Cabinet Resolution No. (102) of 2022 Concerning the List of Administrative Penalties for Acts Committed in Violation of Federal Decree-Law No. (32) of 2021 Concerning Commercial Companies

§Preamble

Cabinet Resolution No. (102) of 2022 Concerning the List of Administrative Penalties Concerning Acts Committed

in Violation of the Provisions of Federal Decree-Law No. (32) of 2021 Concerning Commercial Companies

The Cabinet,

- After perusal of the UAE's constitution; and

- Federal Law No. (1) of 1972 Concerning the Competencies of Ministries and the Powers of Ministers as amended; and

- Federal Law No. (14) of 2016 Concerning the Violations and Administrative Penalties in the Federal Government; and

- Federal Decree-Law No. (26) of 2019 Concerning Public Finances; and

- Federal Decree-Law No. (32) of 2021 Concerning Commercial Companies; and

- Cabinet Resolution No. (78) of 2022 Promulgating the List of Administrative Penalties Concerning Acts Committed in Violation of the Provisions of Federal Decree-Law No. (32) of 2021 Concerning Commercial Companies; and

- Acting upon the proposal of the Minister of Finance and the approval of the Cabinet, Hereby resolves as follows:

§Article 1 — Definitions

In applying the provisions of this Resolution, the following words and expressions shall have the meanings assigned to each of them, unless the context requires otherwise:

State : United Arab Emirates.

Ministry : Ministry of Economy.

Minister : Minister of Economy.

Authority : Securities and Commodities Authority (SCA).

Competent : The local authority concerned with corporate affairs in the Authority concerned Emirate.

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Decree-Law : Federal Decree-Law No. (32) of 2021 regarding Commercial

Companies.

Working Day : The official working day of the ministries, government agencies and the relevant Competent Authority.

§Article 2 — Scope of Application

1. The provisions of this Resolution apply to: (i) commercial companies established in the State; (ii) foreign companies; (iii) branches of foreign companies; (iv) Representative Offices, and (v) Investment Funds that are subject to the provisions of the Decree-Law and the decisions and regulations issued in implementation thereof; and (vi) foreign companies based in the State and carries out any activity therein, or establishes a branch or Representative Office therein.

2. The provisions of this Resolution do not apply to: (i) companies exempted from the provisions of the Decree-Law; (ii) professional, civil and foreign companies; and (iii) companies operating in free zones.

§Article 3 — Administrative Penalties

1. Without prejudice to any harsher penalty or procedure provided for in the Decree-Law, the Ministry or the Competent Authority, each in accordance with its competence, may impose one or more of the following administrative penalties on whoever commits any of the acts that violate the provisions of the Decree-Law and the decisions and regulations issued for its implementation contained in the Schedule attached to this Resolution according to the following gradation:

a. In the event of a first-time violation, a written warning notice shall be sent to the violator, and they shall be given a period not exceeding (30) thirty days that starts on the date on which the written warning notice was sent, to correct the violation.

b. In the event of a second-time violation, the administrative fine shall be imposed in accordance with the Schedule attached to this Resolution.

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c. In the event of a third-time violation, the administrative fine shall be doubled in accordance with the Schedule attached to this Resolution.

d. In the event of a fourth-time violation, the administrative fine shall be tripled in accordance with the Schedule attached to this Resolution, and the violating company shall be subjected to temporary administrative closure for a period not exceeding (6) six months. Such period is renewable for one time only.

e. Revocation of the licence and approval issued to the violator or those responsible for the violator, provided that the violator bears the expenses and costs of removing and treating the damage resulting from the violation in the event that such violation is not removed or treated.

2. Taking into account Clause (1) of this Article, the Ministry or the Competent Authority, each in accordance with its competence, may impose the most severe administrative penalty and not follow the gradation referred to in Clause (1) of this Article, in case of serious violations, and it is left to its discretion to estimate the appropriate administrative penalty in accordance with the nature of the violation.

3. The value of the administrative fines mentioned in the Schedule attached to this Resolution shall be collected in accordance with the mechanism determined by the Ministry of Finance after coordination with the Minister, the Chairman of the Authority, or the head of the Competent Authority.

4. The Ministry or the Competent Authority, each in accordance with its competence, may double the administrative fines for acts committed in violation of the provisions of the Decree-Law contained in the Schedule attached to this Resolution in the event of recidivism or recurrence of the violation.

5. For the purposes of collecting the value of the administrative fine mentioned in the Schedule attached to this Resolution, any part of the day is considered a full day and any part of the month is considered a full month.

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§Article 4

Provisions Concerning Violations Falling within the Jurisdiction of the Authority

1. Without prejudice to any harsher penalty or procedure provided for in the Decree-Law, the Authority may impose one or more of the following administrative penalties on whoever commits any of the acts that violate the provisions of the Decree-Law and the decisions and regulations issued for its implementation that fall within its jurisdiction and contained in the Schedule attached to this Resolution according to the following gradation:

a. In the event of a first-time violation, a written warning notice will be sent to the violator and they will be given a period not exceeding (30) thirty days, counted from the date the written warning notice was sent, to correct the violation.

b. In the event of a second-time violation, the administrative fine shall be imposed in accordance with the Schedule attached to this Resolution.

c. In the event of a third-time violation, the administrative fine imposed for the second- time violation shall be doubled.

d. In the event of a fourth-time violation, the administrative fine imposed for the second- time violation shall be tripled.

e. Revocation or suspension of the license and approval issued to the violator or those responsible for the violator, provided that the violator bears the expenses and costs of removing and treating the damage resulting from the violation in the event that such violation is not removed or treated.

