A public company which shares were suspended from trading on TASE due to non-publication of financial statements petitioned at the last minute against the transfer of its shares to the maintenance list after the three months of suspension had lapsed. The company sought a short delay contending that the statements would be published soon, but the TASE refused to grant the request and the company petitioned for urgent interim orders on the eve of the cut-off date.
The Court rejected the motion for interim relief and the petition and held that the petition was filed with undue delay and that there was no legal cause on its merits. The provisions of the TASE regulations constitute a normative document with the status of a statutory regulation. These rules are intended to protect the investing public and ensure proper disclosure and proper corporate governance and they should not be flexed or deviated from by means of a compelling interpretation. Here, the TASE rules unequivocally stipulated that after the first suspension period of three months has passed, the resumption of trading in the security will be done by the TASE CEO only as part of the maintenance list. The company was aware months in advance of the cut-off date and the legal consequences of not publishing the statements and nevertheless turned to the Court at the very last minute in an attempt to establish facts on the ground. On the merits of the matter, the CEO of the TASE acted in accordance with his authority and duty under the regulations and there was no ground for judicial intervention in his discretion. Therefore, the motion and the petition were rejected.
For the sake of full disclosure, Afik & Co. advises Axilion Smart Mobility Ltd. in securities matters, including litigation, but did not handle the aforementioned legal proceeding.