• Glossary of Defined Terms

    • Glossary History

      Change Date Description of Changes
      April 2007 Initial Launch
      July 2007 Amendment of definition of "Administrator(s)"
      July 2011 Inclusion of Capital Markets Rulebook Definitions
      January 2012 Clarified definition of independent director; amended definition of chief executive; added definition of listed company.
      April 2012 Definitions with references to Module CIU deleted as these are now covered under Volume 7.
      April 2013 Amended definition for discount broker.
      Added definitions for external trading member, financial services, licensee, market maker and proprietary trading member.
      January 2014 New glossary terms added to incorporate terms for Module OFS.
      October 2014 Added definition for relevant authorities.
      July 2016 Amended definition of politically exposed person (PEP).
      Added and amended terms and definitions used in Modules AML, CSD, MAE and MIR.
      October 2017 Amended definition of Beneficial Owner.
      October 2017 New glossary terms added to incorporate terms for crowdfunding.core.
      January 2019 New glossary terms added to incorporate terms for market makers.
      April 2019 New glossary terms added to incorporate terms for Crypto Asset Module (CRA).
      October 2019 Added definition of Disinterested Shares.
      October 2019 Amended definition of Offer.
      October 2019 Amended definition of Professional Adviser.
      October 2019 Added definition of Relevant Person(s).
      October 2019 Added definition of Securities Exchange Offer.
      October 2019 Amended definition of Share Repurchase.
      October 2019 Added definition of Standstill Agreement.
      October 2019 Added definition of Takeover.
      October 2019 Added definition of Voluntary Offer.
      October 2019 Added definition of Voting Rights.
      October 2019 Added definition of 'without delay'.
      January 2020 Added definition of Beneficiary.
      January 2020 Added definition of Beneficiary financial institution.
      January 2020 Amended definition of Capital Market Service Provider.
      January 2020 Added definition of Client Assets.
      January 2020 Added definition of Client Money.
      January 2020 Added definition of Correspondent Account Services.
      January 2020 Added definition of Intermediary Financial Institution.
      January 2020 Added definition of Ordering Financial Institution.
      January 2020 Added definition of Originator.
      January 2020 Added definition of Payable-through Account.
      January 2020 Added definition of Respondent Financial Institution.
      January 2020 Added definition of Shell Financial Institution.
      July 2020 Amended definition of Independent director.
      October 2020 Amended definition of Accredited Investor(s).
      October 2020 Added point (f) in definition of Independent director..

    • [A] [A]

      • Accepted Crypto-asset(s)

        A payment token (cryptocurrency) permitted by the CBB for the purpose of undertaking the regulated crypto-asset service by a crypto-asset licensee.

        Added: April 2019

      • Accredited investor(s)

        Accredited investors are defined as investors meeting the following criteria:

        (a) Individuals who have a minimum net worth (or joint net worth with their spouse) of USD 1,000,000 or more, excluding that person’s principal place of residence;
        (b) Companies, partnerships, trusts or other commercial undertakings, which have financial assets available for investment of not less than USD 1,000,000; or
        (c) Governments, supranational organisations, central banks or other national monetary authorities and state organisations whose main activity is to invest in financial instruments (such as state pension funds).
        Amended: October 2020
        Amended: July 2011

      • Acquisition of equity securities/voting rights

        Acquisition of voting rights includes the exercise of control or direction over voting rights other than by way of a revocable proxy given for no or nominal consideration for the purpose of one meeting of shareholders only.

        Added: July 2011

      • Acting in concert

        Persons acting in concert comprise persons who, pursuant to an agreement or understanding (whether formal or informal), actively cooperate to obtain or consolidate "control" (as defined below) of a company through the acquisition by any of them of voting rights of the company. Without prejudice to the general application of this definition, persons falling within each of the following classes will be presumed to be acting in concert with others in the same class unless the contrary is established:

        (a) A company, its parent, its subsidiaries, its fellow subsidiaries, associated companies of any of the foregoing, and companies of which such companies are associated companies;
        (b) A company with directors (together with their connected persons, related trusts and companies controlled by any of the directors, their connected persons or related trusts) of it or of its parent, subsidiaries or fellow subsidiaries;
        (c) A company with any of its pension funds, provident funds and employee stock option plans;
        (d) A fund manager (including an exempt fund manager) with any investment company, mutual fund, unit trust or other person, whose investments such fund manager manages on a discretionary basis, in respect of the relevant investment accounts. For the purpose of Module TMA, investments mean the holding collectively or individually of 30% or more of the securities of an offeror who intends acquiring 30% or more of the securities of an offeree;
        (e) A financial or other professional adviser (including a stockbroker) with its client in respect of the shareholdings of the adviser and persons controlling, controlled by, or under the same control as the adviser (except in the capacity of an exempt principal trader);
        (f) Directors of a company (together with their connected persons, related trusts and companies controlled by such directors, their connected persons and related trusts) which is subject to an offer or where the directors have reason to believe a bona fide offer for their company may be imminent;
        (g) Partners;
        (h) An individual (including any person who is accustomed to act in accordance with the instructions of the individual) with his connected persons, related trusts and companies controlled by him, his connected persons or related trusts; and
        (i) A person, other than an authorised financial institution within the meaning of the CBB Law lending money in the ordinary course of business, providing finance or financial assistance (directly or indirectly) to any person (or a person acting in concert with such a person) in connection with an acquisition of voting rights (including any direct or indirect refinancing of the funding of the acquisition).
        Added: July 2011

      • Administrator(s)

        Administrators are persons who undertake the administration of financial instruments and other assets, for a third party. Administration may include the following activities:

        (a) Legal and fund management accounting services;
        (b) Client enquiries;
        (c) Valuation and pricing (including tax returns);
        (d) Regulatory compliance monitoring;
        (e) Maintenance of unit-holder register;
        (f) Distribution of income;
        (g) Issuance and redemption of holdings in a CIU;
        (h) Contract settlements (including certificate dispatch); and
        (i) Record-keeping.
        Amended: July 2007

      • Allotment

        "Allotment" means an amount of securities assigned to each of the participants, subscribers, or allottees. The financial responsibilities of the subscribers are set forth in an allotment notice, which is prepared by the issuer or lead manager.

        Added: January 2014

      • Annual report

        Annual report means the annual audited financial statements, plus all accompanying notes, auditors' reports, commentaries and disclosures required by IFRS, including the required non-financial, employment and corporate governance disclosures.

        Added: July 2011

      • Appointed Expert(s)

        A duly qualified individual or firm appointed by the CBB to carry out inspections in accordance with Article 114 of the CBB Law or special investigations of licensees in accordance with Article 121 of the CBB Law. Appointed experts may be appointed in addition to the CBB's own officials. Examples of appointed experts include reporting accountants, lawyers, private investigators, expert witnesses and independent actuaries.

        Added: April 2019

      • Approved person(s)

        Approved Persons are individuals holding certain specified positions in CBB licensees; they must be approved by the CBB prior to taking on those positions and must demonstrate that they are fit and proper. The list of positions subject to the CBB's Approved Persons regime vary according to the CBB license category, but generally cover directors and senior management, as well as certain other positions. Approved Persons requirements are specified in the relevant Rulebook Volume for the license category in question.

      • Arbitration cell

        Means a division or employee(s) of an SRO designated and authorised to receive petitions, coordinate and assist in the administration of arbitrations in terms of Chapter 3 of Module DRA.

        Added: July 2011

      • Associate

        For the purpose of Module TMA, the term associate will cover all persons acting in concert with an offeror. It is also intended to apply to a wider range of persons (who may not be acting in concert) and will cover all persons who directly or indirectly own or deal in the relevant securities of an offeror or the offeree company in an offer and who have (in addition to their normal interests as shareholders) an interest or potential interest, whether commercial, financial or personal, in the outcome of the offer. Without prejudice to the generality of the foregoing, the term "Associate" normally includes the following:

        (a) An offeror's or the offeree company's parent, subsidiaries and fellow subsidiaries, and their associated companies, and companies of which such companies are associated companies;
        (b) Any bank and financial and other professional adviser (including a stockbroker) to an offeror, the offeree company or any company in (a), including persons controlling, controlled by, or under the same control as such banks, financial and other professional advisers;
        (c) The directors (together with their connected persons, related trusts and companies controlled by any of the directors, their connected persons or related trusts) of an offeror, the offeree company or any company in (a);
        (d) The pension funds, provident funds and employee share schemes of an offeror, the offeree company or any company in (a);
        (e) Any investment company, unit trust or other person whose investments an associate manages on a discretionary basis, in respect of the relevant investment accounts;
        (f) A person who owns or controls 10% or more of any class of relevant securities issued by an offeror or the offeree company, including a person who as a result of any transaction owns or controls 10% or more. When two or more persons act pursuant to an agreement or understanding (formal or informal) to acquire or control such securities, they will be deemed to be a single person for the purpose of the Module TMA. Such securities managed on a discretionary basis by an investment management group will, unless otherwise agreed by the CBB, also be deemed to be those of a single person; and
        (g) A company having a material trading arrangement with an offeror or the offeree company.
        Added: July 2011

      • A person associated with another person

        For the purposes of Module MAM, a person associated with another person means:

