Банкеръ Weekly

Briefs

PUBLIC OFFERING OF SECURITIES ACT APPROVED ON FIRST READING

The Chairman of the Parliamentary Economic Policy Commission Valeri Dimitrov will move between the first and second reading of the Bill on Amendments to the Public Offering of Securities Act a proposal for deleting the amendments in article 119, it became clear on January 26, when the commission approved the draft on first reading. Article 119 stipulates the criteria for a company to be written off the register of public companies without obliging its owner to make a tender offer. The amendments stipulate considerably higher criteria which gives a possibility for an easier administrative deletion from the register. During the second reading of the bill, amendments will be also proposed to part 4, which regulates the establishment and activities of a fund for compensating investors in securities. The fund will be guaranteeing investments up to BGN40,000. This means that if a certain investment underwriter becomes insolvent, his clients' investments will be compensated by money from that fund. On January 13 the Economic Commission received a letter from a great number of investment underwriters, voicing their concerns regarding the high amount of instalments they will have to make into that insurance fund. The draft bill stipulates that they should annually remit 0.5% of their clients' assets into the fund. On similar capital markets that instalment is much lower - between 0.09 and 0.016 per cent. Representatives of the investment underwriters expressed dissatisfaction with the fact that the insurance fund will be guaranteeing clients' assets, including money and securities. According to them, shares and bonds are not an obligation of the underwriter to his clients.

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