SECP issues guidelines for cooperation with foreign regulatory authorities


ISLAMABAD, Aug 30 (APP): The Securities and Exchange
Commission of Pakistan (SECP) has issued guidlines for cooperation
and assitance to foreign regulatory authorities under which the SECP
has conveyed to the authorities that it is ready to exchange the
data including financial information of companies with financial
services regulatory bodies under the framework for international
cooperation and multilateral infomration sharing arrangments.
These Guidelines for Cooperation and Assistance to Foreign
Regulatory Authorities provides a framework for international
cooperation under section 42D and to stipulate formal mechanisms for
sharing information and assistance under the Act or any administered
SECP can provide assistance not only in investigations but
also in other types of inquiry, as part of a compliance program for
preventing illicit activities. It can also exchange general
information about matters of regulatory concern, including financial
and other supervisory information, technical expertise, surveillance
and enforcement techniques, and investor education.
The form of assistance may include obtaining public or non-
public information, for example, about a license holder, listed
company, shareholder, beneficial owner or a person exercising
control over a license holder or company; obtaining banking,
brokerage or other records; obtaining voluntary cooperation from
those who may have information about the subject of in inquiry;
providing information on the regulatory processes, or in obtaining
court orders, for example, urgent injunctions; providing and
obtaining unsolicited information, on voluntary basis.
The SECP said that strong international cooperation is
important to facilitate the detection and deterrence of cross-border
misconduct and to assist in the discharge of licensing and
supervisory responsibilities. The commission recognizes the
importance of international cooperation and assistance among
jurisdictions for effective and appropriate resolution of cross-
border regulatory and enforcement issues to protect investors and,
policyholders and combat cross border violations of laws.
Hence, in 2016, a new independent section 42D regarding
international cooperation and assistance to foreign regulatory
authority was inserted in the Act through SECP (Amendment) Act, 2016
to address the concerns and needs of SECP’s on the subject of
international cooperation and assistance. The section authorizes the
Commission to seek and provide assistance on reciprocal basis, to
international regulators for assisting in any inquiry or
investigation for contravention of laws relating to financial
services, SECP said.
The law authorizes the Commission to require the production of
any information or document from any person on the request of the
requesting authority.
The SECP has the ability to provide non-public information or
document filed with or provided to the Commission, or obtained by
the Commission from any person, to the foreign regulatory
authorities, upon a showing that such information is needed by the
foreign regulatory authority.
The SECP when requesting such non-public information from any
foreign regulatory authority shall establish and maintain such
safeguards as are necessary and appropriate to protect the
confidentiality of information and documents, and provide assurances
of confidentiality to the foreign regulatory authority, including
assurances that the SECP will use the confidential information
received for no other purpose than those specified in the request;
make no public use of the information without prior approval of the
foreign regulatory authority; notify the foreign regulatory
authority of any legally enforceable demand for the information
prior to complying with the demand, and assert such legal exemptions
or privileges on the foreign regulatory authority’s behalf as it may
request and not grant any other demand or request for the
information without prior notice to and lack of objection by the
foreign regulatory authority.
All requests received from multilateral or bilateral
forums/regulators/organizations must be made in accordance to terms
and conditions as specified in the information sharing agreement
(MMoU/MoU). Such MoUs including the IOSCO MMoU outline how requests
for assistance should be made.