        (1)
        (a) Where the other person is a company:
        (i) A director or secretary of the company;
        (ii) A related company; or
        (iii) A director or secretary of such related company;
        (b) Where the matter to which the reference relates is the extent of a power to exercise, or to control the exercise of, the voting power attached to voting shares in a company, a person with whom the other person has, or proposes to enter into, an agreement, arrangement, understanding or undertaking, whether formal or informal, or express or implied:
        (i) By reason of which either of those persons may exercise, directly or indirectly, control the exercise of, or substantially influence the exercise of, any voting power attached to a share in the company;
        (ii) With a view to controlling or influencing the composition of the board of directors, or the conduct of affairs, of the company; or
        (iii) Under which either of those persons may acquire from the other of them shares in the company or may be required to dispose of such shares in accordance with the directions of the other of them;
        except that in relation to a matter relating to shares in a company, a person may be an associate of the company and the company may be an associate of a person;
        (c) A person with whom the other person is acting, or proposes to act, in concert in relation to the matter to which the reference relates;
        (d) Where the matter to which the reference relates is a matter, other than the extent of a power to exercise, or to control the exercise of, the voting power attached to voting shares in a company:
        (i) Subject to paragraph (2) a person who is a director of a company of which the other person is a director; or
        (ii) A trustee of a trust in relation to which the other person benefits or is capable of benefiting otherwise than by reason of transactions entered into in the ordinary course of business in connection with the lending of money;
        (e) A person with whom the other person is, according to any subsidiary legislation made under this Module, to be regarded as associated in respect of the matter to which the reference relates;
        (f) A person with whom the other person is, or proposes to become, associated, whether formally or informally, in any other way in respect of the matter to which the reference relates; or
        (g) Where the other person has entered into, or proposed to enter into a transaction or has done, or proposes to do so, any other act or thing, with a view to becoming associated with a person as referred to in sub-paragraph (a), (b), (c), (d), (e) or (f), that last-mentioned person.
        (2) Where, in any proceedings under this Module, it is alleged that a person referred to in paragraph (1) (d) (i) was associated with another person at a particular time, the first-mentioned person shall not be considered to be so associated in relation to a matter to which the proceedings relate unless the person alleging the association proves that the first-mentioned person at that time knew or ought reasonably to have known the material particulars of that matter.
        (3) A person shall not be considered to be associated with another person by virtue of paragraph (1) (b), (c), (e) or (f) by reason only of one or more of the following:
        (a) That one of those persons furnishes advice to, or acts on behalf of, the other person in the proper performance of the functions attaching to his professional capacity or to his business relationship with the other person;
        (b) That one of those persons, a customer, gives specific instructions to the other, whose ordinary business includes dealing in securities, trading in futures contracts or leveraged foreign exchange trading, to acquire shares on the customer's behalf in the ordinary course of that business;
        (c) That one of those persons has sent, or proposes to send, to the other a take-over offer, or has made or proposes to make, offers under a take-over announcement, within the meaning of the Take-overs, Mergers, Acquisitions and Share Repurchases (TMA) Module in relation to shares held by the other;
        (d) That one of those persons has appointed the other, otherwise than for valuable consideration given by the other or by an associate of the other, to vote as a proxy or representative at a meeting of members, or of a class of members of a company.
        Added: July 2011

      • Associated company

        A company shall be deemed to be an associated company of another company if one of them owns or controls 20% or more of the voting rights of the other, or if both are associated companies of the same company.

        Added: July 2011

    • [B] [B]

      • Bahrain domiciled CIU(s)

        [This definition has been moved to Volume 7 in April 2012].

      • Bahrain domiciled exempt CIU(s)

        [This definition has been moved to Volume 7 in April 2012].

      • Bahrain domiciled expert CIU(s)

        [This definition has been moved to Volume 7 in April 2012].

      • Bahrain domiciled retail CIU(s)

        [This definition has been moved to Volume 7 in April 2012].

      • Bai Bithaman Ajil contracts

        Refers to the sale of goods on a deferred payment basis. Goods or equipment requested by the purchaser are paid for by the financial institution which subsequently sells the goods back to the purchaser at an agreed price which includes the financial institution's fee.

        Added: January 2014

      • Beneficial owner

        The term 'beneficial owner' of securities refers to any person who, if not the recorded owner of the securities, has or participates in the underlying benefits of ownership. These benefits include the power to direct the voting or the disposition of the securities, or to receive the economic benefit of ownership of the securities. A person is also considered to be the 'beneficial owner' of securities if that person has the right to acquire such securities within a certain period of time, either by option or other agreement. Beneficial owners include persons who hold their securities through one or more trustees, brokers, agents, legal representatives or other intermediaries, or through issuers in which they have a 'controlling interest', which means the direct or indirect power to direct the management and policies of the issuer, or any other entity in question.This definition should also apply to "Ultimate beneficial ownership".

        Amended: October 2017
        Added: July 2011

      • Beneficiary

        (As used in Module AML): refers to the natural or legal person or legal arrangement who is identified by the originator as the receiver of the requested wire transfer.

        Added: January 2020

      • Beneficiary financial institution

        Refers to the financial institution which receives the wire transfer from the ordering financial institution directly or through an intermediary financial institution and makes the funds available to the beneficiary.

        Added: January 2020

      • Best-efforts underwriting

        Where the underwriter acts as an agent to the issuer and agrees to do its best to sell the issue to the investors, but does not guarantee subscription and does not buy the securities in case of under-subscription.

        Added: January 2014

      • Book building

        Book building means a process whereby demand for the securities proposed to be issued by an issuer are elicited and built-up, in order to assess the price for such securities.

        Added: January 2014

      • Bonds

        An instrument creating or acknowledging a present or future indebtedness (i.e. debentures, debenture stock, loan stock, bonds, certificates of deposit and any other instruments creating or acknowledging a present or future indebtedness), but excluding:

        (a) An instrument creating or acknowledging indebtedness for, or for money borrowed to defray, the consideration payable under a contract for the supply of goods and services;
        (b) A cheque or other bill of exchange, a bankers draft or a letter of credit (but not a bill of exchange accepted by a banker);
        (c) A banknote, a statement showing a balance on a bank account, or a lease or other disposition of property; and
        (d) A contract of insurance.
        Added: July 2016

      • Broker

        Means a person who acts as an intermediary between the buyer and seller, usually charging a commission. A broker who specializes in stocks, debt securities, commodities or options acts as agent and must be licensed by the CBB and registered with the licensed exchange as a member.

        Added: July 2011

      • Broker-dealer

        Means a person licensed by the CBB to operate as an agent on behalf of its clients (as broker) and as a principal for its own account (as dealer), in securities transactions. A broker-dealer must also be registered with the licensed exchange as a member.

        Added: July 2016

      • Business rules

        Are those rules issued by a licensed exchange, licensed market operator, or licensed clearing house or licensed central depository in its capacity as a self-regulatory organisation (SRO) to regulate the functions of such institutions and the admission, regulation and supervision of its members or participants.

        Amended: July 2016
        Added: July 2011

    • [C] [C]

      • Capital Market Service Provider (CMSP)/Capital Market Advisory Service Provider

        Means any person licensed or authorised or involved in providing by itself or as agent, regulated crypto-asset service or any activity specified under Article 80 of the CBB Law and includes SROs, their members and companies listed on licensed exchanges and crypto-asset licensees.

        Amended: January 2020
        Amended: July 2016
        Amended: January 2014
        Added: July 2011

      • Capitalisation issue

        An allotment of further securities to existing securities holders, credited as fully paid-up out of the issuer's reserves or profits, in proportion to their existing holdings, or otherwise not involving any monetary payments.

        Added: January 2014

      • Cash purchases

        For the purpose of Module TMA, cash purchases include contracts or arrangements where the consideration consists of a debt instrument capable of being paid off in less than 3 years.

        Added: July 2011

      • CBB licensee(s)

        CBB licensees are persons holding a license from the CBB to undertake a regulated service. Different license categories apply, depending on the types of regulated services undertaken. Each license category is subject to its own Rulebook Volume (e.g. Volumes 1 and 2 for conventional bank licensees and Islamic bank licensees, and Volume 4 for investment firm licensees).

      • Central depository

        Means a central securities depository being any person who is eligible and licensed by the CBB to provide custody services, maintain a central securities register and accounts of central depository participants and evidence and transfer of ownership.

        Added: July 2011

      • Chief executive/Chief executive Officer (CEO) or General Manager

        Means a person who is responsible for the conduct of the licensee (regardless of actual title). The Chief Executive or General Manager must be resident in Bahrain. This person is responsible, alone or jointly, for the conduct of the whole of the firm.

        Amended: July 2016
        Amended: January 2012
        Added: July 2011

      • (CIU) manager(s)

        [This definition has been moved to Volume 7 in April 2012].

      • (CIU) participant(s)

        [This definition has been moved to Volume 7 in April 2012].

      • Class(es)

        Class means securities that have similar features. Stocks and bonds are the two main classes; they are subdivided into various classes — for example, mortgage bonds and debentures, issues with different rates of interest, common or preferred stock, or Class A and Class B common. The different classes in a company's capitalisation are itemised on its balance sheet.

        Added: January 2014

      • Clearing member

        Means a person who is a member of a licensed clearing house who clear and settle transactions in a licensed clearing house.

        Amended: July 2016
        Added: July 2011

      • Clearing house

        Means any person who is eligible and licensed by the CBB and acts as the central counterparty in making payments or deliveries or both in connection with transactions in securities, or who provides facilities for comparison of data in respect of the settlement of securities transactions, to reduce the number of settlements of securities transactions, or for allocation of securities settlement responsibilities.

        Added: July 2011

      • Client(s)

        Means a person with or for whom a licensed member conducts or intends to conduct regulated activities.

        Amended: July 2016
        Added: July 2011

      • Client Assets

        Means securities, money or other assets received or retained by, or deposited with a member or a crypto-asset licensee in the course of its business for which it is liable to account to its client, and any securities, money or other assets accruing therefrom.

        Added: January 2020

      • Client complaints

        For the purposes of this Module, a client complaint includes: "any complaint in relation to the provision of services by a CMSP in which the client alleges that he has suffered, or is likely to suffer financial prejudice as a result of the member or CMSP:

        (a) Contravening or failing to comply with any instruction given by the client, or any agreement or mandate entered into with the client;
        (b) Contravening or failing to comply with the rules and the directives;
        (c) Acting dishonestly, negligently or recklessly; or
        (d) Treating the client unreasonably, or unfairly."
        Added: July 2011

      • Client information

        Means transaction information relating to:

        (a) A named client of a licensed member; or
        (b) A group of clients, from which the name of a client can be directly inferred from a licensed member.
        Added: July 2011

      • Client Money

        Money, of any currency, that a licensee receives from or on behalf of a client in the course of carrying on securities business or regulated crypto-asset services (as the case may be) is client money except for money which is to be:

        (a) used to defray the licensee’s brokerage and other charges which are lawfully due to the licensee;
        (b) paid to the client or in accordance with the client’s written direction; and
        (c) money which is to be used to reduce the amount owed by the client to the licensee.
        Added: January 2020

      • CMSD

        Means the Capital Markets Supervision Directorate of the Central Bank of Bahrain.

        Added: July 2011

      • Closed-ended funds

        Closed-ended funds are CIUs with a limited number of holdings. Where the fund vehicle is a company, holdings can take the form of shares. New holdings are rarely issued after the fund is launched and are not normally redeemable until the fund liquidates. Typically an investor can acquire or dispose of holdings in a closed-ended fund by buying or selling them on a secondary market, from a market intermediary or other investor, rather than by dealing with the CIU itself.

