The Role of Securities and Exchange Commission of Pakistan in the Pegulation of the Stock Market

Abstract

Securities and Exchange Commission of Pakistan has been established under the Securities and Exchange Commission of Pakistan Act, 1997 . Establishment of the Securities and Exchange Commission of Pakistan since 1st January 1999 is an important milestone in the evolution of the Regulatory Framework for the Capital Market in Pakistan. The rapid expansion of the market during early 1990s highlighted the need for establishment of an independent regulatory body with full operational and administrative autonomy. The Securities and Exchange Commission of Pakistan is a governing body. It looks after working of all the companies registered under companies ' ordinance 1984 .Many of these companies float their shares in the stock market . . The commission has taken many steps and reforms in order to improve the working of the Stock Market, but at the same time there are numerous problems faced by the Stock Market. These problems are related directly with the Stock Market. The governance of the Stock Market is one of the major problems faced by the commission. The study is qualitative and descriptive in nature. Results are based on secondary data. • SEC has implemented a reform Programme that was necessitated by the Stock Market crisis of May 2000, improvement in Stock Exchange Governance , 40%. director on Stock Exchange boards to be nominated by SECP in consultation with the Stock Exchanges. Prohibition on "Blank Selling" T+3 System at the three Exchanges, Brokers, Agents Registration Rules , Establishment of III Futures Contracts Market, implementation of Code of Corporate Governance etc . The quality of corporate governance has substantially improved and the general public is satisfied that the Commission provides protection for their interests. Following steps were recommended, the commission should emphasize on public awareness , induction of specialist in the sector, demutualization, monitoring of the members , and the commission should facilitate a more vibrant primary market with strong under writing and distributive capacity .