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                1. What constitutes capital market institutions?

                1- Jordan Securities Commission (JSC).
                2- Amman Stock Exchange (ASE).
                3- Securities Depository Center (SDC).

                2. What is "Jordan Securities Commission" (JSC)?

                JSC is a governmental regulatory entity that aims to organize & develop the capital market, & monitor trading in shares, bonds & other securities. The Commission shall have a legal personality with financial & administrative autonomy. JSC is affiliated with the Prime Minister to enhance its independence & to perform efficiently.

                3. What are the "Aims" of JSC?

                JSC aims in particular to achieve the following:
                1- Regulate & develop the capital market to ensure fairness, efficiency & transparency.
                2- Protect investors in securities.
                3- Protect the capital market from the risks it might face.

                4. What are the responsibilities & authorities of JSC?

                a- Regulating & monitoring the issuance of securities & dealing therein.
                b- Insuring full & accurate disclosure by issuers of the material information necessary to investors & relevant to the public issuance of securities.
                c-  Regulating & monitoring disclosure including the periodic reports prepared by issuers.
                d- Regulating licensing & registration, & monitoring the activities of Licensed & Registered Persons in the capital market.
                e- Regulating & monitoring the Stock Exchange & Trading Markets in Securities.
                f- Regulating & monitoring the Center.
                g- Regulating Mutual Funds & Investment Companies.

                5. What is the ‘Mission’ of JSC?

                To regulate, monitor & develop the capital market by regulating disclosure, financial services & dealing in securities at the Amman Stock Exchange, to enhance investor protection; to continuously upgrade legislations & human resources; to keep abreast of the latest technical developments & apply the most up-to-date standards & best international practices.

                6. What is the ‘Vision’ of JSC?

                To upgrade the national capital market in order to create an environment attractive to investment.

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                7. What are the authorities of the Board of Commissioners?

                The Securities Law stipulates that the Board of Commissioners authorities include the following; in addition to managing the affairs of Jordan Securities Commission (JSC) & setting instructions & decisions necessary to implement the provisions of this Law:
                1- Preparing draft laws & regulations related to securities.
                2- Granting licenses issued pursuant to the provisions of this law & approving the registration of Mutual Funds.
                3- Approving Amman Stock Exchange (ASE) & Securities Depository Center (SDC), by-laws & instructions. Reviewing objections related to decisions issued by them. In addition to the Boards’ authority to suspend market activity for a period that does not exceed one week. And, if it exceeds this period the Prime Minister approval must be sought.
                4- Approving fees & commissions charged by the Amman Stock Exchange (ASE) & the Securities Depository Center (SDC). In addition to setting the minimum & maximum limits of commissions which licensed financial services companies & members of the SDC charge their clients.
                5- Adopting the accounting, auditing & performance evaluation standards to be followed by parties subject to the Commission's monitoring. In addition to setting the standards & eligibility conditions required for auditors qualified to audit the accounts of the entities subject to the Commission’s monitoring & supervision.
                6- Prohibiting the issuance of or trading in any securities at the Amman Stock Exchange (ASE), if the Board of Commissioners deems this necessary.

                8. What are the issues that JSC must not engage in?

                The Commission shall not engage in any commercial activity, participate in commercial projects, lend any funds, or own or issue any securities.

                9. How is JSC administered?

                A. A board known as the (Board of Commissioners of the Commission) shall undertake the administration of the Commission & the supervision of its affairs. The Board shall be composed of five Commissioners. Each Commissioner must be a Jordanian natural person, must serve on the board on a full-time basis, & must be experienced & specialized.
                B. The Commissioners, including the Chairman & the Deputy Chairman, shall be appointed for a five year term renewable once, by a decision of the Council of Ministers upon the Prime Minister’s recommendation, endorsed by a Royal Decree. Any Commissioner may be replaced by another for the outstanding period of the Board’s term in accordance with the same procedures.
                C. The salaries, benefits & all financial entitlements of the Commissioners shall be determined by a decision of the Council of Ministers.
                D. The Commissioners shall take the following oath before the Prime Minister, prior to assuming their positions: I swear by Almighty Allah to be loyal to the King & the Country, to uphold the Constitution, to abide by the Laws & Regulations in force & to perform the functions & duties entrusted to me with honor, honesty & dedication.