      • Collective Investment Undertaking(s) ('CIUs')

        Collective investment undertakings ('CIUs') are undertakings:

        (a) The sole object of which is the collective investment of capital raised from the public in financial instruments or other assets and which operates on the basis of risk-spreading; and
        (b) The holdings of which are re-purchased or redeemed, directly or indirectly, out of those undertakings' assets.

        [This definition has been amended as CIUs have been moved to Volume 7 in April 2012].

        Amended: April 2012

      • Connected fund manager and connected principal trader

        For the purpose of Module TMA, a fund manager or principal trader will be connected with an offeror or the offeree company, as the case may be, if the fund manager or principal trader controls, is controlled by, or is under the same control as:

        (a) An offeror;
        (b) The offeree company;
        (c) Any bank or financial or other professional adviser (including a stockbroker) to an offeror or the offeree company; or
        (d) An investor in a consortium formed for the purpose of making an offer.
        Added: July 2011

      • Connected party transactions

        Means a transaction between the CMSP and a 'connected person'.

        Added: July 2011

      • Connected persons

        In relation to an individual means:

        (a) The individual's spouse and his/her son, adopted son, stepson, daughter, adopted daughter, step-daughter, father, step-father, mother, step-mother, brother, step-brother, sister or step-sister, under his/her guardianship or control; or
        (b) A firm or corporation in which the individual or any of the persons mentioned in sub-paragraph (a) has control of not less than 10% of the voting power in the firm or corporation, whether such control is exercised individually or jointly;
        (c) Connected persons in relation to a firm or corporation means another firm or corporation in which the first-mentioned firm or corporation has control of not less than 10% of the voting power in that other firm or corporation.
        Added: July 2011

      • Consideration issue

        An issue of securities as consideration, other than cash, in a transaction or in connection with a takeover or merger or the division of an issuer.

        Added: January 2014

      • Control

        Unless the context otherwise requires, control shall be deemed to mean a holding, or aggregate holdings, of 30% or more of the voting rights of a company, irrespective of whether that holding or holdings gives de facto control.

        Added: July 2011

      • Controlled functions

        Means a function carried on by an approved person in relation to a CMSP that requires prior CBB approval, as per the relevant licensing Module.

        Added: July 2011

      • Controlling shareholder

        Means any shareholder who holds 10% or more of the share capital or is able to exercise (or control the exercise of) 10% or more of the voting power in the company.

        Added: July 2011

      • Conventional bank licensee(s)

        A bank licensed by the CBB under Volume 1 of the CBB Rulebook, and generally operating according to conventional finance principals (as opposed to operating in accordance with Islamic finance principles).

      • Convertible securities

        Unless the context otherwise requires, convertible securities means securities convertible or exchangeable into other types of securities, or into another class of the same securities. The conversion can also take place within the same securities issuer's company and/or group, or in relation to another company or group.

        Amended: January 2014
        Added: July 2011

      • Correspondent Account Services

        Means the provision of services between a Capital Market Service Provider and a respondent financial institution, in relation to any regulated activity as stipulated by the CBB, whether for that respondent financial institution as principal or for that respondent financial institution’s customers.

        Added: January 2020

      • Crowdfunding Platform

        Means the online platform operated by a crowdfunding platform operator.

        Added: October 2017

      • Crowdfunding Platform Operator

        Means a person licensed by the CBB under the CBB Rulebook Volume 5 in respect of operating a crowdfunding platform.

        Added: October 2017

      • Crypto-asset

        Crypto-asset, within the context of the CBB Rulebook, Volume 6 and Module CRA: Cryptoasset, refers to virtual or digital assets or tokens operating on a blockchain platform and protected by cryptography. Tokens are broadly of four types: Payment tokens, Utility tokens, Asset tokens and Hybrid tokens.

        i. Payment tokens (Exchange tokens): Payment tokens (synonymous with cryptocurrencies) are virtual currencies which are intended to be used, now or in the future, as a means of payment for acquiring goods or services or as a means of money or value transfer. Payment tokens give rise to no claims on their issuer and are usually decentralised. The most prominent example is Bitcoin.
        ii. Utility tokens: Utility tokens are tokens that are intended to provide access to a specific application or service but are not accepted as a means of payment for other applications.
        iii. Asset tokens: Asset tokens represent assets such as a debt or equity claim on the issuer. Asset tokens promise, for example, a share in future company earnings or future capital flows. In terms of their economic function, therefore, these tokens are analogous to equities, bonds or derivatives. Tokens which enable physical assets to be traded on the blockchain also fall into this category.
        iv. Hybrid Tokens: Hybrid tokens are those that have features of one or more of the other three types of tokens.
        Added: April 2019

      • Crypto-asset exchange

        A center or network established for the purpose of trading or exchanging of crypto-assets, which operates by matching orders in the normal course of business.

        Added: April 2019

      • Crypto-asset license

        A license issued by the CBB under the crypto-asset Module of Rulebook Volume 6

        Added: April 2019

      • Crypto-asset licensee

        A person licensed by the CBB under the Crypto-asset Module of Rulebook 6.

        Added: April 2019

      • Custodian(s)

        Means a person who is licensed to undertake depository participant or clearing member services as a member of a licensed clearing house or licensed central depository, and is mandated to hold and safeguard the financial instruments and other assets of a person, such as a collective investment undertaking (CIU).

        Amended: July 2016
        Amended: July 2011

      • Cyber Security Incident

        An observable occurrence indicating a possible breach in the systems, network and operating environment.

        Added: April 2019

      • Cyber Security Risk

        The combination of the probability of an incident occurring within the realm of a licensee's information assets, systems and operating environment.

        Added: April 2019

      • Cyber Security Risk Resilience

        The ability to anticipate, absorb, adapt to, rapidly respond to, and recover from disruption caused by a cyber-attack.

        Added: April 2019

      • Cyber Security Threat

        A circumstance or incident with the potential to intentionally or unintentionally exploit one or more vulnerabilities in a licensee's information assets, systems and operating environment.

        Added: April 2019

    • [D] [D]


      • Days

        Unless specifically referred to as business days, means calendar days.

        Added: July 2011

      • Dealing

        For the purpose of Module CSD and in relation to any deposited security, means the deposit, purchase or sale of securities, including the charging of pledging of the deposited security by a securities holder and the evidence of ownership.

        Added: July 2016

      • Dealing in securities

        Includes (whether as principal or agent) making or offering to make with any person, or inducing or attempting to induce any person to enter into or to offer to enter into any agreement for, or with a view to acquiring, disposing of, subscribing for, or underwriting securities.

      • Dealer

        Means a person acting as a principal in a securities transaction. Principals trade for their own account and risk. When buying from a broker acting as a dealer, the customer receives securities from the member's inventory; the confirmation must disclose this when dealers trade for their own account as part of their responsibility for maintaining an orderly market. Since most brokerage firms operate as both brokers and principals (dealers) the term "broker-dealer" is commonly used.

        Added: July 2011

      • Debt security(ies)

        Debenture, loan stock, bonds, sukuk, subordinated debt, notes and other securities or instruments acknowledging, evidencing or creating indebtedness, whether secured or unsecured, conventional or Islamic, and options, warrants or similar rights to subscribe or purchase any of the foregoing and convertible debt securities.

        Added: January 2014

      • Default proceedings

        Means proceedings or other action taken by a licensed clearing house or a central depository under its default rules.

        Added: July 2011

      • Default rules

        In relation to a licensed clearing house or central depository, means the business rules of the licensed clearing house or central depository which provide for the taking of proceedings or other action if a clearing member or participant has failed, or appears to be unable or to be likely to become unable, to meet his obligations for all unsettled or open derivatives market contracts to which he is a party.

        Added: July 2011

      • Defaulter

        Means a clearing member or participant who is the subject of any default proceedings.

        Added: July 2011

      • Delivery

        Means the final transfer of a security by the seller to the buyer.

        Added: July 2011

      • Dematerialisation

        Means a process by which evidence of ownership of securities is issued in electronic form or book entries, either at the time of original issue of securities or by subsequent conversion of evidence of ownership in the form of physical certificates into electronic form.

        Amended: January 2014
        Added: July 2011

      • Depository participant

        Means a member of a licensed central depository who intermediates between the licensed central depository and the beneficial owner of securities as an agent of the depository.

        Added: July 2011

      • Derivative

        Derivative includes any financial product whose value in whole or in part is determined directly or indirectly by reference to the price of an underlying security or securities, whether or not it includes the possibility of delivery of such underlying security or securities.

        Added: July 2011

      • Director

        Is any person who occupies the position of a Director, as defined in Article 173 of the Commercial Companies Law (Legislative Decree No. 21 of 2001).

        Added: July 2011

      • Director and senior management

        Includes any member of senior management, regardless of title, including:

        (a) The issuer's directors;
        (b) General Manager, Chief Executive Officers, Presidents, Heads of Finance, Heads of Business Departments;
        (c) Partners with unlimited liability, in the case of a limited partnership with share capital;
        (d) Nominees to serve in any of the aforementioned positions; and
        (e) Founders, if the issuer has been established for fewer than two years.
        Added: July 2011

      • Directive

        Directive includes any directive, waiver, consent, decision, confirmation or other determination in writing under the Modules by the CBB.

        Added: July 2011

      • Disciplinary action cell

        Means a division or employee of an SRO designated and authorised to receive notification of a breach of rules of an SRO and to coordinate and assist in the administration of disciplinary proceedings.

        Added: July 2011

      • Disclosure standards

        The Disclosure Standards issued under Circular ODG/407/03 and as updated from time-to-time.

        Added: July 2011

      • Discount broker

        Means a person who arranges orders to buy and sell securities and who supplies these orders to a licensed broker for execution.

        Amended: April 2013
        Added: July 2011

      • Disinterested Shares

        Shares in the offeree company other than those which are owned by the offeror or persons acting in concert with it.

        Added: October 2019

      • Document

        Unless the context otherwise requires, for the purpose of Module TMA, document includes any announcement, advertisement or document issued or published by any party to an offer or possible offer in connection with such offer or possible offer. For this purpose, parties to an offer or possible offer include all offerors, the offeree company, shareholders of an offeror or the offeree company and any persons acting in concert with any of them. Document also includes any announcement, advertisement or document issued or published by any person in connection with a transaction:

        (a) Where a directive is sought that no offer obligation arises;
        (b) Which is stated to be conditional on no such offer obligation arising; or
        (c) Which is stated to be conditional on a directive being given that no such offer obligation arises.
        Added: July 2011

    • [E] [E]

      • Employee share benefit plan or Employee stock option plan

        Offering of securities which is made by the issuer on the exercise of options granted to or for the benefit of management and/or employees, after obtaining the approval of securities holders and the CBB.

