KUWAIT, March 20 Kuwait's market watchdog may
extend a year-end deadline for listed companies to comply with
new corporate governance rules if it finds there are "real
obstacles", the regulator said, after meeting with the commerce
The Capital Markets Authority (CMA) issued the regulations
in June 2013, giving companies until the end of 2014 to
The rules include separating the positions of chairman and
chief executive, prompt disclosure of information to the market,
and the setting up of internal controls and risk management.
Some corporate executives and investors have welcomed the
effort to stamp out suspicious activities and potential
conflicts of interest, and several major listed companies have
changed their corporate structures accordingly.
Others, however, have complained that the CMA, which began
operating in 2011, is leading a heavy-handed crackdown. There
are about 200 listed companies in Kuwait.
The CMA said in a statement late on Wednesday that it would
review the deadline on March 31, when it is to issue a report on
implementation of the rules so far.
"The issue of governance is also subject to monitoring and
evaluation. The level of application will be considered, and (we
will) consider postponing deadlines for those rules after the
report is available," it said.
CMA officials discussed the issue with Minister of Commerce
and Industry Abdulmohsen al-Madaj on Wednesday, the statement
said. They told him that the regulator was ready for dialogue on
the topic and that its "decisions and deadlines for
implementation are subject to flexibility".
The CMA said it had already held a meeting with over 260
companies to identify any obstacles and that the regulations
aimed simply to "enforce the law and protect the national
economy and the interests of investors."
A Reuters survey of a dozen international fund managers last
month found they ranked Kuwait lowest among five big Middle
Eastern markets for corporate disclosure and enforcement of
regulations against improper or illicit trading.
In recent months the CMA has been targeting suspected
illicit activity in the market more aggressively, fund managers
say, leading to dips in the stock market.
Earlier this month, a Kuwaiti court fined the chairman of Al
Ahli Bank 1.5 million dinars ($5.3 million) over
alleged insider trading in the bank's shares, after the CMA
filed a complaint. He denied any wrongdoing and said he would
(Reporting by Sylvia Westall; Editing by Andrew Torchia)