New SC Guidelines Facilitate Shift to Post-vetting of Prospectuses

Promotes Efficiency of Fund-raising Process

Kuala Lumpur, 27 October 2005

The Securities Commission (SC) today released the guidelines to facilitate the shift from a pre- to post-vetting prospectus registration regime. This measure is expected to further expedite the processing of corporate proposals, boosting the overall efficiency of raising funds in the Malaysian capital market.

The introduction of the revised Prospectus Guidelines by the SC is in line with the announcement of the move to a post-vetting prospectus registration regime by the Prime Minister and Minister of Finance, YAB Dato' Seri Abdullah bin Haji Ahmad Badawi, during the Budget 2006 speech on 30 September 2005.

This latest measure is part of the SC's continuing efforts to liberalise access to the capital market and will significantly reduce turnaround time to register all public offering prospectuses to 14 market days upon submission of a full and complete registrable prospectus. The turnaround time for abridged prospectuses, which are already processed on a post-vetting basis, remains at seven market days.

The revised Guidelines, Practice Note and Procedures on prospectuses and a set of Frequently Asked Questions (FAQs) with further details of the measures and amendments are available on the SC website here.

To facilitate a smooth transition to the post-vetting of prospectuses regime, the SC has held industry briefings and consulted industry and capital market participants, who have provided invaluable feedback for the enhancement of the Guidelines.

The shift to this new regime is made possible with the ever-improving standards of professionalism in the market, consistent with the demands of an enhanced disclosure-based regulatory regime that expects higher standards of disclosure, due diligence and corporate governance.

This move is also a natural progression of the development of the capital market, as envisaged in the Capital Market Masterplan that will see the gradual shifting of accountabilities for market discipline to capital market participants, in tandem with the growing capabilities of intermediaries and advisers.

As a complement to this initiative to promote a more business-friendly environment and increase market efficiency, the SC has enhanced its safeguards by way of surveillance and enforcement operations to ensure that the intermediaries and advisers meet their obligations to conduct due diligence and provide timely, adequate and accurate disclosures in prospectuses.


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