Abuja – The Securities and Exchange Commission (SEC) and the Nigerian Judiciary on Wednesday pledged to collaborate to boost investor confidence in the dispute resolution mechanisms available in the capital market.
This is contained in a statement by the SEC management and made available to newsmen in Abuja.
It said the duo made the pledge at the 2016 Judges Workshop organised in collaboration with the National Judicial Institute (NJI) in Abuja.
According to the statement, the Director – General of SEC, Mr Mounir Gwarzo, said the collaboration was crucial to ensure that the rights of investors are protected.
Gwarzo said the role and responsibility of the Commission as provided in the ISA 2007 included the powers to register, inspect, investigate, discipline and suspend any market operator.
”The Act also gives SEC substantial powers to make rules and regulations and also to impose sanctions on and enforce decisions against erring capital market operators, or their sponsored individuals.
“In pursuance of the above mandate, we leverage on stakeholder engagements to share knowledge and information on areas of mutual interest.
”That is why you cannot downplay the essence of the judiciary, especially in terms of investor’s protection.”
He explained that Investors would be very comfortable to invest if they invested in the market.
He said if they were not able to get what they wanted, they could have recourse to a way and means that the issue could be resolved.
“And the only way such issue can be resolved is when both the capital market and the judiciary are on the same page.
“The judiciary needs to understand the workings of the capital market; the capital market needs to understand the workings of the judiciary; this is the essence of the collaboration, for us to understand each other better,” he said.
According to Gwarzo, capital market encompasses all parts of the financial system where long-term equity or debt securities are bought and sold.
He noted that by definition, such markets were highly specialised and governed by distinct sets of rules and regulations.
He said the Judiciary’s work impacted on market integrity, investor confidence, market development and market fairness as it was clear that without fair, prompt and effective dispensation of justice, capital markets could never develop.
He added that the Commission’s quest to develop a vibrant capital market in Nigeria, could not afford to overlook the central role of the Judiciary.
The Director-General further disclosed that the Commission had so far paid about 530 investors that had invested certain amounts of money ranging from N5,000 to N200,000 and suffered losses.
The statement said the Chief Justice of Nigeria, Justice Mahmud Mohammed, said the workshop could not have come at a better time.
” This is especially in view of the ongoing SEC led capital market reforms aimed at building a world class capital market and the underlying need to boost investor confidence in dispute resolution mechanisms.
Mohammed said a resilient and efficient dispute resolution mechanism was imperative for a strong and reliable capital market.
He added that the entrenchment of sound adjudicatory processes must be seen as a precursor to a world class capital market and so, must be accorded priority.
“All over the world, capital markets are principally established to mobilise long-term capital for investment and productive purposes.
”Capital markets enhance industrial growth and aid socio-economic development by expediting the rate of capital formation, fostering free enterprise, promoting creativity, advancement and good governance.
“Nigeria relies heavily on huge amounts of medium and long term funds for infrastructure development.
”The economy also utilises capital to provide support for entrepreneurship, which in turn promotes growth and creation of opportunities,”he said.
He further said the Nigerian capital market remained the most important source of these long term funds and had continued to perform its conventional function.
The CJN added that the workshop would also afford the participants the opportunity to become better acquainted with other trending issues in the industry.
He listed some of such issues to include the precise role of SEC in the current reforms; the need for regulatory reforms in the capital market; corporate governance and the law.
” Others are procedure of the Investments and Securities Tribunals; the impediments militating against the Nigerian Securities Market and the role of the judiciary in addressing these challenges,” he added.
