Delayed law obstructs securities industry – SEC boss

Securities and Exchange Commission (SEC) says the capital market has lost the opportunity to exchange investor information with other markets across the globe due to the delay in passage of new legislation for the securities industry.

The country missed the December 2012 deadline -- stipulated by the International Organisation of Securities Commissions (IOSCO), the global securities regulatory body -- to enact the law that should ensure cross-border enforcement cooperation and investor protection.

Adu Anane Antwi, Director-General of the Securities and Exchange Commission (SEC), told the B&FT in an interview that, “Our securities law, as it is now, does not permit us to share information with the other regulators”.

IOSCO warned that failure to comply with the deadline will result in the country’s securities market losing the opportunity to be upgraded to the highest international standing -- while it could be classified as an uncooperative jurisdiction in the areas of securities regulation, market conduct and prudential supervision.

That deadline has passed without compliance as the Securities Industry Bill, which went before parliamentarians in 2012, was subsequently withdrawn. Mr. Antwi said the Securities Industry Bill has been resubmitted to Cabinet, where it is expected to be fine-tuned and sent back to parliament.

“We are hoping that cabinet will look into it and it goes through parliament. The Finance Minister has worked on it and submitted it to Cabinet. We have done so much work regarding reviewing our laws; we are hopeful and believe that parliament will be able to pass it into law and allow Ghana to conform to the IOSCO standards.”

Mr. Antwi said that as a member of IOSCO, SEC is under obligation to ensure that all the securities laws in the country are aligned to achieve the three main objectives of securities regulation: protect investors; ensure fair, efficient, and transparent markets; and reduce systemic risk.

He added: “We are working toward it; that is why we have to amend our laws to bring in provisions which will allow us to do that. If we don’t have laws that are conducive enough, we’ll have problems”.

He explained that amendment of the securities industry law will incorporate developing, implementing and promoting adherence to internationally recognised and consistent standards of regulation, oversight and enforcement in order to protect investors, maintain fair, efficient and transparent markets, and address systemic risks.

The amended bill, when eventually passed by parliament, will enhance investor protection and promote investor confidence in the integrity of Ghana’s securities market through strengthened information exchange and cooperation in enforcement against misconduct, and in supervision of markets and market intermediaries.

The country’s securities industry will also be in a position to exchange information at both global and regional levels on their respective experiences in order to assist the development of markets, strengthen market infrastructure and implement appropriate regulation.

South Africa, Nigeria, Kenya and Tanzania are among a few African countries whose securities industry laws and regulations are consistent with IOSCO standards.