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  • Saturday, 11 June 2016 09:25

Founded in 2011, Capital Market Central Asset Management Co. of Iran has issued various types of sukuk for originators from various industries including: financial intermediation, mining and metals, transportation, petrochemical and chemicals, food, medicine and health, energy, telecommunications, household appliances, construction, etc. with the total amount of more than IRR2,000 trillion.
We are hugely proud of providing part of the country's financial needs for production, entrepreneurship, development and job creation via issuing Islamic financial certificates or sukuk.
Objectives:
The main business objective of this company is to establish and manage SPVs under paragraph (D) of The Law for Development of New Financial Instruments and Institutions.
Moreover, Central Asset Management Company undertakes administrative, financial, and legal affairs of SPVs and records their financial documents as well.
Central Asset management Co. meanwhile serves as a trustee to investors, preserves shareholders' interests and ensures them of issuers' accuracy. In other words, it also monitors processes regarding securities issuance operations.
Legal Framework:
CMCAMC is a non-profit entity by nature and its sole source of income is the fees specified by the SEO for issuing Sukuk. The shareholders are Central Securities Depository of Iran (49%), Iran Fara Bourse (29%), Tehran Stock Exchange (20%), and Cooperative Company of the Securities and Exchange Organization Staff (2%) and it is under direct supervision of SEO.
Laws and regulations impacting CMCAMC's activities:
1.The Securities Market Act of the Islamic Republic of Iran, passed by the parliament in 2005 forms the primary source of law for Iran's capital market. The act composed of seven sections. It introduced the High Council of the Securities and Exchange and Securities and Exchange Organization (SEO) as the key institutions and bodies, regulating and monitoring the market activities in Iran and the arbitration board of the market as the sole judicial body competent to deal with the disputes in the market. Moreover, it defined primary and secondary markets offences and punishments within the capital market.
2.The Law for Development of New Financial Instruments and Institutions. Increasing need for new financial institutions and instruments entailed to the ratification of this act by the parliament in 2009. For the first time, the act defined and recognized Special Purpose Vehicles (SPV) and Mutual Funds as new entities financing projects and companies in the market. It described features and functions of SPV's and funds. In addition, the act made considerable changes in the Direct Taxation Act with respect to the taxes on transactions in the market. The statute determined taxes on the commodity and securities trade in the exchanges, SPV's and funds' income. The last section of the law adopted criminal and financial penalties in respect of breach of the laws and regulations in the market.
•Article 11: The SPV shall be exempt from payment of any tax whatsoever and transfer tax and charges and income tax for that category of the assets for which the funds are raised through issue of securities for public offering. The funds raised through issue of securities by such institutions shall be pooled in a special account and any withdrawal from such account shall take place under the supervision and with the approval of the Organization. The regulations governing the activities of the SPVs shall, within three months, be approved by the Securities and Exchange High Council upon the recommendation of the Organization.
•Article 12: The proceeds gained from selling assets to the SPV so as to provide financial resources through public offering of securities shall be exempt from tax and no tax and charges whatsoever shall be levied on the transfer of such securities. The depreciation expenses arising from assets value appreciation in the repurchase of the same assets by the seller, in whichever manner, shall not be regarded as parts of the tax deductible.Capital Market Central Asset Management Company was established in February 2011 under Article II of Guidelines for SPVs Activities ratified by Securities and Exchange High Council of Iran.


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