STOCK BROKING IN NIGERIA FROM TOMORROW DECEMBER 1,

Stock broking in Nigeria will change significantly from tomorrow, December 1, 2015 as 31 new rules and regulations take effect. These new rules and regulations are principally aimed at improving on the dealing practices of stockbrokers and how they also relate to their investing clients.
The new regulations were announced in a released signed by Tinuade Awe esq, the  Exchange's Head of Regulation and general counsel.
In a nutshell, from tomorrow stockbroking will be more of stock brewing with brewing in this instance meaning state of preparing. gathering or forming for a desired end.
In the first place. Stockbrokers will now maintain minimum net liquidity capital of 10% of shareholders fund with commuting guidelines determined by the Nigerian Stock Exchange (NSE).
Once the parameters for computation are established by the NSE the onus lies on stockbrokers to include updated positions on each regulatory report issued and shall notify the NSE within 24hrs of net liquidity capital that is less than the minimum.
The intention is to ensure that default by dealing members are reduced to the barest minimum.
In addition, stockbrokers are now to keep clear and prescribed records of transactions with the NSE having right to inspect same from time to time  after giving 10 days written notice before such inspection.
Fees and charges are also to be as prescribed by the SEC and additional charges are only allowed only if ancillary services relating to Securities investment are performed.
Under a new rule,  dealing members or appointed market makers shall establish internal policies , guidelines and procedures to ensure no improper trading occurs through the use of price sensitive or material information available to persons within the firm.
Also amongst the 31 regulations taking effect tomorrow are obligations to do nothing to adversely affect the goodwill of the exchange; No default on transactions with another member; No improper influence over payments and strict compliance with anti corruption laws; compulsory registration of chief executive officers at the Corporate Affairs Commission; and adoption of December as accounting year end.
Already treated in a separate post in this blog are the new rules and regulations that have very direct bearing on the investing public and portfolios.
These include biometrics before opening of investment accounts for clients; monthly financial statement of accounts to clients; establishment of complaints handling processes; and cash payment directly into client accounts or otherwise as per written permission.
More technical new regulations include guidelines for naked short selling; systems decoupling; dealings in hard to borrow securities; approval of securities lending agents; robing and induction of dealing clerks and disclosure obligation of such clerks and dealing members.

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