Establishing 'Bourse Co' A Stride In Making Kuwait Financial Hub

(MENAFN- Arab Times) Saleh Al-Falah, President of the Board of Commissioners of the Capital Markets Authority, said on Sunday the establishment of a Kuwaiti shareholding company, under the name "Kuwait securities bourse," was a new step forward on the path of transforming Kuwait into a regional financial center. In an exclusive interview with Kuwait News Agency (KUNA), Al-Falah said the CMA had tackled all obstacles facing establishment of the company, which would "replace Kuwait Stock Exchange." A specific and explicit road-map has been drawn up for actual execution and practical steps have begun with the license issuance, he added.. The commissioners' board decision to establish the company has been taken as a basis for realizing the state strategies, Al-Falah said. Explaining, he said the authority will own all the company stocks in a transitional period, during which the company will be prepared at the administrative and financial levels as well as for sake of making it eligible to obtain a permit to start operating the bourse. Following this phase, its shares will be floated for subscription by Kuwaiti citizens and KSE-listed companies, according to Law Number 7 (2010). Shedding further light on mechanisms of forming the company, he said the board had decided to step up a committee grouping its founders to take all relevant legal procedures, as a prelude to electing the first board that will manage the company in the interim period of time. Abovementioned law has assigned the authority with the task of launching the company, specifying its capital and floating its stocks at a rate of 50 percent for citizens' subscription and 50 percent for auctioning, equally, by the listed companies. The authority and consultants, who were employed for the task, had been involved in consultation and examination with the founding commission. Moreover, meetings in this respect had been held with the KSE Committee, the Ministry of Commerce and the Public Investment Authority (PIA). Subsequently, the authority worked out the executive plan, set the timetable and mechanisms for assets' transfer to render the company ready for activity in the bourse, according to the authority law and the best internationally-accredited "practices in this regard." In accordance with Articles 32 and 33, the board, at its 18th meeting in 2013, decided to launch the new company with a declared total capital of KD 60 million, subscribed capital of KD six million and paid-up capital of KD 1.5 million. The Capital Markets Authority will possess the newly-born company, totally, in the interim phase, during which the (first and transitional) board would act upon recommendations, included in the advisors' reports. This board will take important decisions related to stetting-up structural systems for the company and staff, mechanisms of employment, with preference for employees currently serving in the KSE. It will also forward proposals on means for promoting the bourse, according to best-practiced international mechanisms. Al-Falah added that the board of commissioners decided, on basis of Artcile 70 of the authority law, to form the founders' committee, grouping Abdullah Ahmad Al-Qabandi and Dr Salah Abdullah Al-Othman, for sake of taking legal procedures to set up the company according to terms of the Ministry of Commerce and Industry, with no breach of rules of the authority law No 7 (2010) and the corporates' law No 25 (2012). Illustrating further, Al-Falah said the authority, in its capacity as the sole owner of the company at the founding stage, will appoint an interim eight-member board, including the chairman and vice chairman, in accordance with the conditions mentioned in the authority law and executive regulations. This board will manage the company in the transitional stage and prepare it for subscription for the nationals and the KSE-listed companies. Following accomplishment of these tasks, the company will increase its publicized capital. The authority will invest in the company capital, at a proportion equal to the shares allocated for the citizens - half of the declared total capital - estimated at 300 million shares of the stocks floated for public subscription. These shares will be equally distributed to the citizens, namely those whose names are registered in the Public Authority for Civil Information. The remaining stocks will be auctioned for the listed companies.