The Competition Commission of Pakistan (CCP) will soon start hearing on a complaint against dominance market position of Karachi Stock Exchange (KSE), it was learnt. Sources said that the Competition Commission of Pakistan (CCP) has received KSE point of view, which was shared with the complainants, Islamabad Stock Exchange and Lahore Stock Exchange.
Finally, the expert opinion of Securities and Exchange Commission of Pakistan (SECP) being regulator was also sought on the issue. The comments from SECP were also received. The ISE had lodged a complaint with the Competition Commission of Pakistan (CCP) against the dominance market position of KSE, the LSE also requested to be a party in the case.
They have taken the position that existing trading system was not the just one owing to the absence of centralisation. Thus, the investors in ISE and LSE have to go through the brokerage houses rather than trading directly in the KSE. As a result, they have not only to pay the fee twice but unable to avail the desired trading as KSE refuses to entertain investors directly.
The Competition Commission of Pakistan (CCP) has initiated an enquiry under section 30 of the Commission Ordinance 2007 for contravention of provisions of section 3 of the Ordinance.
The ISE complained that bids and offers of investors entered into trading systems of one exchange can not be matched with those entered at another exchange. As a result, the ISE members have to route many orders of their client (investors) through the members of Karachi Stock Exchange (KSE) resulting in large scale trading without being regulated by either of the exchanges. Moreover, investors at ISE have to pay higher out of pocket brokerage costs.
The ISE wants a centralised system in the market that should enable access of all market centres to a national pool of liquidity for the best universal execution of the investor's orders, alleging that KSE and its members have maintained the practices which defy all the practices of competition in the relevant market, thus constituting what it called "abuse of dominance position" in terms of section 3 of the ordinance.
This dominance position of KSE and its member, ISE said could be do away with by requiring KSE, along with LSE and ISE, to enter into centralisation of all buying and selling interests so that each investors would have level playing field.
The ISE wants the commission to initiate proceedings under Section 30 of the Ordinance against the KSE and may require the KSE to discontinue these practices and bring about such changes to ensure centralise all buying and selling interest so that each investor would have the opportunity for the best possible execution of his order.
Comments
Comments are closed.