ISLAMABAD: The Security and Exchange Commission of Pakistan (SECP) being firmly committed to implementing review recommendations of IOSCO Assessment Committee.
As SECP top priority agenda is pleased to say that significant progress has been achieved to implement reforms in Pakistan’s legal, regulatory and supervisory architecture, endorsing our pledge to bring Pakistan’s markets in line with international standards, a statement said issued by SECP here on Thursday. The Pakistani capital markets have achieved several key milestones after the last assessment.
The key milestones which will contribute towards improved assessment rating in upcoming IOSCO assessment includes. The amendments to the SECP Act, the foremost of the actionable areas which involved changes to the powers and functions of the SECP has been enacted.
This is a remarkable achievement as all amendments, including changes to the composition of policy board, SECP’s role in addressing systemic risk, fast track disposal of cases, enhancing powers of the SECP to help foreign regulators’ requests and establishment of Audit Oversight Board of Pakistan have been addressed.
One of the most recurring assessment recommendations was the overhauling of the brokers regime and specifically calling for enhanced requirements for brokers to address the recommendations regarding Principle 29-32.
These requirements have been incorporated in the Securities Brokers (Licensing and Operations) Regulations 2016, notified on 24th June, 2016.
The National Clearing Company of Pakistan Limited (NCCPL) has successfully commenced functioning as a CCP effective May 2, 2016. The reform entailed introduction of the concept of novation, transfer of risk management from the stock exchange to NCCPL, development of requisite operational capacity and system requirements, establishment of a consolidated settlement guarantee fund, changes to the default management procedures and major regulatory restructuring to cater for all of the above. The SECP has been rigorously pursuing to implement the AC review recommendations aimed at further improving SECP’s compliance with IOSCO Principles and has requested for a follow-up review to validate the reforms implemented.
After implementation of these reforms it is explained that the overall rating in the follow up assessment of IOSCO would significantly be improved to at least 80% from the existing 62%. Created in 2012, the IOSCO Assessment Committee conducts Country Reviews of IOSCO member jurisdictions to assess their compliance against IOSCO Principles.
The aim of these Reviews is to assess implementation of the IOSCO principles and standards and to help identify gaps in implementation. Pakistan was the first country review undertaken by the IOSCO Assessment Committee.
