Himal Press 
Photo: RSS
KATHMANDU: The Finance Committee of the House of Representatives has directed the Ministry of Finance and the Securities Board of Nepal (SEBON) to draft a new Securities Bill and present it to the federal parliament at the earliest.
The committee issued a five-point directive following a meeting on Wednesday, calling for reforms to make the capital market more modern, technology-driven, orderly, transparent, credible and investor-friendly.
According to the committee, the Bill should clearly define the roles, responsibilities and accountability of Sebon, Nepal Stock Exchange (Nepse) and CDS and Clearing Ltd in securities issuance and listing, market operations and regulation, and protection of investors’ interests.
The committee also directed Sebon to introduce a system of grading and prioritizing companies seeking to issue initial public offerings (IPOs), based on factors including capital adequacy, net worth, balance sheet and returns, before granting approval. It also asked the regulator to review existing provisions on the shareholding that founders are required to retain.
Stating that recurring disruptions in Nepse systems have caused losses to investors as well as the government in terms of revenue, the committee directed the finance ministry, Sebon and Nepse to accelerate the restructuring of Nepse and upgrade its online trading and data systems. It also called on the government and the Nepse to put in place highest level of cybersecurity safeguards.
The committee further directed Sebon and Nepse to intensify monitoring to control manipulation in the secondary market, including collusive trading, cornering, circular trading and pump-and-dump schemes.
Likewise, the house panel directed the finance ministry to immediately start the appointment process to fill vacant posts of CEO in Nepse, and CDS and Clearing Ltd.
