The second and final vote is scheduled to take place after two weeks. The bill calls for an independent five-member Capital Market Authority whose main duties would be to ensure complete transparency and to prevent insider trading and other forms of illegal trading and fraud.
Since its founding as the region's first bourse in the early 1970s, Kuwait Stock Exchange has been run by a government-appointed administration that MPs said lacks the powers to ensure transparency. MPs complained of insufficient protection for small investors. "Small investors on the bourse have been massacred as they lost their money.
This law will put an end to suspect trades and will promote transparency," independent MP Ali al-Deqbasi said during the debate. Minister of Commerce and Industry Ahmad al-Harun said the law will "put Kuwaiti bourse on the same level of stock markets in advanced countries."
The market has a capitalisation of around 102 billion dollars and lists more than 200 local and foreign companies. KSE and the tiny Bahrain Stock Exchange were the only Gulf bourses to record losses in 2009, with Kuwait dropping 10 percent. The market has fluctuated sharply so far in January.