SECP Approves New Regulations For Licensing, Operation Of Clearing
Houses
Fakhir Rizvi Published August 09, 2016 | 11:48 PM
ISLAMABAD, (UrduPoint / Pakistan Point News - 9th August, 2016) : Securities and Exchange Commission of Pakistan (SECP) has approved the Clearing Houses (Licensing and Operations) Regulations, 2016. The regulations which have been finalized after detailed stakeholder consultation have been placed on the SECP website, said a statement received here on Tuesday. In compliance with the requirements of the Act, the regulations provide for matters relating to licensing, minimum financial resources, duties and obligations. It also prove audit and accounts, appointment and conduct of directors and management, fit and proper criteria for directors and management and manner of outsourcing of important functions, for the clearing house. For the protection of investors' interest and to boost investor confidence in the market, the regulations also provide for establishment of a fund by the clearing house to guarantee settlements of trades executed at a securities exchange.
Under the regulations, initial and ongoing financial resource requirements for a clearing house, based on current and future risk evaluation of the clearing house's operations, have been prescribed given the critical functions being performed by a clearing house.
For good governance, shareholding criteria and shareholding limits have been specified for a clearing house besides requiring it to appoint one-third independent directors on its board.
Considering that the clearing house has recently acquired the status of a central counter party as per best international practice, various new requirements have been made applicable to the clearing house through the regulations to strengthen its new status and to meet its enhanced requirements. This includes requirement for the clearing house to form a risk committee comprising of independent directors, key management personnel and industry experts in order to assist the clearing house in developing risk management policies and procedures. Clearing houses worldwide are critical infrastructure institutions for capital markets and it is expected that with the implementation of this comprehensive regulatory framework. Clearing house in Pakistan will be better geared towards provision of efficient clearing and settlement services, while ensuring maximum reduction of risks, thus promoting investor confidence.
Recent Stories
Five killed, 1,351 injured in Punjab road accidents
President urges Australian companies to invest in Pakistan
Nazeer Tarar introduces (The Tax Law Amendment Bill 2024)
Spain PM under pressure as wife faces graft probe
UUVAS arranges seminar to commemorate Allama Iqbal
Vaccines save at least 154 million lives in 50 years: WHO
Young officers visit PID for briefing on govt principal public relations agency
RUDA takes stern action against pyrolysis plants, dismantles five
U.S. Secretary of State Blinken arrives in Shanghai
PM Shehbaz asked to extend hand to Imran Khan, India
BISE Hyderabad to announce HSC-Il result exams on April 25
ARI calls for comprehensive measures to curb tobacco use
More Stories From Pakistan
-
Five killed, 1,351 injured in Punjab road accidents
17 minutes ago -
President urges Australian companies to invest in Pakistan
17 minutes ago -
Nazeer Tarar introduces (The Tax Law Amendment Bill 2024)
17 minutes ago -
Young officers visit PID for briefing on govt principal public relations agency
26 minutes ago -
RUDA takes stern action against pyrolysis plants, dismantles five
26 minutes ago -
PM Shehbaz asked to extend hand to Imran Khan, India
35 minutes ago
-
ARI calls for comprehensive measures to curb tobacco use
34 minutes ago -
DWE extends training to 300,000 workers of 350 industries in twin city
34 minutes ago -
WASA disconnects 144 connections of defaulters
34 minutes ago -
Govt committed to double exports' volume in 5 years: PM
34 minutes ago -
Dacoit killed during conflict with locals
34 minutes ago -
Vietnam hails Gandhara Corridor project for cultural tourism promotion
36 minutes ago