KATHMANDU, May 7: Santosh Narayan Shrestha, the Chairman of the Securities Board of Nepal (SEBON), has been accused of demanding commissions through intermediaries in exchange for approving IPO issuances—a matter that has now reached the parliament.
During Wednesday's session of the House of Representatives, opposition lawmakers raised the issue during an emergency hours discussion and demanded action against Chairman Shrestha.
Madhav Sapkota, a Member of Parliament from the CPN (Maoist Centre), called for an investigation into the matter, pointing out that such actions by the head of a regulatory body discourage hydropower companies—especially at a time when the government has set a goal to produce 28,000 megawatts of electricity in the next ten years.
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Sapkota said that it is a very serious issue for the Chairman of SEBON to demand a commission for performing his official duties. He urged the Speaker Dev Raj Ghimire, to direct the government to initiate an investigation into the matter.
Sapkota stated, "It is deeply troubling and serious that SEBON is demanding commissions from hydropower companies in exchange for IPO approvals. I want to draw the government's attention to this issue. I also urge the Speaker to issue a ruling instructing the government to conduct a credible investigation.”
Roshan Karki, a Member of Parliament from the Rastriya Prajatantra Party, also called for action to be taken against SEBON Chairman Shrestha.
The Independent Power Producers Association Nepal (IPPAN) held a meeting in Kathmandu on Tuesday, where it decided to draw the attention of SEBON Chairman Shrestha to the issue of commission demands being made through intermediaries.
IPPAN resolved that if IPO issuance approvals are still not granted smoothly even after raising the concern, they will launch pressure-oriented programs to push for action.
There are currently 89 companies awaiting approval from the SEBON to issue IPOs, out of which 43 are hydropower companies. These 43 hydropower companies have applied for permission to issue IPOs worth a total of NRs 19.44 billion. Hydropower project promoters have stated that they are suffering significant financial losses due to SEBON’s delay in granting IPO approvals. According to them, they have already spent Rs 4.96 billion just to cover bank interest payments.
Since Shrestha was appointed as SEBON Chairman, only seven companies have been granted IPO approval in the past five and a half months.
