KARACHI: Following the changes introduced into the regulatory regime, the Securities and Exchange Commission of Pakistan (SECP) has disposed of 36 applications for obtaining licenses as securities broker under Securities Broker (licensing and operations) Regulations, 2016.
The SECP has directed the Pakistan Stock Exchange (PSX) to suspend the trading terminals of the respondent and proceed further under the applicable regulatory framework.
Similarly the SECP has directed the Central Depository Company of Pakistan Limited (CDCPL) and National Clearing Company of Pakistan Limited (NCCPL) to immediately suspend the trading terminals of the respondent and proceed further under the applicable regulatory framework. CDC shall immediately suspended the admission of the respondent as CDS participant and proceed further.
The applicants that were not in compliance with the provisions of different sections and their applications for grant of license as securities brokers have been found noncompliant with the provisions of the regulations read with the Act. These include Allied Securities (Pvt.) Ltd, S. A Securities (Private) Limited, InteractiVe Securities (Pvt.) Limited, Chippa Securities (Private) Limited, JCR Capital Securities (Pvt.) Ltd., Luxor Securities (SMC-Pvt.) Limited, MAN Securities (Pvt.) Limited, Omni Capital Management (Pvt.) Ltd, Jawed Zakaria Guiabi Securities (Pvt.) Limited, MAC Securities (Private) Limited, Muhammad Anaf Kapadia Securities (SMC-Pvt.) Limited, Motiwala Securities (Pvt.) Limited, MY Securities (Pvt.) Limited, AAU Securities (Pvt.) Limited, Abid Ali Habib Securities (Pvt.) Limited, Ahsam Securities (Pvt.) Limited, Ashtaq Ashraf Securities (Pvt.) Limited, BMS Capital (Pvt.) Limited, Bright investment & Securities (Pvt.) Limited, Fine Securities (SMC-Private) Limited, Fort Securities (Pvt.) Limited, Fortress Financial Services (Pvt.) Limited, H.H.K. Securities (Pvt.) Limited, Khayyam Securities (Pvt.) Limited, Prime Capital Management (Pvt.) Limited, R.F.J. Equity (Pvt.) Limited,
S. M. Securities (Private) Limited, Schon Capital Markets Limited, Sher Capital Equities (Pvt.) Limited, SMAC Investments (SMC-Pvt.) Limited, South Asian Securities (Pvt.) Limited, Union Securities (Pvt.) Limited, Venus Securities (Pvt.) Limited, ZM Capital (Pvt.) Limited, MAS Capital Securities (Pvt.) Limited and R. A. Securities (Pvt.) Limited.
The SECP has further directed the aforementioned brokers to initiate the process for changing the name and Memorandum of Association (MoA) of the company or winding up the company; as the case may be.
Reportedly, many brokerage houses are surrendering their trading right entitlement (TRE) certificates due to a stringent regulatory framework put in place by the SECP.
However, the SECP disposed of applications for renewal of licenses by the aforementioned brokerage houses mainly for being inactive or dormant. Now a person can obtain trading rights either by purchasing the same from a brokerage house or from the stock exchange directly. The stock exchange under the Demutualisation Act is allowed to issue 15 TRE certificates every year with effect from May 2016.
After the promulgation of Securities Act 2015, the SECP introduced various new regulations and many new requirements following a detailed consultation process, including reporting on client-assets segregation in view of instances of misuse of investor assets by brokers in the past.
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