The Commission fully endorses and supports the measures proposed. Through the activities announced in its corporate plan, unveiled earlier this year, the Commission is well positioned to facilitate the translation of policies announced into reality.

In response to queries from the press, the Commission would like to provide clarification on some of the matters raised.

Time frame for approvals
Since June 1993, the Commission has undertaken a comprehensive study of the reason for delays in the processing of applications. As a result of the study, it has adopted internal benchmarks for eleven classes of applications which it processes. Our statistics indicate that apart from extraneous factors beyond the control of the Commission, the SC is currently meeting the benchmarks for a large majority of the classes of applications.

The decision by the Minister recognizes the constraints of the fragmented regulatory framework, which has become a drag to speedier approvals. The SC is not the only agency involved in the approval process -- the Ministry of Trade and Industry, the Government valuer, the Foreign Investment Committee, the Registrar of Companies, the Rating Agency of Malaysia and Bank Negara are involved in aspects of various types of transactions.

On its part, the SC will leave no stone unturned in further speeding up the process, but the co-operation of other agencies is vital to ensure that the time frames are met.

The completeness of submissions is another matter highlighted by the Minister, and issuers and their advisors must also play their part to ensure that the submissions made are complete in terms of the information required. In so doing, they will be helping themselves.

The SC has made know its intention to move away from the present system of merit regulation, to a system of disclosure based regulation. This will further accelerate the process of raising capital. At the same time, this move will inculcate higher standards of accountability on the part of companies, their directors and advisors in matters relating to the disclosure of information that investors reasonably need to know in order to assess the risk and return of securities offered to them.

Reduction of levy
The reduction of the levy of one basis point is well timed to coincide with the reduction of transactions costs through the introduction of a graduated scale of commissions. The SC sees the move as part and parcel of the move to reduce the cost to investors of using the stock exchange. Although it will have an impact on the future cashflows of the SC, the Commission will make efforts to adjust to the reduction without impairing the quality of its work in the regulation and development of the capital market.

The location of fund management activities
The government's role to create a conducive environment to attract foreign fund managers. The decision on whether they decide to choose Kuala Lumpur or Labuan or any other location in this region is a matter of their commercial judgement.

Of course, Labuan has an advantage from a tax and exchange control perspective. In terms of the critical mass of skills and human resources, Kuala Lumpur may have more to offer.

Infrastructure projects
SC has developed a new set of guidelines for the listing of infrastructure projects and is in the process of consulting with various industry groups such as issuers, merchant banks, advisers and standard setters.

It is intended that the guidelines would apply to infrastructure projects for which a concession or licence has been awarded by a government or state agency for a certain period of time. The infrastructure project must also be of substantial size and is able to generate income in an amount sufficient to give a suitable rate of return to shareholders. Since infrastructure projects would not have the earnings track record when they apply to be listed on the exchange, the SC would be concerned about the future cashflows and risks of the project. The viability of the project must also be validated by independent and reliable experts. High standards of due diligence would be imposed on the company, its management, the advisers and experts, whose representations would be relied upon in the assessment of the viability of the project. In this connection, the SC is in the process of developing Best Practices for Due Diligence for various market participants.