Versita

The Supervisory Role of the Emirates Securities and Commodities Authority over the Company's Buyback of its Shares wiith the Intention of Reselling amidst the Outbreak of the Corona Pandemic – A Comparative Study

Dr. Mohammad Saad Ali Al Armman ,Prof.Malek Hamad Abunaseir
Keywords: Securities and Commodities Authority, buyback, the supervisory role, selling company shares. ,

Abstract

With the prevalence of the term “buyback” of the company’s shares, especially amidst the crises faced by the countries of the world, the latest of which is the Corona pandemic, many companies have resorted to buying their shares offered in the trading markets for many reasons. The public shareholding company may see that the value of its share is valued at less than the nominal value that is traded in the market, and this will prompt it to invest its money by repurchasing its shares. The reason may be the company's desire to motivate investors to buy its shares, which will result in an increase in the price of those shares. Whatever the case, the reasons for the company’s purchase of its shares have become a modern practice in most capital markets, especially on the basis of allowing public shareholding companies to buy their shares.However, this practice is surrounded by procedures represented in the necessity of fulfilling the conditions and requirements included in the Securities and Commodities Authority Board Resolution No. 40 of 2015 regarding the controls and procedures related to the company’s purchase of its shares with the intention of reselling them and the provisions of Decree-Law No. 32 of 2021 regarding commercial companies. Therefore, this study aimed to explain the regulatory controls and procedures issued by the Securities and Commodities Authority and to indicate the adequacy of the role played by the Authority in extending its control over the process of purchasing the company's shares. The study ended with several results and included a set of recommendations.