                10. Who is subject to JSC monitoring & supervision?

                The following shall be subject to the Commission’s monitoring & supervision in accordance with the provisions of this Law & the regulations, instructions & decisions issued pursuant thereto:
                1- Issuers (any legal person issuing or announcing the intention to issue securities).
                2- Licensed Persons (any person licensed by the Commission in accordance with the provisions of this Law).
                3- Registered Persons (any natural person who is a member of the Board of Directors or the Board of Executives, or director, manager or employee of a Financial Services Company, or any person occupying a similar status or performing similar functions as a Financial Broker, Dealer, Investment Trustee, Investment Manager, Financial Advisor, Underwriter or a Financial Services Company).
                4- The Amman Stock Exchange (Securities Market).
                5- The Securities Depository Center.
                6- Mutual Funds & Investment Companies.

                11. What are JSC financial resources?

                By virtue of Article (28) of the Securities Law, JSC financial resources consist of the following:
                A. The fees, service charges, & commissions charged in accordance with the provisions of this Law & the regulations, instructions & decisions issued pursuant thereto.
                B. The fines imposed by the Board pursuant to the provisions of this Law, or by the Courts.
                C. The charges for the use of the Commission’s facilities, returns on the Commission’s investments, & proceeds from the sale of the Commission’s assets.
                D. Assistances, donations & grants received by the Commission, provided they are approved by the Council of Ministers.
                E. Amounts allocated by the Government to the Commission in the General Budget or for covering a deficit in the Commission’s revenue & expenditures account.
                F. Any other revenues received by the Commission & approved by the Board.

                12. What are the privileges of investing in Securities?

                1- Encourage the culture to save rather than to consume.
                2- Easy investment liquidation.
                3- Diversify investments in more than one company.
                4- Have a dividend & a capital gain.

                13. How are investors protected at the Jordan Securities Commission (JSC)?

                • Enhance the concept of disclosure & transparency.
                • Monitor trading on a daily bases. 
                • Inspection over licensed companies & these companies capital adequacy.
                • Set, review & implement capital market regulations. 

                14. What is ‘Investors Protection Fund’?

                A legal personality Fund, having financial & administrative autonomy. It aims to protect investors in licensed financial services companies that conduct financial broker businesses, via compensating them from incurred losses either by bankruptcy or obligatory liquidation. The Fund shall be subject to the Commission's monitoring & supervision. 

                15. What are ‘Trading Commissions’?

                Securities Minimum Maximum
                Shares JD 5.4 per 1000 JD 7.4 per 1000
                Bonds JD 0.45 per 1000 JD 0.95 per 1000
                Investment Unites JD 2.0 per 1000 JD 2.2 per 1000

                16. What are the listing conditions to transfer company shares from the First or Second Markets?

                Company shares are transferred to the First Market if the following conditions are fulfilled:

                • To be listed for a full year at least on the Second Market.
                • The Company's net shareholders' equity must not be less than 100% of the paid-in capital.
                • The Company must make net pre-tax profits for at least two fiscal years out of the last three years preceding the transfer of listing.
                • The Company's (free float) to the subscribed shares ratio by the end of its fiscal year must not be less than:
                  • 5% if it’s paid-in capital is JD 50 million or more.
                  • 10% if it’s paid-in capital is less than JD 50 million.
                • The number of Company shareholders must not be less than 100 by the end of its fiscal year.
                • The minimum days of trading in the Company shares must not be less than 20% of overall trading days over the last twelve months, & at least 10% of the free float shares must have been traded in during the same period.

                The listing of a Company's shares shall be transferred from the first market to the Second Market in any of the following cases:

                • If the net shareholders' equity decreased to less than 75% of the paid-in capital.
                • If the Company accounts show losses in the last three fiscal years.
                • If the Company's free float ratio shares drop to less than the minimum set by the end of its fiscal year.
                • If the number of Company shareholders drops to less than 75 by the end of its fiscal year.
                • If the days of trading on Company shares over the last twelve months drop to less than the minimum set.
                • If the percentage of traded free float drops during the last twelve months to less than the minimum set by the end of its fiscal year. 

                17. How are securities prices determined at Amman Stock Exchange (ASE)?

                According to supply & demand, reflecting buy & sell orders at the ASE.

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                18. What are the Primary & Secondary Markets?

                Primary Market: is a capital formation market in which new issues of securities are being sold for the first time.
                Secondary Market: is the market where trading in securities takes place in accordance with the laws, regulations & instructions in force.

