The Chairman of the Securities Board of Nepal (SEBON), Ramesh Kumar Hamal, has vigorously defended the fairness of the broker license distribution process, emphasizing his commitment to transparency and integrity. Speaking at an event in Kathmandu, Hamal asserted that no hint of corruption tainted the licensing procedure, claiming that he did not even have a casual meeting over tea with any of the 43 licensed brokers.
Hamal also highlighted the adoption of Singapore's "meritocracy" approach in granting licenses to broker companies. The meritocracy system, based on education and work performance, provides equal opportunities for advancement. Hamal stated, "We have initiated the concept of broker license distribution for the first time in Nepal's history. Why limit the licenses to a select few who have already established themselves in society? We believe that every eligible individual should have the chance to obtain a license."
According to Hamal, this inclusive approach ensures equal opportunities and eliminates competition resulting from a biased system. He also mentioned that the government now generates revenue from broker licenses, emphasizing the introduction of educational standards not only for broker management but also for board members.
Hamal outlined the requirement for at least one-third of the management committee to hold master's degrees in fields such as law, accounting, and economics. In contrast to India, where anyone meeting the broker criteria can apply without restrictions, Nepal follows a regulated process. Hamal asserted that Nepal's regulatory body, SEBON, aims to approve or reject broker applications within 35 days, following a model similar to India's Securities and Exchange Board (SEBI), which has a ten-day approval period.
With his remarks, Hamal aims to address concerns about favoritism or unfair practices in the broker licensing system, emphasizing the board's commitment to a transparent and inclusive approach.
As of today, 43 companies have received preliminary broker licences/letter of intent (LOI). Among the 43 companies with LOIs, 18 companies have met final approval in two different phases after fulfilling infrastructural pre-requisite.
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