CBB Disclosure Standards: Contents
Chapter II Ongoing Obligations
Article 32 Immediate Announcement
The issuer must notify the Agency of any major developments or changes in its sphere of activity, i.e.:32.1 Any information concerning the issuer, or any of its subsidiaries necessary to avoid the establishment of a false market in the issuer's securities, or which would be likely to materially affect the price of its securities.32.2 Any intention to fix the Record Date of any corporate action and the reason for establishing a Record Date, which shall be at least 10 calendar days after the date of notification to the Agency, and the address of the share registry at which documents will be accepted for filing. In addition, Annual General Meetings must be held within three months from the end of the issuer's financial year.32.3 Any proposed change in capital, including that of the issuer's debt securities listed on the Exchange, must be notified immediately after board approval.32.4 Any decision by the board to submit to the issuer's shareholders a proposal for the issuer to be authorized to purchase its own shares must be notified immediately. An indication must be given as to whether the proposal relates to specific purchases, or to a general authorization to make purchases. The outcome of the shareholders meeting must also be notified immediately.32.5 Any recommendation of declaration of a dividend (including bonuses, if any), the rate and amount per share and date of payment, which shall be within a maximum of 10 calendar days from the general meeting date approving the dividend.(a) Once the Record Date is announced, the issuer shall not make any subsequent alterations to that date.(b) All dividends (including bonuses, if any) must be paid within a maximum of 45 days from the date of declaration.32.6 Any notification to shareholders of any nature that may be price sensitive should be made to the Agency before circulation.32.7 All resolutions put to an extraordinary general meeting of an issuer within 7 calendar days after such meeting, whether or not the resolutions were carried.32.8 Any call to be made upon any of the partly paid-up share capital of the issuer.32.9 Any change of address of the registered office of the issuer, or of any office at which the register of securities of the issuer is kept.32.10 Any change in the directors or senior management or auditors of the issuer.32.11 Any proposed alteration to the Memorandum of Association, or Articles of Association of the issuer.32.12 Any notice of substantial shareholdings or changes received by the issuer relating to:32.12.1 Acquisition of 5% or more of the issuer's issued and paid-up capital by a beneficial owner, reaching 5% or more.32.12.2 Ownership of a beneficial owner reaches 10% or more.32.12.3 If a beneficial owner's ownership reaches 10% or more of the issuer's issued and paid-up capital and wishes to purchase or own 20% of the issuer's shares.Details of the above information shall be provided. In addition, acquisition or disposal of 10% or more of the paid-up capital of any listed issue on the Bahrain Stock Exchange should be approved by the Agency, prior to the execution of such order on the Exchange.32.13 Any application filed with a court or legal entity to wind up the issuer, or any of its subsidiaries.32.14 The appointment of a receiver, administrator or liquidator (or equivalent in the country of incorporation) of the issuer, or any of its subsidiaries.32.15 Any acquisition of shares of an unquoted company which results in such company becoming a subsidiary of the listed issuer, or where the valuation of the transaction exceeds 10 percent of the net assets of the listed issuer.32.16 Any acquisition of shares which results in the holding being 10 percent or more of the paid-up capital of another quoted issuer, or where the valuation of the transaction exceeds 10 percent of the net assets of the listed issuer.32.17 Any sale of shares in another company:32.17.1 resulting in that company ceasing to be a listed issuer's subsidiary; or32.17.2 resulting in a holding falling below 10 percent of the issued capital of that company, if it is a quoted issuer.32.18 After the end of the issuer's financial year (unless accompanied by preliminary financial statements, as required in Article 34), no announcement shall be made of any:32.18.1 cash dividend;32.18.2 bonus or rights issues;32.18.3 record date;32.18.4 capital return;32.18.5 passing of a dividend;32.18.6 sales, turnover or total return.32.19 Any significant discovery of mineralization or hydrocarbons by an issuer, whose activities include or are to include exploration for natural resources.32.20 A description of all pending litigation, or occurrence of circumstances of a material nature in which the issuer, or any of its subsidiaries may be involved, which may affect its income derived from title to or possession of any of its properties, licences or concessions from governmental authorities.32.21 In the case where a valuation (not in the ordinary course of business) has been conducted on the fixed assets of the company and/or its subsidiaries, a prompt announcement must be made and shall state whether the valuation is subject to the approval of supervisory or other government authorities. A copy of each of the valuation reports must be submitted to the Agency and be made available for inspection at the issuer's registered office for a period of 3 months.32.22 Any change in the status of the issuer for taxation and/or zakat purposes under any statutory provisions must be notified.
