Fondul Proprietatea To Be Traded On Brokers" Platform

• Dan Paul: Tests on the new platform start today

The Brokers Association is one step away from introducing Fondul Proprietatea for trading on the Romanian Over-The-Counter (ROTC) platform, an event which many investors have been anxiously expecting for some time.

The alternative trading system was cleared by the National Securities Commission (CNVM) last week, pending final discussions with the issuers, which would be the last step before trading may begin.

The actual commissioning of the alternative trading platform has entered the final stage of preparations, and could take place next week, according to Dan Paul, President of the Brokers Association, contacted by BURSA.

"Brokers will start running tests on the platform on Monday (i.e. today) and, after a few days of discussions with the Central Depository about the traded issuers, we hope to perform the actual commissioning next week," Paul told BURSA.

Fondul Proprietatea shares used to be traded via classifieds for prices that were simply insignificant, compared to the value of the Fund"s assets, which had reached some 3.5 billion EUR. For comparison, Fondul Proprietatea"s asset value is ten times more the average asset value of one of the financial investment firms (SIFs), which together generate over 40 per cent of the turnover of the Bucharest Stock Exchange (BSE).

The brokers also plan to bring to the ROTC most of the several hundreds of companies that were de-listed from the Bucharest Stock Exchange and left numerous captive stockholders, as well as a number of companies that have never been listed, the general idea being to leave the liquidity of the regulated market unaffected.

In order to be traded on the ROTC, companies need to be registered with the Central Depository and to have their memorandum of association cleared of any pre-emptive clauses that may affect free trading.

The National Securities Commission (CNVM) will take a commission of 0.15 per cent of the value of the transactions performed on the ROTC, whereas the brokers" margins will be similar to those applied on regular markets.

The project is designed exclusively for the brokers who are members of the Brokers Association and who thereby acquire by default the capacity of ROTC Participant. Brokers who used to be members of the Association and now want to sign up again, will have to cover a number of additional costs.

Approved by the General Meeting of the Brokers Association in September, the alternative trading system ROTC has been developed in partnership with the law firm Schoenher.