An Innovative Platform To Trade Unlisted Securities

OTC is an over the counter platform developed by Boursa Kuwait to serve investors looking to trade in unlisted securities, with a main focus on creating a new, credible and transparent investment system.

The Concept

The OTC platform is a new electronic platform for trading unlisted securities and is the only one in the GCC region.

Mechanism and Terms of Operation

OTC platform is a new platform in which all trades are executed by licensed brokerage offices that will result in profits, losses and transfer of ownership. All trades are subject to the rules and regulations of the OTC rulebook, whereby clients assume the responsibility for the risks that may result from such trades and investigating the financial and legal status of the company that they wish to trade securities from.

Trading Unlisted Securities in the Past

In the Past, Trading of unlisted securities was a manual process characterized by shortfalls and lack of transparency, investors usually expressed concerns about the seriousness of the buying / selling process, the credibility of prices and difficulty of clearance on executed trades.

Bridging The Gap

Boursa Kuwait restructured the unlisted securities trading mechanism from the grounds up introducing major reforms including a fully automated framework and updated procedures and processes, aiming at bridging all legal gaps that were encountered in the previous mechanism.

As per the OTC rules, all trades should be carried out through brokers in a similar fashion to the official market, and companies should keep all records of shareholders through an authorized clearing company.

New Platform Features

• The new OTC platform, developed by Boursa Kuwait, provides the following:
• Facilitates trading, buying and selling of unlisted securities.
• Reduces paperwork cycle through full automation.
• Facilitates settlement and clearing processes for investors using the platform.
• Provides a dedicated website for OTC
• Creates more opportunities for investors willing to trade in unlisted securities and gives them more freedom in making investment decisions.
• Gives small companies and start-up businesses that do not qualify for listing in the official market the opportunity to grow, and simplifies procedures.