Introduction

Introduction

The establishment and constitution of the Securities and Exchange Commission of Sri Lanka was initially provided for by the Securities and Exchange Commission Act No. 36 of 1987 (as amended by Act No. 26 of 1991 and Act No. 18 of 2003). The said Act has now been repealed and replaced by the Securities and Exchange Commission Act No. 19 of 2021.

Vision

“To become the benchmark regulator in South Asia for effective, efficient and proactive capital market regulation”

Mission

“To promote, develop and maintain a capital market that is fair, efficient, orderly and transparent”

OBJECT AND PURPOSE OF THE ACT

  1. To establish the Securities and Exchange Commission of Sri Lanka;
  2. To create, maintain and regulate a fair, orderly, efficient and transparent securities market ;
  3. To protect the interests of local and foreign investors; and
  4. To ensure the maintenance of high professional standards in the provision of services in relation to securities markets. .

Powers, Duties and Functions

  • To advise the Government on the development of the securities market and to assist in the effective implementation of the policies and programmes of the Government with respect to the securities market;
  • To encourage and promote the development of securities markets in Sri Lanka including research and training in connection therewith;
  • To give general or specific directives or instructions to market institutions, market intermediaries, registered persons, clearing members, trading participants, depository participants, issuers, investors, recognized market operators or such other person or persons as may be necessary to give effect to the provisions of this Act from time to time;
  • To give general or specific directives or instructions to supplementary service providers of market institutions, market intermediaries, collective investment schemes or listed public companies from time to time;
  • To grant a licence to a body corporate to operate as a market institution and to ensure its proper conduct;
  • To grant a licence to any person to operate as a market intermediary and to ensure its proper conduct;
  • To register a person advising clients on sale or purchase of securities for and on behalf of a market intermediary as a registered person and to regulate their conduct in the discharge of their duties;
  • To register any person as a market operator;
  • To issue general or specific directives to listed public companies or listed foreign entities from time to time;
  • To issue general or specific directives to an acquirer, an offeror or persons acting in concert with an offeror or an offeree or a target company in relation to a takeover or a merger of a listed public company;
  • To issue specific directives to any person to prevent the imminent infringement of this Act, regulations or rules and to restrain infringement;
  • To regulate the listing and trading of securities in an exchange;
  • To regulate the issuance of securities;
  • To prohibit or suspend the listing of any securities or to delist the listed securities or to prohibit or suspend the trading of any securities or to take such steps as the Commission considers necessary or expedient for the protection of investors or for ensuring fair and orderly securities market or for ensuring the integrity of the securities market;
  • To employ such officers and servants as the Commission may consider necessary and to fix the salaries and wages or other remuneration and benefits of such officers and servants for the purposes of carrying out the objectives and functions of the Commission;
  • To acquire in any manner whatsoever and hold, take or give on lease or hire, mortgage, pledge, sell or otherwise dispose of any immovable or movable property;
  • To regulate a takeover or merger of a listed public company or any matter connected therewith or incidental thereto;
  • To inquire and conduct investigations into any activity of a market institution, market intermediary, a registered person, a listed public company or a listed foreign entity;
  • To conduct investigations into any alleged violation or contravention of the provisions of this Act or any regulation or any rule or directive made or any instruction given thereunder or by any person and to take any enforcement measures provided under this Act as considered necessary by the Commission;
  • To enter into agreements or memoranda of understanding with any organization or a foreign regulatory authority in relation to any matter which comes within the purview of this Act;
  • To publish findings of wrongdoing by any market institution, market intermediary or registered person, supplementary service provider, any listed public company or any listed foreign entity;
  • To carry out surveillance of securities transactions;
  • To levy fees or charges, for any services rendered by the Commission;
  • To take such steps as the Commission may deem necessary to mitigate systemic risk to the financial system;
  • To give specific or general directions to companies that have made an offer to the public to subscribe for securities;
  • To exempt certain public offers or issues from the provisions of this Act;
  • To appoint experts as the Commission deems expedient for the purposes of this Act; and
  • To do all such other acts as may be considered necessary, incidental and ancillary to the performance of the Commission’s objects, duties and functions under this Act.