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SECP rationalizes licensing regime for securities brokers to promote business

SECP rationalizes licensing regime for securities brokers to promote business

ISLAMABAD: The Securities and Exchange Commission of Pakistan (SECP) has rationalized licensing regime for securities brokers with an objective to reduce regulatory burden and to promote ease of doing business.

The Commission has approved that a single license would be issued to a securities broker. A licensed securities broker would not require all other mandatory licenses including futures broker, securities advisor, futures advisor and accredited representative.

As per new simplified procedure for annual renewal, a security broker will only required to provide recommendation from the Pakistan Stock Exchange (PSX) along with an undertaking from the securities broker and deposit of regulatory fee. The SECP has also approved a single cut-off date concept for expiry of licenses for entire brokerage industry. This is to facilitate the brokerage industry as well as the front line regulator i.e. PSX.

It is pertinent to mention here that in the prevalent licensing regime and the draft frameworks notified for public consultation, a securities broker has to obtain at least eight annually renewable mandatory licenses to act as a securities broker of capital markets. In case of mid-size and large brokerage houses, having more than one office, the requisite number of mandatory licenses increases even further.