Parliament passes securities law

Parliament on Wednesday amended the Securities Industry law to provide exhaustively for the regulation of unit trust and mutual fund.

It replaces that of 1993 and PNDC Law 333 and introduces a dispute settlement mechanism with quasi-judicial powers to examine and determine complaints and disputes to which appeal lies with the High Court.

Alhaji A.M. Seidu, Deputy Majority Leader, moved that the bill become law after its third reading. With this, the name of the Securities Regulatory Commission is changed to Securities and Exchange Commission.

A memorandum to the new law said the government considers that although the Commission has a regulatory function, it also has the task of actively participating in the development of the capital market and its name should therefore not project the institution as purely regulatory.

Furthermore, since the term "securities" is still novel to most Ghanaians and generally associated with financial market operations, the addition of "Exchange" will facilitate the education of the public that the Commission's powers and responsibilities relate to "Stock Exchange" and the financial market.

The law also revises the penalties under the previous one which vested authorisation for the operation of mutual fund schemes in the Registrar of Companies and partly in the Securities Regulatory Commission.

The memorandum said the government considers that the Commission is better equipped to authorise the operation of the schemes and a company that desires to operate such a scheme should seek its authorisation from the Commission after registering with the Registrar of Companies.

The law now re-designates the chief executive and its two deputies as Director-General and Deputy Director-General respectively, and their appointments now conform with the constitution as public officers who have to present their annual reports to Parliament through the Minister of Finance.