The BSE cancels the sales of "Biofarm" and "Mercur" shares managed by the AVAS

• The capital market watchdog has blocked the transactions with other shares managed by AVAS, which the court appointed executor was planning to sell sale

According to market sources, the Bucharest Stock Exchange has cancelled the trades by which the court appointed liquidators of "Dobra, Coşoreanu & Dobra" tried to sell 7.24 million shares of "Biofarm" Bucharest (BIO) and 6,000 shares of "Mercur" Craiova (MRDO), whicuh were managed by the AVAS. The court appointed liquidators tried to sell the shares through the special selling method, after receiving the right to foreclose on the institution.

The settlement of the trades had been suspended by the CNVM since August.

"What the BSE did is a first on the capital market, when considering that the decision to cancel the trades is not backed by a court ruling", said Iulian Coşoreanu, who obtained the right to foreclose on the Authority for the Recovery of State Assets (AVAS) and who, thanks to his own expertise as a stock market investor, handled the sale of the shares himself.

The decision of the Bucharest Stock Exchange came as the capital market watchdog issued an Ordinance, about two weeks ago, requiring the BSE to intervene and to take "the appropriate measures", claiming that the sale of the blocks of shares which the AVAS owned in BIO and MRDO violated the Code of the Exchange.

Article 228, paragraph 1 of the BSE code, stipulates that the sale of stocks by special orders is used in the case of blocks of shares equal to or greater than 5% of the company"s total number of shares, or having an equivalent value of at least 500,000 Euros. Paragraph 3 of the same article stipulates that those provisions do not apply to "public institutions involved in the privatization process for securities which are the object of methods of sale, others than public offers, stipulated in special laws concerning privatizations, as well as the execution of the security interest agreements which have stocks traded on the BSE as their object". The CNVM has shown, however, that SSIF "Oltenia Grup Invest" has erroneously claimed that the AVAS was the initiator of the sale of shares of BIO and MRDO (and other companies) and that it provided inaccurate grounds for the request which these operations were based on.

The Ordinance of the CNVM states that "The AVAS was not involved in the process for the privatization of the blocks of shares which had been put up for sale", as well as the fact that the trades involving the two stocks, "didn"t represent the foreclosure of security interests which had the shares in question as their object".

Valentin Ionescu, the general manager of the Bucharest Stock Exchange, could not be contacted by the closing of the edition.

• The fight between the Romanian National Securities Commission and the liquidator of the AVAS continues

The court appointed liquidators don"t seem to be discouraged by the Ordinances of the CNVM which suspended the settlement of the trades by which the shares of BIO and MRDO managed by the AVAS were sold, as well as the attempts to sell shares of "Agrana" Romania (BETA), "Castill" Bucharest (CAST), "Biofarm" and "Mercur" Craiova, managed by the AVAS. The aforementioned shares had been put up for sale by the liquidators, in the same conditions as the shares of BIO and MRDO.

The liquidators of "Dobra, Coşoreanu & Dobra" recently tried to sell on the stock market the shares which the AVAS manages in "Transchim" Bucharest, "The Transportation Sector Construction Company" of Bucharest and "Faur", which are evidenced in the account of the AVAS.

"It was our intention to sell these shares", Mr. Coşoreanu said.

On Wednesday, the Romanian National Securities Commission issued an ordinance by which it blocked the transfers of these blocks of shares for two weeks. The Romanian National Securities Commission said that this decision was made to protect buyers acting in good faith.