NIGERIAN STOCK EXCHANGE PROPOSES NEW DISCIPLINARY PROCEDURE


The Nigerian Stock Exchange (NSE) is currently proposing major changes in its rules and regulations to establish a more robust and effective disciplinary procedure for dealing members.

According to a release signed by Tinuade Awe esq as head of regulations, stakeholders and the investing public are encouraged to view the proposals and send their comments to the exchange on or before August 9, this year.

The amendments cover three packaged areas: Investor Protection rules amendment which seeks to only expunge a word; Disciplinary procedure for dealing members and amendments to the Rule book of the exchange 2015.

The main amendment is the one being proposed to establish clear disciplinary procedure for erring dealing members. It sets up three disciplinary organs: Adjudication panel; Appeals committee and The National Council.

The proposed amendment sets out clear powers and procedures of the adjudication panel and the appeals committee. It defines types of breaches and tries to classify breaches especially with regards to circumstances surrounding them; potential impact on the market; how deliberate it is and the compliance history of the dealing member amidst other parameters.

It also provides for more lenient treatment for dealing members that unconditionally accept responsibility for a breach and provides window for negotiated settlement of issues involved.

However, negotiated settlements or consent orders as called by the proposed amendment will not apply in serious cases like insider trading ; accounting fraud; market manipulation and other "egregious" rule violations.

The proposed amendment to existing rules and regulations are to align them with the new proposed disciplinary procedures and also clearly define authorities over license revocation; suspension pending investigation, sanctions and establish the roles of compliance officers amongst other related provisions.

It also proposes to extend maximum time for submission of audited financial statements from current 4 weeks to 8 weeks.

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