Article 33 New Issues33.1 An issuer shall not issue securities without the prior approval of shareholders at a general meeting, or as stipulated by the Articles of Association of the issuer or applicable laws and regulations of the issuer's home market, as the case may be.33.2 An issuer intending to make a rights issue should make a prompt announcement which shall state that the rights issue is subject to the approval of the authorities. The price, terms and purpose of the rights issue, as well as the financial circumstances which call for the rights issue, should also be disclosed. No date should be fixed for the record date until the issue has been approved by the Agency.33.3 An issuer intending to make a bonus issue should make a prompt announcement in accordance with the requirements of Article 32.18, which shall state whether the bonus issue is subject to the approval of the authorities. No date should be fixed for the record date until the issue has been approved by the Agency.33.4 In relation to a rights issue, in which holders of securities are given the right to participate in proportion to the amount of existing shares held, such rights shall allow for renunciation in part or whole, in favour of a third party at the option of the entitled shareholders. The Agency will not entertain any rights issue in which the rights cannot be made renounceable in part or whole in favour of a third party at the option of the entitled shareholders.33.5 In relation to a rights issue, an issuer shall fix the closing date for the receipt of applications for and acceptance of the new securities, not earlier than one month after the record date, provided that the period from the date of splitting to the date of the exercise and payment of rights shall not be less than 10 calendar days.33.6 All rights issues for which there are no irrevocable written undertakings from the shareholders to take up their full entitlement shall be taken up by an underwriter. If a rights issue is underwritten, a copy of the underwriting agreement between the issuer and its underwriters shall be provided to the Agency.33.7 An issuer shall issue to the appropriate persons within 7 market days (or a longer period as approved by the Agency) after the record date:—33.7.1 A Letter of Entitlement.33.7.2 A Provisional Letter of Allotment, incorporating:(i) Form of Acceptance;(ii) Request for Splits;(iii) Form of Renunciation;(iv) Form of Nomination; and(v) Excess Shares Application Form.33.8 Except in the case of a rights issue to shareholders, no director or senior manager of the issuer, or any person regarded as an associate of any director, shall participate (directly or indirectly) in an issue of equity securities, or other securities with rights to conversion to equity, unless shareholders at a general meeting have approved the specific allotment to be made to such a director or executive officer, or associated person. Such directors, executive officers and associates shall abstain from exercising any voting rights on the matter.
The notice of the meeting shall state:33.8.1 the number of securities to be allotted;33.8.2 the precise terms and conditions of the issue; and33.8.3 that such directors, executive officers and associates shall abstain from exercising any voting rights.33.9 When existing holders are offered a specific entitlement in a new issue of securities, or in a company about to be floated, such entitlement must be on a pro-rata basis, with no restriction placed on the number of shares to be held before entitlements accrue.33.10 Once the basis of the entitlement and the books closing date are declared, the issuer shall not make any subsequent alteration to such entitlements.33.11 An issuer must not close its register to determine holders' entitlements to participate in a new issue, until 10 market days after copies of the issuer's registered prospectus or memorandum of offer for sale, or other documents have been lodged with the Agency.33.12 Where an issue of securities is to be made overseas only and is supported by a prospectus or other public documents, the prospectus or other public documents in Arabic or English shall be lodged with the Agency. Such documents shall be endorsed "Specimen — For Information Only."33.13 All schemes involving the issue or sale of shares or other securities (including options) to employees shall be governed by the following provisions, and shall apply to schemes not only for all listed issuers, but also all subsidiaries thereof, even if the subsidiary is incorporated and operating abroad:33.13.1 The scheme, which must be approved by the shareholders of the issuer at a general meeting, must contain provisions relating to:(a) the persons to whom securities may be issued or sold under the scheme ("participants");(b) the total amount of the securities to be issued must not be more than 10 percent of the issued share capital, without prior approval;(c) a fixed maximum entitlement for any one participant;(d) the amount payable on application or acceptance, and the basis for determining the subscription or sale or option price, and the period in or after which payments or calls or loans to provide the same, may be paid or called ;(e) the time limit for the scheme,(f) the period during which the participants are debarred from disposing of the allotted securities, if applicable,(g) the voting, dividend, transfer and other rights, including those arising from the liquidation of the company, attached to the securities33.13.2 The scheme or corresponding document, if not circulated to the shareholders, must be available for inspection at the issuer's registered office or posted on its website, if it so desires, for a period of not less than 10 calendar days.33.13.3 The resolution must approve a specific