CAIRO: The Egyptian Financial Supervisory Authority (EFSA) set initial contract Model and the Statute of Investment Fund on Monday alongside the latest amendments at the investments fund.
In the new draft “statute” EFSA balanced between the new amendments and the past regulations of capital market, according to EFSA official home page.
EFSA also defined the new statue the entity of investment fund according to the last amendments. It includes defining the required conditions in fund owner, valuing funds assets, the auditors’ qualifications, and ways to achieve profit.
EFSA seeks through setting the statute on new investment funds to define each participant’s rights and duties and to avoid confusion while sharing profits. The last amendments in May are considering investment funds as a joint stock company, Al-Hilal Al-Saudi Company for Financial Securities executive manager Saeed Hilal told The Cairo Post.
Over the new amendments, the shareholders are considered corporate owners of the fund. “By acquiring shares in the fund, you become owner of the fund and also part of the capital,” Hilal said.
The EFSA new statue ensures the investors “shareholders” rights in which it requires signing contracts between the shareholders and the funds’ owners by the value of their capitals, he added. But for auditors “who edit the financial lists of investments funds,” EFSA puts measures for auditors to be eligible for ratifying the lists.
Over EFSA new measures, auditors should ratify budgets of five different companies to be accepted for auditing and they must pass the EFSA and the Central Bank of Egypt tests.
EFSA seeks to avoid mistakes by bringing qualified auditors while auditing as the new amendments oblige the funds owners to present quarterly, half yearly, and annual financial lists, he said.
For participation rates, EFSA’s May amendments oblige that 51 percent of the fund should be owned by Egyptians and more than 75 percent are owned by corporate owners “shareholders.” Each fund should include financial institution with more than 25 percent shares of total capital, Al-Tahrir news gate reported in June.
It required at the shareholders along with funds’ owners to have financial solvencies as to invest in such funds.