2. As an exception to Clause (1) of this Article, if the incident subject of the violation relates to formal procedures or, is subject to its discretion, the Authority may warn the violating person and instruct them to correct and avoid a recurrence of the incident in the future.

3. The Authority is allowed not to follow the gradation referred to in Clause (1) of this Article in the case of serious violations, and it shall be left to its discretion to estimate the appropriate administrative penalty in accordance with the nature of the violation.

4. The fine imposed by the Authority on the violating person must be paid within the payment deadline specified by the Authority. It may impose a daily late payment fine of

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(1,000) one thousand dirhams for each day of late payment beyond the specified date, provided that the total of the delay fines does not exceed the imposed fine.

5. Without prejudice to the maximum limit of financial fines stipulated in the Decree-Law, the Authority may impose an administrative fine in an amount equal to or greater than the benefit or profits achieved by the violator, or the losses they avoided, or equal to the value of the damage incurred as a result of the violation.

The administrative penalties that fall within the competence of the Authority and are mentioned in this Resolution shall apply to the violations that occurred after its effective date, as well as the violations that occurred from the effective date of the provisions of the Decree- Law and were not decided upon by the Authority until the date on which this Resolution takes into force.

For the purposes of collecting the value of the administrative fine mentioned in this Article, any part of the day is considered a full day and any part of the month is considered a full month.

§Article 5 — Grievances Against Administrative Penalties

1. The Ministry, the Authority, or the Competent Authority, each in accordance with its competence, shall notify the violating company of the decision imposing the administrative penalty [on such company] within (15) fifteen days from the date of its issuance.

2. Each person with the capacity and interest may file a grievance against the administrative penalty with the Minister, the Chairman of the Board of Directors of the Authority, the head of the Competent Authority, or whomever authorized by them, within (30) thirty days from the date of being notified of the contested decision, provided that the grievance is reasoned and accompanied by all supporting documents. The grievance shall be decided on within (30) thirty days from the date of its submission and in accordance with the procedures in force at the Ministry, the Authority or the Competent Authority.

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3. The decision issued regarding such grievances shall be final. Failure to respond to a given grievance within (30) thirty days from the date of its submission shall be deemed a rejection thereof.

4. After the expiration of the period stipulated in Clause (2) of this Article, no grievance against the decision imposing the administrative penalty may be accepted.

§Article 6 — Amendment of Fines

The Cabinet is responsible for making any amendments to the amount of fines contained in the Schedule attached to this Resolution, by way of addition, deletion or modification.

§Article 7 — Repealing

The Cabinet Resolution No. (78) of 2022 Promulgating the Administrative Penalties Regulations regarding Acts Committed in Violation of the Provisions of Federal Decree-Law No. (32) of 2021 regarding Commercial Companies is hereby repealed. Any provision that contradicts or conflicts with the provisions of this Resolution is also hereby repealed.

§Article 8 — Publication and Enforcement

This Resolution shall be published in the Official Gazette and shall come into force from the date of such publication.

Mohammed bin Rashed Al-Maktoom Prime Minister

Issued by us:

On: 9 Rabi` al-Akhir 1444 AH Corresponding to: 4 November 2022 AD

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Schedule Attached to Cabinet Resolution No. 102 of 2022 Concerning the Administrative Penalties Regulations Concerning Acts Committed in Violation of the Provisions of Federal Decree-Law No. (32) of 2021 Concerning Commercial Companies

A. Violations and Penalties Related to Commercial Companies:

SN Violation Limited Private Joint Public Joint

Liability Stock Stock Companies Companies Companies 1 Violation of Article - - - The fines the Rules of (7) specified by the Governance Authority shall

apply to the Company whose violation of the rules of governance is proven, provided that the financial fine does not exceed (10,000,000) ten million dirhams.

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SN Violation Limited Private Joint Public Joint

Liability Stock Stock Companies Companies Companies 2 Failure to Article A fine of A fine of A fine of A fine of Observe the (10) (50,000) fifty (100,000) one (150,000) one (200,000) two Percentage of thousand hundred hundred and hundred the dirhams shall thousand fifty thousand thousand Contribution be imposed on dirhams shall dirhams shall dirhams shall of the State's any Company be imposed on be imposed on be imposed on Citizens in that violates the any Company any Company any Company Accordance provisions that violates the that violates the that violates the with the governing the provisions provisions provisions Activities that State citizens' governing the governing the governing the have a shareholding State citizens' State citizens' State citizens' Strategic percentage in shareholding shareholding shareholding Impact. the companies’ percentage in percentage in percentage in capital. the companies’ the companies’ the companies’ capital or the capital or the capital or the State citizens' State citizens' State citizens' percentage in percentage in percentage in companies’ companies’ companies’ Boards of Boards of Boards of Directors. Directors. Directors.