scheme and refer to either the scheme itself (if circulated to the shareholders), or to a summary of its principal terms included in the circular, which must contain all the provisions set out in Article 33.13.1 above. Where directors of the issuer are trustees of the scheme, or have a direct or indirect interest in the scheme, the circular must disclose that interest.33.13.4 Unless the securities subject to the scheme are identical with other listed securities, they must be separately designated;(a) the scheme may provide for an adjustment of the subscription or option price, or the number or amount of securities subject to the scheme not already allotted in the event of a capitalization issue, and may provide for variation of the terms in the event of other circumstances (e.g. sub-division or consolidation of shares). Such variation should normally give a participant the same proportion of the equity capital as that to which he was previously entitled;(b) the issue of securities as consideration for an acquisition will not be regarded as a circumstance requiring adjustment,(c) an adjustment other than on a capitalization issue must be confirmed in writing by the company's auditors and in their opinion be fair and reasonable,(d) the scheme must provide, or the circular must state, that the provision relating to the matters contained in Article 33.13.1 (a) to (g) cannot be altered to the advantage of participants, without the shareholders' prior approval.33.13.5 The scheme and any subsequent renewal or amendments to the terms of the scheme shall be subject to the approval of the Agency.
Article 34 Periodic Reports34.1 An issuer shall give a preliminary financial statement to the Agency (on a consolidated basis) immediately after figures are available, and in any event not later than 2 months after the end of the financial year, giving all the information as prescribed by the Agency and stating whether such results are audited or subject to audit. Unless an extension has been granted by the Agency, the Agency may, without notice, suspend trading in the issuer's securities if the preliminary financial statement is not submitted within the 2-month period. The suspension will last until such time as the preliminary financial statement is received.34.2 An issuer shall give a half-yearly report to the Agency (on a consolidated basis) immediately after figures are available and in any event not later than 2 months after the end of the first half of the financial year, supplying all the information as prescribed by the Agency.34.3 Where any audited accounts differ materially from the announced unaudited accounts or any forecasts/projections previously made, or when any auditor has qualified his report, an explanation of such difference, or full details of such qualification shall be given to the Agency immediately for public release upon its receipt by the issuer.34.4 An issuer shall publish the financial statements for each interim quarter no later than 2 months after the end of the related quarter, prepared in accordance the prevailing IAS.
Article 35 Annual Financial Statements35.1 The interval between the end of the financial year of the issuer and the issuing of the printed annual report to the company's shareholders and the Exchange shall not exceed 6 months.35.2 The annual audited accounts shall be prepared in accordance with the International Accounting Standards (IAS) and in compliance with Bahrain's Commercial Companies Law or other applicable laws, as well as the requirements of the Agency. In addition, the annual report should also include both directors' and management's reports on the results for the year.35.3 The issuer shall separate items in its annual report:35.3.1 The amount of:(i) turnover, and(ii) investment and other income, excluding extraordinary items, together with comparative figures for the previous year;35.3.2 A statement of source and application of funds with comparative figures for the previous year;35.3.3 A statement as at the end of the financial year, showing the interest of the directors of the issuer, or related corporations.35.4 Particulars of material contracts involving directors' interests shall be disclosed, either those still in existence at the end of the financial year, or if not, then those entered into since the end of the previous financial year, providing, in the case of a loan, and without limiting the generality of the foregoing:35.4.1 the names of the lender and the borrower,35.4.2 the relationship between the borrower and the director (if the director is not the borrower);35.4.3 the purpose of the loan;35.4.4 the amount of the loan;35.4.5 the interest rate;35.4.6 the terms regarding payment of interest and repayment of principal; and35.4.7 security provided.35.5 A statement as at the end of the issuer's financial year shall be disclosed setting out:35.5.1 The names and nationalities of the major shareholders and the number of equity securities of each class held in which they have an interest of 5% or more of outstanding shares, as shown in the issuer's shares register;35.5.2 The number of holders of each class of equity security, and the voting rights attached to each class;35.5.3 A distribution schedule of each class of equity security, setting out the number of holders and percentage in the following categories:
