Kathmandu. Investors have questioned the government, saying that the capital market worth more than Rs 46 trillion is running on the basis of the old Securities Act of 2063. Khagendra Raj Kandel, general secretary of the Nepal Stock Market Investors Association, has demanded immediate introduction of a new securities act, accusing the old law of promoting insider trading, market manipulation, policy corruption and impunity.

Kandel said that the provision of only a simple penalty compared to the profit from illegal transactions is not effective and it is like a ‘service charge’. He said that in the new N, there should be a provision for a fine of at least three times the illegal gains, confiscation of illegal income and compensation to the aggrieved investors.

According to him, although modern practices such as Demat, online transactions, book building, margin trading and cyber risk have developed, the legal basis for regulating them is still weak. He claims that the rights and responsibilities of SEBON, NEPSE and CDSC are also not clear.

Kandel said that a defamation case of Rs 40 crore has been filed against him for raising his voice against the wrong activities of the market and said that the state should immediately intervene to maintain financial governance in the capital market. The Investors Association has also submitted a draft of the new Securities Act along with proposals related to the expansion of regulatory powers, cyber security and accountability to the committee.