SHC puts on notice stock exchanges, NCCPL, SECP & MoF

A division bench of Sindh High Court (SHC) Monday issued notices to all the three bourses, National Clearing Company of Pakistan Limited (NCCPL), Securities and exchange commission of Pakistan (SECP) and the finance ministry on two identical petitions filed by United Bank Limited (UBL) and IGI Investment Banks Limited challenging the impugned directives of NCCPL.

The petitioners claimed in the petitions that NCCPL (respondent no 2) has developed and established an automated platform under the name and style of Continuous Funding System Market. This system is referred to as CFS Mark-II aimed to provide funds to members of all three stock exchanges in Pakistan on a centralised basis along with comprehensive risk management.The petitions said the CFS Mark II System is designed to provide financing to brokers and their clients to purchase securities. Such funding is arranged by NCCPL by raising finances from CFS Financiers such as the Petitioner.The petitioners have challenged the of impugned illegal directives, of which the petitioners have already “under went business disruption” and it is “apprehended that the petitioners may incur additional /extra costs” due to actions by the respondent No 2 which are confiscatory in form and in substance and amount to expropriation.”

The bench comprising Justice Khilji Arif Hussain and Justice Syed Mehmood Alam Rizvi issued notices to Karachi Stock Exchange, Lahore Stock Exchange, Islamabad Stock Exchange and NCCPL, SECP and finance ministry for December 16.Earlier, the bench heard arguments in two identical petition filed by UBL and IGI Investment Bank Limited who submitted their major grievances as financial institutions.The petitioners are in effect a secured lenders and Respondent No 2 has provide regulations and procedures for the protections to minimise risks under taken by such CFS Financiers (such as collection of margin and marked to market losses).On the other hand the Respondent No 2 arranges financing for essentially speculators as they purchase securities with borrowed money and consequently wish to maximize their gains by taking a leveraged positions. Thus such speculators are expected to and indeed the Respondent No 2’s Regulations and Procedures requires them to bear the losses on account of their leveraged positions.The petitions said the impugned directives and the proposals circulated on 6-12-2008 is an attempt by Respondent No 2, at the behest of Respondent No 1, to unilaterally amend the terms of the agreement entered into between the Petitioners and Respondent No 2.

They said the impugned directives and the proposals circulated on December 6 are, even otherwise, contrary to public interest, does not protect the interest of the investors and against the interest of the capital markets, as all future financing of equity markets and/or transactions could be jeopardised. As such, the same have been issued by Respondent No 2 without lawful authority. The Petitioner, therefore, sought a declaration that the Impugned Directives issued by Respondent No 1 and the directions/notices issued therein by Respondent No 2 are illegal, void ab initio and of no effect whatsoever.

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

THK Associates (Private) Limited: Shares Registrar

THK Associates (Pvt) Limited was formed in 1989. The company is engaged in providing specialized services relating to the corporate sector and in particular acts as share transfer agent for a number of companies. THK Associates (Pvt) Limited is one of the leading service provider of Share Registrar, Transfer Agent, Balloters for IPO’s and Share Accounting Services and is managed and run by a set of professionals having indepth knowledge and expertise of organizing and managing diversified corporate activities including depository related Share Registrar activities. THK Associates (Pvt) Limited, previously an associate of KPMG Taseer Hadi & Co., has been restructured in terms of requirements of Clause XL of the Code of Corporate Governance and the shareholding of THK partners has been divested in the year 2004. Mr. Yunus Dawood, Chief Executive of DYL Motorcycle Limited, a shareholder and Director was appointed as Chairman of the Company in 2008. Mr. Javed Iqbal, former Chairman an

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