* Expressed as a percentage of total outstanding shares of the listed company. Categories* No. of Shares No. of Shareholders % of Total Outstanding Shares Less than 1% 1% up to less than 5% 5% up to less than 10% 10% up to less than 20% 20% up to less than 50% 50% and above35.6 There shall be disclosed:35.6.1 the name of the company secretary;35.6.2 the address and telephone number of the registered office; and35.6.3 the address of each office at which a register of securities is kept.35.7 In the first financial year in which an issuer adopts new accounting policies, there shall be stated by way of notes to the accounts the principles and policies adopted, the amount of increase or decrease in profits and losses, and the amount of assets or reserves resulting from the adoption of such policies.35.8 Except for those firms that are regulated by the Agency as financial institutions and that are involved in the acquisition and disposition of properties in the ordinary course of business, the following information shall be provided:35.8.1 The address of each property;35.8.2 In respect of each property:(i) a brief description (e.g. land or buildings, approximate areas, etc);(ii) existing use (e.g. shops, offices, factories, residential, etc);(iii) tenure (i.e. freehold, or leasehold, giving terms);(iv) terms of tenants leases or under leases (including repairing obligations);(v) approximate age of the buildings;(vi) present capital value in existing state.
Article 36 Statements, Transfers, Transmission and Registers
The issuer shall agree:36.1 To allot securities within 7 calendar days of the final applications closing date for an issue of securities, and to dispatch statements within 7 calendar days of the date of allotment, or within such period as may be prescribed by the Agency.36.2 To dispatch within 4 working days after the day of lodgment of a registrable transfer of securities of the issuer, a statement in respect of such securities and a balance statement for any remainder.36.3 Notwithstanding Article 33 (New Issues) above, upon declaration of a disaster by the Agency and the subsequent lodging of a report of the statements lost or destroyed, together with a letter of indemnity by the Clearing House to replace the said lost or destroyed statements and to dispatch them within 7 working days from the date of lodgment, or a longer period as determined by the Agency. In this section "Disaster" means a situation arising from destruction or loss of statements in the possession of the Clearing House and such a situation shall be considered as a disaster, as declared by the Agency.36.4 When so requested by the transferee at the time of lodging the registrable transfer of securities of the issuer, to dispatch the statement in respect of those securities to the lodging broker.36.5 Not to refuse to register or fail to register, and to give effect to any transfer in registrable form of a fully paid security issued by the listed issuer except:(a) the registration of the transfer would result in a contravention of, or failure to observe the provisions of the law in the Kingdom of Bahrain, or result in non-compliance with the rules and restrictions of the issuer's Memorandum and Articles of Association.(b) the transfer is in respect of a partly paid security, in respect of which a call has been made and is unpaid.36.6 If in the exercise of its rights under Article 36.5 (a) above, the issuer refuses to register a transfer of a security, it shall give to the lodging broker and the transferee written notice of the refusal and the precise reasons therefore within 7 working days after the date on which the transfer was lodged with the issuer.36.7 To register transfers, split statements, issue statements and mark or note transfers and where any fee is charged, such fee should not exceed the amount that shall, from time-to-time, be approved by the Agency for each statement issued.36.8 When so requested by the transferee at the time of lodgment of registrable transfers of securities of the issuer, to issue statements in requested denominations.36.9 To endorse (where necessary) transfer forms with the notation "power of attorney exhibited" or "probate exhibited" on production of the proper documents, and to do so without charge.36.10 To split statements within 4 working days of receipt, or to certify transfers within 2 working days upon lodging the relevant statements.36.11 To accept for registration, transfers of the issuer's Transfer Forms securities, executed on a standard form of transfer approved by the Agency, or on such other form as may be approved by the Agency.36.12 To design proxy forms in a manner which will allow a shareholder of an issuer appointing a proxy, to indicate how he would like his proxy to vote in relation to each resolution.36.13 To give to the Agency upon inquiry an extract of the share register, showing full details on or between the named date or dates of all entries relating to the registration of shares entered or deleted under any particular name, and the relevant statement numbers and the names into which, or from which any particular stock or shares may have been transferred.36.14 In the case of multiple listing, to permit securities of the issuer to be transferred from one register to another without restriction.36.15 In the case of share splits carried out by the issuer, the issuer shall issue without charge, statements in denominations requested by the shareholders, up to a maximum of 5 statements per shareholder.36.16 To inform the Agency as and when a report is lodged with the issuer, or the issuer's registrar on any loss of statements, giving all the information prescribed by the form set out by the Agency.36.17 To inform the Agency immediately the issuer is notified of any forgery in the statements of the company by the issuer's registrar.36.18 The issuer upon request by the Agency must ensure that its transfer agent submit a report by an independent accountant that studies and evaluates the transfer agent's internal controls.36.19 To provide the Agency upon request, with an auditor's certificate to the effect that the processing of transfers and the issue of statements is in accordance with the Agency's law.
