It is claimed that the separate AIZIN will have a negative impact on Nepal's capital market, investment environment and the plan to bring investment of non-resident Nepalis to Nepal.
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The Non-Resident Nepalese Association (NRNA) has drawn serious attention to the proposal submitted by CDS and Clearing to the Securities Board of Nepal (SEBON) to keep founder and common shares under separate International Securities Identification Number (IZIN).
It is stated in the release that the proposal submitted by CDSC to arrange two eigens of founders and common shares in the process of dematerialization (turning physical shares into an electronic system) of the founding group of companies that are in the process of being listed in the securities market through public issue of shares, may have a negative impact on Nepal's capital market, investment environment and the plan to bring investment of non-resident Nepalis to Nepal .
According to NRNA, if such a proposal is implemented, confusion and disappointment will spread among Nepali founding investors living abroad, confusion will increase in share trading, and there will be a serious impact on the stability and transparency of the capital market in the long run.
"Since the establishment of the Non-Resident Nepali Association, the knowledge, skills and capital of Nepalese abroad have been brought into Nepal, and it is known that the aim of the association is to bring small and medium investments into Nepal in a more organized manner," the statement said, "Accordingly, there is a significant increase in investment by non-resident Nepalis in the fields of energy, infrastructure, tourism, startups and finance."
Investments from non-resident Nepalis in Nepal are an important source of current economic reform and infrastructure development. However, the conclusion of this association is that this proposed guideline will have a great impact on investment in the need to create a comfortable environment for non-resident Nepalis from around the world to participate in the development of Nepal and bring their knowledge, skills and capital into Nepal.
Non-resident Nepalis expect stability, transparency and legal clarity when investing in Nepal. But if the proposed system is implemented, the founding shareholders will face difficulties in selling their shares, there will be a situation where foreign investment cannot be returned and there is a danger that the atmosphere of legal confusion will send a negative message to international investors .
Confidence in the capital market, ensuring investment security and maintaining the confidence of expatriate and foreign investors is the basis of Nepal's long-term prosperity. Therefore, we request the relevant regulatory bodies, especially the Nepal Securities Board, Ministry of Finance and CDSC to reconsider this proposal, evaluate the overall impact through serious discussion and take a balanced decision.