                19. What are ‘Securities’?

                The term ‘Securities’ shall mean any ownership, rights or any evidences local or foreign that are commonly recognized as securities & considered as such by the Board. In particular, the term ‘Securities’ shall include the following:
                - Transferable & tradable company shares.
                - Bonds issued by companies.
                - Securities issued by the Government, official public institutions, public institutions, or municipalities.
                - Securities depository receipts.
                - Shares & investment units of Mutual Funds.
                - Equity option bonds.
                - Spot contracts & forward contracts.
                - Put & call option contracts.
                - Any right to acquire any of the aforementioned subparagraphs.

                20.  What is a ‘Share’?

                Certificates or book entries representing ownership in a company, these shares consist of three values:
                Par Value: it is the issuing price of a stock which equals one Jordanian Dinar.
                Book Value: the proportion of each share from ownerships equity which includes capital reserves & retained earnings.
                Market value: is the value representing the price of the share in the securities market. The profit of the share is received from cash & non-cash dividends, in addition to capital gains which are received from the difference in selling & buying prices of shares.

                21. What is a ‘Bond’?

                A long term debt instrument for the purpose of borrowing money from the public; it can be issued by governments, municipals & corporations. Bonds have future cash flows obtained on regular bases from coupon payments. The bond issuer is obliged to pay the par value at maturity date, in addition to periodic coupon payments. There are a number of useful definitions related to bonds that investors must be aware of:
                Par Value: is the issuing price of a bond.
                Coupon Payments: interest payments on a debt instrument usually paid annually or semiannually or quarterly.
                Maturity Date: is the agreed upon date in which the issuer is obliged to pay the par value for bondholders.

                22. What is ‘Amman Stock Exchange’ (ASE)? 

                A market organized for the sale & buy of shares, bonds & other types of securities. This market is subject to Jordan Securities Commission (JSC) supervision.

                23. What is ‘Securities Depository Center’ (SDC)?

                An entity having a legal personality & is subject to Jordan Securities Commission (JSC) supervision. This entity is responsible for the registration of securities, transfer of their ownership, settlement of their prices & depositing them.

                24. How can shares & bonds be bought & sold?

                Through a broker who is licensed by Jordan Securities Commission (JSC).

                25. What are the procedures to buy & sell securities at the Amman Stock Exchange(ASE)?

                • Refer to a broker licensed by Jordan Securities Commission (JSC).
                • Thoroughly read the agreement with your broker before signing it.
                • Ensure that the required commission is up to the accredited limit.
                • Regular follow up of your investments.

                26. What is a ‘Financial Services Company’?

                Any legal person engaged in the business of performing services as a financial broker, dealer, investment trustee, investment manager, financial advisor, underwriter, or any combination of these functions, or any other service specified by the JSC.

                27. What is a ‘Financial Broker’?

                Any person engaged in the business of buying & selling securities for the account of others.

                28. What is a ‘Dealer’?

                Any person engaged in the business of buying & selling securities directly for his own account through the Market.

                29. When does the license granted to any financial services expire?

                The license granted shall expire on the 31st day of December of each year.

                30. Who is the ‘Safe Keeper’?

                Any legal person engaged in the business of providing safe keeping of securities.

                31. Who is the ‘Investment Trustee’?

                Any legal person engaged in the business of administering & monitoring the management of a client’s investments so as to ensure their conformity with the client’s investment principles & objectives specified in the investment agreement concluded between the client & the Investment Manager.

                32. Who is the ‘Investment Manager’?

                Any person engaged in the business of managing securities portfolios for the account of others, including the management of Mutual Funds.

                33. Who is the ‘Financial Advisor’?

                Any person engaged in the business of providing advice with respect to securities investment to others for a fee, charge or commission.

                34. Who is the ‘Underwriter’?

                Any legal person engaged in the business of administering the issuance & marketing of securities on behalf of the Issuer.

                35. What is a ‘Public Offer’?

                Any bid for the sale of any security to more than 30 persons of the public, including public issuance & public subscription.

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                36. What is ‘Public Takeover Bid’?

                Any bid for the purchase or exchange of 40 % or more of the securities of one Issuer.

                37. What is a ‘Trading Contract’?

                A contract based on the purchase & sale of securities.

                38. What is a ‘commission’?

                Broker return for the sale or purchase of securities on behalf of his client. It is usually calculated according to the market capitalization -in percent- of sold or purchased securities. 

                39. What are ‘New Issuances’?

                Issuances of an already existing company shares that needs to increase its capital for investment purposes.

                40. What are ‘Initial Public Issuances’?

                Offering shares to the public for the first time.

                41. What is a ‘Private Subscription’?

                Granting current shareholders subscription rights, to purchase new shares, the company management intends to issue, according to shareholders current contributions.

