Securities and Exchange Commission Thailand


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SEC News Release

No. 96/2006

Monday, December 25, 2006


FSAP, securities business innovations to lead 2007 plan

Bangkok, December 21, 2006 Thirachai Phuvanatnaranubala, SEC Secretary-General, announced at a press conference today the SECs progress and achievements during the year, especially in the areas of corporate governance, securities business liberalization and enforcement.

The SEC also confirmed the Thai capital markets readiness to enter the Financial Sector Assessment Program in 2007 with consistent preparations throughout the years.
The 2006 efforts contributed to major progresses in the following areas:

1. Corporate governance
Highlights of the years corporate governance improvement included the launch of the Annual General Shareholders Meeting Assessment Program, the oversight of information disclosure through financial statements and other reports and the supervision of connected transactions, the disclosure of acquisitions and dispositions of material assets of listed companies to ensure that shareholders are provided with accurate and complete information before casting their votes. 
On legislation, the SEC Board approved the proposal for the amendments to the SEC Act B.E. 2535 (1992). This includes the restructuring of the SEC Board structure to enhance its independency, the stricter roles and responsibilities of listed company executives, the class action legal proceedings to protect the rights of retail investors and the whistle blower protection measures.

2. International roles and standards improvement
On the second consecutive term of chairmanship of the International Organization of Securities Commissions Asia Pacific Regional Committee (IOSCO APRC), the SEC continued the regional campaign for proactive cooperation and assistance in the sharing of knowledge and experience in capital market supervision and encouraged members to become signatories of the IOSCO Multi-lateral Memorandum of Understanding (MMoU) to strengthen borderless consultation, cooperation and exchange of information. The SEC also contributed to the supervisory standards setting at the IOSCOs Implementation Task Force and submitted comments to the International Accounting Standards Board concerning the impracticality of certain accounting principles. To support the improvement of Thai accounting standards towards convergence with the ever-changing international accounting principles, the SEC made a 10-million baht contribution to enhance the operation the Federation of Accounting Professions.   

3. Market development and supervision
In developing the capital market structure to enhance local players competitiveness on the global arena, the SEC encouraged securities companies to introduce new products and services to lessen their dependency on brokerage fees. The SECs launch of the securities business liberalization plan helped securities business operators to get started on their preparations for the full liberalization within five years. 

On the bond market, the SEC amended several regulations to enhance flexibility for the issuance and sale of corporate debt instruments, both onshore and offshore. Launched in April, the derivatives market helped to enhance investors risk management, generating an average daily trading of 1,064 contracts. The mutual fund market continued to grow throughout the year with an increase of 118  funds (as of October 31, 2006) or a 17 percent rise from last years, making a total of 689 funds. On the provident fund market, new 586 employers (as of September 30, 2006) set up provident funds, making a current total of 7,378 employers or an 8.63 percent increase from the previous years with 1.8 million members in total. A positive prospect as it is, the SEC will continue to push for more employer participation in employee retirement savings plans to lighten the retirees dependency on government aids.

4. Enforcement
The legal enforcement on securities business offenses became more efficient thanks to the close collaboration with relevant agencies and the improvement of investigation procedures. Fine settlement cases reached 80, up by 67 percent, with a total fine value of 44.8 million baht or a 193 percent increase from last years. Most of the fines were imposed on insider trading offenses.
On social responsibilities, the SEC management and staff organized several charitable activities such as donations to needy schools and an orphanage for handicapped children, having set a policy to encourage listed companies to devote more energy and resources to social programs. 

The FSAP will be on the top of our priority list in 2007. Throughout the year, we have made preparations in all areas, including the amendments to the securities law and the prevention of money laundering and terrorism financing. We are making sure that all parties will become well-prepared for the assessment.

Next year, the SEC will be working closely with securities business operators in preparation for the full liberalization of securities business licensing in 2012. Also, we expect to see more public hearings on issues of high impacts, particularly those concerning market supervision and product innovation, to promote continual and sustainable market developments, said Mr. Thirachai.


The Securities and Exchange Commission, Thailand
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