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3 Non- Article A fine of A fine of A fine of A fine of Compliance of (11) (5,000) five (7,000) seven (10,000) ten (50,000) fifty the Sharia thousand thousand thousand thousand Controller and dirhams shall dirhams shall dirhams shall dirhams shall Members of be imposed on be imposed on be imposed on be imposed on the Internal the Sharia the Sharia the Sharia the Sharia Sharia Control Controller and Controller and Controller and Controller and Committee every member every member every member every member

of the Internal of the Internal of the Internal of the Internal Sharia Control Sharia Control Sharia Control Sharia Control Committee of Committee of Committee of Committee of companies that companies that companies that companies that operate in operate in operate in operate in accordance accordance accordance accordance with the with the with the with the provisions of provisions of provisions of provisions of Islamic Sharia, Islamic Sharia, Islamic Sharia, Islamic Sharia, who fails to who fails to who fails to who fails to comply with comply with comply with comply with the controls for the controls for the controls for the controls for practising their practising their practising their practising their work, which are work, which are work, which are work, which are issued by a issued by a issued by a issued by a resolution of resolution of resolution of resolution of the Cabinet. the Cabinet. the Cabinet. the Cabinet. 4 Non- Article A fine of (500) A fine of (500) A fine of (1000) A fine of (1000) Compliance (12) five hundred five hundred one thousand one thousand with the dirhams per dirhams per dirhams per dirhams per Decision to month shall be month shall be month shall be month shall be Change the imposed on any imposed on any imposed on any imposed on any

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SN Violation Limited Private Joint Public Joint

Reference Simple

Liability Stock Stock Companies Companies Companies Company's Company that Company that Company that Company that Trade Name fails to comply fails to comply fails to comply fails to comply with the with the with the with the decision to decision to decision to decision to change the change the change the change the Company's Company's Company's Company's trade name. trade name. trade name. trade name. This fine shall This fine shall This fine shall This fine shall begin to be begin to be begin to be begin to be calculated after calculated after calculated after calculated after the lapse of a the lapse of a the lapse of a the lapse of a period of (30) period of (30) period of (30) period of (30) thirty Working thirty Working thirty Working thirty Working Days from the Days from the Days from the Days from the date of date of date of date of notification of notification of notification of notification of the decision, the decision, the decision, the decision, provided that provided that provided that provided that the total of such the total of such the total of such the total of such fines does not fines does not fines does not fines does not exceed (5,000) exceed (5,000) exceed exceed five thousand five thousand (10,000) ten (10,000) ten dirhams dirhams thousand thousand annually. annually.

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SN Violation Limited Private Joint Public Joint

Liability Stock Stock Companies Companies Companies

dirhams dirhams annually. annually.

5 Failure to Article A fine of A fine of A fine of A fine of Keep (26) (10,000) ten (15,000) fifteen (20,000) (100,000) one Accounting thousand thousand twenty hundred Registers dirhams shall dirhams shall thousand thousand be imposed on be imposed on dirhams shall dirhams shall

any Company any Company be imposed on be imposed on that fails to that fails to any Company any Company keep its keep its that fails to that fails to Accounting Accounting keep its keep its Registers Registers Accounting Accounting showing its showing its Registers Registers transactions. transactions. showing its showing its

transactions. transactions. 6 Publication of Article - - - A fine ranging the Invitation (32) from (500,000) for Public five hundred Subscription, thousand without the dirhams to Approval of (10,000,000) the Authority, ten million in any Shares, dirhams shall Bonds, or any be imposed on

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SN Violation Limited Private Joint Public Joint

Reference Simple

Liability Stock Stock Other any natural or Securities, legal person Regardless the proved to have Means of committed the Publication: in said violation, Daily in accordance Newspapers, with the Magazines, or circumstances in any Public and conditions Advertising of the incident. Medium in the State 7 Company's Article A company that A fine of A fine of A fine of Data and (44) fails to keep the (5,000) five (10,000) ten (100,000) one Documents & following data thousand thousand hundred Stakeholders' And and documents dirhams shall dirhams shall thousand Access Denial Article shall be fined be imposed on be imposed on dirhams shall

(100) an amount of any Company any Company be imposed on

(1,000) one that refuses to that refuses to any Company And thousand let the let the that refuses to Article dirhams: Shareholder Shareholder let the

(144) 1. A record have access to have access to Shareholder

containing the the minutes of the minutes of have access to names and the meetings of the meetings of the minutes of

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SN Violation Limited Private Joint Public Joint

Liability Stock Stock Companies Companies Companies addresses of the Company's the Company's the meetings of the General General the Company's Shareholders. Assembly, Assembly, General

2. A copy of the books and books and Assembly, Company's documents, or documents, or books and Memorandum any documents any documents documents, or of Association or papers or papers any documents and any related to a deal related to a deal or papers amendments that the that the related to a deal thereto. Company Company that the

3. A statement concluded with concluded with Company of the monetary one of the one of the concluded with amounts and Stakeholders. Stakeholders or one of the the nature and any Company Stakeholders or value of any that fails to any Company assets publish a copy that fails to contributed by of its publish a copy each Memorandum of its Shareholder of Association Memorandum and the dates of and Articles of of Association the Association on and Articles of contributions. its website. Association on

4. Any other its website. data,

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SN Violation Limited Private Joint Public Joint

Liability Stock Stock Companies Companies Companies documents or records imposed by the provisions of the Decree-Law and its implementing decisions.

