Lack Of Empowerment
DSE decides not to inspect any listed company
The Dhaka Stock Exchange has decided not to conduct inspection to any listed company and to any company which is seeking regulatory approval for its initial public offering as the bourse lacks explicit legal power to make such visit, DSE officials said.
They said conducting inspection within the existing legal framework might raise questions.
A senior DSE official told New Age that the bourse took the decision to avoid such questions.
DSE officials, however, said that the bourse would resume such inspection once the Bangladesh Securities and Exchange Commission approves the proposed listing regulations of the bourse.
They said that the proposed listing regulations clearly mentioned the bourse’s legal power to visit a company listed or proposed for enlistment with the stock exchange.
As per the section 3 (6) of the proposed listing regulations of the DSE, the stock exchange will have the rights to visit the office/factory or other related site of the company before taking any decision about listing.
The section 5 (ix) of the proposed listing regulations said the stock exchange would have the rights and power to visit the office/factory or any site of the company at any time with information to the company.
‘The exchange may also inquire/seek any matter/information/document of the company or any of its subsidiaries or holding company if it feels necessary for public interest,’ it also said.
The question regarding the primary regulator’s legal power to conduct inspection to the listed companies rose for the first time when the DSE suspended trading of Pharma Aids in February 5 this year due to the company’s non-cooperation with the DSE officials to visit factory of the company.
After the trade suspension of Pharma Aids, the BSEC following a complaint by the company asked the DSE to explain its legal authority to make such visit to a company.
The BSEC found the explanations provided by the stock exchange inappropriate, BSEC officials said.
Consequently, the bourse withdrew trading suspension on Pharma Aids’ shares in May 11 this year.
DSE managing director Swapan Kumar Bala recently admitted to the media that sometimes mode of seeking/collecting information was not articulated categorically in the existing regulations.
‘Moreover, there is no explicit provision for physical inspection to the listed companies,’ he said.
‘However, it is clearly mentioned in the proposed listing regulations which are under the BSEC’s consideration,’ he also said.
-With New Age input
