Public limited companies (PLCs) will have to obtain due diligence certificate and preliminary consent from the stock exchanges before getting regulatory consent to go public, officials said.
The Bangladesh Securities and Exchange Commission (BSEC) has included such provision, among others, in the draft of the proposed amendment brought to the exchanges' listing regulation.
The regulator has finalised the draft of uniform listing regulation for both the bourses instead of separate regulations.
"A company will submit its IPO (initial public offering) proposal to both the exchanges and the securities regulator. The regulator will start the job for approving the proposal just after receiving exchange's consent and due diligence certificate," said a senior official of the securities regulator.
As per the proposed listing regulation, a stock exchange will not be bound to give listing to a company if that exchange finds the ground of negative consent.
"The regulator will start the job of approving the IPO proposal if the company gets primary consent from any of the exchanges. The exchanges of other countries such India are following such practice in an effort to create competition," the BSEC official said.
The BSEC has also discussed the proposed provisions included in listing regulation with both the exchanges.
"We will again sit with both the exchanges and the amendment is likely to be approved very soon," the BSEC official said.
He also said that both the exchanges have agreed with many changes included in the listing regulation.
As per the proposed amendment, the companies willing to go public must have dedicated website and any disclosures will have to be posted on website within five minutes of taking decision.
And the companies will have to conduct the auditing job choosing the audits from the panel formed by the securities regulator.
While conducting scrutiny the exchanges must be sure whether the companies follow the corporate governance guideline.
"The companies will have to open dedicated investors' relation team to fulfill any query of the investors," the BSEC official said.
The exchanges will give listing approval within 30 days of completing the subscription.
Both the exchanges have said that their responsibility will be increased in giving NOC.
As per another provision of listing regulation, financial disclosure of the listed companies will have to be more inclusive.
Listed companies will have to announce the date of quarterly and half yearly disclosures at least five working days before making the disclosure.
"Presently, the listed companies announce the date of annual disclosures only. As per international practice, we have incorporated same provision for quarterly and half yearly statements so that investors can be prepared for any kind of disclosures," said a senior BSEC official.
DSE managing director Dr Swapan Kumar Bala said the responsibility of the exchanges will be increased for giving preliminary consent and due diligence certificate.
"Exchange will try to give its best efforts in scrutinizing the companies' prospectus. But I think the 15-day timeframe, which is mentioned in public issue rules, is not enough to complete the scrutiny of company papers," Mr. Bala said.
Mr. Bala also stressed on availability of the companies' prospectus on website to ensure the scope of public scrutiny.
CSE (Chittagong Stock Exchange) Managing Director Wali-ul Maroof Matin said it must be clear whether the exchange's NOC will be merit-based or disclosure-based.
The BSEC official, however, said the exchanges' NOC is disclosure-based across the world.
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