                42. What is a ‘Public Subscription’?

                Offer of securities to the public to subscribe in.

                43. What are ‘Treasury Stocks’?

                Stocks issued & bought-back by the company.

                44. Are Treasury Stocks entitled to any rights?

                Treasury Stocks shall not be entitled to any dividends distributed by the company to shareholders, nor to participating in, & voting at the company’s general assembly meetings.

                45. Is it allowed for a company to issue any new securities during the period of retaining Treasury Stocks?

                The company shall not issue any new securities during the period of retaining Treasury Stocks.

                46.  What is a ‘Settlement Process’?

                The process of a trading contract completed with the final, unconditional transfer of securities from the seller to the buyer & the final settlement of price payments in their respect.

                47.  What is a ‘Clearance Process’?

                The process of computing the net rights & obligations of trading counter-parties arising from a trading contract, in order to deliver the securities or settle their price payments on the specified settlement date.

                48. What is ‘Margin Finance’?

                Finance by a financial broker, part of the value of the securities in the Margin Finance account by guarantee of the securities in that account.

                49. What is the ‘Association of Capital Market Registered Persons’?

                An ‘Association’ comprised of licensed natural persons by the Jordan Securities Commission (JSC) to practice businesses of Investment Management, Investment Trusteeship or Financial Advisory & Financial Brokerage. It mainly aims to improve registered persons businesses, protect the interests of its members, promote interaction between members, & raise awareness about standards of professional conduct.

                50. What are the reports to be published by the issuing company?

                The issuing company shall publish its preliminary business results within a period not exceeding 45 days of the end of the fiscal year, its annual report & statements within a period not exceeding three months from the end of its fiscal year & its semi-annual report within a month of the end of its bi-annual fiscal year.

                51. What are ‘Shareholders Rights’?

                Financial resources provided by owners of the company. Ownership Rights are calculated by deducting the company's net assets out of its net liabilities.

                52. Who is the ‘Affiliate’?

                The person who controls another person or is controlled by that other person, or who, together with that person is controlled by the same person.

                53. What is ‘Deception’?

                An act, scheme, device, practice or course of conduct likely to have the effect of misleading others or intended to mislead them.

                54. What is ‘Capitalization’?

                Transfer of company retained earnings & reserves to the contributed in capital through issuing more shares.

                55. What is ‘Price Index’?

                Index recording companies prices listed at Amman Stock Exchange (ASE) organized market weighted according to the shares market value.

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                56. What are ‘Cash Dividends’?

                The amount of cash distributed to shareholders.

                57. What are ‘Convertible Bonds’?

                Bonds converted to other types of securities.

                58. What is a ‘Control’?

                Influence, directly or indirectly, the actions & decisions of another person.

                59. Who is the ‘Insider’?

                A person possessing inside information by virtue of his position or job.

                60. What is a ‘Block Trade’?

                Trading between two brokers or through one broker to buy & sell a security in one lot, upon the written authorization of the client, provided that the market value of the single contract does not fall short of the minimum set by the Board of Directors for such security & the price of the block trade falls within the allowed minimum & maximum thresholds which are set by the Board of Directors for such security.

                61. What is a ‘Mutual Fund’?

                A fund established under, & operating in accordance with the provisions of this Law & the regulations, instructions & decisions issued pursuant thereto, in order to invest in a portfolio of securities or other financial assets for the purpose of providing professional management of a collective investment on behalf of its shareholders or investment units.

                62. What are the privileges of investing in Mutual Funds?

                • Reduce risks through diversification.
                • Benefit from an efficient institutional management.
                • Liquidate investments easily.
                • Save the investor time to follow up his investments.

                63. What is a ‘Closed-end Mutual Fund’?

                A mutual fund having a limited number of issued investment units.

                64. What is an ‘Open-end Mutual Fund’?  

                A mutual fund having unlimited number of investment units, where units can be invested in by either purchasing or selling them from & to the fund.

                65. What is an ‘Income Fund’?

                An investment fund that aim to gain regular profits to shareholders.

                66. What is ‘Earning Per Share’?

                Net income after taxes divided on number of subscribed shares.

                67. What is ‘Market Capitalization’?

                The number of subscribed shares times the last closing price of the company.

                68. What is a ‘Hidden Quantity’?

                A quantity included in a broker forwarded order to the trading system that he does not wish to refer to it in the orders record of a company.

                69. Who is an ‘Issuance Manager (firm commitment)’?

                Issuance Manager (firm commitment): to exert utmost effort to attract buyers to the issue accompanied with assurance to buy part or all of the securities to be issued, at the agreed price, according to the coverage agreement concluded with the issuer.