        Added: January 2014

      • Employee share repurchase

        Employee share repurchase means a share repurchase made by an offeror from one or more of its current or former employees, or the current or former employees of a subsidiary of the offeror, in accordance with an employee share option scheme which has been approved by shareholders of the offeror in a general meeting.

        Added: July 2011

      • Enforcement decision committee (EDC)

        Means the committee constituted by the CBB for the purpose of taking enforcement decisions of material significance, on behalf of the CBB. The EDC exercises enforcement powers on behalf of the CBB and acts independently from the CBB's executive management structure.

        Added: July 2011

      • Enforcement order

        Means an order issued by the CBB for imposing penalty or other enforcement actions pursuant to a decision made by the EDC after considering the alleged contraventions and the representations, if any, made by the recipient of a warning notice.

        Added: July 2011

      • Equity Crowdfunding

        Equity crowdfunding is raising of capital through a crowdfunding platform by issuance of ordinary shares by closed, private, family companies, start-up and small and medium size companies, entities engaged in real estate development projects and real estate income properties.

        Added: October 2017

      • Equity Crowdfunding Issuer

        Means a person making an equity crowdfunding offer.

        Added: October 2017

      • Equity Crowdfunding Offer

        An offering of ordinary shares by means of equity crowdfunding by an equity crowdfunding issuer through a crowdfunding platform operated by a crowdfunding platform operator.

        Added: October 2017

      • Equity Crowdfunding Offering Statement

        For the purpose of Module MAE, equity crowdfunding offering statement includes a disclosure statement or such other information or documentation or part thereof issued by an equity crowdfunding issuer to investors in connection with an equity crowdfunding offer.

        Added: October 2017

      • Equity security(ies)

        Securities representing the capital of a company and which provide the holders thereof the right of participation in that company most commonly in the attendance and vote at the general meeting and the receipt of dividends when issued.

        Added: January 2014

      • Exchange/Substitution of securities

        Securities issued through an exchange or a substitution of securities or a conversion of securities into other classes of securities.

        Added: January 2014

      • Executive director

        Means a director who is an officer or employee, or is otherwise involved in the day-to-day management of either:

        (a) The company;
        (b) Another company which is a controlling shareholder of the company;
        (c) Another company of which the company is a controlling shareholder; or
        (d) Another company which is controlled by a controlling shareholder.

        In this definition, the word "company", which is a controller of the CMSP, excludes sovereigns such as government-owned entities and government ministries.

        Added: July 2011

      • Exempt CIU(s)

        [This definition has been moved to Volume 7 in April 2012].

      • Exempt exchange

        An exempt exchange means an exchange who has been exempted from the requirement of licensing by the CBB.

        Amended: July 2016
        Added: July 2011

      • Exempt fund manager

        An exempt fund manager is a person who manages investment accounts on a discretionary basis and is recognised by the CBB as an exempt fund manager.

        Added: July 2011

      • Exempt market operator

        An exempt market operator means a market operator who has been exempted from the requirement of licensing by the CBB.

        Added: July 2016

      • Exempt principal trader

        An exempt principal trader is a person who trades as a principal in securities, particularly the relevant securities assented to by the CBB, and is recognised by the CBB as an exempt principal trader.

        Added: July 2011

      • Exempt share repurchase

        Exempt share repurchase means a share repurchase that falls into one of the following categories:

        (a) An approved employee share repurchase;
        (b) A share repurchase made in accordance with the terms and conditions attached to the shares being repurchased which either permit or require such share repurchase without the prior agreement of the owners of the shares;
        (c) A share repurchase made by a company at the request of the owners of the shares repurchased, in accordance with the terms and conditions attached to the shares, which provide the owners of the shares a right to require the company to effect such share repurchase; and
        (d) A share repurchase that is required by the law of the jurisdiction in which the offeror is incorporated or otherwise established.
        Added: July 2011

      • Expert CIU(s)

        [This definition has been moved to Volume 7 in April 2012].

      • Expert investor(s)

        [This definition has been moved to Volume 7 in April 2012].

      • Expert Investors

        Are (a) Individuals who have a minimum net worth (or joint net worth with their spouse) of USD 100,000, excluding that person's principal place of residence; (b) Companies, partnerships, trusts or other commercial undertakings, which have financial assets available for investment of not less than USD 100,000; or (c) Governments, supranational organisations, central banks or other national monetary authorities, local authorities and state organisations.

        Added: October 2017

      • External trading member

        Means an eligible foreign institution (remote member) who is a member of a licensed exchange and authorised by the CBB but who conducts their regulated activity (including trading on behalf of their clients) exclusively outside the jurisdiction of the Kingdom of Bahrain.

        Amended: July 2016
        Added: April 2013

    • [F] [F]

      • Fiat Currency

        Government issued currency that is designated as legal tender in its country of issuance through government decree, regulation or law.

        Added: April 2019

      • Financial instruments

        Any of the following instruments, as further defined in Volume 4, Section AU-1.5, of the CBB Rulebook:

        (a) Transferable securities;
        (b) Islamic financial instruments;
        (c) Money market instruments;
        (d) Holdings in collective investment undertakings;
        (e) Derivative contracts other than commodity derivatives;
        (f) Derivative contracts relating to commodities settled in cash;
        (g) Derivative contracts relating to commodities;
        (h) Credit derivatives;
        (i) Financial contracts for differences;
        (j) Other derivative contracts;
        (k) Interests in real estate property;
        (l) Certificates representing certain securities; and
        (m) Rights or Interests in Financial Instruments.
        Amended: July 2011

      • Financial services

        Financial services means:

        (a) Any dealings in any instrument defined as a financial instrument in any Volume of the CBB Rulebook;
        (b) Any arrangement where money, goods or services are made available to a person in exchange for his promise to pay at a later date and that arrangement is of a type habitually provided by another person for commercial gain;
        (c) Any arrangement in which money is solicited from the public in return for a promise of financial gain on, or safekeeping of, that money; or
        (d) Any product or other financial services in the area of regulated services (regulated by the CBB) marketed in the Kingdom of Bahrain.
        Added: April 2013

      • Firm commitment underwriting

        Firm Commitment Underwriting means a securities underwriting arrangement whereby underwriters make outright purchases from the issuer through providing a guarantee to the issuer and the market that any unsubscribed securities will be taken up.

        Added: January 2014

      • Foreign or overseas authority

        Foreign or overseas authority means:

        (a) The authority involved in the regulation of the financial service markets in another country; or
        (b) Any foreign central bank or body with the authority of issuing money or responsible for supervising payment systems, clearances, or cheques and financial papers settlement.
        Added: July 2011

      • Founders

        For the purpose of Module OFS, founders means the subscribers who signed the incorporation application and paid their contribution in the paid-up capital before the public offer.

        Added: January 2014

      • "Fraud"

        Includes:

        (a) Any act, expression, omission or concealment committed, whether in a deceitful manner or not by a person or by any other person with his connivance or by his agent while dealing in securities, in order to induce another person or his agent to deal in securities, whether or not there is any wrongful gain or avoidance of any loss, and shall also include:
        (i) A knowing misrepresentation of the truth or concealment of material fact in order that another person may act to his detriment;
        (ii) A suggestion as to a fact which is not true by one who does not believe it to be true;
        (iii) An active concealment of a fact by a person having knowledge or belief of the fact;
        (iv) A promise made without any intention of performing it;
        (v) A representation made in a reckless and careless manner whether it be true or false;
        (vi) Any such act or omission as any other law specifically declares to be fraudulent;
        (vii) Deceptive behaviour by a person depriving another of informed consent or full participation; (viii) A false statement made without reasonable ground for believing it to be true;
        (ix) The act of an issuer of securities giving out misinformation that affects the market price of the security, resulting in investors being effectively misled even though they did not rely on the statement itself, or anything derived from it other than the market price;
        and "fraudulent" shall be construed accordingly, nothing contained in this paragraph shall apply to any general comments made in good faith in regard to:
        (a) The economic policy of the government;
        (b) The economic situation of the country;
        (c) Trends in the securities market; or
        (b) Any other matter of a like nature.
        Added: July 2011

      • Free float

        That portion of a company's securities that are available for public trading on a licensed exchange.

        Added: January 2014

      • Futures contracts

        An agreement to buy or sell a specific amount of a commodity or financial instrument at a particular price on a stipulated future date. A futures contract obligates the buyer to purchase the underlying commodity and the seller to sell it, unless the contract is sold to another before settlement date, which may happen if a trader waits to take a profit or avoid a loss. This contrasts with options trading, in which the option buyer may choose whether or not to exercise the option on the exercise date

        Added: January 2014

    • [G] [G]

      • GCC

        Gulf Cooperation Council (www.gcc-sg.org ). The member countries of the GCC are Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates.

    • [H] [H]

      • Head of function

        Means a person who exercises major managerial responsibilities, is responsible for a significant business or operating unit, or has senior managerial responsibility for maintaining accounts or other records of the licensee.

        Added: July 2011

      • Holding(s)

        Holdings mean the unit of measurement of the beneficial interest of participants in a CIU, by whatever name it is called (including 'units' and, in the case of investment trusts or companies, shares). Each holding (which may be in fractions of a holding) represents a right to the assets of the CIU.

    • [I] [I]

      • Ijara sukuk

        Islamic contract issued on stand alone assets identified on the balance sheet. For this purpose, the assets identified can be land which is to be leased, or equipment (e.g. aircraft, ships) to be leased. The rental rates of returns on these Sukuk can be both fixed and floating, depending on the particular originator.

        Added: January 2014

      • Immobilization

        Means a process by which physical securities are held in a licensed central depository for the account of the beneficial owners of such securities and such immobilized securities can either be transferred by electronic or book entries on the records of a licensed central depository.

        Added: July 2011

      • Independent director

        Means a director whom the board has specifically determined has no material relationship which could affect his independence of judgement, taking into account all known facts. The board should consider that, although a particular director meets the formal requirements, he may not be independent owing to specific circumstances of the person or the company, ownership structure of the company, or for any other reason. The board's determination should be a good faith finding after diligent review and full discussion.

