Clearer penalties in amended securities law
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The National Legislative Assembly has approved the amendments to the Securities and Exchange Act, aimed to clearly specify market misconduct and civil penalty.
"The amendments had been screened by relevant experts to improve the enforcement efficiency and cope with today's market misconduct which becomes more complex. Aside from market misconducts and civil penalties, the amendments also seek to support new types of securities and the issuance of securities by foreign companies," said Sakarin Ruamrangsi, assistant secretary-general of the Office of Securities and Exchange Commission.
The amended securities law will take effect after royal endorsement.
Market misconduct is divided into four categories and clearly defined in the amended version. They include intentional disclosure of falsified or misleading information as well as insider trading by listed companies' directors and executives. By law, any transactions by directors and executives during the time when their companies make significant decisions will be assumed to be based on inside information.
There have been calls for stronger actions on insider trading following the purchases of Siam Makro shares by CP All's three board members. At the time, CP All was in talk to take over Siam Makro.
The three persons were fined by the SEC but were allowed to keep their jobs.
A civil penalty committee will be set up mainly to deal with the disclosure of misleading information as well as directors or executives' failure to uphold fiduciary duty. If the individuals in question agree to settle fines, all criminal and civil charges against them will be automatically dropped. In case of no settlement, the charges will go the civil court. The attorney general will chair the committee.
