FAQ's for investors
1. How am I protected as an investor?
Ans: Regulation by SEC/Exchanges and other operators through the process of registration, rule making and establishment of Investors Protection Fund (IPF).
2. How can I purchase shares?
Ans: Through any registered stockbroker of your choice by indicating precisely what you want or based on his advice; or through the Receiving Agents named in the offer document/prospectus in case of primary issue.
3. How can I sell shares?
4. What steps can i take to recover my share certificate, dividend, and bonus that i have not received?
Ans: Confirm that your broker has bought the shares as instructed, if yes, contact the registrars to the issue; if the matter is still not satisfactorily resolved, then lodge a complaint to SEC.contact us or file a complaint
5. What is the period between the closing of a public offer and listing of the company on the stock exchange?
Ans: This question relates to a firm underwriting where the underwriter pays the issuer all the proceeds of the issue, immediately the securities are registered and in turn, the underwriter takes the responsibility of marketing and listing of the securities.
In most jurisdictions, especially in the developed economies, the underwriter takes the responsibility of marketing and listing of the Securities and provides from day one the total issue proceeds to the issuer. But in our jurisdiction, at least 90% of underwriting is on a stand by basis.
All public issues are to be underwritten except where the issuer specifically requests in writing for non-underwriting. - Where there is an underwriting, the warehoused Securities shall be sold within six (6) months from date of allotment to the underwriter.
Sale of warehoused Securities may commence not earlier than ten (10) days from date of filing of memorandum of sale with the SEC.
6. Can a public quoted company do a private placement?
Ans: No. Only public unquoted Companies (i.e not on the stock exchange) are allowed to do Private Placements.
7. How does the commission monitor the activities of operators?
Ans: This is done at two levels (on-site and off-site):
- Off-site (i.e. In the commission’s offices) review of returns - all registered operators are required to submit quarterly returns of their activities to the commission for analysis. The returns consist of financial statements as well as other information prescribed for disclosure. These returns are reviewed to ascertain the financial health of the operator and to detect early distress signals. All observed deficiencies are communicated for remedial action.
- On-site inspection (in the operators’ offices) the commission’s officials visit the offices of operators in a programmed and co-coordinated manner. This is aimed at ascertaining compliance with due process in the execution of clients mandate as well as adherence to best market practices.
8. Does the commission ensure that funds obtained from the market by state governments and companies are utilized for the approved purposes?
Ans: Yes. All organizations that obtain funds from the market are expected to prepare and submit statutory returns on utilization of issue proceeds to the commission for review. The returns are reviewed for compliance with the utilization plan approved in the offer documents. Thereafter, on-site inspection is conducted to corroborate information disclosed in the returns and cases of deviation from the approved plan attract appropriate sanctions. The commission may engage the services of other professionals to complement