        Formal Requirements — "Independent Director" means a director of the company who, or whose family shareholders either separately or together with him or each other, does not have any material pecuniary relationships or transactions with the company (not counting director's remuneration for this purpose), and in particular who, during the one year preceding the time in question met all the following conditions:

        (a) Was not an employee of the company;
        (b) Did not:
        (i) Make to, or receive from, the company payments of more than BD 31,000 or equivalent (not counting director's remuneration);
        (ii) Own more than 5% share or other ownership interest, directly or indirectly, in an entity that made to or received from the company payments of more than such amount;
        (iii) Act as a general partner, manager, director, or officer of a partnership or company that made to or received from the company payments of more than such amount;
        (iv) Have any significant contractual or business relationship with the company which could be seen to materially interfere with the person's capacity to act in an independent manner.
        (c) Did not own directly or indirectly (including for this purpose ownership by any family member or related person) 5% or more of the shares of any type or class of the company;
        (d) Was not engaged directly or indirectly as an auditor or professional adviser for the company;
        (e) Was not an associate of a director or a member of senior management of the company; and
        (f) Was not an associate of a Director, member of senior management or board member of the company’s controller.

        For the purpose of the definition of "independent director":

        (a) Where the term "family" or "family member or related persons" is used reference is made to: spouse, father, mother, son(s) or daughter(s); and
        (b) Where the term "associate" is used reference is made to:
        (i) Spouse, father, mother, son(s) or daughter(s); or
        (ii) A person who is an employee or partner of the Director or of the firm represented or owned by the Director.
        Amended: October 2020
        Amended: July 2020
        Amended: January 2012
        Added: July 2011

      • Information

        Includes:

        (a) Matters of supposition and other matters that are insufficiently definite to warrant being made known to the public;
        (b) Matters relating to the intentions, or the likely intentions, of a person;
        (c) Matters relating to negotiations or proposals with respect to:
        (i) Commercial dealings;
        (ii) Dealings in securities; or
        (iii) Trading in futures contracts;
        (d) Information relating to the financial performance of a company or business trust, or otherwise;
        (e) Information that a person proposes to enter into, or had previously entered into one or more transactions or agreements in relation to securities, or has prepared or proposes to issue a statement relating to such securities; and
        (f) Matters relating to the future.
        Added: July 2011

      • Information Assets

        Any piece of data, device or other component of the environment that supports informationrelated activities.

        Added: April 2019

      • Information disclosed widely enough

        Information is disclosed widely enough if:

        (a) It consists of readily observable matter;
        (b) Without limiting the generality of paragraph (a);
        (i) It has been made known in a matter that would, or would be likely to, bring to the attention of persons who commonly invest in securities of a kind whose price or value might be affected by the information; and
        (ii) Since it was so made known, a reasonable period for it to be disseminated among such persons has elapsed; or
        (c) It consists of deductions, conclusions or inferences made or drawn from either or both of the following:
        (i) Information referred to in paragraph (a);
        (ii) Information made known was referred to in paragraph (b) (i);
        (d) Such information is disclosed in the manner and within the timeframe stipulated by the CBB rules and regulations.
        Added: July 2011

      • Initial listing(s) for publicly traded companies

        For non-Bahraini issuers whose securities are issued in other markets, or listed on another regulated exchange and who wish to list on a licensed exchange in Bahrain.

        Added: January 2014

      • Initial offer for sale

        An offer for sale to the public by or on behalf of existing companies or unlisted issuers or its securities holders or part of its securities holders, whose securities are already in issue or subscribed.

        Added: January 2014

      • Initial public offering

        An offer for subscription to the public by or on behalf of a newly-established company, or an unlisted issuer of its own securities.

        Added: January 2014

      • Insider

        Means any person who has obtained inside information:

        (a) By virtue of his employment or profession;
        (b) Being an officer or shareholder of the issuer of the securities; or
        (c) Through illegal means.

        A person may be an insider if he is already aware that such information is classified as inside information, even though none of the above applies to him. All persons who have access or come into possession of material inside information before its public release are considered insiders. Such persons include controlling shareholders, directors and senior management, officers and employees, and frequently should also include any officials of the CBB and the Exchange who have access to such information, outside attorneys, accountants, auditors, underwriters, investment bankers, public relations advisers, advertising agencies, consultants and other independent contractors. The husbands, wives, immediate families and those under the control of insiders may also be regarded as insiders. Where acquisition or other negotiations are concerned, the above relationships apply to other parties to the negotiations as well. Insiders include “tippees” who come into possession of material inside information.

        Added: July 2011

      • Inside information

        Means information that:

        (a) Is precise in nature relating directly or indirectly to one or more of the securities or the issuer thereof;
        (b) Has not been made public;
        (c) If made public, is likely to have a significant impact on the price of those securities or their derivatives;
        (d) Is, directly or indirectly, related to derivatives of commodities which the traders expect to be disclosed according to the market regulations.

        Inside information includes but not limited to:

        (a) All information that requires prompt announcement, as per the CBB's Disclosure Standards and Listing Rules;
        (b) A merger or demerger of the company, or other significant corporate actions;
        (c) Issuance of a security, a purchase or redemption offer, or another change relating to the paid-up capital of the listed company;
        (d) The contents of quarterly, semi-annual and annual financial statements.
        Added: July 2011

      • Insider trading

        Refers not only to the purchase or sale of an issuer's equity and debt securities, but also to the purchase or sale of puts, calls or other options with respect to such securities. Such trading is deemed to be done by an insider whenever he has any beneficial interest, direct or indirect, in such securities or options, regardless of whether they are actually held in his name. Included in the concept of insider trading or tipping, or revealing inside information to outside individuals, to enable such individuals to trade in the issuer's securities on the basis of undisclosed information.

        Added: July 2011

      • Inspection

        Means an inspection undertaken by official(s) of the CMSD to inspect SRO's, CMSP's, listed companies and members of SRO's, as per Article 114 of the CBB Law.

        Added: July 2011

      • Insurance licensee(s)

        A person licensed under Volume 3 of the CBB Rulebook to undertake regulated insurance services.

      • Intermediary Financial Institution

        Refers to a financial institution in a serial or cover payment chain that receives and transmits a wire transfer on behalf of the ordering financial institution and the beneficiary financial institution, or another intermediary financial institution.

        Added: January 2020

      • Intifaa contract

        Islamic contract which involves "right of use". Buying the Sukuk allows the user the right of use of the asset at predetermined times.

        Added: January 2014

      • Investigation

        Means a formal investigation or preliminary investigation undertaken by any official(s) of the CMSD or any professional firm appointed by the CBB, as per Article 121 of the CBB Law.

        Added: July 2011

      • Investigator

        Means any official(s) of the CMSD or any professional firm appointed by the CBB under Article 121 of the CBB Law to conduct an investigation.

        Added: July 2011

      • Investment firm licensee(s)

        A person licensed under Volume 4 of the CBB Rulebook to undertake regulated investment business services.

      • IOSCO MMoU

        IOSCO MMoU means the International Organisation of Securities Commissions Multilateral Memorandum of Understanding Concerning Consultation and Cooperation and the Exchange of Information.

        Added: July 2011

      • Islamic bank licensee(s)

        A person licensed under Volume 2 of the CBB Rulebook to undertake regulated Islamic banking services.

      • Islamic securities

        Securities which are held out to be Shari'a compliant.

        Added: January 2014

      • Issuer

        Means any person making an issue of securities.

        Added: July 2011

      • Istisna'a contract(s)

        Islamic contract used primarily in project finance. Such contracts are not tradable securities since the underlying asset does not yet exist. The proceeds of such an issue would typically be used to construct the base infrastructure through multiple Istisna'a agreements.

        Added: January 2014

    • [J] [J]


      • Joint stock company(ies)

        A form of business organisation whose securities are eligible to be issued to and held by the public.

        Added: January 2014

    • [K]


    • [L] [L]


      • Laws and regulations

        For the purpose of Module ICO, laws and regulations means the provisions of the laws of the jurisdictions of the overseas authorities, the regulations promulgated thereunder, and the other regulatory requirements that fall within the competence of the overseas authorities, concerning the following:

        (a) Insider dealing, market manipulation, misrepresentation of material information and other fraudulent or manipulative practices relating to securities and derivatives, including solicitation practices, handling of investor funds and customer orders;
        (b) The registration, issuance, offer, or sale of securities and derivatives, and reporting requirements related thereto;
        (c) Market intermediaries, including investment and trading advisers who are required to be licensed or registered, collective investment undertakings, brokers, dealers, and transfer agents; and
        (d) Markets, exchanges, and clearing and settlement entities.
        Added: July 2011

      • Licensed central depository

        Means a central depository licensed by the CBB under the Clearing, Settlement and Depository Module (CSD) of Rulebook Volume 6.

        Amended: July 2016
        Added: January 2014

      • Licensed clearing house

        Means a clearing house licensed by the CBB under the Clearing, Settlement and Depository Module (CSD) of Rulebook Volume 6.

        Amended: July 2016
        Added: July 2011

      • Licensed exchange

        Means an exchange licensed by the CBB under the Markets and Exchange Module (MAE) of Rulebook Volume 6 in respect of the operation of its market in and from the Kingdom of Bahrain.

        Amended: July 2016
        Added: July 2011

      • Licensed market operator

        Means an overseas exchange that is licensed by the CBB under the Markets and Exchanges Module (MAE) of Rulebook Volume 6 to operate a market in the Kingdom of Bahrain.

        Amended: July 2016
        Added: July 2011

      • Licensed member(s)

        For the purpose of Module MIR in Volume 6 of the CBB Rulebook, means a member licensed by the CBB under this Module.

        Added: July 2016

      • Licensee

        Any person licensed by the CBB under any of the Volumes of the CBB Rulebook.

        Added: April 2013

      • Listed company

        Means a company who should have been admitted for trading of the official list of a licensed exchange in Bahrain.

        Added: January 2012

      • Listing of closed or private companies

        Closed, private, family companies, or such other non-public companies that offer their securities to the public and list.

        Added: January 2014

      • Listing rules

        In relation to a licensed exchange or a licensed market operator that establishes or operates or proposes to establish or operate a licensed market means rules governing or relating to:

        (a) The admission to the official list of the licensed exchange or licensed market operator of the securities of corporations, governments, bodies unincorporated or other persons for the purpose of the quotation on the securities market of the licensed exchange of securities issued, or made available by such corporations, governments, bodies unincorporated or other persons, or the removal from that official list and for other purposes; or
        (b) The activities or conduct of corporations, governments, bodies unincorporated and other persons who are admitted to that list.
        Added: July 2011

    • [M] [M]

      • Malware

        Malicious software used to disrupt the normal operation of an information system in a manner that adversely impacts its confidentiality, integrity or availability.