8 Failure To Article - A fine of (3000) A fine of (8000) A fine of Invite a (104) three thousand eight thousand (100,000) one Director or a dirhams shall dirhams shall hundred Member of the And be imposed on be imposed on thousand Board of Article any Director, any Director, dirhams shall Directors to (156) Chairman of Chairman of be imposed on the Board's the Board of the Board of any Director, Meetings Directors, or Directors, or Chairman of their their the Board of representative representative Directors, or in the Company who fails to their

who fails to invite a representative invite a Member of the who fails to Member of the Board of invite a Board of Directors to the Member of the Directors to the Board of

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SN Violation Limited Private Joint Public Joint

Liability Stock Stock Companies Companies Companies Board's Board's Directors to the meetings. meetings. Board's

meetings.

9 Company's Article - - - A fine of Founders (117) (500,000) five Subscribe to hundred the Shares thousand Offered for dirhams shall Public be imposed on Subscription every

[Company’s] Founder who subscribes to Shares offered for Public Subscription. 10 Receiving Article - - - Every entity or Public (122) company that Subscription receives Without the Subscription Approval of funds in Shares, the Authority Bonds or any other securities, in accordance

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SN Violation Limited Private Joint Public Joint

Liability Stock Stock Companies Companies Companies

with the conditions and circumstances of the incident, shall be fined an amount ranging from (500,000) five hundred thousand dirhams to (10,000,000) ten million dirhams.

11 Delay in Article - - - A fine of Allocating the (126) (500,000) five Shares to the hundred Subscribers thousand Within the dirhams shall Specified be imposed on Period (5 the entity that Working Days fails to allocate from the Shares to Closing of the Subscribers

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SN Violation Limited Private Joint Public Joint Subscription) within the or Delay in specified period Refunding the or fails to Amounts in refund the Excess of the surplus Subscription amounts and and the returns accrued Accrued therefrom Returns to the within the Subscribers specified within (5) period.

Working Days from the Date of Allocating the Shares 12 Failure of the Article - - A fine of A fine of Company’s (133) (20,000) (100,000) one Board of twenty hundred Directors, thousand thousand within (10) ten dirhams shall dirhams shall Working Days be imposed on be imposed on from the Date any Company any Company of the whose Board of whose Board of Constituent Directors, Directors,

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SN Violation Limited Private Joint Public Joint

Liability Stock Stock Companies Companies Companies General within (10) ten within (10) ten Assembly Working Days Working Days Meeting, to from the date of from the date of Submit an the Constituent the Constituent Application to General General the Ministry or Assembly Assembly the Authority meeting, fails to meeting, fails to Accompanied submit an submit an with application to application to Supporting the Ministry the Authority Documents to accompanied accompanied Issue a with supporting with supporting Certificate of documents to documents to Incorporation issue a issue a of the Certificate of Certificate of Company Incorporation Incorporation

of the of the Company. Company.

13 Failure of the Article - - A fine of A fine of Company’s (135) (20,000) (100,000) one Board of twenty hundred Directors, thousand thousand within (10) ten dirhams shall dirhams shall Working Days be imposed on be imposed on

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SN Violation Limited Private Joint Public Joint

Liability Stock Stock from the Date any Company any Company the Ministry or whose Board of whose Board of Authority Directors fails, Directors fails, Issues the within (10) ten within (10) ten Company’s Working Days Working Days Certificate of from the date from the date Incorporation, the Ministry the Authority to Take issues the issues the Measures to Company's Company's Register it Certificate of Certificate of with the Incorporation, Incorporation, Competent to take to take Authority measures to measures to

register it with register it with the Competent the Competent Authority. Authority.

14 Company's Article - - - A fine of (2000) Failure to List (137) two thousand Itself in a dirhams per Financial day shall be Market imposed on any

Company that fails to list itself in one of the

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SN Violation Limited Private Joint Public Joint

Liability Stock Stock Companies Companies Companies

Financial Market licensed in the State. The calculation of this fine begins for each day of delay after the lapse of the specified period for listing.

15 Violation of Article - - - A fine of the Authority's (141) (100,000) one Regulations hundred Governing the thousand Company's dirhams shall keeping of its be imposed on Shareholders' any Company Register proved to have

violated the regulations governing the Company's keeping of its

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SN Violation Limited Private Joint Public Joint

Shareholders' Register.

16 Violation of Article - - A fine of A fine of the Provisions (143) (10,000) ten (200,000) two Relating to the AND thousand hundred Formation of Article dirhams shall thousand Boards of (144) be imposed on dirhams shall Directors any Company be imposed on

proved to have any Company violated the proved to have provisions violated the relating to the provisions formation of relating to the Boards of formation Directors. Boards of Directors.

17 Failure to Article - - A fine of A fine of Comply with (145) (10,000) ten (200,000) two the Prescribed thousand hundred Procedures dirhams shall thousand When the be imposed on dirhams shall Position of a any Company be imposed on Member of the that fails to any Company Board of comply with that fails to

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SN Violation Limited Private Joint Public Joint

Liability Stock Stock Directors the prescribed comply with Becomes procedures the prescribed Vacant when the procedures

position of a when the Member of the position of a Board of Member of the Directors Board of becomes Directors vacant. becomes

vacant.

18 Violation of Article - - A fine of A fine of the (147) (10,000) ten (200,000) two Procedures for thousand hundred Nomination to dirhams shall thousand the be imposed on dirhams shall Membership any Company be imposed on of Boards of proved to have any Company Directors violated the proved to have

procedures for violated the nomination for procedures for membership of nomination for Boards of membership of Directors. Boards of Directors.

