The Securities and Exchange Commission (SEC), has said it would register and actively monitor brokers selling stocks for foreign companies.
The Executive Commissioner Operations of the SEC, Mr. Dayo Obisan, who disclosed this weekend during an interview with Bloomberg, said the move is in furtherance of its mandate of ensuring investor protection and market transparency especially for retail investors.
Obisan said the SEC intends to license firms offering foreign stocks under a “digital sub-broker” regulation, which should provide a form of clarity to their activities adding that the requirement will ensure regulatory responsibilities in on-boarding clients, custody of assets, and compliance with reporting requirements are met.
He said the SEC is mindful that these platforms expose investors to both local and foreign stocks and are mooting registration of these platforms under the Digital Sub-Broker regulations which should provide some form of legitimacy for their activities while also ensuring that regulatory responsibilities in on-boarding clients, custody of assets, and compliance with reporting requirements are met.
According to him, “Ultimately, we expect that registration will ensure that only genuine platforms target retail investors. We already have one of the platforms at a very advanced stage in the registration process.
“The SEC has rules on foreign investments and cross-border transactions which specify the requirements for foreign investors seeking to invest in Nigeria as well as issuers of securities. Broadly speaking, all capital market instruments are registrable – Equities, Bonds, Units of Investment Funds, Derivatives, etc
