Investor's Guide (Regulating the Stock Market )

Regulating the Stock Market

HOW DOES KSE REGULATE TRADING ACTIVITIES?

The regulatory authority for the securities market and corporate sector in Pakistan is the Securities and Exchange Commission of Pakistan (SECP). The SECP administers the compliance of the corporate laws in the country and is run by commissioners under a chairman.

The Securities and Exchange Commission of Pakistan, is an autonomous regulatory authority, and at the same time provides an accountability mechanism through establishment of a Securities and Exchange Policy Board. All policy decisions are made by the board on the recommendations of the commission and the board is directly answerable to the Parliament.

THE REGULATORY INFRASTRUCTURE OF KARACHI STOCK EXCHANGE

Members of the stock exchanges and trading at the Exchange are also subject to the discipline of self-regulation under various Rules and Regulations of the Stock Exchanges.

KSE is regulated by the provisions of the following regulations:

1. General Regulations of Karachi Stock Exchange
2. Listing Regulations of Karachi Stock Exchange
3. Regulations Governing Over the Counter Market
4. Regulations Governing Future Contracts
5. Regulations Governing Cash-Settled Future Contracts
6. Regulations Governing Provisionally Listed Companies
7. Regulations Governing Short Selling, 2002
8. Regulations Governing Proprietary Trading
9. Regulations Governing Margin Trading, 2004
10. Regulations Governing Karachi Automated Trading System (KATS)
11. Regulations Governing System Audit, 2004
12. Regulations Governing Investors Protection Fund
13. Regulations Governing Continuous Funding System 2006
14. Regulations Governing Recovery of losses
15. Regulations Governing Risk Management
16. Regulations Governing Branch Offices
17. Regulations Governing Stock Index Future Contracts

Trading activities are being monitored through the surveillance terminal to ascertain that, there are no illegal postings and dealings made in any of the issues listed in the Exchange. Through the Compliance and Surveillance Group, compliance of members to set rules and regulations are monitored.