Bangladesh Securities and Exchange Commission is set to sign a memorandum of understanding with Indian Securities and Exchange Board for greater cooperation in diverse areas including tackling the market manipulation and insider trading, a senior finance ministry official said.
The signing is expected to take place sometime in January 2015 in Dhaka while the commission has been struggling for long to fix the capital market plagued by instability and manipulations.
‘The MoU is meant for greater cooperation between two securities regulating agencies on areas such as risk-based supervision, training and addressing market manipulation,’ the commission executive director Saifur Rahman told New Age on Saturday.
The memorandum has outlined at least five broad areas for mutual cooperation to make the regulators compliant and equipped to handle any worse situation, as far as regulating the market and boosting investments and schemes.
The draft memorandum mentioned ‘assisting in discovery of and taking action against insider trading, market manipulation and other fraudulent practices in dealing in relation to companies, securities, future contracts, options and collective investment schemes,’ and ‘enforcement of laws, rules and regulations relating to dealing in, arranging deals in, managing and advising on securities, future contracts, options of collective investments and other investment products’ as the scope of the instrument.
The law ministry in the past week vetted the draft memorandum. It is expected to be okayed by the finance ministry this week before inking the deal by the contracting parties, a senior finance ministry official said.
The memorandum, first of its kind, would be helpful particularly to Bangladesh, as ISEB’s long cooperation extended to the commission would be broadened, Saifur said.
‘India is much ahead of us, in terms of regulating and boosting capital markets,’ he said.
The draft memorandum further said that supervising and monitoring securities and future markets and clearing and settlement activities and their compliance with the relevant laws and regulations would come under the purview of the instrument.
Cooperation on take-overs and mergers of listed companies would also be facilitated by the proposed memorandum, the draft said.
Individual information will, however, be strictly excluded from the areas of cooperation, a ministry official said.
The investors have no reasons to be worried as investors information would not be shared by either institution, a commission official asserted.
He said that the move would develop institutions, without hurting any individual investors.
-With New Age input
