Can the Authority extend or reduce the lock-up period (Two financial years) imposed, by the Companies Law, on the shareholders of the companies converting to joint stock companies with regard to the companies seeking to be listed in the Parallel Market-No
Yes, since paragraph (4) of the article (107) of the Companies Law gives the Authority the right to extend or reduce the lock-up period for companies that wish to be listed in the Saudi Stock Exchange.
Is it required for companies listed in the Parallel Market-Nomu to comply with Corporate Governance Regulations?
Companies listed in the Parallel Market-Nomu are not required to comply with Corporate Governance Regulations; given that Corporate Governance Regulations are indicative to all issuers in the Parallel Market-Nomu. However, this does not prejudice the obligations of the companies listed in the Parallel Market-Nomu according to the provisions of the Companies Law which is set forth in the Corporate Governance Regulations.
Is it required for companies listed in the Parallel Market-Nomu to publish the annual Board of Directors report?
Yes, in compliance with the Companies Law and the provisions of article (43) of the Listing Rules. However, the information required by the Authority's regulations to be included in the Board of Directors report are indicative to issuers whose shares are listed in the Parallel Market-Nomu.
Do the instructions and procedures related to listed companies with accumulated losses amounting to %20 or more of its capital apply to the Parallel Market-Nomu listed companies?
Is it required for companies seeking to be listed in the Parallel Market-Nomu to comply with the instructions of Book Building process and allocation method in Initial Public Offerings (IPOs)?
No, the instructions of Book Building process and allocation method in IPOs are not applicable to offering made in accordance to the Parallel Market Listing Rules.
Do Merger and Acquisition Regulations apply to companies listed in the Parallel Market-Nomu?
What is the daily fluctuation limit for the share prices of companies listed in the Parallel Market-Nomu?
The daily fluctuation limit for the share prices of all companies listed in the Parallel Market-Nomu is 20%.
Should the offer be fully covered for those companies seeking to be listed in the Parallel Market-Nomu?
Offering shares to qualified investors in the Parallel Market-Nomu does not require full coverage of the offer.
Is there a specific allocation method for the shares of the issuer to the Qualified Investors?
There is no specific method for share allocation, since the instructions of Book Building Process and Allocation Method in Initial Public Offerings (IPOs) do not apply to the Parallel Market-Nomu. However, the issuer must submit, after obtaining the approval on the prospectus and prior to the listing, a list of shareholders and shares allocated to them.
Are there any requirements or restrictions for setting the price range or the pricing of the offered shares?
The Parallel Market Listing Rules did not include any requirements or restrictions regarding the price range or the pricing of the offered shares.
When is the issuer permitted to apply for waiver from disclosure of a matter to be disclosed under the Parallel Market Listing Rules?
Where, in the opinion of the issuer, disclosure of any matter required by the Parallel Market Listing Rules would be unduly detrimental to the issuer, and omission is not likely to mislead the Qualified Investors with regard to facts and circumstances, knowledge of which is essential for the assessment of the securities in question, the issuer may apply for a waiver from the relevant requirement. The issuer must in that case provide to the Authority on a strictly confidential basis a statement of the requested waiver together with the reasons why the issuer believes that the information should not be disclosed at that time. The Authority may approve or reject the application for a waiver. If the Authority approves the application for a waiver, the Authority may at any time require the issuer to disclose any information in relation to the waiver.
What does Corporate Governance means?
It means rules to lead and guide the Company that includes mechanisms to regulate the various relationships between the Board, Executive Directors, shareholders and Stakeholders, by establishing rules and procedures to facilitate the decision making process and add transparency and credibility to it with the objective of protecting the rights of shareholders and Stakeholders and achieving fairness, competitiveness and transparency on the Exchange and the business
What are the Objectives of the Corporate Governance Regulations?
These Regulations aim at establishing an effective legal framework to govern the Company, and particularly aim at the following:
1) enhancing the role of the Company’s shareholders and facilitating the exercise of their rights;
2) Stating the competencies and responsibilities of the Board and the Executive Management;
3) enhancing the role of the Board and the committees and developing their capabilities to enhance the Company’s decision making mechanisms;
4) achieving transparency, impartiality and equity in the Exchange, its transactions, and the business environment and enhance disclosure therein;
5) providing effective and balanced tools to deal with conflicts of interest;
6) enhancing accountability and control mechanisms for the Company’s employees;
7) establishing the general framework for dealing with Stakeholders and protecting their rights;
8) supporting the effectiveness of the system for overseeing Companies and the tools thereof; and
9) raising the awareness of Companies in respect of the concept of professional conduct and encouraging them to adopt and develop such concept in accordance with their nature.
Is the Board of Directors of a listed Company on the Exchange required to establish governance rules for the Company?
Article 94 of the Corporate Governance Regulations requires the Board of Directors to establish governance rules for the Company that do not conflict with the mandatory provisions of the Corporate Governance provisions, and shall monitor their application, verify their effectiveness, and amend them as necessary.
What constitutes a Shareholders Assembly:
It is an assembly consisting of the shareholders in the Company formed in accordance with the provisions of the Companies Law and the Company’s bylaws.
