KUWAIT CITY, Aug 16: Simultaneously initiated by supervisory actions in both directions, a recent agreement has been established between officials from the Capital Markets Authority (CMA) and leaders of the Ministry of Commerce and Industry (MoCI).

This accord aims to facilitate comprehensive coordination of information exchange between the two entities, particularly in terms of joint reporting, whether pertaining to companies or their executives, reports Al-Rai daily quoting sources. Following multiple meetings between the involved parties, the agreement stipulates that the Ministry of Commerce will promptly notify the Capital Markets Authority of punitive measures and decisions taken against both listed and unlisted companies, along with their executives, once these actions are approved by the Ministry. This process ensures a standardized exchange of information between the two bodies.

Consequently, the Ministry will swiftly provide the Authority with updated company data, encompassing changes in ownership, board composition, and other procedural modifications that affect the company database, specifically those with significant implications. Furthermore, this collaboration mandates that the Ministry of Commerce immediately informs the Capital Markets Authority about any penalties imposed on companies and their officials.

Additionally, the Ministry will furnish updated records from the company register, encompassing capital movements, whether upward or downward. The sources emphasized that harmonizing regulatory information between the two entities guarantees that the Capital Markets Authority can take necessary actions if new data registered with the Ministry is not mirrored within its own records, necessitating an update. A pertinent query arises: does this coordination imply that no prior information exchange existed between the Capital Markets Authority and the Ministry of Commerce? Addressing this, sources indicated that practical oversight exercised by the Capital Markets Authority uncovered a communication gap between it and the Ministry of Commerce regarding certain data. This lacuna requires both parties to collaborate in bridging the gap. It was revealed that this disparity relates to discrepancies between the Capital Markets Authority’s database and the corresponding records maintained by the Ministry of Commerce.

This is due to instances where the Ministry alters company records or enforces punitive measures without promptly notifying the Capital Markets Authority. Consequently, there might be two sets of regulatory information, one of which remains outdated. But how can the Capital Markets Authority address this quandary, given its regulatory and supervisory mandate to ensure immediate disclosure of any new relevant data, including changes to boards of directors, capital movements, and penalties? Moreover, sources indicated that the informational predicament faced by the Capital Markets Authority predominantly pertains to companies temporarily suspended from trading or those delisted, as well as companies suspended from trading due to outstanding fees. These decisions fall under the purview of Capital Markets Authority regulations but do not equate to revoking the companies’ licenses. Instead, these companies remain legally operational entities under the Ministry of Commerce, updating their records in line with established conditions and resolutions passed by their general assemblies.

Sources noted that this scenario might encourage some penalized companies to withhold their updated data from the Capital Markets Authority and merely re-register with the Ministry. Their rationale rests on the belief that they have exited the scope of Capital Markets Authority oversight. These sources pointed out that while the actions of many such companies might contravene Capital Markets Authority requirements, it has become a “fait accompli”, prompting the authority to address the information gap via an integrated temporary link with the Ministry of Commerce.

This mechanism ensures prompt notification to the Capital Markets Authority regarding any changes in records concerning both listed and unlisted companies, as well as their executives. In the event that companies removed from trading persist in not notifying the Capital Markets Authority of updated data, the Authority will mitigate reliance on outdated information by establishing comprehensive information sharing with the Ministry of Commerce. This measure is particularly vital for data that necessitates continual supervisory updates. Sources indicated that these scheduled reporting instances will be communicated through joint emails between the two parties. These communications will facilitate the timely exchange of required data. It is expected that this collaboration will encompass the sharing of decisions made by the Capital Markets Authority against companies under its supervision with the Ministry of Commerce.