FE Report

Hearing on the writ petition relating to mutual funds resumes today (Wednesday) at the High Court Division of the Supreme Court.

The High Court (HC) earlier adjourned the hearing thrice. Investors filed the writ petition as the Securities and Exchange Commission (SEC) a year ago made changes in the mutual fund rules, restricting fund managers from issuing rights or bonus shares.

"Actually, there will be no verdict on the writ Wednesday, just further hearing on it will be held," said Barrister Shafiqur Rahman, who moved the petition along with eminent lawyer Dr M Jahir.

Challenging the amendment by the SEC, three individual investors filed the writ petition with the HC in August last year.

After filing of the writ, the court directed all the listed mutual funds to make sure that no dividend was declared by any mutual fund manager until disposal of the case.

Share prices of mutual funds have been swinging for a couple of months centring on hearing on the case.

"Whatever the verdict is, the matter should be resolved as early as possible," said a fund manger. "Because, investors were not getting dividend," he said adding that the investors might lose their interest in the growing mutual fund industry.

On June 26 last year, the SEC decided in principle to review the Mutual Fund Rules, 2001 and sought opinions and recommendations from the public.

On June 22, 2008 it formally approved the changes in the rules that barred the close-end mutual funds from offering bonus share as dividend or rights issues in a bid to increase their capital base.

Earlier, the SEC and Dhaka Stock Exchange called upon the law minister and the attorney general separately and also jointly to dispose of quickly the mutual fund writ and other stock market-related cases to bring an end to sufferings of the investors.