The DSE Brokers Association has sent a legal notice to the DSE board, claiming the bourse has given the consent to the draft rules on issuing new TREC licence ignoring the interest of the DSE members and investors.
The regulator published the draft rules of Bangladesh Securities and Exchange Commission (Trading Right Entitlement Certificate), 2020 last month incorporating the criteria for issuing TREC and sought opinions from bourses within April 15.
In response, the Dhaka Stock Exchange (DSE) has already given its consent to the rules.
DSE Brokers Association on Sunday sent a legal notice to the DSE board of directors and company secretary, claiming that they gave ‘no objection’ to the draft rules on issuing new TREC licence ignoring the interest of the DSE members and investors.
The Law Valley legal firm on behalf of DBA president Sharif Anwar Hossain issued the legal notice to all DSE directors and company secretary.
Stock Brokers said the BSEC has no right to set the criteria for issuing new stock brokerage licences, rather, the bourses can exert their authority to do so as per the demutualisation rules.
According to the demutualisation act, the bourse will set the criteria for giving TREC and will take approval from the regulator.
The BSEC framed the draft rules without lawful jurisdiction as it has laid down criteria that includes fixation of fees, security deposit and time factor of issuance of the TREC, it said.
The regulator has no authority to determine the criteria, the timeframe of issuing TREC, fees and security deposit against new TREC, the association pointed out citing relevant rules.
The legal notice also said that if the rules were implemented by the BSEC, the DBA would challenge the propriety of the rules.
This is simply usurpation of power by the BSEC, it said.
All the directors of the DSE as well as its company secretary received the legal notice, which called for sending a “note of protest” to the BSEC on the draft rules within seven days of receipt of the notice.
If they fail to issue the note of protest to the BSEC, the general members of the DSE shall be constrained to hold an extraordinary general meeting to remove all the directors of the DSE, it said.
Top official of the DSE confirmed that they received the legal notice and would take the next steps.
There are 250 TREC holders at the DSE and some of them continue struggling in running their business.
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