        Added: April 2019

      • Manager(s)

        [This definition has been moved to Volume 7 in April 2012].

      • Mandatory offer

        An offer for the remaining outstanding shares of an offeree company made by a shareholder, whether individually or along with persons acting in concert on the acquisition of control of such offeree company or such other threshold stipulated in the Module TMA.

        Added: July 2011

      • Manipulation

        Includes any deliberate/reckless act or attempt or act, expression, omission or concealment or influence to interfere with the free and fair functioning of the market, or to introduce misinformation or misleading appearance in the market, or to impede judgement of investors and market participants.

        Added: July 2011

      • Market

        Means a place at which, or a facility (whether electronic or otherwise) by means of which, offers or invitations to sell, purchase or exchange securities or futures contracts (including options and derivatives) regularly made on a centralised basis, being offers or invitations that are intended or may reasonably be expected to result, whether directly or indirectly, in the acceptance or making, respectively, of offers to sell, purchase or exchange securities or futures contracts (whether through that place or facility or otherwise).

        Amended: July 2016
        Added: July 2011

      • Market analysis

        Means research aimed at predicting or anticipating the direction of stock, debt securities, or commodity markets based on technical data about the movement of market prices, or on fundamental data such as corporate earnings prospects, or supply and demand.

        Added: July 2011

      • Market charge

        Means a security interest, whether fixed or floating, granted in favour of a licensed clearing house or central depository:

        (a) Over property held by or deposited with the licensed clearing house or central depository; and
        (b) To secure liabilities arising directly in connection with the licensed clearing house or central depository, ensuring the performance of a market contract.
        Added: July 2011

      • Market collateral

        Means property held by, or deposited with, a licensed clearing house or central depository for the purpose of securing liabilities arising directly in connection with the licensed clearing house or central depository, ensuring the performance of market contracts.

        Added: July 2011

      • Market contract or contracts

        Means:

        (a) A contract subject to the business rules of a licensed clearing house or central depository that is entered into between the licensed clearing house and a member pursuant to a novation (however described), whether before or after default proceedings have commenced, which is in accordance with those business rules and for the purposes of the clearing or settlement of transactions using the clearing facility of the licensed clearing house; or
        (b) A transaction which is being cleared or settled using the clearing facility of a licensed clearing house and in accordance with the business rules of the licensed clearing house, whether or not a novation referred to in paragraph (a) is to take place.
        Added: July 2011

      • Market information

        Means any published information about trading or non-trading in certain types of securities, their number, prices, range of price for trading, or the identity of those involved or who may be involved in any capacity, such as trading.

        Added: July 2011

      • Market intermediary and representative

        Means a person falling within a category referred to in Module MIR-2.2.4 which undertakes regulated activities.

        Amended: July 2016
        Added: July 2011

      • Market Maker

        Means the person licensed by the Central Bank of Bahrain and registered with a licensed exchange or licensed market operator to provide both buy and sell quotes on continuous basis with an objective to improve liquidity in a security.

        Amended: January 2019
        Added: April 2013

      • Market Maker Agreement

        Means an agreement executed between the licensed exchange or licensed market operator and a member in respect of registration of the member as a market maker.

        Added: January 2019

      • Market Making

        Means the act of providing two-way quotes on a regular and on-going basis to enhance liquidity of a security.

        Added: January 2019

      • Market Making Agreement

        Means an agreement executed between the market maker and the issuer to undertake a market making scheme in the issuer's security

        Added: January 2019

      • Materiality

        Information is material if its omission or mis-statement could influence the economic decisions of the users taken on the basis of the financial statements. A reasonable person would be taken to expect information to have a material effect on the price or value of securities if the information would, or would be likely to, influence persons who commonly invest in securities in deciding whether or not to subscribe for, buy or sell the first-mentioned securities.

        Added: July 2011

      • Member

        In relation to an SRO means a person who holds membership of any class or description in the SRO, whether or not he holds any shares in the share capital of the SRO, as the case may be, and who has been approved by a licensed exchange to effect transactions on the trading system of the licensed exchange and/or approved by a licensed clearing house to effect the clearing, settlement or depositing of securities thereof.

        Added: July 2011

      • Merger

        Means the combination of two or more companies through the acquisition of an equity stake.

        Added: July 2011

      • Mixed Ijara contract(s)

        Islamic contract where the underlying assets can comprise of Istisna'a or Murabaha receivables in addition to Ijara.

        Added: January 2014

      • Mixed Ijara Sukuk

        Islamic contract that allows for a greater variety of funds to be used since previously inaccessible Murabaha and Istisna'a assets can be used in the portfolio.

        Added: January 2014

      • Modarabah contract(s)

        Islamic contract used to finance a project or business venture whereby the investor (Rabb Al Maal) provides capital and a manager (Mudarib) manages the project or the business. A financial institution may act as the Mudarib for funds it mobilizes for investments in Shari'a compliant products. If the venture is profitable, the profit will be distributed based on a pre-agreed ratio and losses if any are to be borne solely by the provider of the capital (Rabb Al Maal).

        Added: January 2014

      • Money laundering

        As defined in Decree Law No. 4 of 2001 and Decree Law 54 of 2006 with Respect to the Prohibition of the Laundering of Money.

        Added: July 2011

      • Murabaha contract(s)

        Islamic contract that covers the sale and purchase transaction for the financing of an asset whereby the cost and profit margin (mark-up) are made known and agreed by all parties involved. The settlement for the purchase can be a deferred lump sum payment or an instalment basis of payments.

        Added: January 2014

    • [N] [N]


      • Non-executive director

        Means any director who is not an Executive Director.

        Added: July 2011

    • [O] [O]

      • OECD

        Organisation for Economic Cooperation and Development (www.oecd.org).

        Amended: July 2011

      • Offer

        For the purpose of Module TMA, offer includes takeover and merger transactions, however effected, including partial offers, and offers by a parent company for shares in its subsidiary and (where appropriate) share repurchases by general offer.

        Amended: October 2019
        Added: July 2011

      • Offeree

        Means a listed company to whom an offer has been submitted under Module TMA.

        Added: July 2011

      • Offering document(s)

        For the purpose of Module OFS, offering document includes a prospectus or such other information or documentation or part thereof required by the CBB or another authority for the offer and/or issue of securities.

        Added: January 2014

      • Offering period

        For the purpose of Module OFS, the time in which securities are offered for subscription which shall be for a period not less than 10 calendar days and not more than 6 months.

        Added: January 2014

      • Offering price

        The price per security at which a new or secondary distribution of securities is being offered for sale.

        Added: January 2014

      • Offeror

        For the purpose of Module TMA, offeror includes companies wherever incorporated and individuals wherever resident, governments, not-for-profit organisations, individuals or any other juridical person. In relation to share repurchases, offeror means a company engaged in, or considering engaging in, a share repurchase in respect of its own shares.

        Added: July 2011

      • Offer document

        For the purposes of takeovers, mergers, acquisitions and share repurchases, includes both Appendix C and Appendix D and any other information required to be included in the terms of Module TMA.

        Added: July 2011

      • Offer period

        Offer period for the purpose of Module TMA shall mean the period starting from the date when an announcement is made of a proposed or possible offer, with or without terms, until whichever is the latest of:

        (a) The date when the offer closes for acceptance;
        (b) The date when the offer lapses;
        (c) The time when an offeror announces that the possible offer will not proceed;
        (d) The date when an announcement is made of the withdrawal of a proposed offer;
        (e) Where the offer contains a possibility to elect for alternative forms of consideration, the latest date for making such election; or
        (f) Where there are two or more offers or possible offers outstanding, the closure of an offer period in respect of one offer or possible offer does not affect the termination of any other offer or possible offer.
        Added: July 2011

      • Open-ended fund(s)

        An open-ended fund is a CIU which can issue and redeem holdings at any time. An investor can purchase holdings in such funds directly from the operator, or through a broker. An open-ended fund is equitably divided into holdings (shares or units) which vary in price in direct proportion to the variation in value of the CIU's net asset value. Each time money is invested new holdings are created to match the addition to net assets; similarly, each time holdings are redeemed by participants they are cancelled to reflect the reduction in net assets. In this way, the price of holdings remains a reflection of the underlying assets of the CIU.

        Amended: July 2011

      • Operator(s)

        [This definition has been moved to Volume 7 in April 2012].

      • Options

        Unless the context otherwise requires, options means options to subscribe or purchase new shares or existing shares in a company.

        Added: July 2011

      • Ordering Financial Institution

        Refers to the financial institution which initiates the wire transfer and transfers the funds upon receiving the request for a wire transfer on behalf of the originator.

        Added: January 2020

      • Originator

        Refers to the account holder who allows the wire transfer from that account, or where there is no account, the natural or legal person that places the order with the ordering financial institution to perform the wire transfer.

        Added: January 2020

      • Overseas capital market service providers

        Means a CMSP that is incorporated and operates in an overseas jurisdiction and operates via branch presence, or such other equivalent license, in the Kingdom of Bahrain.

        Added: July 2011

      • Overseas crypto-asset service licensee

        A crypto-asset licensee incorporated in an overseas jurisdiction but licensed to operate within the Kingdom of Bahrain.

        Added: April 2019

      • Overseas domiciled CIU(s)

        [This definition has been moved to Volume 7 in April 2012].

      • Overseas domiciled exempt CIU(s)

        [This definition has been moved to Volume 7 in April 2012].

      • Overseas domiciled expert CIU(s)

        [This definition has been moved to Volume 7 in April 2012].

      • Overseas domiciled retail CIU(s)

        [This definition has been moved to Volume 7 in April 2012].

      • Overseas exchange

        Means an exchange licensed or recognised by a financial services authority in a jurisdiction outside the Kingdom of Bahrain to operate a licensed market in that jurisdiction.

        Added: July 2011

      • Overseas issuer(s)

        An issuer not incorporated in the Kingdom of Bahrain.

        Added: January 2014

    • [P] [P]

      • Partial offer

        For the purpose of Module TMA, a partial offer is an offer with the consent of the CBB to all shareholders to acquire a portion of the remaining outstanding shares of the offeree company.

