KATHMANDU: Shareholders classified as major shareholders of listed companies will now have to notify the company at least 15 days before selling 5% or more of their total shareholding.
The Securities Board of Nepal (SEBON) on Tuesday directed the Nepal Stock Exchange (NEPSE) to implement the new disclosure requirement. The information must first be submitted to the concerned company, which will then publish it through NEPSE. The disclosure will remain valid for three months.
SEBON said the measure aims to improve market transparency and ensure that investors are informed in advance when major shareholders plan to sell a significant portion of their holdings.
Under the Companies Act, shareholders holding at least 5% voting rights in companies with paid-up capital below Rs 250 million, and those holding more than 1% in companies with paid-up capital above Rs 250 million, are classified as major shareholders.
SEBON spokesperson Tolakanta Neupane said the requirement was introduced to ensure that the public is informed when shareholders with significant ownership exit a company.
SEBON has also directed NEPSE to facilitate mobile-based secondary market trading and ensure the uninterrupted operation of its official demo trading platform for new investors and students.
The regulator has ordered an IT audit of the Trading Management System (TMS) following complaints from investors and asked NEPSE to identify and prevent orders generated through AI or other automated technologies until further arrangements are made.
SEBON has also instructed NEPSE to develop a new benchmark index based on free-float shares while retaining the existing NEPSE Index as an all-equity index. The circuit-breaker mechanism and other index-related arrangements are also to be reviewed.
The regulator has further called for improvements in company classification based on financial condition, liquidity and corporate governance, as well as reforms in the method used to determine the opening price of newly listed companies.
SEBON said the directives are part of the implementation of regulatory reforms outlined in the Capital Market Development Roadmap 2083 and the fiscal year 2083/84 capital market policy and programme.
