SECP seeks comments on draft regulations

ISLAMABAD: The Securities and Exchange Commission of Pakistan (SECP) invited comments on the draft Clearing Houses (Licensing and Operations) Regulations, 2016 from all the stakeholders within the next 15 days.

“As required under the Securities Act, 2015, the draft regulations provide for matters relating to licensing, duties and obligations of clearing house and requirements relating to audit and accounts, appointment and conduct of directors, chief executive officer, chief regulatory officer and chief risk officer, fit and proper criteria for directors and senior management officers,” the Securities and Exchange Commission of Pakistan said in a statement on Tuesday.

“Under the draft regulations, the financial resource requirements for a clearing house are proposed to be increased to an adequate level, given the critical functions being performed by a clearing house.”

The Securities and Exchange Commission of Pakistan said shareholding criteria has been specified for a clearing house, requiring the clearing house to appoint one-third independent directors on its board and constitute risk committee to supervise its risk management operations.

“The clearing house is being made responsible for setting up settlement guarantee fund, obtaining default insurance cover, putting in place robust risk management system and ensuring data secrecy and security.

The clearing house has to make adequate arrangements for resolving disputes and redressal of grievances of customers,” it said.