Securities broker is a regulated securities activity under the Securities Act, 2015 and all securities brokers are required to be licensed with the SECP for offering brokerage services to the general public. Licensing of the securities brokers is regulated by the Securities Act, 2015 read with the Securities Brokers (Licensing and Operations) Regulations, 2016 (SB Regulations).
The regulations prescribe the eligibility conditions, licensing procedure, effect for refusal of licence, renewal, general obligations and responsibilities of securities brokers. A Trading Right Entitlement Certificate (TREC) holder of the Pakistan Stock Exchange Limited (PSX) desirous of acting as broker shall make an application to the SECP in terms of regulation 5 of the SB Regulations for grant of licence through PSX.
Grant of Licence
The SECP, if satisfied that the applicant is eligible for licence as a securities broker and in compliance with the provisions of the Act, these regulations and any directives/guidelines/codes issued thereunder and that it is in the interest of the public and the capital market, may grant licence as securities broker to the applicant. The licence of a broker shall be valid for one year.
Renewal of Licence
The licence is renewable on payment of fee as prescribed in the Schedule I of the SB Regulations. Requirements for renewal of licence are stipulated in regulation 9 of the regulations.
The detailed procedure for grant /renewal of licence as securities broker is provided in the Securities Brokers (Licensing and Operations) Regulations, 2016