Nepal Securities Board (SEBON) announced a new ‘Right Renounce’ system, which will allow investors to sell or transfer their entitlement to buy rights shares to another party.
Nepal Securities Board (SEBON) has made an announcement as part of its capital market policy for fiscal year 2083/84. The board will bring into effect a new arrangement related to the transfer of rights share entitlements, known as ‘Right Renounce’. Once this system is in place, investors will have the option to sell or hand over their right to purchase rights shares to another party.
Under the current rules, when rights shares are issued, the concerned shareholders must either buy them themselves or simply let their entitlement go unused. This new policy brings a change to this system. It will allow investors who do not wish to, or are unable to, buy their rights shares to sell their entitlement to another investor through the secondary market.
This initiative will greatly benefit small investors, enabling them to gain a monetary value from their rights share entitlements instead of letting them expire without any use.
To support this, the necessary legal and structural infrastructure will be prepared. As per the policy, essential modifications will also be carried out in the systems of Nepal Stock Exchange (NEPSE) and CDS and Clearing (CDSC).
The board has identified the simplification and smooth functioning of the rights transfer process as a primary success indicator for this new policy.
AI Disclaimer: This article was originally published on https://bajarkochirfar.com. It has been translated with the help of AI. For the best understanding and accurate facts, we recommend reading the original Nepali version.
