By Abaibat Aliu
Chairman of the House Committee on Capital Markets and Institutions, Babangida Ibrahim
has said that the Investments and Securities Bill (ISB) is capable of attracting more investment in þ the capital market, encouraging the influx of foreign investors as well as boosting investors’ confidence in the market
Ibrahim stated this during an interview at the weekend while commenting on the benefits of the recent passage of the bill by the House of Representatives.
According to him, the bill seeks to repeal the existing Investments and Securities Act 2007 and would aid the establishment of new market infrastructure and a wide-ranging system of regulation of investments and securities businesses in Nigeria, especially in the areas of derivatives, systematic risk management, financial market infrastructure, and Ponzi scheme and platforms.
According to him, the bill seeks to repeal the existing Investments and Securities Act 2007 and would aid the establishment of new market infrastructure and a wide-ranging system of regulation of investments and securities businesses in Nigeria, especially in the areas of derivatives, systematic risk management, financial market infrastructure, and Ponzi scheme and platforms.
Other areas the bill would address are alternative trading systems, the inclusion of the National Pensions Commission as part of the board of the Securities and Exchange Commission, deletion of the provisions on merger control in the current Act, and amendment of the criteria of borrowing by sub nationals and strengthening and enforcement powers of the Securities and Exchange Commission (SEC) in line with the requirement of the International Organisation of Securities Commissions, IOSCO.
“We owe a duty to Nigerians and Nigeria to make sure that things work well. In the financial market, we have the money market and the capital market. With the challenges facing the money market, the only option left is the capital market.
“What we tried to do is to build investors’ confidence and ensure that investors are comfortable. At the same time, we realised that there are areas like derivatives, commodities exchanges, Ponzi schemes, and the rest of them that are new developments in the capital market. We feel it’s very important for us to provide regulations for these new developments.
“We also emphasized borrowing by sub nationals, in the past you hardly see state governments and local governments coming into the capital market to borrow. We introduced a lot of new provisions and also made provisions relating to financial market infrastructures. Also, the board of the SEC was expanded to include the Pension Commission. The existing Act needed a total overhaul because of the passage of time and developments in the capital market.
Ibrahim said the Bill is also to determine the type of training required by market operators to perform optimally in the capital market and also provide certification for persons deemed to have met the qualifications and standards.
He also pointed out that the bill will enhance the expansion of products such as equities, bonds, Sukuk, derivatives, and the advent of electronic share issuance.
Furthermore, Ibrahim stated that the House of Representatives and the committee on the capital market are committed to ensuring that the SEC delivers on its core mandate of ensuring due registration of the players, market integrity to avoid systemic risk, guarantee inspection, investigation of breaches, due surveillance, market development and law enforcement and rules making.
On the issue of Ponzi schemes, Ibrahim said the House has ensured that there is enough deterrent in the bill.
Ibrahim said the Bill is also to determine the type of training required by market operators to perform optimally in the capital market and also provide certification for persons deemed to have met the qualifications and standards.
He also pointed out that the bill will enhance the expansion of products such as equities, bonds, Sukuk, derivatives, and the advent of electronic share issuance.
Furthermore, Ibrahim stated that the House of Representatives and the committee on the capital market are committed to ensuring that the SEC delivers on its core mandate of ensuring due registration of the players, market integrity to avoid systemic risk, guarantee inspection, investigation of breaches, due surveillance, market development and law enforcement and rules making.
On the issue of Ponzi schemes, Ibrahim said the House has ensured that there is enough deterrent in the bill.
This he said includes cash penalty, conviction as well as a combination of both cash penalty and conviction.
Also commenting on the passage of the Bill by the house, Executive Commissioner Legal and Enforcement of the SEC, Reginald Karawusa, commended the National Assembly on its efforts at ensuring a vibrant capital market that would aid economic development.
Karawusa stated that the Bill introduced the appropriate framework for the regulation of Commodities Exchanges and trading of Warehouse Receipts to strengthen the commodities market ecosystem to diversify the Nigerian economy away from a mono-product economy.
Karawusa stated that the Bill introduced the appropriate framework for the regulation of Commodities Exchanges and trading of Warehouse Receipts to strengthen the commodities market ecosystem to diversify the Nigerian economy away from a mono-product economy.