Article 37 Form and Content of Statements
Notwithstanding the above provisions, the investor is entitled upon request to receive share certificates subject to the following:37.1 The number of securities represented by the certificates must be clearly shown in words and figures on the face of the certificates, or in such a manner as may be approved by the Agency.37.2 The certificates should be designed so that paper quality and watermark forgery and/or alterations are readily detectable. The printing of securities certificates must only be entrusted to recognized security printers. The paper for printing securities must either be first class bond or banknote paper containing a watermark of the printer or issuer, and any other additional security features as may be determined by the Agency from time-to-time.37.3 Share certificates shall show the following:37.3.1 serial number;37.3.2 par value of securities;37.3.3 class of securities;37.3.4 name of the company and the authority under which it was incorporated;37.3.5 address of the registered office of the issuer;37.3.6 name and address of the registrar, if it is different from the registered office of the issuer;37.3.7 where a rubber seal is imprinted, original signatures shall support it;37.3.8 where an embossed seal is used, it may, subject to the Articles of Association of the issuer, be supported by facsimile signatures only;37.3.9 where only the seal is used without supporting signatures, the method or system of control by the issuer on the application of the seal must be approved by the auditors of the issuer, and a copy of such approval forwarded to the Agency.37.4 Debt security certificates shall show the following:37.4.1 serial number;37.4.2 the name of the issuer, and the authority under which it was incorporated;37.4.3 the address of the registered office of the issuer, and the register on which the loan securities are situated;37.4.4 the security, rate of interest and dates of payment, any participating rights and the date and method of redemption;37.4.5 where a rubber seal is imprinted, original signatures shall support it;37.4.6 where an embossed seal is used, it may, subject to the Articles of Association of the issuer, be supported by facsimile signatures only;37.4.7 where only the seal is used without supporting signatures, the method or system of control by the issuer on the application of the seal must be approved by the auditors of the issuer, and a copy of such approval forwarded to the Agency.37.5 The size of the certificates shall be determined by the Agency from time-to-time.
Article 38 A Dematerialized Environment
Securities Settlement (transfer of securities) shall be effected by simple debit or credit on the books of the Clearing House system via computer data entry.
Transferees (new owners) of securities will regularly report to the issuer's transfer agent(s) for legal transfer of title within 4 days.
