Related Party Transactions
Related parties represent major shareholders, Board Members and key management personnel of Bupa Arabia, and companies of which they are principal owners and any other entities controlled, jointly controlled or significantly influenced by them. Contract pricing policies and terms are conducted on an arm’s length basis and transactions approved by the Company’s Management, or where required and applicable by the Company’s Board of Directors.
In any instance where any Board member was conflicted, whether personally or via related party relationship, the conflicted Board member did not vote.
The following are the details of the major related party transactions during the year and their related balances:
| Legal Entity | Related Party |
Description | 2021 Period | 2020 Period | 2021 SR ’000 |
2020 SR ’000 |
Change |
| Bupa Global | Bupa | Reinsurance Premium Ceded (Bupa International Saudi Arabia Plan) |
12 months January-December |
12 months January-December |
-59,358 | -41,431 | -17,927 |
| My Clinic International Medical Company | Nazer | Nurse service fees | 12 months January-December |
12 months January-December |
131 | 131 | 0 |
| Various | Various | Other expenses – net | 12 months January-December |
12 months January-December |
528 | 307 | 221 |
| Bupa Investments Overseas Limited (BIOL) | Bupa | Tax Equalisation – net | 12 months January-December |
12 months January-December |
14,241 | -1,873 | 16,114 |
| Bupa Investments Overseas Limited (BIOL) | Bupa | Board and Committee Member Remuneration | 12 months January-December |
12 months January-December |
833 | 915 | -82 |
| Bupa Middle East Holdings Two. WLL (BMEH2) | Bupa and Nazer | Trade mark fees | 12 months January-December |
12 months January-December |
26,611 | 26,896 | -285 |
| Total Listed Transactions | -16,661 | -14,624 | -2,037 | ||||
All contracts are for a 12-month period for both 2020 and 2021 .
Related Party Transactions Relating to Insurance Contracts
Details of health insurance contracts associated with Bupa Arabia’s Board Members, or that of their first-degree relatives, are reflected below:
Bupa Arabia Board Members' Personal/Family Health Insurance with Bupa Arabia
| Board Member Name | Contract Description | Period | Saudi Riyals | Gross Written Premium (GWP) | |||
| 2021 | 2020 | 2021 Change |
2021 Percentage Change |
||||
| Eng. Loay H. Nazer | Nazer Group Ltd. Related Contracts (multiple contracts) | Various | SR millions | 14 | 11 | 3 | 27% |
| Dr. Abdulla Elyas | Careem Contract Health Insurance Scheme | 4/20-4/21 | SR millions | 1 | 1 | 0 | 0% |
| Mr. Tal Nazer | Bupa Arabia Employees Health Insurance Scheme |
1/7-30/06 | SR millions | 21 | 20 | 1 | 5% |
| Mr. Nader Ashoor | Bupa Arabia Employees Health Insurance Scheme |
1/7-30/6 | SR millions | 21 | 20 | 1 | 5% |
The explanation for those contracts is available below:
| Board Member Name | Contract Explanation |
| Eng. Loay H. Nazer | Health cover for self and family as an employee of the Nazer Group Ltd. and the Nazer Group Ltd. settles to Bupa Arabia directly |
| Mr. Tal Nazer and Mr. Nader Ashoor |
Health cover for self and family as well as all employee members of the Bupa Arabia Health Insurance scheme and reflected within the staff costs |
| Dr. Abdulla Elyas | Health cover for self and family is as an employee of Careem, and Careem settles to Bupa Arabia directly |
Bupa Arabia Board Members' Other Related Party Health Insurance with Bupa Arabia
| Board Member Name | Contract Description/Explanation | Period | Saudi Riyals | Gross Written Premium (GWP) | |||
| 2021 | 2020 | 2021 Change |
2021 percentage Change |
||||
| Mr. Zaid Algwaiz | SNB (an independent Board Member) | 1/1-31/12 | SR millions | 173 | 157 | 16 | 10% |
| Riyadh Cables Group Company | 10/21-10/22 | SR millions | 7 | N/A | 0 | 0% | |
| Mr. David Fletcher Mrs. Joy Linton Mr. Martin Houston Mr Nigel Sullivan |
During 2021 there was a group of contracts which Bupa (England, UK) had an interest in |
Various | SR millions | 83 | 1 | 82 | 8200% |
| Mr. Ali Sheneamer | AMS Baeshen Co. | 1/21-12/21 | SR millions | 3 | N/A | 0 | 0% |
Any health insurance coverage which Bupa Arabia provides to any Bupa Arabia Board Member, and/or if applicable his company/family members, or with whom he may be associated or have an interest, is done strictly on an arm’s length basis, with no preferential treatment in any form, and in accordance with the Company’s pricing and loss ratio targets per the Company’s Underwriting Policy/Manual. This is in full adherence to each of the SAMA medical pricing regulations, and the CHI medical insurance product regulations.