        Added: July 2011

      • Partial underwriting

        Partial underwriting means the underwriter provides the issuer with a commitment to guarantee a sale of a certain portion of the total issue and in the case of under-subscription, by purchasing the balance of the securities.

        Added: January 2014

      • Payable-through Account

        Means an account/crypto-asset wallet maintained at the Capital Market Service Provider by the respondent financial institution for the provision of correspondent account services, but which is accessible directly by a third party to effect transactions on its own behalf.

        Added: January 2020

      • Participant

        For purposes of Module MAE in Volume 6 of the CBB Rulebook, means a person who may participate in one or more of the services provided by a licensed exchange or a licensed market operator in its capacity as a licensed exchange or licensed market operator respectively.

        Added: July 2016

      • Paying agent

        An agent that receives funds from an issuer of securities and in turn pays principal and interest to debt securities holders and dividends to shareholders.

        Added: January 2014

      • Payment

        Means the final transfer of funds from the buyer to the seller.

        Added: July 2011

      • Permanent insider

        Means members of the Board of Directors of a company, its senior management, the Issuer itself, and such other persons as decided by the Issuer's Board to have access to inside information relating to the Issuer from time-to-time.

        Added: July 2011

      • Person(s)

        Means a natural or legal person, corporation, limited liability company, joint stock company, partnership, association, trust, fund or any organized group of persons whether incorporated or not.

        Amended: July 2016
        Added: July 2011

      • Placing

        Placing means to market new securities. The term applies to both public and private sales but is more often used with reference to direct sales to institutional investors, as in private placement. The terms float and distribute are preferred in the case of a public offering.

        Added: January 2014

      • Politically exposed person (PEP)

        Means individuals who are, or have been, entrusted with prominent public functions in Bahrain or a foreign country, such as Heads of State of government, senior politicians, senior government, judicial or military officials, senior executives of state-owned corporations or important political party officials or persons who are or have been entrusted with a prominent function by an international organisation. Business relationships with immediate family members (i.e. spouse and children, including step-children or adopted children) or close associates of PEPs involve reputational risks similar to PEPs themselves. The definition is not intended to cover middle-ranking or more junior officials in the foregoing categories. Bahraini PEPs would include all Ministers, all MPs, and all Ministry officials with the rank of Undersecretary or above.

        Amended: July 2016
        Added: July 2011

      • Position

        In relation to a securities or futures contract, means a securities or futures contract which is outstanding and which has not been liquidated:

        (a) By an off-setting transaction;
        (b) By delivery of the securities or the commodity (or any other asset class) underlying the futures contract;
        (c) Through settlement of the securities or futures contract in accordance with the business rules or practices of a securities or futures market, as the case may be; or
        (d) By substituting the futures contract for a cash commodity.
        Added: July 2011

      • Preliminary/red herring prospectus

        The first document released by an issuer or underwriter of a new issue to prospective investors. The document offers financial details about the issue but does not contain all the information that will appear in the final or statutory prospectus, and parts of the document may be changed before the final prospectus is issued.

        Added: January 2014

      • Private offer

        An offer of securities for a specific group of persons.

        Added: January 2014

      • Private placement

        An offer to accredited investors, selected or accepted by the issuer or the appointed lead manager for obtaining subscriptions for securities of an issue, or for obtaining subscription for sale of securities by an underwriter or lead manager.

        Added: January 2014

      • Professional adviser

        Means an independent financial institution or other entity specialising in corporate finance who meets the eligibility requirements, has an acceptable track record and is authorised to act as a professional adviser by the CBB.

        Amended: October 2019
        Added: July 2011

      • Profit

        Includes the avoidance of any loss.

        Added: July 2011

      • Property

        In relation to a market charge or market collateral, means:

        (a) Money, letters of credit, banker's drafts, certified cheques, guarantees or other similar instruments;
        (b) Securities listed and deposited with the central depository;
        (c) Futures contracts and any similar financial contract; or
        (d) Other assets of value acceptable to a licensed clearing house or central depository.
        Added: July 2011

      • Proprietary trading member(s)

        Means a locally incorporated entity or an eligible foreign institution accepted as a member by a licensed exchange and authorised by the CBB, and who conducts trading only for its own account or funds and who does not trade or accept instructions on behalf of clients or other third parties.

        Amended: July 2016
        Added: April 2013

      • Prospectus

        An offering document that sets forth the plan for a proposed business enterprise or the facts concerning an existing one that an investor needs to make an informed decision. The prospectus contains financial information and a description of an issuer's business history, officers, operations, pending litigation (if any) and plans (including the use of the proceeds from the issue).

        Amended: January 2014

      • Public offer

        An offer of securities to the general public.

        Added: January 2014

      • Purchase

        In relation to securities, includes, in the case of an option contract under which a party acquires an option or right from another party, acquiring the option of right under the contract, or taking an assignment of the option or right, whether or not on another's behalf.

        Added: July 2011

    • [Q] [Q]


      • Qualified by Exception

        A report issued by an appointed expert that is qualified and indicates that certain areas or issues remain unresolved or are unverifiable due to certain limitations imposed on the appointed experts' work. The report will clearly indicate the type and reason for exception and the action taken by the appointed experts had the mentioned limitation not been placed on their work.

        Added: April 2019

      • Quote

        In relation to securities and a securities market of a licensed exchange or of a licensed market operator, means to display or provide, on the securities market of the licensed exchange or licensed market operator, information concerning the particular prices or particular consideration at which offers or invitations to sell, purchase, or exchange issued or prescribed securities are made on that securities market, being offers or invitations that are intended or may reasonably be expected to result, directly or indirectly, in the making or acceptance of offers to sell, purchase or exchange issued or prescribed securities.

        Added: July 2011

    • [R] [R]

      • Real Estate Project

        For the purpose of equity crowdfunding offer, real estate project means real estate development projects as well as real estate income properties duly incorporated and registered with relevant authorities.

        Added: October 2017

      • Receiving bank (as used in Module OFS)

        The bank appointed by the issuer to collect subscription money from subscribers of the securities.

        Added: January 2014

      • Receiving bank (as used in Module TMA)

        Means Settlement Bank used to settle the transaction taking place on the licensed exchange, or any other bank designated for this purpose with the consent of the CBB.

        Added: July 2016

      • Recognised jurisdiction(s)

        [This definition has been moved to Volume 7 in April 2012].

      • Record

        Includes the records maintained in the form of books or stored in a computer or in such other form as may be determined and approved by the CBB.

        Added: July 2011

      • Recovery Time Objective (RTO)

        Targeted duration of time which an information system and network must be recovered after a cyber breach.

        Added: April 2019

      • Registered owner

        Means a person who is listed in the issuer's register as the owner of securities.

        Added: July 2011

      • Registered person(s)

        Registered persons are those persons required to be registered by the CBB (as opposed to being authorised or licensed).

      • Registered representative

        Means an employee of a broker-dealer who acts as an account executive for clients. As such, the registered representative gives advice on which securities to buy and sell and he collects a percentage of the commission income he generates as compensation. To qualify as a registered representative, a person must acquire a background in the securities business and pass a series of tests and other qualifications imposed by the CBB and/or licensed exchange. "Registered" means licensed or authorised by the CBB and the licensed exchange.

        Added: July 2011

      • Regulated activities

        For the purpose of this Module means any activity stipulated under the CBB Law Article (80).

        Added: July 2011

      • Regulated crypto-asset services

        Any of the regulated activities permitted to be undertaken by a crypto-asset licensee as outlined in Module CRA Paragraph CRA-1.1.6.

        Added: April 2019

      • REIT(s) or real estate investment trust(s)

        Real Estate Investment Trust(s). REITs are investment vehicles that invest in real estate, and typically enjoy tax benefits in return for an obligation to distribute a high percentage of their income. REIT structures were originally designed to provide a similar structure for investment in real estate, as mutual funds provided for investment in financial instruments

        Amended: July 2011

      • Related company

        Means where a company:

        (a) Is the holding company of another company;
        (b) Is a subsidiary of another company; or
        (c) Is a subsidiary of the holding company of another company,

        that first-mentioned company and that other company shall for the purposes of this Module be deemed to be related to each other.

        Added: July 2011

      • Relevant authority(ies)

        Means for the purpose of Module AML, the authorities listed in Section AML-4.4.

        Added: October 2014

      • Relevant person(s)

        Means the offeror and offeree companies, their shareholders, directors and any other principal officers of offeror and offeree as well as persons acting in concert with them in relation to an offer covered by Module TMA.

        Amended: October 2019
        Amended: July 2016

      • Relevant office holder

        Means:

        (a) A person acting in relation to a company as its liquidator, its provisional liquidator, its receiver, its receiver and manager, its judicial manager, or an equivalent person; or
        (b) A person acting in relation to an individual as his trustee in bankruptcy, the interim receiver of his property or an equivalent person.
        Added: July 2011

      • Remuneration

        Means all types of compensation including but not limited to salary, fee and non-cash benefits such as grants of stocks, stock options or pension benefits.

        Added: July 2011

      • Respondent Financial Institution

        Means a financial institution, to which correspondent account services are provided.

        Added: January 2020

      • Retail CIU(s)

        [This definition has been moved to Volume 7 in April 2012].

      • Rights issue(s) or Rights offering

        A new issue of securities by an issuer by way of exercising the pre-emptive rights by existing holders of securities which enables those holders to subscribe to those securities in proportion to their existing holdings, or otherwise on the basis of allotment approved by those holders.

        Added: January 2014

      • Rights over shares

        Includes any rights acquired by a person under an agreement to purchase, or an option to acquire shares, options, warrants, convertible securities or voting rights (or control of any of them), or any irrevocable commitment to accept an offer.

        Added: July 2011

      • Roadshow

        The marketing of an investment product, including an offer of securities that are to be formally offered and issued outside the Kingdom of Bahrain.

        Added: January 2014

      • RTGS

        Means Real Time Gross Settlement System introduced, operated and maintained by the CBB for facilitating on-line real-time settlement of payments in the Kingdom of Bahrain between members admitted to the RTGS system, either on gross basis, or through the Multilateral Net Settlement Batches (MNSB) received from the members and for matters connected therewith, or incidental thereto.

        Added: July 2011

      • Rumour

        Includes an unverified statement or account or explanation of events, circulated from person to person, whose veracity or authenticity or truthfulness is not immediately verifiable.

