B Izaak, staff Writer
KUWAIT: The National Assembly yesterday unanimously passed the first reading of the Capital Market bill that calls for stringent supervision and regulation of the Kuwait Stock Market which MPs claimed had been lacking. All the 48 members present, including cabinet ministers, voted for the law which Commerce and Industry Minister Ahmad Al-Haroun described as a "major push for Kuwait's comprehensive economic development".
The law essentially calls for setting up of a five-member Capital Market Authority and although it will enjoy an independent status under the law, it will still be monitored by the office of the prime minister. The law also calls for turning the Kuwaiti bourse into a public shareholding company in which 50 percent of its shares will be sold to citizens in an initial public offering.
Twenty-four percent of the shares will be held by the government while the remaining 26 percent will be sold to a strategic private investor, according to rapporteur of the assembly's financial and economic affairs committee MP Abdulrahman Al-Anjari. The law places emphasis on transparency and regulating trading in the market in a bid to prevent illegal activities, insider trading and other violations which MPs claimed were rampant in the bourse.
Anjari also said the law illustrates acquisitions, listing of companies and all procedures necessary to combat paper companies and artificial increases or decreases in prices of stocks. Kuwait Stock Exchange is currently managed by a government-appointed administration, headed by a director general and supervised by the commerce and industry minister. The law also separates between supervision and monitoring aspects and issues relating to executive orders.
Haroun said the law will take the Kuwaiti bourses to levels of bourses in advanced countries. MPs welcomed the law, saying it will help introduce stringent regulation and supervision to the Kuwaiti bourse and that will essentially help small investors who lost most of their fortunes because of suspicious trading.
They also said the law will help regulators curb illegal trading that has mainly hit small investors. Although Kuwait bourse was the first to be established in the Gulf in early 1970s, it is the only one without a capital market authority. The second and final vote on the law is expected to take place after two weeks after making amendments to a number of articles.
In another development, Interior Minister Sheikh Jaber Al-Khaled Al-Sabah said yesterday that 1,181 expatriates, including 350 women and 26 children, are awaiting deportation at the country's deportation center. In a response to a question by MP Maassouma Al-Mubarak, the minister said that Bangladeshis top the list with 290 including 12 women followed by Indians with 241 including 57 women.
Sri Lankans came in third place with 115 including 88 women, Egyptians with 106 including two women, Pakistanis 79 men and Filipinos with 68 women and six men. The minister said that 103 people had been released after legalizing their stay and another 129 were released on temporary basis under a bail. The minister added that the would-be deportees cost around KD79,000 monthly on food which is about KD1 million a year.
Kuwait Times