Declarations Relating to Waiver of Salary, Compensation and Rights to Dividends
The Company confirms the below declarations:
– That it has not issued, nor granted, any convertible debt instruments, options, warrants or similar rights during the financial year and accordingly has not received any consideration for the same.
– That it has not converted, nor issued, nor granted, any subscription rights under any convertible debt instruments, contractually based securities, warrants or similar rights during the financial year.
– That it has not redeemed, purchased or cancelled any redeemable debt instruments during the financial year. The Company has no such securities outstanding so the value of the same is nil.
Our Shareholders and Our Disclosure of Information to All Stakeholders
As at 31 December 2021 the major shareholders were as per the table below:
| Description | Shares | Shares percentage |
| Bupa Investments Overseas Limited (BIOL) |
51,900,000 | 43.25% |
| Nazer Group control through the below two legal entity companies: |
10,908,000 | 9.09% |
| Nazer Group Holding Company Ltd. (Nazer) | 10,800,000 | 9.00% |
| Modern Computer Programs Company Limited (MCPC) | 108,000 | 0.09% |
| Major Shareholders | 62,808,000 | 52.34% |
| Public Shareholders | 57,193,448 | 47.66% |
| Total | 120,000,000 | 100.00% |
Tadawul Shareholder Database Requests
During 2021, Bupa Arabia made eight (8) requests of Tadawul for its shareholder database, on a variety of dates, and they are as follows:
| # | Request Date | Request Purpose |
| 1. | 24 June 2021 | General Assembly |
| 2. | 28 June 2021 | Dividends File |
| 3. | 1 August 2021 | Corporate procedures |
| 4. | 8 August 2021 | Corporate procedures |
| 5. | 9 August 2021 | Corporate procedures |
| 6. | 10 August 2021 | Corporate procedures |
| 7. | 4 November 2021 | General Assembly |
| 8. | 31 December 2021 | Corporate procedures |
Other Disclosures and Information in Accordance with Laws and Regulations
Provision of Corporate Governance
Bupa Arabia is committed to, and is in full compliance with, the full adherence to the provisions of the SAMA Insurance Corporate Governance Regulations, as well as with that of the requirements of the Company’s Code of Corporate Governance. There are a number of guiding requirements within the CMA regulations which Bupa Arabia has decided to either adapt, for example, within the RMC scope the corporate governance related, or adopt in the future, either when required to as mandatory, or earlier if considered appropriate and best practice to do so.
| Article Number | Article Section and Narrative | Reason for Non-Compliance |
| 90/93 – Board Report disclosures | Article 90 paragraph 8 with respect to Article 93 a) paragraph 4) point b) Disclosure of the five Senior Executives who have received the highest remuneration from the Company. | Bupa Arabia has disclosed the top five executive payments, including the CEO and CFO, in totals under the Remuneration section of this report. |
| 70 – Composition of the Risk Management Committee | The Company’s Board shall, by resolution therefrom, form a committee to be named the “Risk Management Committee.” Chairman and majority of its members shall be Non-Executive Directors. The members of that committee shall possess an adequate level of knowledge in risk management and finance. | Bupa Arabia’s Risk Management Committee Chairman is an Independent Member. He and the majority of the Committee Members are not Members of the Board of Directors as this article is a guiding article. |
| 54 – Audit Committee Formation | Paragraph (b) The chairman of the Audit Committee shall be an Independent Director |
Bupa Arabia’s Audit Committee Chairman is an Independent Member, who is not a Member of the Board of Directors as this article is a guiding article. |
In terms of the CMA Corporate Governance regulation Article Number 89, regarding policies that regulate the Relationship with stakeholders to protect their respective rights, Bupa Arabia’s policies will be enhanced during 2022 to ensure a stronger alignment with regulations and latest international best practice.