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SN Violation Limited Private Joint Public Joint

Liability Stock Stock 19 Being a Article Shall be fined Shall be fined Member of the (149) an amount of an amount of Boards of (5,000) five (10,000) ten Directors of thousand thousand More than dirhams any dirhams any Five Joint- Member of the Member of the Stock Board of Board of Companies Directors of a Directors of a Based in the Company who Company who State exceeds the exceeds the maximum limit maximum limit

prescribed for prescribed for the number of the number of memberships memberships of the Boards of of the Boards of Directors of Directors of Joint-stock Joint-stock Companies Companies based in the based in the State. State.

20 Same person Article - - Shall be fined Shall be fined Occupying (149) an amount of an amount of More Than (10,000) ten (100,000) one Two Positions thousand hundred

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SN Violation Limited Private Joint Public Joint of Chairman or dirhams any thousand Vice-Chairman Member of the dirhams any of the Board of Board of Member of the Directors of Directors of a Board of Two Joint- Company Directors of a Stock proved to have Company Companies exceeded the proved to have Based in the specified exceeded the State number of specified

occupying the number of positions of occupying the Chairman or positions of Vice-Chairman Chairman or of the Board of Vice-Chairman Directors of a of the Board of Joint-stock Directors of a Company Joint-stock based in the Company State. based in the State.

21 Being a Article - - Shall be fined Shall be fined Managing (149) an amount of an amount of Director of (10,000) ten (100,000) one More than a thousand hundred

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SN Violation Limited Private Joint Public Joint

Liability Stock Stock Company dirhams any thousand Based in the Managing dirhams any State Director proved Managing

to have Director proved occupied more to have than one occupied more position as a than one Managing position as a Director in a Managing Joint-stock Director in a Company Joint-stock based in the Company State. based in the State.

22 Board Article Shall be fined Shall be fined Member's (150) an amount of an amount of Failure to (50,000) fifty (200,000) two Report an thousand hundred Incident of dirhams any thousand Conflict of Member of the dirhams any Interest Board of Member of the Directors of the Board of Company who Directors of the fails to report Company who

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SN Violation Limited Private Joint Public Joint

Liability Stock Stock

an incident of fails to report conflict of an incident of interest. conflict of interest.

23 Failure to Article - - Shall be fined Shall be fined Comply with (152) an amount of an amount of the Prescribed (50,000) fifty (200,000) two Procedures thousand hundred Regarding the dirhams any thousand Prohibited Stakeholder dirhams any Dispositions proved to have Stakeholder of failed to comply proved to have Stakeholders with the failed to comply

prescribed with the procedures prescribed regarding procedures prohibited regarding dispositions of prohibited Stakeholders. dispositions of Stakeholders.

24 Company’s Article - - A fine of A fine of Board of (154) (10,000) ten (100,000) one Directors thousand hundred

dirhams shall thousand

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SN Violation Limited Private Joint Public Joint Abuses its be imposed on dirhams shall Powers any Chairman be imposed on

or Member of any Chairman the Board of or Member of Directors of the the Board of Company Directors of the proved to have Company abused their proved to have powers. abused their

powers.

25 Chairman of Article - - A fine of A fine of the Board of (155) (50,000) fifty (200,000) two Directors' thousand hundred Absolute dirhams shall thousand Delegation of be imposed on dirhams shall Their any Chairman be imposed on Competencies of the Board of any Chairman to Any Other Directors of the of the Board of Member of the Company who Directors of the Board of has absolutely Company who Directors delegated all has absolutely

their delegated all competencies their to any other competencies

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SN Violation Limited Private Joint Public Joint

Member of the to any other Board of Member of the Directors. Board of Directors.

26 Board of Article - - A fine of A fine of Directors' (155) (50,000) fifty (200,000) two Absolute thousand hundred Delegation of dirhams shall thousand its be imposed on dirhams shall Competencies any Member of be imposed on to the the Board of any Member of Chairman of Directors the Board of the Board proved to have Directors

absolutely proved to have delegated all absolutely the delegated all competencies the of the Board of competencies Directors to the of the Board of Chairman of Directors to the the Board of Chairman of Directors of the the Board of Company. Directors of the Company.

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SN Violation Limited Private Joint Public Joint

Liability Stock Stock Companies Companies Companies 27 Failure to Article - - A fine of A fine of Comply with (160) (5,000) five (100,000) one the Controls thousand hundred Governing dirhams shall thousand Deputizing a be imposed on dirhams shall Member of the any Chairman be imposed on Board of or Member of any Chairman Directors in the Board of or Member of Board Directors of a the Board of Meetings Company Directors of the proved to have Company

failed to comply proved to have with the failed to comply stipulated with the controls stipulated governing controls deputizing a governing Board Member deputizing a to the Board's Board Member meetings. to the Board'

meetings.

28 Failure to Call Article - A fine of A fine of A fine of the Annual (173) (5,000) five (30,000) thirty (200,000) two General thousand thousand hundred

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SN Violation Limited Private Joint Public Joint

Liability Stock Stock Companies Companies Companies Assembly to dirhams shall dirhams shall thousand Convene be imposed on be imposed on dirhams shall any Director or any Chairman be imposed on Chairman of of the Board of any Chairman the Board of Directors, or of the Board of Directors, or their Directors or their representative, Member representative who fails to thereof who in the invite the fails to invite Company, who Annual General the Annual fails to invite Assembly of the General the Annual Company to Assembly of the General convene within Company to Assembly of the the period convene within Company to specified in the the period convene within Decree-Law, or specified in the the period if they invite Decree-Law, or specified in the the Annual if they invite Decree-Law, or General the Annual if they invite Assembly of the General the Annual Company to Assembly of the General convene before Company to Assembly of the obtaining the convene before Company to obtaining the

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SN Violation Limited Private Joint Public Joint

Liability Stock Stock Companies Companies Companies convene before approval of the approval of the obtaining the Ministry. Authority.

approval of the Competent Authority.

