The Federal Parliament Finance Committee has directed key regulatory bodies to take five-point actions regarding the reform, regulation, and protection of investors in Nepal’s capital market after a four-hour discussion.
Directives for New Legislation
The committee has instructed the Ministry of Finance and the Securities Board of Nepal (SEBON) to draft new securities legislation. This bill aims to clearly define the roles, responsibilities, and accountability of all related bodies to ensure better market listing, operations, and the protection of investor interests. The committee wants this bill to be presented to the Federal Parliament as soon as possible.
New Rules for IPOs and Institutional Investors
SEBON has received directions to change how companies get permission for Initial Public Offerings (IPOs). Before giving the green light, the board must check the company’s capital, technology, leadership, operations, and potential returns. They also need to set clear standards and priorities for these companies. Furthermore, SEBON is asked to review the current rules about the amount of shares that institutional investors are allowed to hold.
Focus on NEPSE Infrastructure and Technology
The committee expressed concerns that frequent problems in the online trading system, networks, and data systems are hurting investors and reducing government revenue. Because of this, the Ministry of Finance, SEBON, and NEPSE are ordered to speed up the restructuring of NEPSE. They are expected to improve technology, upgrade the system, and provide strong cybersecurity to keep the market running smoothly.
Stopping Market Manipulation
To keep the market fair, the committee has taken a strict stance against illegal activities like circular trading, cornering, and pump and dump schemes. These actions create fake demand or supply and cause high price volatility. SEBON and NEPSE are instructed to keep a close watch on the market and take immediate action against any person or company involved in such price manipulation.
Filling Leadership Vacancies
The committee noted that the positions of Chief Executive Officer (CEO) at both NEPSE and CDS and Clearing Limited have been empty for a long time. They have directed the Ministry of Finance to start the process of appointing new leaders to these posts immediately so that the organizations work well.
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.