                70. Who is the ‘Issuer’?

                Any legal person issuing or announcing the intention to issue securities.

                71. Who is the ‘Public Issuer’?

                Any issuer who has filed a prospectus that has become effective with the Commission.

                72. What is ‘Inside Information’?

                Information relating to one or several issuers or to one or several securities which has not been made public & which if it were made public, would likely affect the price of any such security. This does not include inferences drawn on the basis of economic & financial studies, research & analysis.

                73. What is the ‘International Organization of Securities Commissions (IOSCO)’?

                Is an international organization encompassing in its membership supervisory entities & institutions, with the aim to develop capital markets of member countries via enhanced cooperation & exchange of information among members, as well the issuance of regulations & standards that regulate & develop these markets.

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                74. What is an ‘Institutional Investor’?

                Big institutions having great amounts of money to invest in, in a manner that can influence the fiscal policy & the economic & social orders. These include insurance companies, pension funds, investment trustees companies, labor unions & endowment funds.    

                75. What is a ‘Balance Sheet’?

                A statement provided by the company indicating the assets, liabilities & rights of shareholders at a particular period of time.

                76. What is a ‘Prospectus’?

                A booklet clarifying issuance details such as, a summary of the company’s capital, work nature & operations, as well previous performance, management & future plans. Information of the current issuance, its amount, terms of it & the purpose of the issuance. A summary of the company’s feasibility study, legal documents & declarations from each of the following: members of the Board of Directors or founders, the legal advisor & auditor.

                77. What is a ‘General Assembly Meeting Quorum’?

                The minimum number of shareholders shares of a general assembly meeting that must be present at any of its meetings to make the proceedings of that meeting valid.

                78. What is a ‘Public Shareholding Company Status’?

                A status prepared by company founders & agreed upon by shareholders to organize the internal affairs of a public shareholding company.

                79. What is ‘Initial Margin’?

                It is the sum paid by the client as a ratio of market value of the intended securities to be purchased.

                80. What is ‘Margin Purchase & Sale’?

                The difference in the sale & purchase prices representing a broker profit.

                81. What is ‘Margin Maintenance’?

                It is client contribution in the securities market value at any time after purchase.

                82. What is a ‘Registered Security’?

                A security registered in the name of its owner, at its issuing entity & in the Securities Depository Center (SDC).

                83. What is ‘Power of Attorney?

                A legal document entitling the agent to dispose client property, it may be private or general; to use it in specified or all legal or financial matters.

                84. Who is the ‘Agent’?

                A person who bears a legal document, that entitles him to act on behalf of his client.

                85. What is a ‘Material Fact’?

                Any event or datum, to a reasonable person, would have an effect in making a decision to buy, hold, sell or dispose of a security.

                86. What is ‘Disclosure’?

                Inform the investor of data & information affecting securities prices.

                87. What are the main prohibited acts in the national capital market?

                • Submitting false data.
                • Certifying by an auditor of false financial statements.
                • Using undisclosed inside information to attain gains or prevent losses.
                • Disseminating & promoting rumors.

                88. What should be done if one is deceived or treated unfairly &    have a proof?

                A complaint must be submitted to the JSC on telephone number: 5607171.

                89. What are the main duties of public shareholding companies towards investors concerning disclosure?

                • Issue periodic reports on specified disclosure dates.
                • Disclose material facts affecting securities prices.

                90. Who is responsible for information accuracy issued by a public shareholding company?

                It is the company’s sole responsibility.

                91. What are the main guidelines for investors at the ASE?

                1) Place investment decision on proper information.
                2) Disregard rumors.
                3) Diversify investments.
                4) Consult a licensed financial advisor.
                5) Pursue investments.

                92. What are the trading restrictions on the Chairman & members of the Board of Directors of public shareholding companies?

                • Sell & purchase of securities according to undisclosed inside information by virtue of his position or job.
                • Declare in writing to JSC any changes in securities ownership. 

                93. How is information about securities obtained?

                1)   Companies periodic records.
                2)   Brochures of licensed financial services companies.
                3)   Capital market institutions brochures.

                94. Are capital market institutions entitled to provide advice &   consultation to which companies to invest in?

                No they are not entitled to do so, the financial advisor is entitled to do so.

                95. What are key measures taken against securities violators?

                1)   Impose fines.
                2)   Restrict dealing in securities.
                3)   Revoke or suspend registrations granted.
                4)   Refer to competent courts.

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