Bangkok, 18 April 2019 – SEC is seeking public comments on the revision of rules on net capital applicable to securities companies and derivatives brokers to accurately reflect the financial position, prevent excessive burden on the business operators and limit damage to customers and the capital market in general in case the businesses face financial difficulty.
The securities companies and derivatives
brokers are presently required to maintain net capital (NC) in a specified amount in order to sufficiently
cover risks from conducting business. However, the rules, which are
currently in effect, should be revised with respect to maintenance of NC in
case of abnormal increase in transaction volume of the business operator to the
effect that the business operator must arrange sources of short-term finance to allow maintenance
of NC, and with respect to the rules which allow the business operator failing to
maintain NC to continue providing services to its customers by preparing and
submitting a correction plan for maintenance of NC within 30 days and resolving
such problem within 90
days, during which periods customers and stability of the capital market in
general may be affected. In addition,
the current rules on calculation of NC are not applicable to business operators
which also operate the digital asset business.
SEC therefore proposes to revise such rules to
be more suitable and consistent with the present conditions. The revision process takes into
consideration the environment and the difficulties and obstacles in business
operation raised by the business operators, resulting in the proposed revision
of the rules, such as:
(1) To allow the business operator failing to maintain NC as required due to
an increase in the transaction volume to use of standby subordinated loan
facility to recover NC shortfall on a temporary basis which will reduce costs for
seeking short-term finance.
(2) To require the
business operator failing to maintain NC to immediately cease the business
operation and transfer the customers’ assets to other
business operators in order to limit effects on the customers and stability of
the capital market in general.
(3) To specify rules on NC
maintenance to be applicable to the business operators which also
operate the digital asset business and to allow the qualified digital assets to
be included in the calculation of liquid asset.
The consultation paper is available
at www.sec.or.th/hearing. Stakeholders and
interested parties are welcome to submit comments and recommendations via the
website, or email: juthaporn@sec.or.th or teerawatt@sec.or.th. The public hearing
ends on 13 May 2019.
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Note: Consultation
paper is available at https://www.sec.or.th/TH/Pages/PB_Detail.aspx?SECID=473