Coverage
Coverage
Indemnifying the affected parties for the direct actual financial losses resulting from the erroneous practices of member companies due to the non-commercial risks set out under the Fund’s business rules, provided that the maximum limit of indemnity shall not be exceeded.
Covered risks (non-commercial risks):
They are the risks resulting from a violation by any member company of the Fund, which caused personal and direct financial losses to the affected party. These covered risks are limited to the following:
- bankruptcy of the member company by virtue of a final court ruling, or the insolvency thereof, as determined by a decision of the Fund’s board of directors in accordance with the report issued by the Financial Regulatory Authority in this regard.
- fault, negligence, fraud or deceit on part of the member company, its legal representative, the person in charge of actual management thereof or its employees, as revealed by the investigations conducted by the Authority or judicial entities.
- bankruptcy of the member company by virtue of a final court ruling.
- issuance of final court rulings in favor of the holders of free trading securities or financial instruments against the member company management, provided this shall take place in cases of fraud or gross negligence.
- compulsory delisting of securities or financial instruments of the member company from the Egyptian stock exchanges due to issuing a final decision of the stock exchange management for reasons ascribed to the default or negligence of the member company, with the exception of delisting due to reasons beyond the control of the member company.
- canceling the subscription right as to the capital increase if this took place before the date specified therefor.
Uncovered Risks (Commercial risks):
They are the risks resulting from changes in investment values, the loss of certain investment opportunities, or resulting from fluctuations in the market. These risks are outside the fund’s scope of coverage.
- Any claim that contains or arises from any action, mistake, omission, operation, or incident related to any transactions carried out on securities listed outside the Arab Republic of Egypt.
Any liability incurred by the member in the following cases:
- Under the terms and conditions of any contract, agreement, pledges or guarantees to third parties.
- Based on conditions that exempt any third party from liability, except in cases where the member’s liability arises even in the absence of such conditions.
- Any liability for losing any property or funds owned by the member or in his possession in any capacity, or for which he is actually or implicitly responsible, other than client funds that are related to the member’s activity in the Egyptian capital market.
- Any liability arising from a circumstance or condition that results in any third party – other than the member’s clients – claiming indemnification from the member, regardless of its value.
- Any claim made by, on behalf of, or based on instructions of a third party, whose instructions are legally binding on the member, or made by any other party in which the member, his officials or employees have any executive or leadership capacity.
- Any claim resulting from an act, fault, omission, operation or condition that appears to have actually or implicitly occurred on a date prior to the date the Fund began its work.
- Any claim generated from a circumstance or a condition, the knowledge of which by an ordinary person is sufficient to indicate that it could give rise to a claim.
- Any fines, sanctions, penalties, or doubled indemnification, with the exception of the original compensatory value of the damages that precede this duplication, provided they shall not exceed the maximum limit of indemnity in accordance with the decision that regulates the Fund.
- Any claim made by, on behalf of, or based on the instructions of any government body or any entity reporting to the government, with the exception of the procedures taken independently in personal capacity by a client.
- Any liability arising from the abstention of a member or any of its employees to provide or continue to provide finance or refrain from carrying out an actual or implied commitment to take out or continue a loan or any transaction that has the nature of a loan or advance or to establish credit, whether this actual or implied commitment is authorized or not.
- Any liability arising from deferring transactions or postponing payment due to the client not paying the value of transactions to the member.
- Any loss or deprivation of income or profits, including loss of interest, stock returns, fees, commissions, or the like.
- Any loss arising from orders or messages sent to the member as received on his computer or any technological device for receiving data or printing or displaying same on a computer screen or any similar device, with the exception of losses covered in accordance with the Fund’s business rules.
- All the fees, expenditures or expenses incurred by the client to prove the existence or determine the value of the covered loss.
- Any loss resulting from sudden incidents, force majeure, contingencies or sovereign resolutions.