CDSL set to codify shares under ISIN system

KATHMANDU, OCT 13 - 2012

The Central Depository System and Clearing Limited (CDSCL) is all set to codify the shares listed on the Nepal Stock Exchange (Nepse) under the International Securities Identification Numbering System (ISIN).

The standard provides a uniform structure for a number, known as lSIN, which uniquely identifies securities. The unique code will enable the identification and recognition of certain shares as belonged to a certain company internationally. The existing coding system at Nepse is not recognised internationally.

Following the Securities Board of Nepal (Sebon) directed CDSCL to keep identity of shares with ISIN after the regulator became a member of the Association of National Numbering Agencies (ANNA), CDSCL is working on codifying shares as per the new system.

CDSCL has also asked Nepse to send shares registration details, including of those shares that have been registered as promoter’s shares. Nepse keeps identity of promoter and pubic shares differently. “We will complete codifying with ISIN within a week after Nepse gives us the details,’ said CDSCL Chief Executive Officer Subodh Sharma Sigdel.

As per the ISIN system, Nepal’s unique identification code is ‘np’ and the shares are codified with initial ‘np’ followed by other numbers and syllables. “The move is aimed at ensuring infrastructure as per international practice,” he said.

The identification of shares with ISIN is expected to encourage more Non-Resident Nepalese to invest in Nepal. “ISIN codification will ensure reliability of shares with internationally recognised unique number,” said Sigel.

Source: The Kathmandu Post

CDSCL revises tariff on share transaction

KATHMANDU, Oct 3, 2012

Central Depository System (CDS) and Clearing Limited, a state-owned company that provides automated service on trading, clearing and settlement of securities, is soon revising tariff rate on securities transaction that depository participants can slap on buyers and sellers of securities like shares and bonds.

The CDS and Clearing Limited has proposed that depository participants be allowed to collect no more than Rs 25 on every transaction of securities.

Depository participants are intermediaries that maintain accounts of securities investors and perform works such as transfer of securities on behalf of investors. So far, four companies - Civil Capital Market, Ace Capital, Stock Management and DP and Nabil Investment - have obtained license to work as depository participants.

As of now, these intermediaries are allowed to collect 0.25 percent of the total amount of securities changing hands or a minimum of Rs 20 from buyers and sellers of securities.

“We have already submitted the proposal to Sebon (Securities Board of Nepal),” Subodh Sharma Sigdel, CEO of CDS and Clearing Limited, told Republica. “We hope to hear from them soon.”

Although the CDS and Clearing Limited is yet to come into operation, many have called the company´s existing fee structure exorbitant that will force investors to fork out huge amount just to avail services from depository participants.

This was one of the reasons why the CDS and Clearing Limited decided to revise the tariff and introduce a flat rate, according to Sigdel.
“Besides, our IT system is capable of deducting the charge on percentage basis only on closing price of shares, which goes against the law, as the regulation allows depository participants to slap such charges on real time transaction of shares,” Sigdel said, clarifying, the IT system can, however, grab real time movement of transactions to perform works related to clearing and settlement.

The government has long been trying to automate the securities trading platform. Although this initiative gave birth to CDS and Clearing Limited, it has not yet come into operation due to technical problems.

Source: Republica