Adoption of Guiding Principles for Taking Legal Measures Against Entities Violating Disclosure Instructions

The Board of Commissioners of the Securities Commission adopted new guiding principles for imposing legal measures related to non-compliance by entities subject to the Commission's supervision and oversight with applicable disclosure instructions. The Authority based its amendments to these legal principles and measures on a set of key principles, most notably: consolidating the approved principles for all provisions contained in the currently applicable disclosure instructions into a single document; ensuring fairness and equality among all parties by applying legal measures to all publicly traded companies registered with the Authority, whether their shares are traded on the listed or unlisted stock exchanges; keeping pace with best international practices and developments; linking the legal measure to the severity of the violation and its impact on the integrity of transactions in the financial market and on the rights of shareholders and other stakeholders; considering the importance of the information to be disclosed, the time period between the occurrence of the information and the date of disclosure, including board members in legal measures if they are responsible for the violation; encouraging companies to comply with the instructions through penalties for violations; and calculating the frequency of violations related to the same type of material information.

This step comes as part of the Authority's ongoing efforts to develop the capital market and enhance its resilience and stability by encouraging entities under its supervision to better comply with applicable regulations. This will ensure the achievement of the objectives for which these regulations were established, namely, protecting shareholders' rights and ensuring transparency, fairness, and integrity among all market participants.

Accordingly, the Authority calls upon all entities under its supervision to fully comply with the provisions of the Securities Law and the regulations, instructions, and decisions issued thereunder, in order to safeguard the rights of all parties and avoid legal action against violators.