The Securities and Exchange Commission of Pakistan (SECP) has allowed scheduled banks, audit firms, development financial institutions, and investment banks to obtain licences from the commission to work as "consultant to the issue".
Under the SECP regulations, the "consultant to the issue" means a person licensed by the Commission for undertaking the business of advising any person or undertaking for compliance with the regulatory requirements for offer of securities to the general public.
The SECP has revised the eligibility criteria for seeking license under the draft amendments to the Public Offering (Regulated Securities Activities Licensing) Regulations, 2017.
In this regard, the SECP has amended specific conditions of the eligibility criteria for seeking license under the
Public Offering (Regulated Securities Activities Licensing) Regulations, 2017. The list of "consultant to the issue" specified in the Schedule-I (specific conditions) has been expanded under the revised criteria of the said regulations.
The SECP has now included following categories of financial institutions to operate as "consultant to the issue": A scheduled bank registered with the securities exchange as market maker; an audit firm engaged in professional management services; a development financial institution registered with the securities exchange as market maker and an investment bank registered with the securities exchange as market maker.
In case of scheduled bank, investment bank and development financial institution registered with the securities exchange as market maker, it must be compliant with all the requirements laid down by the
securities exchange relating to market making, the SECP said.
The scheduled banks, audit firms, development financial institutions, and investment banks can apply to the SECP for performing functions of "consultant to the issue".
The SECP has already made it mandatory for certain categories of financial institutions including "banker to an issue", "consultant to the issue" and underwriter to obtain licences from the commission. A banker to an issue, consultant to the issue and underwriter shall perform their duties and functions and discharge their obligations as specified in the Public Offering Regulations, 2017.
The regulations said that no person shall act as or perform the functions of banker to an issue, consultant to the issue and underwriter unless such person is licensed by the commission under these regulations.
A person may apply to the commission for grant of licence under these regulations, if such person fulfils the laid down conditions, the SECP said.
The commission, while considering the application for grant of licence, may require the applicant to furnish such further information or clarification regarding its activities and businesses as it deems appropriate.
Any subsequent change in the information provided to the commission at the time of filing of application shall be intimated to the commission within seven working days from the date of such change.
The applicant shall, if so required, by the commission, appear before the commission for personal representation through an officer duly authorised for this purpose in writing by the board of directors of the applicant.