In a bid to increase the number of quoted companies in the capital market, the Nigerian Stock Exchange (NSE) and the Securities and Exchange Commission (SEC), have disclosed their commitments to ease the listing process.
According to a joint statement made available to the public, the regulators disclosed that they are working to make the listing processes of listing on the bourse more efficient and cost-effective by streamlining the approval process between them.
“THE STREAMLINED PROCESS, WHICH WILL COME INTO EFFECT ON JUNE 1, 2019, IS AIMED AT REDUCING THE REGULATORY BURDEN ON ISSUERS BY ELIMINATING DUPLICATION OF PROCESSES BETWEEN SEC AND THE NSE, REDUCING THE TIME TO MARKET FOR THE ISSUANCE AND LISTING OF SECURITIES AND ULTIMATELY DRIVING MORE LISTING ON THE EXCHANGE.”
How this will work: With the streamlined process, SEC and the NSE will carry out joint site visits of companies intending to get listed, following the registration of their securities with SEC.
Meanwhile, certain offer documents such as the vending agreement, underwriting agreement, trust deed, and ISPO, which are strictly within the jurisdiction of SEC, would be submitted only to the SEC.
The NSE also aims to rely on SEC for approval of offer documents such as the prospectus.
About the regulators: The Securities and Exchange Commission is the apex regulatory institution of the Nigerian capital market. It is supervised by the Federal Ministry of Finance.
On the other hand, the Nigerian Stock Exchange services the largest economy in Africa and is championing the development of Africa’s financial markets.
The NSE is a registered company limited by guarantee. Founded in 1960 and licensed under the Investments and Securities Act (ISA), the bourse is regulated by the SEC.
The Exchange offers listing and trading services, licensing services, market data solutions, ancillary technology services and more.
How SEC and NSE function: SEC is the main regulatory institution of the Nigerian capital market. While the NSE is privately-owned and self-regulating, SEC maintains surveillance over it with the mandate of ensuring orderly and equitable dealings in securities and protecting the market against insider trading abuses.