Article 39 Communications with Holders of Listed Securities39.1 All circulars to holders of listed securities, together with notes of meetings, proxy forms and advertising material to holders of listed securities must be submitted to the Agency in draft form for approval before they are published, at least 5 market days in advance.39.2 A draft of any proposed amendment to the issuer's Memorandum and Articles of Association, or equivalent documents, must be submitted to the Agency.39.3 Whenever shareholders are sent a notice of a meeting which includes any business other than routine business at an annual general meeting, an explanatory circular must accompany the notice, or if the business is to be considered at or on the same day as an annual general meeting, an explanation must be incorporated in the directors report. An explanatory circular must also accompany any notice of a meeting sent to holders of listed debt securities.39.4 Where an increase in authorized capital is proposed, the directors must state in the explanatory circular, or any other document that accompanies the notice of the meeting, whether they have any present intention of issuing any part of that capital.39.5 The issuer must forward to the Agency a copy of all circulars, notices, reports, announcements, or any other documents at the same time as they are issued, and a copy of all resolutions passed by the issuer, other than resolutions concerning routine business at an annual general meeting.39.6 The issuer must ensure that all the necessary facilities and information are available to enable holders of such securities to exercise their rights. In particular, it must inform the holders of any and all meetings to be held which they are entitled to attend, to enable them to exercise their right to vote (where applicable) and publish notices or distribute circulars, giving details of the allocation and payment of dividends or interest in respect of such securities, the issue of new securities (including arrangements for the underwriting, allotment, subscription, renunciation, conversion or exchange of such securities) and repayment of securities.39.7 The issuer must appoint a registrar, and/or where appropriate, a paying agent in the Kingdom of Bahrain, unless the issuer itself performs these functions.39.8 The issuer must allow for proxy forms, with a provision for two-way voting on all resolutions intended for proposal, with a notice convening the meeting of holders of listed securities to all persons entitled to vote at the meeting.39.9 Unless shareholders otherwise permit, an issuer proposing to issue securities that has an equity element for cash, must offer those securities to existing equity shareholders (and where appropriate, to holders of other securities that have an equity element of the issuer entitled to be offered to them) in proportion to their existing holdings.39.10 Similarly, unless shareholders otherwise permit, an issuer must obtain the consent of shareholders before any major subsidiary of the issuer makes any issue of securities having an equity element for cash, so as materially to dilute the percentage equity interest of the issuer and its shareholders in that subsidiary.39.11 In the event of a circular being issued to the holders of any particular class of security, the issuer must issue a copy or summary of such circular to the holders of all other listed securities, unless the contents of such circular are irrelevant to these other holders.39.12 Airmail, courier, fax or email must always be used when communicating with overseas holders of listed securities.39.13 When a foreign issuer publishes or sends a circular to holders of its listed security on the Exchange at an address in the Kingdom of Bahrain, it must be in the Arabic language and/or in the English language.
Article 40 Transactions by Directors and Senior Management40.1 Any change in the board of directors and senior management must be notified immediately to the Agency.40.2 The issuer must adopt rules governing dealings by directors, senior management and associated persons in the listed securities of the issuer, in terms no less exacting than those issued by the Agency.40.3 The rules issued by the Agency should be regarded as applicable to purchases by an issuer of its own shares.40.4 The directors, senior management and associated persons wishing to buy or sell securities in their company, must first pay attention to the following basic rules, and any other rules issued by the Agency from time to time:40.4.1 Directors and senior management should not deal in their companies' securities on considerations of a short-term nature.40.4.2 Directors and senior management will always be thought to be in possession of more information than can ever be published. Accordingly, they must accept that they cannot always feel free to deal in their companies' securities, even when the rules would not prohibit them from doing so.40.4.3 Notwithstanding this general constraint, there must be periods in the year when directors are, in principle (but subject to the rules) regarded as free to deal in their companies' securities. The following rules have been formulated on the basis that:(a) dealings should not normally take place for a minimum period prior to the announcement of regularly recurring information, particularly profits, dividends and other distributions, whether or not the information is price-sensitive (this period being defined in Article 41 below), and(b) dealings should not take place prior to the announcement of matters of an exceptional nature involving unpublished price-sensitive information, in relation to the market price of the securities of the issuer (or where relevant, any other listed company).40.4.4 For the purpose of the rules, the grant to a director or senior manager of an option to subscribe or purchase his issuer's securities shall be regarded as a dealing by him, if the price at which such option may be exercised is fixed at the time of such grant. If, however, an option is granted to a director or senior manager on terms whereby the price at which such option may be exercised is to be fixed at the time of exercise, the dealing is to be regarded as taking place at the time of exercise.40.5 Matters of an exceptional nature cause particular difficulty. A director and senior manager who has knowledge of the exceptional matter in question will normally be prohibited from dealing by the Agency's law and rules, but even if he is not so prohibited he should nevertheless refrain from dealing under the circumstances outlined below. Similarly, a director or senior manager who has no such knowledge should be advised, when he notifies his intention to deal under Article 41 below, that it would be inappropriate for him to deal where the same circumstances apply. Those circumstances are when:40.5.1 The matter in question constitutes unpublished price-sensitive information in relation to the issuer's securities, and40.6 In principle, a director should seek to secure that all dealings in which he is deemed to be interested should be conducted in accordance with the provisions of Article 41, set out as a general proposition.
