New Directive by Securities Board of Nepal: Mutual Fund IPO Sales Restricted for Six Months After Allotment

The Securities Board of Nepal (SEBON) has issued a directive that affects Mutual Fund Schemes, prohibiting the sale of Initial Public Offerings (IPOs) until six months post their allotment. As Per the directive, a minimum of five percent of shares offered for public issuance by institutions are reserved for mutual funds.

Under the Mutual Fund Regulations, 2067, shares purchased by mutual fund schemes cannot be publicly offered for sale or transfer until at least six months have passed from the date of allotment.

This directive is set to be enforced from Kartik 21, 2080. The CDS and Clearing Limited, along with all fund managers, adhere to this new framework. In the event of the scheme's completion or termination, prior to the designated timeframe, the mutual fund may sell or transfer the shares it holds during its ownership of the fund.