Ceylon Chamber asks SEC for more listings at CSE

The meeting between SEC and Ceylon Chamber

The Ceylon Chamber of Commerce has asked the Securities and Exchange Commission (SEC) of Sri Lanka to attract more companies to list at the Colombo Stock Exchange (SEC), during a recent meeting between officials from both institutions.

During the discussion, the Chamber also pointed out the importance of establishing an apex committee comprising capital market stakeholders including the SEC, CSE, Central Bank of Sri Lanka, Ministry of Finance and other key policy makers including industry bodies to decide on matters related to capital market policy.

According to a press release issued today (29) on this matter, the SEC has welcomed these proposals from the Chamber as they understand the importance of attracting Small and Medium Enterprises to get listed.

The SEC said it has already taken certain steps in that direction and pointed out that it had approved the amendments in respect of listing requirements applicable to the Main Board as well as the Dirisavi Board and that they will come into force in the near future.

“These new rules have introduced revenue, market capitalization and positive operating cash flows as alternative criteria in the determination of eligibility for listing. This will now enable a diverse range of companies with different business models to have their businesses listed,” the release noted.

The meeting also included law firms and stockbroker firms and was the latest in a series of meetings being conducted between SEC Chairman Viraj Dayaratne PC and members of SEC since January 2020.

The delegates attached to law firms stated that certain regulatory measures presently in force are seen as an impediment to new listings and also stated that the SEC at times had been somewhat rigid in the application of Rules and Regulations.

The Chairman of SEC in response to this issue explained the need to have a robust regulatory system in order to ensure the integrity of the market but said that the SEC will certainly adopt a very pragmatic and practical approach in the process of regulation and called upon the delegates to point out any particular rules or regulations which they consider to be too rigid so that they could be looked at by the SEC.

The Chairman also informed them that the Commission was at present going through the draft SEC Act and the Demutualization Act and that its recommendations would be submitted to the Ministry of Finance before the end of next month and assured them that steps would be taken to ensure their speedy enactment.

The Law Firms were requested to submit any recommendations they had with regard to the draft laws as well as on any other regulatory matter.

Dayaratne had also elaborated on the work that was in progress with regard to the digitization of the stock market and called upon the broker firms to support and actively participate in the ongoing initiatives of the SEC-CSE joint committee.

He also referred to the other joint committee that had been established to broad base the market and create awareness amongst the general public and called upon the stockbroker firms to partner with the SEC and CSE in these initiatives and to play a more aggressive role.