SECP directives to end floor-price rule by Friday

The SECP and stock market’s guns are silent for now since chairman of the apex regulatory body left Saturday’s (Dec 06) meeting inconclusive with his last words on record that he would himself issue directives on floor in a day or two. “No communication has been built so far from both sides of the fence i.e. (1) Securities & Exchange Commission of Pakistan (SEC), and (2) the officials of local bourses, and none of them tried to approach each others on the issue of floor,” officials of two sides verified.

SECP officials, however, endorsed that directives to end the floor-price rule on Dec 15 would be sent to the three local bourses last by Friday, Dec 12. “The SECP does not work on government holidays and the issuance of directive would not be delayed beyond Dec 12,” they reiterated.The staff of the Commission would resume office on coming Thursday, Dec 11, after celebrating Eid, it was learnt.“Local bourses i.e. Karachi, Lahore and Islamabad do not have powers more than the apex regulatory body and if SECP has once issued directives in any regard then bourses have to comply it. This is the Commission’s legal position,” replied a Commission-Director.Floor to stay beyond Dec 15: A member-director on KSE Board, however, was of the firm belief that floor-mechanism would stay beyond the verbally given deadline of Dec 15 by SECP.

As far as the question of SECP directives on floor is concerned then they would only be acceptable to the bourse if directive were included an applicable solution regarding the leverage market, he added.If SECP ruling would be of one line sentence like “Remove the floor on Dec 15”, and included nothing else like how to resolve the issue of massive leveraging in market then markets have a right to approach the Supreme Court and obtain a stay order.“According to the hierarchy of our legal system, Supreme Court holds the top-most position in Pakistan and it is also over and above any apex regulatory body e.g. SECP,” explained the director. “Moreover, the Board of Directors of Karachi Stock Exchange (KSE) has powers to shut the market down and this is our legal position,” he replied.“We will decide what to do ahead of SECP directives if are issued to us. Otherwise we have held no internal (formal or informal) nor the any external meetings since Saturday, Dec 06,” he said.

He affirmed that Board of Directors of Karachi Stock Exchange Board will not let its members down owing to their weak financial positions and only an applicable solution can convince market representatives to act in compliance with SECP directives.Officials of both the sides, however, said that what so ever measures would be taken at markets, they will be taken in accordance with ‘mutual consent’, which is the past practice of two regulators (i.e. SECP & other bourses), Extension in CFS rollover likely: One of the applicable solutions that the three bourses had put before SECP-Chairman Razi-ur-Reham was the extension in CFS rollover period by six moths and KSE Board expects this to be included in the directives, which are heard to be issued by Commission regarding floor removal.This complicated situation emerged after IMF barred government from using public money to bailout a cash-starved stocks market last week. Markets have entered into the fourth month under floor-rule since it was introduced on Aug 27.

The reason for imposing floor was to escape from likely default situation by the market members, as KSE 100-share Index had fallen by about 41 per cent amid an outflow of about Rs2 trillion market capitalisation by Aug 27 from its peak position of 15,676 points on April 18, this year. At current, market is still staying around Aug 27’s floored position.

SECP initiates 86 show-cause proceedings against compamies

The SECP’s Enforcement Department— while enforcing compliance of corporate and allied laws— initiated 86 show-cause proceedings and concluded 54 proceedings against chief executives, directors and auditors of companies in February and March. While facilitating companies to strengthen their capital base, the department allowed three listed companies to issue shares by way of otherwise than right at a discount and at par. In order to strengthen the existing regime of Corporate Social Responsibility (CSR) reporting, the SECP has joined hands with the ICAP for the external assurances of the CSR reports. CSR reports assist organizations in understanding and communicating their vision of combining a company’s profitability with social responsibility and environmental care. Both the SECP and the ICAP have reaffirmed their commitment to developing a framework for external assurance in accordance with prominent international assurance standards, and within a mutually agreed time f

Chairman SECP Reaffirms Commitment to Facilitate Businesses

The Securities and Exchange Commission of Pakistan (SECP), as part of its efforts to promote ease of doing business through meaningful stakeholder engagement, held an interactive virtual session with representatives of Overseas Investors Chambers of Commerce & Industry (OICCI). The session was chaired by the Chairman SECP, Aamir Khan, who briefed the participants about recent improvements in the regulatory ecosystem and highlighted some key changes, including introduction of digital certificate of incorporation, creation of special portal for banks to facilitate account opening, digitization of account opening process for resident and non-residents for investment in the capital market etc. These reforms have greatly improved efficiency of processes, which have been duly reflected in country’s global rankings. During the session, the Chairman apprised the OICCI’s representatives about SECP’s future endeavors in this regard to simplify regulatory requirements, reduce compliance c

Sohail Wajahat Siddiqui made new Chairman of PSO

The Ministry of Petroleum and Natural Resources has notified appointment of Sohail Wajahat Siddiqui as chairman of the board of directors of Pakistan State Oil (PSO) . Siddiqui has replaced Nazim F Haji with immediate effect. Sohail heads Siemens Pakistan Engineering Company Limited as its Managing Director and Chief Executive Officer. He has served as the president of the Overseas Investors Chamber of Commerce and Industry (OICCI) and also served as chairman of Pakistan Red Crescent Society, Sindh. Siddiqui has also served as board member of Pakistan Steel. He is also the founding member of the Pakistan Business Council. In recognition to his contribution towards the national cause, he has been awarded Sitara-e-Imtiaz. (The News)

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