Regulatory organization Security and Exchange Commission (SEC) has taken some initiative to develop the existing Over The Counter (OTC) Market.Both DSE and CSE has already submitted their preamble to the respective committee for the development of OTC. SEC has ordered the committee that was formed earlier, to evaluate those preamble provided by two stock exchange and submit a final Specific proposals to SEC.Some of the key proposal recommended by the committee to develop the OTC market are :
1. Diversify the market to a new level where both buyer and seller will have equal control over the market.At the present situation sellers enjoy more privilege than buyers in terms of setting the price.
2. In order to bring back those companies listed in OTC market to main market, an open discussion with the management board and with the stock exchange authorities can be effective solution.
3. Companies listed in OTC market, who don’t have any program, their future can be determined by resolution, taken jointly by two stock exchange.
4. Both stock exchange will have to Check all papers and documents of companies listed in OTC market before raising any suggestion regarding those companies.
SEC has issued a written order to the committee that was formed earlier, to evaluate those preamble provided by two stock exchange and submit a final Specific proposals to SEC within the next two month.Earlier on 19 April, SEC formed a committee of four members with Executive Director of SEC Forhad Ahmed as the addresser, to set directive for those companies listed in the OTC market.
OTC market was first established in DSE In 5 October 2009.Mainly, those companies of share market with poor or weak fundamental are listed in OTC .Beside this, companies that don’t maintain annual general meeting or do not pay any dividend to it’s share holders are also listed in OTC market.