Nevertheless it is recognized that a director's or senior manager's duty in this respect will depend on the particular circumstances. A director who is sole trustee, for example, should follow the same procedure as for any dealings on his own account, and should deal only if he would be personally allowed to do so under the rules, even if he is exempt from the general prohibitions imposed by the Agency's law and rules, by virtue of the special defences relating to trustees covered by such provisions.
Where a director has co-trustees who are not directors of the issuer, he may not be able to ensure that the procedure applicable to his personal dealings is followed in respect of dealings on behalf of the trust. The director/trustee has to avoid acting in breach of trust, and at the same time to refrain from divulging or abusing confidential information, and it may not always be practicable to expect that the trustee will refrain from dealing, at a time when one of their members is not personally free to deal.
On the other hand, if a director, whether or not himself a trustee, has as settlor or otherwise, an important influence over the decision of the trustee, the procedure applicable to his personal dealings ought to be followed and the trustee should not deal when he personally is not free to deal. Again, the remoteness of some interests may be such as to make the imposition of any duty under Article 41 below impracticable or inappropriate. Article 41 below indicates certain precautions, which should be taken.
It is an over-riding principle that under no circumstances should a director or senior manager deal, where prohibited from doing so by the Agency's law and rules, or make any unauthorized disclosure of any confidential information, whether to co-trustees or any other person, or make any use of such information for the advantage of himself or others, even those to whom he owes a fiduciary duty.40.7 When a director places investment funds under professional management where either he retains or exercises influence, the managers should be made subject to the same restrictions and procedures as the director himself, in respect of proposed dealings in the issuer's securities.
Article 41 Guidelines for Trading by Directors and Senior Management41.1 A director or a senior manager should not deal in any of the securities of the issuer at any time, when he is in possession of unpublished price-sensitive information in relation to those securities.41.2 The same restrictions should apply to dealings by a director or by a senior manager in the securities of any other listed issue, when by virtue of his position as a director or as a senior manager of his own company, he is in possession of unpublished price-sensitive information in relation to those securities.41.3 A director or a senior manager should not deal in any securities of his own company without first notifying the Board's committee appointed for this purpose, and receiving a form of acknowledgement. In his own case, the committee should first notify the other directors and receive a form of acknowledgement.41.4 The procedure established within the issuer should, as a minimum, provide a written record maintained by the issuer, saying that the appropriate notification was given and acknowledged, and for the concerned director to have written confirmation to that effect.41.5 During the 30 days immediately preceding the preliminary announcement of the issuer's annual results and the announcement of the quarterly and half-yearly results, or of dividends and distributions to be paid, a director, senior management and associated persons should not purchase any securities of the company, nor should he deal in securities as laid out in the abovementioned Article 40, nor should he sell any such securities unless the circumstances are exceptional, for example, where a pressing financial commitment has to be met. In any event, he must comply with the procedure in Article 40.5 above.41.6 Issuers producing quarterly results should consult the Agency on the formulation of modified dealing procedures appropriate to their case.41.7 The restrictions on dealings by a director or by a senior manager contained in these rules should be regarded as equally applicable to any dealings by his or her spouse, or by or on behalf of any minor, and any other dealings in which for the purpose of the applicable laws, regulations and rules he is to be treated as interested. It is the duty of the director, to seek avoidance of any such dealing, at a time when he himself is not free to deal.41.8 Any director of the issue who acts as trustee of a trust should ensure that his co-trustees are aware of the identity of any company of which he is a director, so as to enable them to anticipate possible difficulties. A director having funds under management should likewise advise the investment manager.41.9 Any director who is a beneficiary, but not a trustee, of a trust which deals in securities of the issuer, should endeavour to ensure that the trustees notify him after they have dealt in such securities on behalf of the trust, in order that he in turn may notify the issuer. For this purpose, he should ensure that the trustees are aware of the companies of which he is a director.41.10 A list of directors and senior managers dealing in the securities of the issuer since the date of the previous list should be circulated to members of the board with the board papers, or alternatively, the register maintained for this purpose.41.11 An issuer shall endeavour to ensure that any employee of the issuer, or director or directors of an issuer, who as a board member or individual employee of a subsidiary company and, because of his office or employment in the company or subsidiary, is likely to be in possession of unpublished price-sensitive information in relation to the securities of any listed company, should deal in those securities in accordance with these Rules.