The Securities and Exchange Commission (SEC) has recommended to the Colombo Stock Exchange (CSE) to explore the feasibility of conduct activities digitally as well as to enable clearing and settlement electronically.
In a letter to CSE Chief Executive Office Rajeeva Bandaranaike, SEC Director General Chinthaka Mendis has said the inadequacies of the measures currently in place at the Colombo bourse to conduct all its core activities digitally came to light during the correspondence exchanged between the two organisations recently.
Mendis has said it was imperative to have a mechanism in place for the CSE to conduct all core activities of the stock market digitally as well as to have measures in place to ensure electronic clearing and settlement in order to keep abreast with the development of technology. “The situation prevalent in the country as a result of the COVID-19 pandemic has highlighted this need more than ever before and the SEC is of the view that it is best for the SEC and the CSE to jointly look in to this aspect as an urgent requirement,” Mendis has said.
For this purpose, the SEC has proposed the setting up of a Committee comprising of two members of the SEC and three officers of its Secretariat and two members of the Board of the CSE and three officers of its Secretariat.
The Terms of Reference of this Committee can be broadly defined to “Identify measures/mechanisms required for the Colombo Stock Exchange to conduct all core activities of the stock market digitally as well as to enable clearing and settlement electronically and to make recommendations to have the said measures/mechanisms in place”.
SEC Chairman Viraj Dayaratne PC has nominated Commission Members Manil Jayesinghe and Naresh Abeysekara as well as Director General and Directors Dr. Harshana Suriyapperuma and Prabash Wanigatunga to serve as SEC nominated members of this Committee. SEC has called upon CSE Chairman Ray Abeywardena to nominate members from the CSE.
If the CSE has any alternative proposal, the SEC has said it will be happy to consider the same.
(FT)