Regulatory Alerts2021-07-27
Proposed Major Amendment to Rules on Securities Exchanges and Other Sundry Amendments
The SEC Nigeria proposes major amendments to the Rules on Securities Exchanges to enhance governance, risk management, and operational efficiency through updated regulatory standards and oversight. These amendments introduce new classifications for securities exchanges, including Composite and Non-Composite Exchanges, while formalizing registration requirements, continuing obligations, and reporting mandates for both exchanges and Alternative Trading Facilities. The revisions aim to align the local regulatory framework with international best practices by streamlining operations, clarifying accountability, and strengthening investor protection mechanisms.
Proposed Major Amendment to the Rules and Regulations of the Commission
Legend: Additions are underlined; Deletions are struck through; Justifications are italicized.
Major Amendment Proposed Amendment to Part E- Rules on Securities Exchanges.
PART E Regulation of Securities Exchanges and Transactions on Exchanges, Capital Trade Points and other Self-Regulatory Organizations
E1. General Provisions Registration and Regulation of Financial Market Infrastructures
Securities Exchanges Applicability These Rules shall apply to:
- Composite Securities Exchange - a Securities Exchange that permits listing, quotation and trading of all types of securities on its platform and
- Non-Composite Securities Exchange – which consists of: a. A Mono Securities Exchange that specializes in listing, quotation and trading of a particular class of security; or b. An Alternative Trading Facility (ATF) which means a system or platform, operated by an entity registered by the Commission as a broker-dealer or an ATF that brings together buyers and sellers of securities without the responsibility of regulating participants and issuers.
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Justification The Proposed amendments are intended to comprehensively update and improve the regulations as well as enhance the operations of Securities Exchanges particularly in the areas of governance and risk management. They are also aimed at classifying Securities Exchanges based on size and activities with a view to streamlining their operations and regulation. In addition, they are aimed at aligning the rules to support the current market structure as well as the operations of Securities Exchanges with international best practices.