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  • MIR-5 MIR-5 Substantial Shareholding in a Licensed Member

    • MIR-5.1 MIR-5.1 Control of Substantial Shareholding in a Licensed Member

      • MIR-5.1.1

        No person shall enter into any agreement to acquire shares in a licensed member by virtue of which he would, if the agreement had been carried out, become a substantial shareholder of the licensed member without first obtaining the approval of the CBB, to enter into the agreement.

        Amended: April 2013
        Adopted January 2010

      • MIR-5.1.2

        In rule MIR-5.1.1 "substantial shareholder" means a person who alone or together with his associates:

        (a) Holds not less than 5% of the shares in the licensed member; or
        (b) Is in a position to control not less than 5% of the votes in the licensed member.
        Amended: April 2013
        Adopted January 2010

      • MIR-5.1.3

        In this section:

        (a) A person holds a share if:
        1. He is deemed to have an interest in that share in terms of the CBB Law, rules and regulations; or
        2. He otherwise has a legal or a beneficial interest in that share, except such interest as is to be disregarded in the terms of the CBB Law, rules and regulations;
        (b) A reference to the control of a percentage of the votes in a licensed member shall be construed as a reference to the control, whether direct or indirect, of that percentage of the total number of votes that might be cast in a general meeting of the licensed member; and
        (c) An associate of another person means in respect of individuals, a direct family member and in the case of a company, means the company is bound to follow the directives of the substantial shareholder, or the company in which the substantial shareholder has 20% of the votes of that company.
        Amended: April 2013
        Adopted January 2010

      • MIR-5.1.4

        The CBB may grant its approval referred to in rule MIR-5.1.1, subject to such conditions or restrictions as the CBB may think fit.

        Adopted January 2010

    • MIR-5.2 MIR-5.2 Application and Criteria for Approval to Acquire Substantial Shareholding

      • MIR-5.2.1

        Any person applying for approval under rule MIR-5.1.1 shall submit to the CBB a written application that sets out:

        (a) The name of the applicant;
        (b) In the case where the applicant is a company:
        1. Its place of incorporation;
        2. Its substantial shareholders;
        3. Its directors and chief executive officer; and
        4. Its principal business.
        (c) In the case where the applicant is a natural person:
        1. His nationality;
        2. His principal occupation; and
        3. His directorships;
        (d) All the companies in Bahrain or elsewhere, which the applicant has a substantial shareholding;
        (e) The percentage of shareholding and voting power that the applicant has in the licensed member and/or in any other licensed members;
        (f) The percentage of shareholding and voting power the applicant is seeking to have in the licensed member;
        (g) The reasons for making the application;
        (h) The mode and structure, as appropriate, under which the increase in shareholding would be carried out;
        (i) Whether the applicant will seek representation on the board of directors of the licensed member; and
        (j) Any other information that may facilitate the determination of the CBB as to whether the applicant is a fit and proper person for the purposes of paragraph MIR-5.2.3 (a).
        Amended: April 2013
        Adopted January 2010

      • MIR-5.2.2

        The CBB may require the applicant to furnish it with such information or documents as the CBB considers necessary in relation to the application and the applicant shall furnish such additional information or documents as required by the CBB.

        Adopted January 2010

      • MIR-5.2.3

        The CBB may approve an application made under Paragraph MIR-5.2.1 if the CBB is satisfied that:

        (a) The applicant is a fit and proper person to be a substantial shareholder;
        (b) Having regard to the applicant's likely influence, the licensed member will or will continue to conduct its business prudently and in compliance with the provisions of the CBB Law, rules and regulations, and this Module; and
        (c) It would not be contrary to the interests of the public and market integrity to do so.
        Amended: April 2013
        Adopted January 2010

      • MIR-5.2.4

        The CBB may, for the purposes of securing compliance with rule MIR-5.1.1 or paragraph MIR-5.2.2, or any condition or restriction imposed under rule MIR-5.2.5, by notice in writing direct the transfer or disposal of all or any of the shares of a licensed member in which a substantial shareholder of the licensed member has an interest. The licensed exchange and/or licensed clearing house shall be notified of such extent.

        Amended: April 2013
        Adopted January 2010

      • MIR-5.2.5

        Until a person to whom a direction has been issued under paragraph MIR-5.2.4 transfers or disposes of the shares which are subject to the direction and notwithstanding anything to the contrary in the Memorandum and Articles of Association or other constituent documents of the licensed member:

        (a) No voting rights shall be exercisable in respect of the shares which are the subject of the direction;
        (b) The licensed member shall not offer or issue any shares (whether by way of rights, bonus share, dividend or otherwise) in respect of the shares which are the subject of the direction; and
        (c) Except in liquidation of the licensed member shall not make any payment (whether by way of cash dividend, dividend in kind or otherwise) in respect of the shares which are the subject of the direction.
        Amended: April 2013
        Adopted January 2010

      • MIR-5.2.6

        Any issue of shares by a licensed member in contravention of rule MIR-5.2.5 (b) shall be deemed to be null and void, and a person to whom a direction has been issued under paragraph MIR-5.2.4 shall immediately return those shares to the licensed member, upon which the licensed member shall return to the person any payment received from him in respect of those shares.

        Amended: April 2013
        Adopted January 2010

      • MIR-5.2.7

        Any payment made by a licensed member in contravention of rule MIR-5.2.5 (c) shall be deemed to be null and void, and a person to whom a direction has been issued under paragraph MIR-5.2.4 shall immediately return the payment he has received to the licensed member.

        Amended: April 2013
        Adopted January 2010

      • MIR-5.2.8

        The CBB may exempt:

        (a) Any person or class of persons; or
        (b) Any class or description of shares or interests in shares;

        from the requirement under paragraphs MIR-5.2.1 or MIR-5.2.2, subject to such conditions or restrictions as may be imposed by the CBB in general, and where shares of the licensed member are being listed in particular.

        Amended: April 2013
        Adopted January 2010