Logo of Phnom Penh Post newspaper Phnom Penh Post - Regulator halts trading

Regulator halts trading

Regulator halts trading

FIVE domestic firms trading in derivatives have been ordered to suspend their operations by the Securities and Exchange Commission of Cambodia.

SECC director general Ming Bankosal said Cambodian firms offering derivatives trading had operated without the necessary regulatory framework being in place.

The SECC was cooperating with the firms to prepare the necessary regulations, but the emphasis for the regulatory body was currently on launching the Cambodia Securities Exchange, which is slated for July, he said yesterday.

“We had not prepared any regulations or rules to manage them [firms trading in derivatives],” he said.

“It is not the priority for us – we want the public to understand the stock exchange first, then we will think about preparation of regulations for derivative products.”

In an announcement dated March 1 and obtained yesterday, the SECC ordered five companies to halt operations. They were named as Gold Financial Global, First State Gold Investment Company, Global Gold and Forex Investment Consultant Company, CMDK Gold Company, and International Gold Market Company.

Although the SECC did not define what it considered a derivative product, the Korea Exchange – which is a 45 percent stakeholder in Cambodia’s planned bourse – said it considered a derivative to be a financial instrument that derives its value from other underlying assets, in a presentation given to Cambodian experts in December.

Such assets include contracts for commodities such as gold and oil. Examples of derivatives include options and futures.

Representatives from some of the affected firms told The Post they were complying with the SECC’s announcement yesterday.

Gold Financial Global administrative and human resource supervisor Sales Sovanna said the company had changed its business model since receiving a warning about the impending move from the SECC late last year.

“We have delayed our business, and changed [it] to offer financial sector training courses to the public to assist them with understanding the industry,” he said yesterday.

The firm had previously specialised online trading of foreign exchange currencies, spot metals, and crude oil, according to its website.

An official at Global Gold and Forex Investment, speaking on the condition of anonymity, said the firm had suspended operations following notice from the SECC.

“We postponed our operation after receiving information from them [the SECC] in January,” the official said.

“The SECC told us we can restart operations following the launch of the Cambodia Securities Exchange. Now, we do nothing – we’re just waiting for an announcement from the SECC to restart our operations.”

MOST VIEWED

  • Seven positive for Covid-19, Hun Sen confirms local transmission

    Prime Minister Hun Sen announced that there has been local community transmission of Covid-19. However, he urged the people not to panic even though the Ministry of Health announced the discovery of seven new cases on Sunday. Among the victims are Chhem Savuth, the director-general

  • Cambodia at ‘most critical moment’, Hun Sen warns

    Prime Minister Hun Sen said the first community transmission of Covid-19 in Cambodia has led the country to the “most critical moment” that warranted urgent, large-scale operations to contain the pandemic. Hun Sen, who confirmed the first local transmission on November 28, said the source of

  • PM confirms community transmission, calls for unity

    Prime Minister Hun Sen has called on the public to stay calm, unite and follow the Ministry of Health guidelines after the wife of a senior official tested positive for Covid-19 in the Kingdom’s first case of community transmission. The case has drawn criticism

  • Over 110 garment factories close

    A government official said on November 22 that at least 110 garment factories had closed in the first nine months of the year and left more than 55,000 workers without jobs – but union leaders worry those numbers could be much higher. Ministry of Labour and Vocational Training undersecretary

  • Singapore group seeks $14M in damages from PPSP over ‘breach of contract’

    Singapore-based Asiatic Group (Holdings) Ltd is seeking a minimum of $14.4 million relief from Cambodia Securities Exchange (CSX)-listed Phnom Penh Special Economic Zone Plc (PPSP) for allegedly breaching a power plant joint venture (JV) agreement. Asiatic Group’s wholly-owned Colben System Pte Ltd and 95 per

  • PM vows to protect Hun family

    Prime Minister Hun Sen has vowed to continue his fight against opposition politicians who he said intend to smash the Hun family. Without naming the politicians but apparently referring to former leaders of the Supreme Court-dissolved Cambodia National Rescue Party (CNRP), Hun Sen said there