Egypt Bourse Issues an Executive Decision to Organize Block Trading Mechanism

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Egypt stock exchange market issued on Sunday an executive decision to organise using the usage of the mechanism for Block Trading.

Dr. Mohamed Omran, Chairman of the Egyptian Exchange (EGX) issued an executive decision to organise using the mechanism for large volume transactions, or what is known as “Block Trading”. The measures was approved by EGX and the Egyptian Financial Supervisory Authority (EFSA) earlier this month, to be applied from May 18, 2014, and aiming to protect the market and its participants from the influence of the change in prices as a result of the huge trades that is traded in different prices from that of the market.

The block trading is intended to do transactions or deals valued at more than the daily average trading volume of the security shop and not less than 1% of the voting rights, and a minimum of a million Egyptian pounds, or those processes in excess of 10 million pounds and not less It’s the value of the counterparty for the amount of 50,0000 pounds.

The new decision obliges the brokerage firms which want to use the Block Trading to apply a request to the “Market Control” before the day of the deal by one working day to allow the applicant brokerages to register the buying commends according to the mechanism, Orders cannot be modified or deleted in the last hour before the deal according to the new system.
The new mechanism is able to register large volumes of deals to be operated automatically and with no time depending on the priority of the timing of registration only, and in case of non-completion of the implementation of  the whole quantity, the broker can replace demand to continue to deal with effect from the next working day and until the completion of the implementation of the full amount regularly.

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