MKT 3.3 MKT 3.3 Directors Duties and Fair Treatment of Shareholders
MKT 3.3.1 MKT 3.3.1(1) This section applies, subject to (2), to:(a) the
Boardof a Reporting Entityin respect of Shares; and(b) each individual Directorwho is a member of such a Board.(2) The requirement in Rule 3.3.3 applies to every Reporting Entity.
MKT 3.3.1 Guidance1. Where a
Personreferred to in Rule 3.3.1(1) is required under any legislation applicable to such a Personto comply with a similar or more stringent requirement than the requirements in this section, compliance with those other requirements would be sufficient compliance for the purposes of the relevant requirement in this section.2. For example, in the case of a reduction of share capital, more stringent procedures such as a special resolution (i.e. a vote of at least 75% of the shareholders in voting), may be required under the company law or other legislation applicable to a Reporting Entityin its jurisdiction of incorporation. Where this is the case, compliance with the more stringent requirements applicable to the Reporting Entitysuffices for the purposes of compliance with the requirements in this section dealing with a shareholder approval by simple majority in Rule 3.3.8.
MKT 3.3.2 MKT 3.3.2
Directorof a Reporting Entitymust act:(a) on a fully informed basis;(b) in good faith,(c) honestly;(d) with due diligence and care, and(e) in the best interests of the Reporting Entityand its shareholders.
MKT 3.3.2 Guidance
In order to meet the obligation to act with due diligence and care, a
Directorshould (amongst other things) ensure that he has enough time and capacity available to devote to the job. See also the best practice standards in App 4 which apply to Directorsof Reporting Entitieswho are subject to Corporate Governance Principles.
Equality of Treatment
Boardof a Reporting Entitymust ensure equality of treatment of all holders of Securitiesof a particular class or type in respect of all rights attaching to the Securitiesof that class or type of Securities.
Reduction of Share Capital
MKT 3.3.4 MKT 3.3.4
Boardof a Reporting Entitymust ensure that a Reporting Entitydoes not purchase its own Shares unless:(a) the purchase does not materially prejudice the Reporting Entity'sability to pay its creditors;(b) it has obtained prior approval of shareholders in meeting by:(i) a Special Resolution in the case of a SME that has had its Shares admitted to the List for less than 24 months; and(ii) an Ordinary Resolution in any other case; and(c) prior to the meeting seeking the consent referred to in (b), the notice of the meeting and any accompanying documents relating to the purchase is filed with the DFSA.
MKT 3.3.4 GuidanceIn addition to complying with MKT Rule 3.3.4, a Listed Entity is required under MKT Rule 9.7.4 to obtain the DFSA’s written approval before it purchases its own Shares. It will also need to comply with any applicable company law requirements relating to the purchase of its own Shares.Derived from RMI273/2020 (Made 26th February 2020).[VER16/04-20]
[deleted][Deleted] DFSA RM120/2013 (Made 14th July 2013). [VER4/07-13]
MKT 3.3.6 [deleted][Deleted] DFSA RM120/2013 (Made 14th July 2013). [VER4/07-13]
Boardof a Reporting Entitymust, except where otherwise provided in the constituent documents of the Reporting Entity, ensure that a Reporting Entityprovides pre-emption rights under which, on an issue of Sharesby the Reporting Entityfor cash, the shareholders of the Reporting Entityare offered any Sharesto be issued in proportion to their existing holdings prior to the Sharesbeing offered to third parties, unless there is prior approval of the issue of Shareswithout pre-emption rights by shareholders in meeting, by a majority vote.
Communications with Shareholders
MKT 3.3.6(1) The
Boardof a Reporting Entitymust ensure that all the necessary information and facilities are available to its shareholders to enable them to exercise the rights attaching to their Shareson a well informed basis.(2) Without limiting the generality of the obligation in (1), the Boardmust ensure that the shareholders:(a) are provided with the necessary information relating to the matters to be determined at meetings to enable them to exercise their right to vote, including the proxy forms and notice of meetings; and(b) have access to any relevant notices or circulars giving information in relation to the rights attaching to the Securities.
Boardof a Reporting Entitymust ensure that for each meeting at which shareholders are eligible to exercise voting rights attaching to their Securities, each shareholder is given the right and means to vote by proxy.
Other Matters Requiring Shareholder Approval
MKT 3.3.8 MKT 3.3.8(1) The
Boardof a Reporting Entitymust, subject to (2), ensure that a majority of shareholders in voting approves:(a) any alteration of the constitutional documents of the Reporting Entityincluding any alteration to the memorandum of association, articles of association, bylaws or any other instrument constituting the Reporting Entity;(b) an alteration of the issued share capital of the Reporting Entitywhich is more than 20% of the existing issued share capital;(c) any acquisition or disposal of an asset of the Reporting Entitywhere the value of the asset involved is 50% or more of the value of the net assets of the Reporting Entityas at its last published financial reports;(d) the appointment or removal of a Directorof the Reporting Entityand the terms of such appointment;(e) the appointment or removal of the auditor of the Reporting Entity; and(f) the placing of the Reporting Entityinto voluntary liquidation.(2) The requirement in (1) does not apply, subject to any requirements in the constitutional documents of the Reporting Entity, in relation to the appointment or removal of a Directoror auditor of a Reporting Entityin circumstances where the immediate appointment or removal is necessary in the interests of the Reporting Entity.
MKT 3.3.8 Guidance1. Under Rule 3.3.8(1)(b), an increase in the issued share capital of a
Reporting Entitywhich results in an increase of more than 20% of its current share capital requires shareholder approval regardless of whether or not such an increase is within the authorised capital of the relevant Reporting Entity.2. The circumstances in which the immediate removal of a Directoror auditor may become necessary include matters affecting that Person'sfitness and propriety, such as professional misconduct of such a Person.