Investment, Securities Bill To Transform Capital Market

The Investments and Securities Bill has been described as capable of transforming the capital market, encourage the influx of foreign investors as well as boost investors’ confidence, among others.

Chairman of the House Committee on Capital Markets and Institutions, Hon. Babangida Ibrahim, stated this during an interview weekend while commenting on the recent passage of the Bill by the House of Representatives.

Ibrahim said: “the ISA Bill seeks to repeal the existing Investments and Securities Act 2007 and to establish a new market infrastructure and 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 addresses are alternative trading systems, inclusion of 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 in line with the requirement of the International Organisation of Securities Commissions (IOSCO).”

According to him, “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.”

Ibrahim said, the Bill is also to determine the type of trainings required of an operator to perform professional functions in the capital market and also provide certification for persons deemed to have met the qualifications standards.

Ibrahim stated that the House of Representatives and indeed the Committee on capital market are committed to ensuring that the Securities and Exchange Commission delivers on its core mandate of due registration of the players in the capital market, market integrity to avoid systemic risk, guarantee inspection, investigation of breaches, due surveillance, market development and law enforcement and rules making.

“This Committee is indeed proud of this bill as they seek to ensure a more robust, vibrant, prosperous and more developed capital market and also to ensure that the capital market is well institutionalised and accountable,” he said.

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 adding that, “it depends on the nature and gravity of the offense but we try as much as possible that its serves as a deterrence to anyone that wants to do any manipulation in the capital market. We have provided enough regulation in this bill that will take care of many of these issues.”

Also speaking on the passage of the Bill by the house, executive commissioner, Legal and Enforcement of SEC, Mr. Reginald Karawusa, stated that, the Bill introduced the appropriate framework for regulation of Commodities Exchanges and trading of Warehouse Receipts to strengthen the commodities market ecosystem with a view to diversifying the Nigerian economy away from a mono-product economy.