Prohibited persons, institutions, groups, organizations, etc. are requested not to trade in shares, if they have done so before, to stop and inform the relevant authorities
We use Google Cloud Translation Services. Google requires we provide the following disclaimer relating to use of this service:
This service may contain translations powered by Google. Google disclaims all warranties related to the translations, expressed or implied, including any warranties of accuracy, reliability, and any implied warranties of merchantability, fitness for a particular purpose, and noninfringement.
The Nepal Securities Board has instructed not to trade in the shares of individuals and organizations that are on the United Nations restricted list. By issuing guidance on financial transactions aimed at participants of the securities market, the board has instructed securities brokers, merchant bankers, etc., not to trade shares with such individuals, institutions, groups, organizations, etc.
The United Nations regularly publishes a list of individuals and organizations globally sanctioning individuals involved in terrorist activities, illegal activities, etc. The list is regularly updated and published by the Ministry of Home Affairs of each country. The board has asked not to trade the shares of individuals, institutions, groups, organizations etc. in the same list and to monitor possible such transactions.
"According to sub-rule (3) of rule 69 of the Money Laundering Prevention Regulations, 2081, guidance on targeted financial actions has been issued for securities market participants," the board's directive says, "Based on the said data (database), if any listed person, group or organization or any other person, group or organization associated with it has any assets or funds, the said assets or funds shall be withheld immediately."
The board has also instructed the securities market participants to follow the rules related to prevention of financial investment in the manufacture and expansion of terrorist acts or weapons of mass destruction while conducting their activities. "Reporting to the Financial Intelligence Unit should be done in relation to suspected persons related to prevention of financial investment in terrorist activities or the manufacture and expansion of weapons of mass destruction," the board said.
Nepal has been included in the "grey list" of the Financial Action Task Force (FATF), an international organization that monitors money laundering and terrorist activities. Nepal has been included in the "grey list" due to the neglect of the political leadership in the investigation and implementation of laws related to prevention of money laundering. The second General Assembly meeting of FATF in Paris, France last Friday evening decided to place Nepal on the 'grey list'.
Nepal has made a two-year action plan to get out of the negative list as suggested by FATF. It is mentioned in the action plan to comply with the conditions set by FATF within two years. In one point of the action plan, it is mentioned to stop the share trading of individuals, organizations, groups, and organizations that are on the United Nations' restricted list.
The financial sector high-level coordination committee meeting held last week also decided that all regulatory bodies will issue guidance in this regard. Based on the action plan prepared to get out of the negative list and the decision of the committee, the Securities Board has issued the said directive.
