Dhaka Stock Exchange (DSE) has moved to look into the legal notice served by its brokers challenging the exchange's opinion already submitted on the draft rules formulated for issuing new TREC to the securities regulator.
The move came after the DSE Brokers Association (DBA) on Sunday served a legal notice to the top bosses of the premier bourse.
The stock brokers said the stock market regulator has no right to set the criteria for issuing new TREC (Trading Right Entitlement Certificate) as per the demutualisation rules.
"We have asked the exchange's legal advisor to look into the legal notice served by the lawyer of the stock brokers," said the DSE chairman Md. Eunusur Rahman.
Apart from this, the DSE management is working to prepare a digital platform for holding a meeting to discuss the legal notice, among others, served by the DBA.
The securities regulator recently has sought public opinion on the draft rules formulated to issue new TREC to the firms willing to conduct trading operations in the country's capital market.
The timeframe for submitting opinion will end today (Tuesday) and the premier bourse DSE has already submitted its opinion to the Bangladesh Securities and Exchange Commission (BSEC).
On Sunday, the brokers' association sent a legal notice to the DSE saying that the bourse has given the consent 'furtively' and the securities regulator has no right to set the criteria for issuing new licences for conducting transactions in the capital market.
Asked, a senior official of the premier bourse DSE said they have received the legal notice amid ongoing closure of the exchange's activities.
"We are not sure whether a legal notice is lawful enough when it is served amid closure of the exchange's activities. Nevertheless, we have moved to discuss the matter through digital platform," said the DSE official, adding that officials concerned are judging the nitty-gritty for preparing a digital platform to hold meetings.
Asked, a BSEC official said presently the activities of the securities regulator remains closed due to country-wide lockdown to contain the spread of COVID-19.
"It's not possible to speak about the complaints raised by the brokers unless the BSEC's activities are resumed," the BSEC official said preferring anonymity.
In their legal notice, the brokers called the DSE to send a note of protest to the BSEC on the draft rules within seven days of receipt of the notice.
Otherwise, the general members of the DSE shall be constrained to hold an extraordinary general meeting to remove all the directors of the DSE.
The draft rules titled Bangladesh Securities and Exchange Commission (Trading Right Entitlement Certificate), 2020 said the persons, other than the existing shareholders of the exchanges, will be allowed to get the TREC if they are companies, or institutions approved by the statutory bodies or the commission.
The minimum paid-up capital of a company aspirant to get TREC must be Tk 30 million.
But the condition is that the permanent and audited net asset value of the firm must be above 75 per cent of its paid-up capital.
Apart from the stipulated paid-up capital, the companies always will have to keep Tk 20 million, the amount may be revised time to time by the regulator, as security money in the concerned exchange, the draft rules said.
And the firms willing to get the TREC must have qualified manpower and managements defined by the securities regulator.
The firms will not be allowed to get TREC if it or any of its directors are penalised or convicted as per the criminal laws.
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