SEC mulls hiking futures trading fees

SEC mulls hiking futures trading fees

The Securities and Exchange Commission office.
The Securities and Exchange Commission office.

The Securities and Exchange Commission (SEC) plans to replace the annual fee it charges the Thailand Futures Exchange (TFEX) from the existing 2 million baht per year to 0.05 baht per contract, with a minimum annual collection of 2 million baht.

The current annual trading fee charged by the SEC for investment products traded on the TFEX is 2 million baht, the rate in effect since 2011. 

No annual fee was charged when the TFEX was first established in 2004.

The reason given for the hike is that trading volume on the TFEX has grown steadily, now averaging about 550,000 contracts per day on a year-to-date basis.

SEC secretary-general Ruenvadee Suwanmongkol said the new fee structure for TFEX is appropriate, given that the higher volume has increased the costs of operations and regulatory management by the SEC.

Securities firms, however, view the new rate as quite high and believes the TFEX may pass on the cost to brokers, who would then pass it on to investors. Brokers have asked the SEC to reduce the planned fees to ease financial burdens.

The SEC is still assessing the new fee structure and will evaluate opinions received from business operators, the Stock Exchange of Thailand (SET) and other stakeholders in the capital market.

But the SEC will maintain the fees collected from brokers for securities and derivatives at the existing 0.001 baht per trade, capped at 10 million baht per year.

For the commission collected from brokers’ trading of futures products, the SEC will uphold the trading fee of 0.01 and 0.10 baht per contract in line with the reference price of a futures product, which has been in place since 2017.

Securities companies also have an obligation to pay the SET a trading fee of 0.005 per trade and a clearing fee of 0.001 baht per trade. There is also a fee for holding securities in clients’ trading accounts of 1.50 baht per month per every one million baht.

These obligations are not under the SEC’s regulatory jurisdiction, but between the SET and its member brokers.

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