The federal government may empower the Securities and Exchange Commission of Pakistan (SECP) to revise penalties on offences under the Second Schedule (Penalties) of the draft Securities and Exchange Commission of Pakistan Act, 2010.
Sources told Business Recorder on Tuesday that in the last meeting of the SECP policy board, it was agreed that the commission may be empowered to amend the Second Schedule of the Securities and Exchange Commission of Pakistan Act, 2010. The SECP has also proposed that the revision in the rates of penalties and fee should be subject to the approval of the policy board.
The existing scale of penalties being too harsh needs to be reviewed carefully and some rationale must be given for increasing the rate of penalty and fee. Sources said that the quantum of the proposed fine/penalty provided in the Second Schedule of the Securities and Exchange Commission of Pakistan Act, 2010 needs to be reduced.
According to the draft of the Second Schedule of the Securities and Exchange Commission of Pakistan Act, 2010, the maximum fine/penalty would be Rs 100 million in the case of an individual on contravention or failing to comply with any provision of the Act or Subsidiary Legislation for which a specific penalty is not provided under the Act. In the case of a corporate body, maximum fine/penalty would be Rs 200 million on contravention of the said provision.
The maximum penalty would be Rs 100 million (for individuals) and Rs 200 million (corporate) for furnishing a document, which is incorrect or misleading. In the case of an individual, maximum penalty would be Rs 100 million for wilfully obstructing any Commissioner, employee or any authorised person, inspector or investigator from performing his duties and destroying, falsifying, concealing or disposing of any document relevant to an inspection. For committing the same offence, the maximum penalty would be Rs 200 million in the case of a body corporate.
The maximum penalty has been proposed to be Rs 100 million (for individual) and Rs 200 million (body corporate) for those who does not comply with a direction or order of the Commission, employee or any authorised person, inspector or investigator, draft of the Securities and Exchange Commission of Pakistan Act, 2010 added.