Market Committee Resolution No. (6) for year 2005
Concerning the organization of deposits and central depository

After perusal of the amended Decree issued on 14/8/1983 organizing the Kuwait Stock Exchange.
And the decision of the Minister of Commerce and Industry No. 35 for year 1983 to issue the internal resolution for Kuwait Stock Exchange.
And the resolution of the Market Committee No. 3 for year 2000 concerning stocks trading controls through the companies that manage others’ portfolios.
And the resolution of the Market Committee No. 1 for year 2001 concerning the amendment of stocks dealing controls through the companies that manage others’ portfolios.
And according to the Market Director proposal,
And after the consent of the Market Committee

The following has been decided:

Article (1)

This resolution shall be applied to Kuwaiti companies and investment funds listed in Kuwait Stock Exchange and non-Kuwaiti companies and investment funds and any other securities allowed to be traded in the Market.

Article (2)

All securities issues that are listed or allowed to be traded in Kuwait Stock Exchange shall be deposited at the central depositary system at the clearing house in order to be able to deal with these securities in the Market.

Article (3)

Deposited securities shall be registered and settled through the clearing house. Dealing with these securities or receiving the consequent rights may not be done except through journal entry in the clearing house records.

Article (4)

The clearing house issues to the securities’ owners receipts under their names with the number of stocks they own, against the deposited certificates.

Article (5)

Deposits receipts issued by the clearing house are considered a proof of the securities’ ownership as long as they are consistent with the records deposited at the clearing house.

Article (6)

The ownership of securities that are traded in Kuwait Stock Exchange is transferred after completing the transactions in the trading hall and executing the consequent commitments on time through the clearing house.
These transactions shall apply against the company and others by registering them in the special records at the clearing house provided that dealing with these securities does not violate the law or rules based on which the securities have been issued.
The companies and issuers of securities shall be notified with the names of the recent owners of these securities on the date set by the Market.
It is permitted for others to look into the previously mentioned records according to the rules set by the market administration.

Article (7)

Securities that are definitively deleted from dealing, whatever the reason of deleting is, shall be excluded from the deposit and central depository system.

Article (8)

The clearing house shall provide the issuers of deposited securities with the reports that they request on the date set by the Market.

Article (9)

Any mortgage or block of deposited securities and elimination of the same, as well as transfer of ownership in case of heritage or mergence, shall be noted in the clearing house records.

Article (10)

If securities are registered at the clearing house under the name of a bank or one of the companies managing others’ portfolios, it should be stated that the ownership is for the company or the bank or other’s account.

Article (11)

The issuers of securities listed in KSE shall deliver to the clearing house a copy of its shareholders’ records including the names and addresses of the securities owners during twelve months from the effective date of this resolution. These records shall not be kept at any other party after this period if it is not delivered to the clearing house.

Article (12)

Securities’ records are subject to the Market’s supervision and monitoring. The Market administration may suspend the registration in these records during the period mentioned in the previous article in case the companies or its offices breach the rules and conditions issued by the Market administration regarding this issue.

Article (13)

The clearing house shall commit to set out the systems that ensure the internal work control and provide a copy of the same to the Market administration which may request to amend these systems if needed.

Article (14)

Unless approved by the Market administration, the clearing house may not announce any statement or disclose any information related to the records’ content that it manages in cases other than those allowed by the law.

Article (15)

Upon Market administration consent, the clearing house shall issue a guide for the services it provides and the requested amount and way to get it.

Article (16)

This resolution shall come into force from the date of publishing in the official Gazette, and the Market Director shall execute it.

The Minister of Commerce and Industry
Market Committee President
Abdullah Abdulrahman Al-Tawil