ISLAMABAD: The Securities and Exchange Commission of Pakistan (SECP) will make the book-building process more efficient and transparent in consultation with the stakeholders, the commission’s newly appointed chairman said on Tuesday, stressing for a reforms agenda in the capital markets.

Addressing SECP officers, Zafarul Haq Hijazi said, “We need to bring the IPO [initial public offering] process on a par with the developed markets and all required steps would be taken to encourage investors’ confidence.”

“A web-based system of book-building will be provided through the platform of a clearing company to ensure a more user-friendly, neutral and transparent model,” he said.

The corporate sector regulator had been at odds with stock market brokers who oppose radical changes in the existing trading regimes in the capital markets.

“There are several faults and flaws in trading, but not all such things are ill intended,” said Zafar Moti, a broker in the Karachi Stock Exchange (KSE). “The problem with the SECP is that it tries to implement the American system on desi people in one go.”

He even said that the level of knowledge and information regarding ground realities among the officers of the SECP’s Investors Awareness Cell was well below than that of punters in the KSE. “However, the fact is that we both can learn from each other and I hope that reforms will be achieved with mutual consent,” Mr Moti added.

Meanwhile, the SECP chairman said that strengthening the commission’s enforcement regime was at the forefront of his reforms road map.

“Monitoring and surveillance capabilities of the apex regulator will be enhanced by strengthening the surveillance teams and infrastructure to ensure timely detection of market misconduct and unfair trade practices and appropriate enforcement action in a swift and equitable manner,” he added.

Mr Hijazi said there would be no compromise on the investors’ interests, and there would be zero tolerance for market misconduct and unfair trade practices.

The SECP is likely to introduce a global concept under which inspections of brokers by the commission, system auditors and the Central Depository Company of Pakistan (CDC) will be replaced by a single comprehensive inspection regime, removing inefficiencies and overlaps.

“Given the significance of the clearing company’s role, efforts are in progress to give the NCCPL [National Clearing Company of Pakistan Limited] the status of a Central Counter Party through appropriate changes to its regulations and the current default management process,” he said.

Published in Dawn, December 24th, 2014