The Securities and Exchange Commission has restated that the protection of investors in the capital market is a top priority of the Commission.
Executive Commission Operations of the SEC, Dayo Obisan, stated this when he received a delegation from the Securities and Exchange Commission Zimbabwe in Abuja, Monday.
Obisan stated that the Commission has a robust rule making process that is meant to take care of current issues as well as create an enabling environment for innovation to thrive in the capital market.
This he said, will aid the stimulation of growth in the economy, attract more investors to the market as well as ensure that investors are protected.
Obisan disclosed that SEC Nigeria has a dual mandate to regulate and develop the capital market in Nigeria, stating that both roles are very delicate in a bid to ensure that the market is attractive to investors.
“They are both delicate roles because if you focus more on regulation, development suffers, and if development suffers growth is stifled. And if growth is stifled it is just a matter of time and the market will be at the receiving end.
“If you focus more on development on the other hand, things have potential of going haywire and you could just be running a market that is not co-ordinated and price transparency and investor protection will suffer. Those are the things we have sworn to do by the provision of the law that created us.
The SEC Executive Commission disclosed that the National Assembly is currently in the process of amending the Investments and Securities Act 2007 to make it in tune in current realities.
“We are in the process of amending our enabling law and it has reached an advanced stage in the National Assembly. There is need to review the law because a lot has happened since the law came into effect in 2007. The essence is to capture all new developments that have taken place in the market within the period. Since the last review in 2007 a lot has happened like Covid-19, technology has taken a bolder stand. Even within the market there are a lot of other innovative instruments that have come which the law at that time did not envisage. Again, there is nothing cast in stone and we have to keep evolving to ensure we are adequately backed by the relevant sections of the law to enable us carry out our functions.
“The issue of transfer of assets was not as aggressive as it is now, we did not even have so much Automated Teller Machines at the time, but that is not the case today. A lot of things are now being done digitally and the plan did not envisage all those. There are some other activities and laws that impact on the capital market and we need to keep looking at our regulations to avoid a disconnect. We need to constantly evolve.
He stated that it is the desire of the Commission to be in tune with current realities that also necessitated the review of the capital market master plan which came into effect in 2014.
“The plan came into effect in 2014 and was meant to run till 2025. But now we are half way through and we saw the need to amend it. This is because in 2014 our focus was different, fintech was not this bold, crypto currencies and virtual assets were not this prominent.
“Fintech is not a walk in the park, we need to understand what we want to regulate, it is a constant phase and we need to keep updating our knowledge to be able to regulate properly. The regulator has to be a step ahead and that was why we created a Division on Innovation since 2018. The tech penetration in Nigeria is growing and the regulator needs to be abreast with the trend and that is a sort of change we need to be able to accommodate” he added.
In his remarks, the Head Corporate Finance Zimbabwe SEC, Kundai Msemburi, said the delegation decided to visit SEC Nigeria in a bid to exchange ideas and boost regulatory efforts.
“We are here to interact with SEC Nigeria to find out how the Commission deals with issues of regulation. In Zimbabwe we have had issues of some crypto exchanges collapsing and we are here to interact in a bid to make our markets better.
“We are keen to see how the bigger markets operate and see how best to get a grip on the regulation of our market. We know that investor education is very important in any market” he stated.