The Securities and Exchange Commission (SEC) is proposing a new guideline that will fully digitalise capital market operations and enable investors to carry out transactions on Internet-enabled appliances.
This is contained in a guideline on Minimum Operating Standards for Information Technology for Capital Market Operators (CMOSs) recently made public. According to the SEC, the new regulatory framework undergoing review seeks to mandate compulsory adoption of information and communication technology (ICT), particularly web-based applications and devices, for virtual capital market transactions.
By the proposal, all registrars, central securities depositories, and clearinghouses will be required to digitise their operations as a regulatory requirement rather than an optional service provision – a move that could address issues fuelling unclaimed dividends. The Commission stated that the provisions of the document apply to all categories of CMOs unless in sections where reference is otherwise made to specific categories.
According to SEC, the new framework’s purpose “is to establish a threshold of operational efficiency in the Nigerian capital market through the effective adoption of information technology in driving business operations and ensuring the security, confidentiality, integrity, and reliability of Information Systems.”