Fresh move on to bring MNCs to share market

Dhaka,  Wed,  20 September 2017
Published : 18 Aug 2017, 22:11:44
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Fresh move on to bring MNCs to share market

The government has taken a fresh move to bring multinational companies running their businesses profitably in Bangladesh to the capital market as it thinks that the market has now got a much more solid ground compared to any other time, reports UNB.

The Finance Ministry has sent a letter to various ministries, regulatory bodies, National Board of Revenue (NBR), Bangladesh Bank, Dhaka Stock Exchange (DSE) and Chittagong Stock Exchange (CSE) in this regard.

"We sent the letter on July 31 and asked them to come up with their suggestions within this month how the multinational companies could be brought to the capital market," a senior official of the Finance Ministry told UNB.

The official said the next steps will be taken once the suggestions from these institutions are available.

While speaking at a pre-budget discussion with the Economic Reporters' Forum on May 13, Finance Minister AMA Muhith said time has come to bring the multinational companies to the capital market. "There were no rules and regulations and laws for the share market, but the stock market has bounced back and it is no more a kerb market," he said.

According to the rules of Company Law, if the paid-up capital of any public limited company exceeds Tk 400 million, it is compulsory for the company to get enlisted in the capital market within one year.

The regulation is three years for banks and insurance companies once they become public limited companies.

If any company fails to get enlisted in the capital market within the stipulated timeframe then it can get six months additional time showing logical grounds.

For violation of this rule, there is a provision to impose a fine of Tk 1000 a day for the insurance companies, but there is no such regulation for multinational companies. The cellphone companies have the restriction to join the share market after being profitable.

The Finance Ministry thinks that the country's capital market has made a turnaround for various pragmatic steps of the government. Besides, the foreign investors are increasing their investment in the market.

According to official data, 296 companies so far have got enlisted in the Dhaka Stock exchange. Currently, there are 41 multinational companies in the country. The number of shares of listed multinational and joint venture companies is 17m which is only 7.0 per cent of the market capital.

Grameenphone was the last multinational company in the country that joined the stock market in 2009.
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