As part of its mandate to develop an efficient and transparent securities market, the Ghana Securities and Exchange Commission (SEC) is working towards the development of an over-the-counter (OTC) securities market in Ghana, according to Standard Bank.
The SEC believes that the OTC market has an untapped potential that can provide access to capital for small and medium scale enterprises which make up Ghana’s large and fragmented private sector. The enterprises find it difficult to access cheaper sources of capital and those who wish to turn to the GSE find it difficult, by virtue of their size, to meetthe requirements and the disclosures demanded of them by the securities industry’s laws.
The OTC market currently exists in Ghana but is not very transparent, with price discovery virtually non-existent while and transaction processing is burdensome.
Developing of an OTC market will necessitate some re-definition and clarification of certain SEC rules and regulations. Questions have been raised around the definition of a public company, the categories of companies that will fall under the purview of the SEC, the body which will organise the market, and what the disclosure requirements and reportingstandards for the OTC market player, will be.