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Govt opens licencing for securities industry

Govt opens licencing for securities industry

THE Securities and Exchange Commission of Cambodia (SECC) will from today receive applications from businesses seeking licences to operate in the new securities industry, according to an announcement Friday following an October prakas, or edict.

Firms wishing to operate as securities underwriters, dealers, brokers, representatives or in investment advisory or representation will have until March 1 to apply, according to the announcement. The SECC’s Department of Intermediaries Supervision will handle the applications, it added.

“After receiving applications for licences, it will take just one month ... to evaluate whether the applicant will be granted a licence or not,” Ming Bankosal, director general of the SECC, said Sunday.

The maximum number of licences available for securities-related firms to operate in the Kingdom has been set, he said, declining to disclose the figure. The SECC may establish a bidding process should the number of applicants to operate in the industry be too high, according to Friday’s announcement.

The announcement represented the latest step towards Cambodia’s first securities market, said Ming Bankosal. After repeated delays, the exchange is not expected to open until year's end.

“After these firms have been licensed, they will work with potential issuing companies to enable them to apply to the SECC for approval to issue securities,” he said.

According to Friday’s announcement, firms seeking to operate as securities underwriters must have minimum capital of US$9.52 million. Securities dealers need minimum capital of $6 million, and brokers require $1.42 million. Investment advisory firms need a minimum of just $96,000, while an investment advisory representative will be required to lodge a securities bond of $4,800 with the National Bank of Cambodia. The new regulations also stipulate certain requirements of human resources and professional experience.

Tong Yang Securities Inc of South Korea is finalising its documentation to apply for a licence in all areas of securities work in Cambodia, according to Han Kyung Tae, chief representative of the firm’s Phnom Penh office.

Tong Yang Securities had started working with a few firms in preparation for the first initial public offerings, he said.

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