Firms get 10 more days to apply for brokerage licence
As the initial deadline was scheduled to expire on 18 March, the DSE officials are “yet to know” the information on how many applications have already been submitted
The deadline to apply for a new brokerage licence from the Dhaka Stock Exchange (DSE) has been extended by 10 days to 28 March.
In a statement on Tuesday, the country's premier bourse said its management decided to extend the deadline for application to avail a new brokerage licence technically called Trading Rights Entitlement Certificate (Trec).
As the initial deadline was scheduled to expire on 18 March, the DSE officials are "yet to know" the information on how many applications have already been submitted.
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One of the officials, however, told The Business Standard that a number of businessmen had long been interested in receiving a brokerage licence.
But the call for applications appears to have been a little premature as the interested ones barely got enough time to prepare themselves in line with regulations concerned, they added.
Following the final Trec rules, the DSE invited applications at the beginning of February and asked for Tk1 lakh in application fees from each of the interested companies.
According to the Trec rules, a company must have at least Tk5 crore in paid-up capital before it looks for a Trec. The mandatory capital is Tk8 crore if the firm is a joint venture between local and foreign owners, which is set at Tk10 crore for sole foreign ownership.
In no cases, net asset of the applicant firm can go below the level of 75% of its paid-up capital.
Also, a company will have to keep Tk3 crore with the DSE as the security deposit, which is Tk4 crore for joint ventures and Tk5 crore for foreign firms.
A local firm, if not disqualified on some common specific grounds, must invest at least Tk9 crore in total in the form of paid-up capital, security deposit and the registration fee to get a stock brokerage licence.
The amount goes as high as Tk16 crore if the applicant company is a foreign-owned one while local-foreign joint ventures are required to invest at least Tk13 crore for availing a brokerage licence, according to the Bangladesh Securities and Exchange Commission (Trading Right Entitlement Certificate) Rules 2020.
The applicant firms also must have required manpower with skills alongside fulfilling other criteria such as their ownership and board structure, transparent disclosures for an acquaintance, and tax and credit market compliances.
However, the new licence holders will only get a Trec or brokerage licence, not any share or membership of the bourse concerned, said the rules to outline the way for awarding new stock brokerage licences to non-members of the bourses.
