Jordan scores significant improvement in ‘protecting minority investors’ indicator

AMMAN — Jordan jumped 40 spots in the last two World Bank Doing Business Reports’ “protecting minority investors” category, the Jordan Securities Commission (JSC) said on Monday.

In the 2019 report, Jordan’s ranking rose from 146th in 2018 to 125th, and improved 19 ranks between 2018 and 2017, JSC Chief Commissioner Mohammad Hourani said, according to the Jordan News Agency, Petra.

Jordan's overall score in the World Bank's annual report, which presents quantitative indicators on business regulation and the protection of property rights in 190 economies, reached 60.98, up 1.42 per cent from last year.

Despite the upgrade in the overall score, the Kingdom's ranking dropped to 104th, compared to 103rd in 2018.

The main contribution that led to the country's improvement in “protecting minority investors” indicator was JSC’s issuance of regulations in 2017 affecting shareholding companies, which included all of the reforms required by the team that prepared the reports, Hourani said.

Jordan strengthened minority investor protection by extending access to evidence before trials, increasing shareholders’ rights and role in major corporate decisions, clarifying ownership and control structures, and requiring greater corporate transparency, according to the 2019 report.

The JSC regulations required electing members of boards of directors according to a cumulative voting system to enhance minority investors’ rights, having independent board members and separating the position of chairman and any other executive position in the firm, according to Hourani, who added that the rules banned relatives of a chairman from holding the position of general manager, to avoid conflict of interests.

The guidelines organised the relations among relevant parties, and obliged companies to provide the commission with governance reports addressing companies’ applications and practices. 

The Doing Business Report measures aspects of regulation affecting several areas of a business’ life, including starting a business, dealing with construction permits, getting electricity, registering property, getting credit, protecting minority investors, paying taxes, trading across borders, enforcing contracts and resolving insolvency.

Among reforms made by the Kingdom, that have contributed to the ease of doing business, is improving access to credit information by reporting data on credit payments from retailers, according to the report.

Other reforms that had a positive impact on the country's score were making paying taxes easier by implementing an online system for filing and payment of general sales tax, and making the enforcing of contracts easier by introducing a system that allows users to pay court fees electronically, the report said.