stock broker license requirement

 Do you want to open broker company in Nepal: only in 5 minute, learn the procedure to open the broker company in Nepal in this blog.

Table of content

• How to open the securities brokerage company?
• Circumstances of Refusal

How to open the Securities brokerage company?

At first you have to incorporate the body corporate (public company) registered under section 3,4 and 5 of the companies act with objectives of securities business. After that you have to apply with fees and following documents to SEBON:

1. Memorandum of association, Articles of association and Registration certificate of the  company.
2. Documents proving minimum paid up capital of 2 crore.
3. Details of Infrastructure
4. Commitment that investor interest shall be protected 
5. feasibility study report along with types of securities business to be conducted
6. 3 years business plan with projected financial
7. copy of board resolution to start securities business
8. Details of board of director, substantial shareholder and high level employee
9. Audited financial statement of previous year
10. Details of formal agent
11. Agreement with formal agent
12. Recommendation from stock exchange if any
13. Tax registration certificate
14. Declaration that not being blacklisted in CIB
15. Types of securities business to be operated

• securities brokerage
• securities trade
• Issue and sales management
• investment management
• investment consultancy service
• collective investment fund management
• securities registration or securities central deposit service or custodial service
• service relating to the settlement of the account of securities transaction
• market maker
• such other business as may be specified by the board to be a securities business

Inquiry, on satisfaction, update its register and issue license. while issuing license, SEBON may specify certain terms and condition and it shall be the duty of concerned securities business person to comply with such terms and conditions.

securities brokerage and investment consultancy service provider need not be public companies.

Circumstances of Refusal

Inquiry, and may refuse to issue the license under the following circumstances:

1. SEBON thinks that investor interest may not be protected
2. SEBON thinks that no new securities business person is required
3. Insufficient document
4. unsigned document
5. Untrained or unqualified agent
6. unsound financial and social status
7. Incompetent to carry on securities business

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(Note: The  above mentioned information is extracted and present in summarized manner from securities act, 2063)

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