Partners’ shares valuation is one of the asset valuation services a CMA-licensed asset valuator renders in the cases specified under law.
Partners’ shares valuation is governed by the provisions set forth in this regard in Module Five, “Securities Activities and Registered Persons” of the Executive Bylaw of Law No. 7 of 2010 regarding the Establishment of the Capital Markets Authority and Regulation of Securities Activity, as amended, and the Companies Law No. 1 of 2016 and its Executive Regulations, as amended.
What are the statutory and regulatory requirements in the State of Kuwait that mandate companies to have their partners’ shares valuated?
Article 1-39 of Module Five, “Securities Activities and Registered Persons” of the Executive Bylaw of Law No. 7 of 2010 regarding the Establishment of the Capital Markets Authority and Regulation Securities Activity, as amended, states that partners’ shares shall be valuated considering the respective status of each partner, along with indicating the relevant articles of the Companies Law No. 1 of 2016 and its Executive Regulations, as amended.
What are the cases that require partners’ shares valuation?
Companies shall appoint a licensed asset valuer to conduct the valuation of partners’ shares in accordance with the law in the following cases:
- Share of the joint partner
- Share of the partner not willing to continue in the company
- Share of the partner who refuses amendment to the partnership memorandum of association
- Share of the dismissed partner
- Share of the deceased partner
- Other cases stipulated in the Companies Law No. 1 of 2016, including the valuation of the share of a partner who has been disqualified from practicing the profession
What is the liability of the asset valuator in this regard?
Article 3-5 of Module Eleven, “Dealing in Securities” of the Executive Bylaw of Law No. 7 of 2010 regarding the Establishment of the Capital Markets Authority and Regulation Securities Activities, as amended, states that:
An Asset Valuator shall be liable for any professional negligence or fault relevant to its conclusions to the extent of the information available to it in this regard.
In light of the above, Baker Tilly adopts effective and efficient valuation techniques to ensure the fair valuation of the underlying assets.
What is the added value to business entities from the partners’ shares valuation services?
- Protect all kinds of rights held by partners in business entities.
- Protect business entities from collapse in case of the partners’ disagreement.
- Ensure that the shares are fairly evaluated, given the independence of the asset valuator.
- Enhance the principles of independence and integrity and prevent conflict of interest while rendering valuation services.
What are the services provided by Baker Tilly Kuwait?
Baker Tilly Kuwait is a CMA-licensed asset valuator that issues asset valuator reports on the valuation of partners’ shares of different types.