Lahore – The Lahore Stock Exchange (LSE) has exhorted the Securities and Exchange Commission of Pakistan to retain the spirit of Section 8 of the Securities and Exchange Ordinance, 1969 in the Draft Securities Act.
The LSE wants to introduce a ‘Unified Order Book’ or ‘National Market System’ in Pakistan. LSE Managing Director Aftab Ahmad Chaudhry said that the policy makers must refer to the National Market System (NMS) of USA and MiFid regulations of the EU and adopt the spirit of such regulations in Pakistan as well, for which the retention of the powers with the Commission to prescribe the order execution mechanism as per the existing Section 8(1) of the S&EO 1969 is a must.
He stated that Section 8 of the Ordinance had vested the powers in the Commission to promulgate rules whereby the Commission could prescribe the manner for the execution of transactions on any exchange by any person.
The MD said that Section 8(1) of the S&EO 1969 was changed during 2006 whereby the Commission had intended to introduce the spirit of prescribing a ‘Unified Order Book’ for the exchanges. He said that it is necessary to remove fragmentations in the price discovery and order execution mechanisms existing amongst the three stock exchanges of the country.
He said that under the previous version of Section 8(1), no person could trade on any on any exchange unless he was a member thereof. He said that the purpose of the change was to change the context of trading on any stock exchange by a member of the same stock exchange into the execution of trading on any exchange by a member of any other exchange.
