointed representative about the details of the dealings conducted for their benefit in the shares and securities of Bahraini listed on the BSE and other markets by the end of the next business day upon the completion of the dealing. The representative must then notify the BSE immediately of such details," he added.
By Mahmood Rafique
© Bahrain Tribune 2010
