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CAIRO - 6 April 2022: Head of the Financial Regulatory Authority (FRA), Mohamed Omran, issued Resolution No. 68 of 2022 amending the Authority’s Board of Directors Decision No. 94 of 2018 regarding the rules and procedures for dealing in securities not listed on the Egyptian Stock Exchange and the procedures for transferring their ownership, according to the Official Gazette.
The first article of the decision, which was published in the Egyptian Gazette in its issue No. 81 of 2022, on Wednesday, stipulates that a new article No. 9 shall be added to the rules and procedures for dealing on securities not listed in the Egyptian Stock Exchange and the procedures for transferring their ownership issued by the decision of the Authority’s Board of Directors No. 94 of the year 2018 read as follows:
Cases of implementation of equity transfers in accordance with the agreements of the shareholders of the start-up companies: in the case of companies and entities that engage in venture capital activity invest in start-up companies through convertible financing instruments, which may result in signing agreements with the shareholders of the start-up companies and result in transfers of ownership of the shares of those companies after a specified period, in accordance with the agreement between the parties, the Central Securities Depository and Registry may enter into an agreement as an Escrow Agent to ensure the execution of ownership transfers on the stock exchange.
The FRA sets the conditions and requirements necessary to carry out the transfers of ownership referred to in the first paragraph of this article, and after obtaining the approval of the Authority, transfers of ownership referred to are excluded from the requirement to submit the document evidencing the deposit of the value of the operations in one of the banks subject to the supervision of the Central Bank of Egypt (CBE).