NSE proposes amendment of rulebook for clientele benefits
The Nigerian Stock Exchange (NSE) is proposing to make amendments to the Rulebook of The Exchange, 2015 known as (Rulebook) (Dealing Members’ Rules) hinged on the objective of ensuring that Dealing Members strive to obtain the best deal for clients when executing clients’ orders.
According to the NSE, the proposed rules aim to guide Dealing Members on their obligations through the life cycle of a client’s order, right from the receipt of mandates through until execution. The NSE also said the rules are to enhance investors’ protection and confidence in the Nigerian capital market.
A document acquired from the NSE and signed its General Counsel and Head of Regulation, Tinuade Awe, stated the NSE has observed that some Dealing Members either do not have effective Best Execution policies, or do not follow the principles outlined in their Best Execution Policy when handling clients’ transactions, hence the need to develop the Order Handling and Best Execution Rules.”
The document then explained that the draft of the new rules made available on the NSE’s official website address and provide for best execution principles and criteria, the role of price, Dealing Members’ obligations with regard to the execution of clients’ orders, following clients’ specific instructions, clients’ order handling, aggregation and allocation of orders, aggregation and allocation of clients’ transactions with Dealing Member’s proprietary account, audit trail requirements, and sanctions in the event of default.
The NSE further stated that the rules will guide Dealing Members on their obligations, from the receipt of clients’ mandates till when the mandates are executed.
For the purpose of creating public awareness and to solicit the public’s feedback on the draft Rules; and also, to improve the quality of the Rules and thereby have a robust, well written set of Rules, the Exchange invited stakeholders in the Capital Market to participate in its rule making process, to achieve the aforementioned goals. They assured the stakeholders that their contributions will be considered in arriving at the final text of the Rules.
The NSE urged contributions and comments to be submitted not later than the close of business on Monday, 14 November 2016, sent in a WORD document and attached to an electronic mail to Mr. Oluwatoyin Adenugba of the Rules and Interpretation Department of The Exchange via: oadenugba@nse.com.ng.
The document further noted that the draft Rules are subject to the approval of the National Council of The Exchange and the Securities and Exchange Commission.
