Securities market regulations to be gazetted by next month
Council being set up
By Gitanjali Singh
July 24, 2002
Regulations to effect a large part of the legal infrastructure for the securities market are to be gazetted by the end of August and a ministerial order issued to bring into operations the remainder of the provisions of the Securities Industries Act (SIA).
Ray Astin, legal consultant with the Adam Smith Institute, says seven of the outstanding nine sets of regulations are to be gazetted shortly and these cover the registration of market participants; disclosure by reporting issuers; the conduct of business rules; accounting and financial statements regulations; advertisements regulations; prospectuses regulations and the registration of issuers and securities regulations.
The two outstanding regulations cover collective investment schemes and takeover regulations, which are now before the Guyana Securities Council (GSC) for consideration.
The council had in December 2001 and in February of this year submitted to the minister of finance the first seven sets of regulations and it is only now that these are being gazetted to bring aspects of the SIA into force.
Astin says once the seven sets of regulations are gazetted and the ministerial order issued, anyone wishing to be registered as a self-regulating organisation can apply to the Guyana Securities Council for registration.
The Guyana Association of Securities Companies and Intermediaries (GASCI) is one such self-regulatory organisation, which has been established and had hoped to be up and running by June of this year. However, with the legal framework not in place this was not possible.
The GSC, on the other hand, which has to operate on a shoestring budget, expects to have its administrative arrangements fully in place by the time the regulations are in effect to push the stock market process forward.
GSC’s Chairman, Brian James, indicated that the council was working diligently to put everything in place, but noted that the process had been delayed because of the number of agencies involved in getting things off the ground.
The UK Department for International Development is providing a budget of US$88,000 per annum for GSC’s operations (until November 2003) but this sum only allows for a “bare bones” operation, according to James. The government has provided office space at the Bank of Guyana building for the council.
James said the council’s allotted budget is sufficient but not adequate. He said the council was not consulted on the budget it would have required. He said that initially, the amount available to pay for a chief executive officer was completely inadequate but the figures have since been rejigged and the Adam Smith Institute would provide a free administrative assistant for the secretariat. However, he noted that resources would have to be found to provide for office stationery and equipment and the council was working within restricted parameters. Six persons have applied for the post as CEO and James said that three candidates are to be interviewed in the coming weeks. He expects an appointment to be made before the end of August but noted that the selected candidate may have to work out his/her notice with his/her current employer.
James said the minister of finance has also been asked to appoint the fifth member to the council as having only four members with the requirement of three as a quorum posed a difficulty when members needed to travel.
Nevertheless, James was optimistic that the council would have all the arrangements in place once the law was operationalised to allow for the effective functioning of the securities regulatory system.
The council’s tasks would include ensuring that the securities market in Guyana operated in a fair, efficient, competitive and informed manner and that there were fair and clear rules and regulations in place for this. Its objectives include encouraging the development of the securities market in Guyana and maintaining and enhancing effective compliance and enforcement programmes among other things.
GASCI in the meantime is to put in place a secretariat and training programmes in the run up to the securities act becoming fully operational. It is not clear how far the organisation has gone in this regard as efforts to contact Anand Beharry, the acting chairman, have not been successful.