Abu Dhabi Securities Market Amends the Insiders’ “Close Period”
In further steps towards enhancing transparency and eliminating transactions based on internal information not disclosed to public investors about securities listed in the Abu Dhabi Securities market, ADSM has initiated, at the decree of the Board of Directors, to amend the insiders’ “close period” from trading on the listed companies of which they are directors, officers, or key employees. This ban, as per market’s requirements, will take place two weeks before the end of any financial period until the disclosure of related period financial statements. Note that this decision will be applied starting from March 18, 2007 and was formally communicated to all listed companies close to the end of year 2006.
As per the old rule, the “close period” started after two weeks following the end of any financial period. The purpose of this amendment is to provide important financial information to investors before allowing insiders to trade. Because of technological developments used in the preparation of financial statements became less time-consuming and thus became familiar with the knowledge of the financial statements within the shorter time period. Therefore, this amendment will urge listed companies for earlier disclosure and provide data to investors on a timely basis, thus making rational investment decisions away from the rumors or misleading information.
Since the end of 2001, the number of listed companies traded on ADSM has grown fourfold; there are now nearly six times as many brokerage firms; the aggregate market capitalization of companies traded on the exchange is 20 times higher; there are 50 times as many shareholders registered and ADSM is a model emiratization employer with UAE national making up about 74% of staff.