Trading Blackout for Insiders on Abu Dhabi Market

Effective today, company insiders on the Abu Dhabi Securities Exchange (ADX) are prohibited from trading the shares of their organizations and affiliated companies. This ban, implemented to ensure market fairness and prevent insider trading, applies during a crucial window – the period leading up to the release of quarterly financial statements.

The Securities and Commodities Authority (SCA) regulation, enacted in 2001, mandates a blackout period of 15 days before and until the official disclosure of a company's financial results. This temporary restriction on insider transactions aims to safeguard investors by leveling the playing field. By preventing those with access to unpublished financial information from buying or selling shares, the regulation fosters a market environment based on publicly available information.

The ADX disseminates the regulation to all listed companies, brokerage firms, and investors. The exchange also emphasizes the importance of maintaining updated insider lists. These lists identify individuals with access to sensitive information, such as board members, senior executives, and employees privy to unpublished financial data.

This regulation is not the only measure the ADX and SCA employ to combat insider trading. Listed companies are obligated to promptly disclose any material information that could significantly impact their share prices. Additionally, the SCA maintains a robust surveillance system to detect and investigate potential insider trading activities. Penalties for insider trading can be severe, including hefty fines and even imprisonment.

The insider trading ban serves a vital function in maintaining investor confidence in the Abu Dhabi market. By ensuring a fair and transparent trading environment, the ADX and SCA work to attract both domestic and international investors, ultimately contributing to the growth and stability of the Abu Dhabi capital market.

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