The securities regulator has approved a 'Block Module' introduced to strictly reinforce the mandatory declarations required in case of transferring shares of listed companies and units of mutual funds by sponsors, directors and placement holders.
The approval came on Tuesday at a meeting held at the office of the Bangladesh Securities and Exchange Commission (BSEC).
The Central Depository Bangladesh Limited (CDBL) introduced the Block Module following a BSEC's instruction in the wake of many transfers of these types of shares without required declarations.
As per existing rules, the sponsor-directors and placement holders of the listed companies have to make declaration before selling or transferring their shares.
The transactions of such shares are executed within 30 days of making declarations through block or public market subject to payment of stipulated amount of tax.
As per Tuesday's decision, all listed companies will keep the shares of their sponsors, directors and placement holders blocked using the module introduced by the CDBL.
On the other hand, the asset management companies will keep the units of their sponsors blocked.
"The stock exchanges will lift blocking from the shares and units after making declaration and paying taxes by the sponsors, directors and placement holders. Then the transactions of such shares and units will be executed," the BSEC said.
Shuvra Kanti Choudhury, managing director at CDBL, said they formulated the Block Module in consultation with the securities regulator, stock exchanges and Bangladesh Association of Publicly Listed Companies (BAPLC).
"We have also provided training to the concerned officials of the stock exchanges and listed companies on the Block Module. The module has also been deployed to our depository system on May 12," Choudhury said.
He said the listed companies and asset management companies will be able to use the module after getting the regulatory directive in this regard.
The securities regulator said it would issue a directive regarding usage of the Block Module soon.
At Tuesday's meeting, the securities regulator gave final approvals to three rules on receipt of public opinions.
The rules are Bangladesh Securities and Exchange Commission (Investment Sukuk) Rules, 2019, Bangladesh Securities and Exchange Commission (Exchange Traded Derivatives) Rules, 2019 and Bangladesh Securities and Exchange Commission (Short-Sale) Rules, 2019.
The gazettes of these rules will be published soon.
The securities regulator has also approved the draft prospectus of Peninsula Balanced Fund.
The initial size of the fund will be Tk 200 million, of which Tk 20 million will come from the sponsors. The remaining Tk 180 million will be collected through sales of units.