        Added: July 2011

    • [S] [S]

      • Salam contracts

        Islamic contracts issued when payment is made in cash at the point of contract, but the delivery of the asset purchased is deferred to a pre-determined date.

        Added: January 2014

      • Securities

        Means shares or bonds issued by shareholding companies, government debt instruments and the following financial instruments:

        (a) Shares in companies and other securities equivalent to shares in companies or other entities, and depositary receipts in respect of shares;
        (b) Bonds or other forms of debt, including depositary receipts in respect of such securities;
        (c) Warrants;
        (d) Units, rights or interests (however described) of the participants in a collective investment scheme;
        (e) Options, futures and any other derivative contracts relating to commodities that must be settled in cash or may be settled in cash at the option of one of the parties (otherwise than by reason of a default or other termination event);
        (f) Options, futures and any other derivative contract relating to commodities that can be physically settled;
        (g) Units to Real Estate Investment Trusts (REITs);
        (h) Index tracking products including Islamic indices;
        (i) Any other financial instrument approved as a financial instrument by the CBB for the purpose of trading such instrument on an exchange; and
        (j) Islamic securities, being those financial instruments that are Shari'a compliant.
        Added: July 2011

      • Securities account

        Means an account maintained by the licensed central depository on behalf of the participants and their clients for use in one or more of its services.

        Added: July 2011

      • Securities Exchange Offer

        Means an offer in which the consideration includes securities of the offeror or any other company.

        Amended: October 2019
        Added: July 2016

      • Self-regulatory organisations (SROs)

        Means a self-regulatory organisation, being a Licensed Exchange, Licensed Market Operator or a Licensed Clearing House under Module MAE and/or Module CSD respectively.

        Added: July 2011

      • Sell

        In relation to securities, includes, in the case of an option contract under which a party acquires an option or right from another party:

        (a) Grant or assign the option or right; or
        (b) Take, or cause to be taken, such action as releases the option or right, whether or not on another's behalf.
        Added: July 2011

      • Senior manager/senior management

        Refers to individuals occupying the position of CEO or head of function.

        Added: July 2011

      • Settlement

        For the purposes of Module CSD, settlement in relation to a market contract includes partial settlement:

        (a) Where a charge is granted partly for the purpose specified in the definition of 'market charge' and partly for any other purpose or purposes, the charge shall be treated as a market charge under this Module insofar as it has effect for that specified purpose;
        (b) Where collateral is granted partly for the purpose specified in the definition of 'market collateral' and partly for any other purpose or purposes, the collateral shall be treated as market collateral under this Module insofar as it has been provided for that specified purpose; and
        (c) References in this Part to settlement in relation to a market contract, are references to the discharge of the rights and liabilities of the parties to the market contract, whether by performance, compromise or otherwise.
        Added: July 2011

      • Settlement bank

        Means an RTGS member entity licensed by the CBB and appointed by a licensed clearing house (including the clearing house itself) to settle payment obligations arising from the transactions of the participants of the licensed clearing house that are cleared or settled by the licensed clearing house.

        Added: July 2011

      • Settlement guarantee fund

        Means a fund maintained by a licensed clearing house through contributions from its members for providing a cushion against any residual risk to enable the licensed clearing house to eliminate counterparty risk and guarantee timely settlement of transactions.

        Added: July 2011

      • Share

        A unit of equity ownership in a corporation. The number of shares a corporation is authorised to issue is detailed in its Memorandum and Articles of Association.

        Added: January 2014

      • Share repurchase

        Means a purchase of shares, or an offer to purchase, redeem or otherwise acquire shares of an offeror made by an offeror.

        Amended: October 2019
        Added: July 2011

      • Share repurchase by mandatory offer

        Share repurchase by mandatory offer means a share repurchase effected by way of an offer made by an offeror to all holders of shares of a class of shares of the offeror.

        Added: July 2016

      • Shareholder(s)

        An owner of one or more shares in a corporation. A common shareholder is normally entitled to four basic rights of ownership:

        (a) Claim on a share of the company's undivided assets in proportion to the number of shares held;
        (b) Proportionate voting power in the election of directors and other business conducted at shareholders meetings or by proxy;
        (c) Dividends when earned and declared by the board of directors; and
        (d) Pre-emptive right to subscribe to additional share offerings before they are available to the general public, except when overruled by the Memorandum and Articles of Association, or in special circumstances or resolutions, such as where shares are issued to effect a merger.
        Added: January 2014

      • Shell Financial Institution

        means a financial institution incorporated, formed or established in a country or jurisdiction where the financial institution has no physical presence and which is unaffiliated with a financial group that is subject to effective consolidated supervision. Physical presence means meaningful mind and management located within a country. The existence simply of a local agent or low level staff does not constitute physical presence.

        Added: January 2020

      • Simplified prospectus

        [This definition has been moved to Volume 7 in April 2012].

      • Specialised licensee(s)

        A person licensed under Volume 5 of the CBB Rulebook.

        Amended: July 2011

      • Standstill Agreement

        An Agreement between a company, or the directors of a company, and a shareholder which restrict the shareholder or the directors from either offering for, or accepting an offer for, the shares of the company or from increasing or reducing shareholdings, may be relevant for the purpose of this definition.

        Added: October 2019

      • Structured warrants

        Warrants issued by financial institutions over a listed security or index that do not confer subscribing rights of new securities but rather the right to receive the difference between the stroke price and exercise price.

        Added: January 2014

      • Subsequent public offer

        An offer for subscription to the public by or on behalf of a listed issuer of its own securities other than by a rights issue, after obtaining the approval on waiving of the pre-emptive rights of the existing securities holders.

        Added: January 2014

      • Subsidiary

        Means a company or other enterprise controlled by another company or enterprise (the parent or the holding company).

        Added: July 2011

      • Suspicious or extraordinary transactions

        Means any transactions which have direct or indirect relevance to the acts provided for under Article (2.1) of the Prevention and Prohibition of the Laundering of Money (Law 4 of 2001), or which by its nature contradicts with the commercial or personal activities of the Persons involved in the transactions, and which the CBB may consider suspicious or extraordinary as determined from its extraordinary size, its recurrence, its nature, the surrounding circumstances and conditions, its extraordinary type which does not carry any clear economic or legal objective, or if the activity of the Persons involved in the transaction or transactions is not consistent with their normal course of business, or if the domicile of such Persons is located in countries which do not apply sufficient measurements for the Prevention and Prohibition of Money Laundering.

        Added: July 2011

    • [T] [T]


      • Takeover

        Means an acquisition of control in a company.

        Added: October 2019

      • Terrorism acts

        Is as defined in Decree Law No. 58 of 2006 with respect to the Protection of Society from Terrorism Activities.

        Added: July 2011

      • Trading member

        Means a person who is a member of a licensed exchange and who can execute transactions on a licensed exchange or licensed market operator.

        Amended: July 2016
        Added: July 2011

      • Transaction information

        Means information relating to:

        (a) Offers or invitations to purchase, sell, or exchange securities or futures contracts;
        (b) Executed transactions in securities or futures contracts; and
        (c) Transactions cleared or settled by a designated clearing house.
        Added: July 2011

      • Trilateral Meetings

        A meeting between a licensee, an appointed expert and the CBB.

        Added: April 2019

      • Trustee(s)

        The person to whom the ownership of the Trust Property is transferred in order to exercise the duties and powers specified in the Trust Instrument with a view to achieving the purpose of the trust or satisfying the interests of the beneficiary.

        Added: January 2014

    • [U] [U]


      • Underwriter

        A financial institution, who singly or as a member of an underwriting group or syndicate, agrees to a firm commitment underwriting arrangement.

        Added: January 2014

      • User

        User in relation to a licensed exchange or a designated clearing house, means a person who is:

        (a) A member of a licensed exchange or designated clearing house; or
        (b) A customer of a member of a licensed exchange or designated clearing house.
        Added: July 2011

      • User information

        Means transaction information that is referrable to:

        (a) A named user of a licensed exchange or designated clearing house; or
        (b) A group of users, from which the name of a user can be directly inferred of a licensed exchange or designated clearing house.
        Added: July 2011

    • [V] [V]


      • Virtual Currency

        A digital representation of value that can be digitally traded and function as: (i) a medium of exchange; and/or (ii) a unit of account; and/or (iii) a store of value, but does not have legal tender status. It is not issued nor guaranteed by any jurisdiction, and fulfils the above functions only by agreement within the community of users of the virtual currency. Virtual currency is distinguished from fiat currency (real currency, real money or national currency), which is the coin and paper money of a country that is designated as its legal tender; circulates; and is customarily used and accepted as a medium of exchange in the issuing country. It is distinct from e-money, which is digital representation of fiat currency used to electronically transfer value denominated in fiat currency.

        Added: April 2019

      • Voluntary Offer

        An offer in the event that a person, or persons acting in concert, does not incur an obligation to make a mandatory offer as under Section TMA-3.1, but has made a takeover offer for the voting shares of the offeree company.

        Added: October 2019

      • Voting Rights

        Voting rights means all the voting rights currently exercisable at a general meeting of a company.

        Added: October 2019

    • [W] [W]


      • Warning notice

        Means a notice issued by the CBB pursuant to the EDC's decision and contains the contraventions committed by the recipient with respect to the CBB Law, rules and regulations and other applicable laws, rules and regulations and accompanied by the evidence that convinced the EDC that such contravention had occurred.

        Added: July 2011

      • Warrants

        Securities that confer an entitlement to subscribe for equity, debt, Islamic securities, or government securities. The rights conferred must be rights to 'subscribe' for the relevant securities. This means that they are rights to acquire the securities directly from the issuer of the securities and by way of the issue of new securities.

        Added: January 2014

      • Without delay

        The phrase without delay means, ideally, within a matter of hours of a designation by the United Nations Security Council or its relevant Sanctions Committee (e.g. the 1267 Committee, the 1988 Committee, the 1718 Sanctions Committee or the 1737 Sanctions Committee). For the purposes of S/RES/1373(2001), the phrase without delay means upon having reasonable grounds, or a reasonable basis, to suspect or believe that a person or entity is a terrorist, one who finances terrorism or a terrorist organisation. In both cases, the phrase without delay should be interpreted in the context of the need to prevent the flight or dissipation of funds or other assets which are linked to terrorists, terrorist organisations, those who finance terrorism, and to the financing of proliferation of weapons of mass destruction, and the need for global, concerted action to interdict and disrupt their flow swiftly.

        Added: October 2019

    • [X]


    • [Y]


    • [Z]