|
|
| • EXCH RATES |
|
Baht/$ 34.65/68 (Bid/Ask)
|
GOLD |
12,500
- 50
|
|
Regulator will become a facilitator
DARANA CHUDASRI
``Regulatory enforcement must be one hundred percent free from politics. No, one million percent,'' says Mr Thirachai. |
Thailand's capital market will face increasing pressure over the next few years from the trends toward regionalisation and globalisation, says Thirachai Phuvanatnaranubala, the secretary-general of the Securities and Exchange Commission.
Moves toward market integration and consolidation worldwide will challenge policymakers to consider the direction Thailand should follow, he said. Plans for an Asean Economic Community by 2015 also represent both an opportunity and threat to the local market.
Given these trends, Mr Thirachai said, the SEC itself also had to change.
Over the past several years, the market regulator had focused on strengthening information disclosure and investor protection. Looking ahead, the priority will shift more toward encouraging product development, business innovation and building up the competitiveness of the capital market.
Mr Thirachai pointed to London's AIM and Singapore's Catalist as two self-regulating exchanges that offered greater flexibility and lower regulatory costs for companies and investors alike.
The SEC also aims to help businesses regulate themselves and adhere to established codes of conduct. The shift will help reduce regulatory costs, which in turn will strengthen Thailand's competitiveness and benefit businesses and investors.
''We plan to decentralise some parts of our three duties _ enforcement, standards and licensing _ to self-regulated organisations, similar to other developed markets. But surveillance will still be maintained with the SEC,'' Mr Thirachai said.
The Thai Bond Market Association has already been given SRO (self-regulating organisation) status, with asset management and securities firms likely to follow.
Mr Thirachai said the SEC would also ease the restraints placed on businesses under its supervision. It would adopt a ''negative list'' approach, under which operators could conduct any business except those explicitly prohibited or restricted. This is in contrast to the ''positive list'' now used.
But while market intermediaries would gain greater leeway in developing new products and services, change could only come once investors themselves understood the importance of protecting their own rights, rather than depending on regulators to do so on their behalf.
''We have to consider where we are in relation to other markets. Capital markets today compete based on efficiency and operating costs,'' Mr Thirachai said.
But how quickly and to what extent Thailand's markets integrate and open to the global market are not necessarily questions for the SEC.
''I think these questions, which relate to how resources and opportunities are allocated among different groups, are best left to the political sphere,'' he said.
Various policy choices would present opportunities to some groups at the expense of others, he acknowledged.
''For instance, if we want to focus on investors or those seeking to raise funds from the capital market, we should allow free investment abroad as well as open up restrictions to foreign investment. But if we want to protect local brokers, then we must limit the number of foreign players. This is a question of policy, of resource allocation, that is the essence of politics.''
But Mr Thirachai said that actual operations and market supervision must remain independent of political influence. ''Regulatory enforcement must be one hundred percent free from politics. No, one million percent.''
Recent changes to the SEC Act are aimed in part at ensuring independence.
The SEC chairman, previously the finance minister in practice, now is elected. Both the chairman and the secretary-general will also be selected by a search committee, rather than appointed by the finance minister.
The SEC board, meanwhile, will have its duties limited to setting broad development policy, while rules will be set by a new Capital Market Supervisory Board composed of SEC executives and private-sector representatives.
The first SEC chairman under the new structure is Vijit Supinit, a former chairman of the SET and a former Bank of Thailand governor.
Prev
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
Next
