KUALA LUMPUR (Feb 6): Securities Commission Malaysia (SC) has introduced a new gatekeeping approach that will reduce the time to market for intermediaries and operators.

The Focused Scope Assessment (FSA), a new gatekeeping approach for new eligible Capital Market Intermediaries (CMIs) and Recognised Market Operators (RMOs), is aimed at advancing the capital market and complementing the growing landscape.

According to the SC, the FSA will evaluate the applicant’s operational and regulatory readiness in a more targeted and efficient manner by reducing the time to market for CMIs and RMOs from more than six months to three months.

The FSA, which takes effect immediately via amendments to the Guidelines on Recognised Markets, will also require applicants to have an independent party validating their business policies and procedures as part of their submission to the SC.

SC referred to eligible CMIs to include corporate finance advisers, investment advisers, fund management — boutique portfolio management, financial planners, venture capital and private equities and digital asset custodians.

SC chairman Datuk Seri Dr Awang Adek Hussin said that the FSA reflects the SC’s recognition of the crucial role of micro, small and medium enterprises (MSMEs) in driving the nation’s growth and development.

“As at 3Q2023, the equity crowdfunding (ECF) and peer-to-peer (P2P) platforms have collectively raised approximately RM5.9 billion, benefiting almost 10,000 MSMEs. This commitment to develop a more progressive and robust regulatory framework reflects the SC’s recognition of the crucial role these businesses play in driving the nation’s growth and development,” Awang Adek said.

The SC also made amendments to the Guidelines on Recognised Markets to ensure a level playing field for all RMOs, particularly in terms of the capital requirement and the practices against financial crimes, such as money laundering and terrorist financing.