A person desirous of performing the functions of a securities broker shall take prior permission from the Securities and Exchange Commission of Pakistan (SECP) to undertake Securities Broker activity by incorporating the securities broker company.
The SECP on Thursday issued an S.R.O. 1914(I)/2022 to amend the Securities Brokers (Licensing and Operations) Regulations 2016.
According to the amended regulations, a person desirous of performing the functions of a Securities broker shall, before obtaining the TRE Certificate of a securities exchange, make an application to the Commission as set out in Form A-1 along- with the documents specified in Annexure A-1.
The Commission, while considering the application for permission, may require the applicant to furnish such further information or clarification as it deems appropriate. The Commission, if it is satisfied that the person seeking permission to perform the functions of securities broker has fulfilled the criteria in terms of this regulation may permit by an order in writing to incorporate a securities broker company.
The permission granted shall be valid for a period of six months unless extended for a maximum period of a further three months under special circumstances, on the application of the sponsors made before the expiry of the initial six months.
During the validity of this permission, the sponsors shall obtain the TRE Certificate from the securities exchange, get the securities broker company incorporated and submit an application to the Commission for a grant of a license, after fulfilling all the conditions specified in these regulations, SECP said.
The affidavit will also be submitted to the SECP stating that he has not been associated with any illegal banking business, deposit taking, or financial dealings; he and companies in which he is a director or substantial shareholder have no over-due loans or installments outstanding towards banks or other financial institutions.
The affidavit will also be submitted on the conditionality that neither he nor the companies in which he is a director or substantial shareholder have defaulted in paying taxes as on the date of application; he has not been promotors or sponsor, director, or chief executive of a defaulting cooperative finance society or finance company; he has never been convicted of fraud or breach of trust or of an offense involving moral turpitude or removed from service for misconduct; he has neither been adjudged an insolvent nor has defaulted in making payments, to his creditors, SECP added.