29 Failure to Article - - A fine of A fine of Comply with (174) (10,000) ten (100,000) one the Conditions thousand hundred and Controls dirhams shall thousand Governing be imposed on dirhams shall Serving the any Company be imposed on Invitation to that fails to any Company the General comply with that fails to Assembly the conditions comply with Meeting and controls the conditions

governing and controls serving the governing invitation to the serving the General invitation to the Assembly General Meeting. Assembly

Meeting.

30 Failure to Article - A fine of A fine of A fine of Invite the (178) (10,000) ten (50,000) fifty (200,000) two

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SN Violation Limited Private Joint Public Joint

Liability Stock Stock Companies Companies Companies General thousand thousand hundred Assembly to dirhams shall dirhams shall thousand Convene at be imposed on be imposed on dirhams shall the Request of any Company any Chairman be imposed on the Authority, Director, or of the Board of the any the Ministry or Chairman of Directors, or Chairman of the the Board of their the Board of Competent Directors, or representative, Directors, or Authority their who fails to their representative, invite the representative, who fails to General who fails to invite the Assembly to invite the General convene after General Assembly to receiving a Assembly to convene after request to do so convene after receiving a from the receiving a request to do so Ministry. request to do so from the from the Competent Authority.

Authority.

31 Specified Data Article - - A fine of A fine of in Accordance (189) (5,000) five (50,000) fifty with the thousand thousand Provisions of dirhams shall dirhams shall

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SN Violation Limited Private Joint Public Joint

Liability Stock Stock Companies Companies Companies the Decree- be imposed on be imposed on Law Not any Company any Company Included in that fails to that fails to the Minutes of include the include the the General legally specified legally specified Assembly data in the data in the Meeting minutes of the minutes of the meeting of its meeting of its

General General Assembly. Assembly.

32 Failure to Article - - A fine of A fine of Implement the (191) (10,000) ten (200,000) two General thousand hundred Assembly's dirhams shall thousand Resolutions be imposed on dirhams shall

any Chairman be imposed on of Board of any Chairman Directors of a of Board of Company Directors of a proved to have Company failed to proved to have implement the failed to resolutions of implement the the General resolutions of

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SN Violation Limited Private Joint Public Joint

Liability Stock Stock Companies Companies Companies

Assembly of the the General said Company. Assembly of the said Company. 33 Disposing of Article Shall be fined Shall be fined Shall be fined Shall be fined Stocks or (211) an amount of an amount of an amount of an amount of Shares in (10,000) ten (20,000) (50,000) fifty (200,000) two Violation of thousand twenty thousand hundred the Provisions dirhams, thousand dirhams, thousand of the Decree- whoever dirhams, whoever dirhams, Law disposes of whoever disposes of whoever Stocks in disposes of Shares in disposes of contravention Stocks in contravention Shares in of the rules set contravention of the rules set contravention forth in the of the rules set forth in the of the rules set Decree-Law. forth in the Decree-Law. forth in the Decree-Law. Decree-Law. 34 Breach of the Article - - A fine of A fine of Rules Relating (221) (20,000) (500,000) five to the twenty hundred Company's thousand thousand Purchase of its dirhams shall dirhams shall Own Shares be imposed on be imposed on (Treasury any Company any Company Shares) that violates that violates

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SN Violation Limited Private Joint Public Joint

one of the rules one of the rules related to the related to the Company's Company's purchase of its purchase of its own Shares own Shares (Treasury (Treasury Shares). Shares).

35 Company or Article - - A fine of A fine of Any of its (224) (15,000) fifteen (200,000) two Subsidiaries thousand hundred Provides dirhams shall thousand Material be imposed on dirhams shall Assistance to any Company be imposed on Any Person to or any of its any Company Enable Such subsidiaries or any of its Person to Own proved to have subsidiaries Any Securities provided proved to have Issued by the material provided Company assistance to material

any person to assistance to enable such any person to person to own enable such any securities person to own

any securities

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SN Violation Limited Private Joint Public Joint

issued by the issued by the Company. Company. 36 Violation of Article - - - A fine of Prescribed (229) (200,000) two Share hundred Certificates thousand Obligations dirhams shall

be imposed on any Company that breaches the obligations prescribed in respect of Share Certificates. 37 Breach of Articles - - A fine of A fine of Rules of from (50,000) fifty (200,000) two Issuance of (231) to thousand hundred Bonds or (236) dirhams shall thousand Sukuk be imposed on dirhams shall any Company be imposed on that violates any Company one of the rules that violates of the issuance one of the rules of the issuance

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SN Violation Limited Private Joint Public Joint

Liability Stock Stock

of Bonds or of Bonds or Sukuk. Sukuk.

