CHANGING ITS MIND IN RECORD TIME The ASF has allowed former insolvent Rasdaq issuers to get listed on the ATS

Consistency isn't the strong point of the Financial Oversight Authority (ASF), which has reached a new record when it comes to the speed that it goes back on its decisions at.

After it rejected, on July 30, the request of the Bucharest Stock Exchange, to eliminate the restriction on companies that are going through reorganization bankruptcy on getting listed, the ASF issued an opposing ruling on August 13th.

In short, the Authority has exempted Rasdaq companies from that rule, meaning that insolvent companies listed on the Rasdaq are allowed to move to the ATS.

Accordingly to the amendment made by the ASF, on August 13th, to the regulations of the alternative trading system, and of the Code of the Bucharest Stock Exchange as a system operator, respectively, in order to be admitted for trading as part of the financial instruments listed on the ATS section, companies are not allowed to be "going through bankruptcy proceedings or to be in reorganization, with the exception of companies which are governed by the Law no. 151/2014 (ed. note: concerning the dismantling of the Rasdaq) and which are either going through insolvency proceedings or through reorganization during the observation period".

The ASF had previously denied the request of the BSE in that regard, even though it had allowed several insolvent companies to be traded on the ATS.

For example, shares of "Intfor" Galaţi and ICMRS Galaţi received the approval of the ASF to move to the ATS, through decisions no. 309/June 17th, 2015 and respectively 1391/June 24th, 2015. Both Rasdaq companies are insolvent, according to information published by the Bucharest Stock Exchange.

Under these circumstances, the Authority had violated the Code of the BSE, as well as its own decisions, meaning that the adjustment of the rules "on the fly" was actually necessary for restoring compliance.

The law which dismantled the Rasdaq has angered investors from the very beginning, as they reported it had flaws.

The Association of Stock Market Investors (AIPC) has repeatedly filed complaints with the delisting of some issuers on the Rasdaq market, saying that the "measures which the ASF claims to have taken have produced no concrete results in the market".

The AIPC has reported deficiencies which concerned the failure to complete the evaluations of the companies in question within the deadlines set by the law (which led to the shareholders being unable to receive the price for their exit), as well as the fact that the perpetuation of such a state of things induces uncertainty in the market and concerning the acquisitions of some investors.

The AIPC also recently expressed its displeasure with the manner in which the National Association of Authorized Romanian Evaluators (ANEVAR) has been monitoring the process of evaluation of the companies that get delisted from the Rasdaq market. In response, Adrian Vascu, the president of the ANEVAR, replied that the Association is doing its job, according to its prerogatives, but that it can't intervene in the contractual relations between issuers and evaluators.

Also, several investors have complained directly to the BSE, as well as to the Financial Oversight Authority (ASF) claiming that the BSE is allowing some issuers, which have changed their respective lines of business stipulated in their bylaws, to get listed on the AeRO alternative system, without being required to amend their articles of incorporation, through a decision of the General Shareholder Meeting, which means that they are breaking the Law no. 31/1990 of companies.

The Rasdaq will permanently shut down in October, one year after the law which required all the issuers listed on it to opt between being delisted or moving to a regulated market or to the alternative trading system.