The Securities Board of Nepal (SEBON) has published the draft of the “Directive on General Eligibility for Public Issuance, 2083” for feedback from stakeholders.

The proposed directive aims to establish a more transparent and systematic framework for determining which companies are eligible to issue securities to the general public. It also seeks to strengthen investor protection, corporate governance, financial discipline and transparency in Nepal’s capital market.

The draft introduces a risk-based IPO eligibility framework that would consider the nature and characteristics of different industries.

The initiative follows Point No. 1 of the Capital Market Strengthening and Revival Action Plan, 2083, which was publicly released by the Ministry of Finance on Bhadra 29, 2083.

The proposed directive would apply to companies seeking to issue securities to the general public, companies that have converted into public companies and intend to conduct a public issue, and other institutions authorized to conduct public issuance under prevailing laws.

The draft covers general and financial eligibility criteria for companies planning an IPO. It also proposes requirements concerning corporate governance, the eligibility of promoters, directors and management, information disclosure and prospectus preparation.

Other provisions address due diligence and professional responsibility, utilization and monitoring of funds raised through public issuance, post-issuance obligations, regulatory compliance and supervision, as well as offences, penalties and administrative actions.

SEBON has asked concerned stakeholders to submit comments, suggestions and feedback on the proposed provisions within seven days from the publication of the notice. Feedback can be submitted to SEBON at [email protected].

SEBON said the directive is part of its broader market development and reform program and that it remains committed to implementing the measures outlined in the government’s action plan within the specified timeframe.

According to the regulator, the proposed framework is expected to make the public issuance process more systematic, transparent and timely while bringing it closer to international practices and standards. SEBON also expects the framework to facilitate the entry of eligible companies into the capital market and improve the environment for raising capital from the private sector and the general public.