38 Violation of Article - - A fine of A fine of Rules of (237) (50,000) fifty (100,000) one Preparation of thousand hundred Financial Year dirhams shall thousand Accounts be imposed on dirhams shall

any Chairman be imposed on or Member of any Chairman the Board of or Member of Directors of a the Board of Company Directors of a proved to have Company violated the proved to have rules of the violated the preparation of rules of the the Financial preparation of Year Accounts. the Financial The same fine Year Accounts.

shall be imposed on the Auditor if they approve such accounts.

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SN Violation Limited Private Joint Public Joint

Liability Stock Stock Companies Companies Companies 39 Nomination or Article - - A fine of A fine of Commission of (245) (50,000) fifty (200,000) two an Auditor Not thousand hundred Accredited by dirhams shall thousand the Ministry or be imposed on: dirhams shall the Authority - Any Chairman be imposed on:

or Members of - Any Chairman the Board of or Members of Directors of a the Board of Company Directors of a proved to have Company nominated or proved to have commissioned nominated or an unaccredited commissioned Auditor. an unaccredited

- The Auditor.

unaccredited - The Auditor who unaccredited has been Auditor who nominated or has been commissioned. nominated or commissioned.

40 Violation of Articles - - A fine of A fine of Rules of from (100,000) one (500,000) five

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SN Violation Limited Private Joint Public Joint Company (294) to hundred hundred Division (298) thousand thousand dirhams shall dirhams shall

be imposed on be imposed on any Company any Company proved to have proved to have violated any of violated any of the provisions the provisions contained in contained in the rules of the the rules of the division of the division of the Company, in Company, in addition to the addition to the procedures procedures decided by the decided by the Ministry in Authority in accordance accordance with the with the decisions decisions issued in this issued in this regard. regard.

41 Violation of Articles - - A fine of A fine of Acquisition from (100,000) one (500,000) five

hundred hundred

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SN Violation Limited Private Joint Public Joint

Liability Stock Stock Rules and (299) to thousand thousand Procedures (301) dirhams shall dirhams shall

be imposed on be imposed on the person who the person who violates any of violates any of the provisions the provisions contained in contained in the acquisition the acquisition rules and rules and procedures, in procedures, in addition to the addition to the procedures laid procedures laid down by the down by the Ministry or the Authority in Authority in accordance accordance with the with the decisions decisions issued in this issued in this regard.

regard.

42 Failure to Article - A fine of A fine of A fine of Invite the (308) (50,000) fifty (100,000) one (200,000) two General thousand hundred hundred Assembly to dirhams shall thousand thousand

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SN Violation Limited Private Joint Public Joint

Liability Stock Stock Companies Companies Companies Convene in And be imposed on dirhams shall dirhams shall the Case of Article the Director or be imposed on be imposed on Losses (309) Chairman of any Chairman any Chairman the Board of of the Board of of the Board of Directors, or Directors, or Directors, or their their their representative representative, representative, in the if its losses if its losses Company, if its amount to half amount to half losses amount of its capital of its capital to half of its and they fail to and they fail to capital and they invite its invite its fail to invite its General General General Assembly to Assembly to Assembly to convene in convene in convene in accordance accordance accordance with the with the with the provisions of provisions of provisions of the Decree- the Decree- the Decree- Law. Law. Law.

43 Refusal to Article A fine of A fine of A fine of A fine of Assist (343) (5,000) five (5,000) five (10,000) ten (200,000) two Inspectors thousand thousand thousand hundred

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SN Violation Limited Private Joint Public Joint

Liability Stock Stock Companies Companies Companies dirhams shall dirhams shall dirhams shall thousand be imposed on be imposed on be imposed on dirhams shall the Director of the Director or any Member or be imposed on the Company, Chairman of Chairman of any Member or or their the Board of the Board of Chairman of representative, Directors of the Directors of the the Board of or the Company, or Company, or Directors of the employee of their the Managing Company, or the Company, representative, Director or the Managing or the Auditor or the General Director or who refuses to employee of Manager, or the General provide the Company, employee of Manager, or the information to or the Auditor the Company, employee of the Authority's who refuses to or the Auditor the Company inspectors to provide who refuses to who refuses to carry out their information to provide provide duties, or the Authority's information to information to conceals inspectors to the Authority's the Authority's information or carry out their inspectors to inspectors to clarifications duties, or carry out their carry out their from them, or conceals duties, or duties, or provides them information or conceals conceals with misleading clarifications information or information or information. from them, or clarifications clarifications

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SN Violation Limited Private Joint Public Joint

Reference Simple

Liability Stock Stock Companies Companies Companies provides them from them, or from them, or with misleading provides them provides them information. with misleading with misleading

information. information.

44 Delayed Article Shall be fined Shall be fined Shall be fined Shall be fined Adjustment of (359) an amount of an amount of an amount of an amount of Status (500) five (1000) one (1,500) one (2,000) two

hundred thousand thousand and thousand dirhams per dirhams per five hundred dirhams per month any month any dirhams per month any Company that Company that month any Company that fails to amend fails to amend Company that fails to amend its its fails to amend its Memorandum Memorandum its Memorandum of Association of Association Memorandum of Association to comply with to comply with of Association and Articles of the provisions the provisions and Articles of Association to of the Decree- of the Decree- Association to comply with Law. This fine Law. This fine comply with the provisions shall begin to shall begin to the provisions of the Decree- be calculated be calculated of the Decree- Law. This fine after the lapse after the lapse Law. This fine shall begin to of a period of of a period of shall begin to be calculated year from the year from the be calculated after the lapse

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SN Violation Limited Private Joint Public Joint

