Apr 07, 2016 (LBO) – Sri Lanka’s securities regulator has invited listed companies to send their suggestions on the minimum public float rule as they seem to be struggling meet the rule.
Director General of Securities and Exchange Commission Vajira Wijegunawardane speaking at a forum on the minimum public float said they are flexible in terms of their guidelines.
“We actually don’t want to see companies getting de-listed. The commission is flexible in terms of guidelines,” Wijegunawardane said.
“But we have to understand that these rules are there for a reason. So we would like companies to comply and in terms of timelines, companies might encounter difficulties,”
“So if there is any issue or proposal that you want the SEC to consider please let us know in writing so that we have time to take recourse.”
Wijegunawardane further stated that if a company is willing to comply with guidelines, the commission may look at giving an extension to those companies.
“But if the company is not willing to comply unfortunately it would lead to a de-listing.”
Currently the Colombo Stock Exchange is transferring non-compliant listed companies to its defaults board.
But the ultimate repercussion would be de-listing though the regulator is currently giving a further 9 months extension period on struggling listed companies on a case by case basis.
Speaking at the forum SEC Chairman Thilak Karunaratne said Sri Lanka need a regulation on minimum public holding to compete with other countries.
“20 percent rule for me is quite reasonable. If an extension is needed we can look at it,” Karunaratne said.
“But we are talking about bringing in foreign investments. In fact all the countries are looking for foreign investments. But we have to show something special to foreign investors to attract.”
He added that the government has given them some breathing space by delaying the capital gains tax.