Supreme Court Finally Dismissed the Petition Challenging New Stock Exchange and Broker Licensing Regulations

The Supreme Court has dismissed the petition concerning the requirements for broker and stock exchange licensing. The Supreme Court's constitutional bench dismissed the petition yesterday.

The Securities Board released a notification on Ashwin 2, 2079 with a 30-day deadline in order to carry it out. As a result, 46 companies submitted applications for stock broker licenses, while one company submitted an application for a stock dealer license. Likewise, the board has also allocated 45 days for applications to the new stock market and commodity market. However, after the order of the Supreme Court, all the proceedings had been suspended.

While hearing a lawsuit challenging the procedure of introducing a new stock exchange and brokers, supreme court issued a temporary injunction because a writ had been filled challenging the manner in which licenses were granted.

On 16 Ashwin, Attorney Amrit Kharel submitted a writ case to the Supreme Court asking that the updated rules for issuing licenses to new stock exchanges and brokers be revoked. The hearing of the same was yesterday and now Judges have dismissed the writ petition after hearing the case.

The Securities Market Operation (Second Amendment), Securities Dealers (Securities Brokers and Securities Dealers) (Fourth Amendment), and Securities Dealers (Securities Brokers and Securities Dealers) (Fifth Amendment) Regulations 2079 were all sought to be canceled in the writ. It was asked in the writ to declare these regulations unconstitutional and null and void since the arrangements made in them are against the Nepalese Constitution and current laws.

In this regard, the Securities Board of Nepal (SEBON) revised the rules to provide new licenses for brokers and stock exchanges. To permit stocks for private investment, the board revised Regulation 2064 of the Securities Market Operation Act. According to this, private enterprises may own stock in the newly established stock market, and its capital has been set at Rs. 3 Arba. To launch a new broker license, the board also changed the Securities Dealers (Securities Brokers and Securities Dealers) Regulations 2064. The petition demanded the cancellation of the modifications made to these regulations. Now, these amended regulations will not be null and void as a result of the writ's cancellation.