Employees have been blocking entry to the office since last Sunday, demanding the chairman's resignation, saying he has played no role in resolving the problem.
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The functioning of the capital market regulator, the Securities Board of Nepal, has been suspended for 45 days. Employees of the Securities Board protested on Thursday, the 45th day, alleging that the Ministry of Finance has cut the services and facilities they have been receiving.
The employees had started the agitation since 7 Asoj. Since then, no work has been done at the Securities and Exchange Board of Nepal. Despite the agitation, the employees had allowed Chairman Santosh Narayan Shrestha and other board members to enter the office until last week. However, since last Sunday, the employees have been blocking the entrance to the office, demanding the chairman's resignation, saying that he did not play any role in resolving the problem.
After the employees blocked the entrance to the office, a meeting of the Securities and Exchange Board of Nepal (SEBON) board of directors was held at the Ministry of Finance on Tuesday. Chairman Shrestha said that the board of directors meeting was held at the Ministry of Finance as there was no opportunity to go to the office. 'Since last Sunday, the employees have blocked the entrance to the office, demanding my resignation. Therefore, since there was no opportunity to go to the office, I have held a board of directors meeting at the Ministry of Finance on Tuesday,' said Chairman Shrestha. 'But despite discussions on various issues, no concrete decision has been made in the meeting.' Chairman Shrestha said that he is still discussing how to resolve the problems of the employees and stop the agitation.
A source said that three options were discussed at the board of directors meeting held at the Ministry of Finance on Tuesday regarding stopping the agitation of the employees. The first option is to implement the Finance Ministry's decision exactly, the second is to send the Finance Ministry's letter regarding the cancellation of services for review, and the third is to authorize the Board Chairman to file a case against the Finance Ministry in court. Although the three options mentioned have been discussed, a concrete decision has not been made on any of the options, the source claims.
The Secretary-level decision of the Finance Ministry on 31 Bhadra had decided to immediately cancel the Securities Board Employees Welfare Fund Procedure 2071 and the Employees Security Fund (Operation and Management) Procedure 2075. The ministry has stated that the aforementioned procedure was canceled because it was issued in violation of Rule 167 of the Nepal Securities Board Employee Service, Conditions Regulations, 2068. The Finance Ministry has also decided to immediately start the process of recovering the amount paid from the fund in the past from the concerned person as government dues based on the procedures made in violation of the prevailing law. The Finance Ministry has also directed that the system of mandatory obtaining the consent of the Finance Ministry before making any decision on financial obligations in the future should be implemented.
The Finance Ministry is aware of the fact that all the activities of the Securities and Exchange Board of Nepal have been suspended for 45 days. But the ministry
has not even discussed reviewing its decision. A Finance Ministry source says that they are firm on their decision and can choose legal avenues if the employees are not satisfied.
Experts say that the stock market has become chaotic due to the regulatory body's inaction for one and a half months. 'The board's employees are on strike. They have not done anything. Brokers and stock investors have benefited from this,' said a securities broker, 'The regulatory body has not looked into it. The frontline regulator, Nepse, has also not been able to work effectively. In such a situation, everyone is in chaos. Whatever anyone does, happens.'
Energy producers say that they have been troubled by the board's inaction. Similarly, the Securities and Exchange Board of Nepal had stopped issuing primary shares (IPOs) and right shares for 28 months. The Independent Power Producers Association (IPPAN) has said that they are facing problems after some companies were allowed to IPO in recent months, but their operations have now come to a standstill. IPPAN says that private sector investors have been discouraged by the Securities and Exchange Board of Nepal's (SEB) delay in issuing shares.
IPPAN complains that the delay in issuing shares has created local obstacles in the construction of the project as shares have not been issued to project-affected locals due to the delay in issuing shares. Even though it has been almost two months since the interim government came to power, not a single file for issuing shares has been moved forward. IPPAN has said that the problem has been compounded by the reduction in the services and facilities of the Securities and Exchange Board of Nepal employees at the same time.
'Due to the unusual situation, the government may have other priorities, but we are also here,' said IPPAN President Ganesh Karki, 'Recently, the number of people demanding shares at the local level is increasing. Who will take responsibility if the project is damaged? We have said enough. There is no place left to take this problem now.’
So far, 43 companies worth 975 MW are awaiting IPO share issuance and 7 companies are awaiting right share issuance, resulting in the failure to issue shares on time by 50 companies, worth 23.27 billion 8 lakhs. As a result, IPPAN claims that the energy sector has lost 108.5 billion rupees. IPPAN says that due to the failure to issue shares on time, interest amount has increased by 12.4 billion 54 lakh rupees and cost by 24.3 billion 67 lakh rupees. IPPAN also stated that 71.78 billion 81 lakh rupees in revenue income has been lost due to this.