Liability Stock Stock Companies Companies Companies date on which date on which after the lapse of a period of the Decree-Law the Decree-Law of a period of year from the entered into entered into year from the date on which force, provided force, provided date on which the Decree-Law that the total of that the total of the Decree-Law entered into such fines does such fines does entered into force, provided not exceed not exceed force, provided that the total of (5,000) five (10,000) ten that the total of such fines does thousand thousand such fines does not exceed dirhams dirhams not exceed (20,000) annually. annually. (15,000) fifteen twenty

thousand thousand dirhams dirhams annually. annually. 45 Violation of - Shall be fined Shall be fined Shall be fined Shall be fined the Provisions an amount of an amount of an amount of an amount not of the Decree- (10,000) ten (10,000) ten (15,000) fifteen less than Law and the thousand thousand thousand (1,000) one Decisions dirhams dirhams dirhams thousand Implementing whoever whoever whoever dirhams but not it, for Which violates any violates any violates any exceeding No provision of the provision of the provision of the (500,000) five Administrative Decree-Law for Decree-Law for Decree-Law for hundred Penalty was acts and other acts and other acts and other thousand

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SN Violation Limited Private Joint Public Joint

Liability Stock Stock Companies Companies Companies Specified in violations not violations not violations not dirhams this previously previously previously whoever Resolution specified in this specified in this specified in this violates any Schedule and Schedule and Schedule and provision of the committed in committed in committed in Decree-Law for violation of the violation of the violation of the acts and other provisions of provisions of provisions of violations not Federal Decree- Federal Decree- Federal Decree- previously Law No. (32) of Law No. (32) of Law No. (32) of specified in this 2021 regarding 2021 regarding 2021 regarding Schedule and Commercial Commercial Commercial committed in Companies or Companies or Companies or violation of the the provisions the provisions the provisions provisions of of rules, of rules, of rules, Federal Decree- regulations, or regulations, or regulations, or Law No. (32) of decisions decisions decisions 2021 regarding issued in issued in issued in Commercial implementation implementation implementation Companies or thereof. thereof. thereof. the provisions

of rules, regulations, or decisions issued in

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SN Violation Limited Private Joint Public Joint

Liability Stock Stock Companies Companies Companies

implementation thereof.

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B- Violations Related to Investment Funds

Legal SN Violation Administrative Penalties Reference

A fine ranging from (20,000) twenty thousand Violation of the Rules, dirhams to (10,000,000) ten million dirhams Decisions and Circulars shall be imposed on anyone whose violation is Regulating Investment Funds proven, in addition to the procedures decided by Issued by the Authority the Authority in accordance with the decisions Article issued in this regard.

(273)

The Fund Manager and the Board of Directors of the self-managed fund shall each be penalized Failure to Renew the 2 with a delay fine of (500) five hundred dirhams Investment Fund Licence for each month of delay in renewing the Investment Fund licence.

C- Violations Related to the Auditors of Joint-stock Companies

Violation Legal Reference Administrative Penalties

A fine of (200,000) two hundred thousand Violation of the Provisions of Articles (153), (173), dirhams shall be imposed on the Auditing the Decree-Law and the Rules (177), (187), (189), Company that violates any of the provisions and Decisions Regulating the (237), (238), (244);

of the Decree-Law and the rules, decisions Affairs of the Auditors of Articles from (245) to and circulars regulating the Affairs of the Private Joint Stock Companies (252); And Articles Auditors of Private Joint Stock Companies and the Mechanism of their (254), (340) and and the Mechanism for their Practice of their Practice of their Profession ( 343) Profession.

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D- Violations Related to the Secretariat of the Share Register

Violation Legal Reference Administrative Penalties

A fine of (100,000) one hundred thousand dirhams shall be imposed on the Registrar of Violation of the Rules and the Shareholders' Share Register in Private Decisions Regulating the Work Shareholding Companies proved to have of the Secretariat of the Article (262) violated any of the rules and decisions Shareholders’ Share Register in regulating the work of the Shareholders' Private Joint-Stock Companies Share Register Secretariat in Private Shareholding Companies.

E- Violations Related to Foreign Companies

Violation Legal Reference Administrative Penalty

Shall be fined an amount of (100,000) one hundred thousand dirhams any foreign company or its office or branch in the State if it fails to register itself with the Registrar Article (336) and obtain a licence from the Competent Failure to Register and License Authority, or if it fails to submit, on an Foreign Companies And annual basis, a copy of the Balance Sheet Article (338) and Final Accounts with the Auditor’s Report and a copy of the Final Accounts of its Holding Company, if any, to the Authority, the Competent Authority and the Ministry.

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F- Violations Related to Representative Offices

Violation Legal Reference Administrative Penalty

A fine of (50,000) fifty thousand dirhams Representative Office's shall be imposed on the foreign Company's Practising a Commercial Article (339) Representative Office in the State if such Activity Representative Office conducts a commercial activity in the State.

G- Violations Related to Other Persons

Violation Legal Reference Administrative Penalty

Any person who commits a violation of any Violation by Other Persons of of the provisions of the Decree-Law and the the Provisions of the Decree- decisions implementing it for which no Law and the Decisions administrative penalty was specified in this - Implementing it, for Which No Resolution shall be fined an amount of not Administrative Penalty was less than (1,000) one thousand dirhams but Specified in this Resolution not exceeding (500,000) five hundred thousand dirhams.

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