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How DBR Affects YouEvolution from MBR to DBR Securities regulation in Malaysia has evolved in a gradual and orderly fashion from an MBR to a DBR regime since 1996. Prior to 1996, under the MBR regime, the SC assumed a paternalistic and interventionist role in the issue of securities. By interspersing itself between issuers and investors and ensuring in so far as possible (based on the representations made by the issuers) that only quality information are made available to investors, the SC shielded the investing public and reduced the possibility of investors being exploited by unscrupulous individuals or corporations. This significantly enhanced the level of investor confidence and provided a sound foundation for the development and growth of the Malaysian capital market. However, as our market matures, it requires a more competitive and market-driven approach towards the regulation of the issue of securities. In 1996, the SC initiated and embarked on a programme that would gradually shift the regulatory focus on issue of securities from MBR to DBR. Under a DBR regime, as long as the issuer adheres to prescribed standards and makes full disclosure to investors, there would be minimal intervention by the SC. In 1996, the SC embarked on a shift in its regulatory philosophy with the phased approach towards a DBR framework. The SC envisioned the move towards DBR taking place in three phases. Phase 1 (1996-1999) was a flexible MBR with enhanced disclosure, due diligence and corporate governance while Phase 2 (2000) promoted accountability and self-regulation. The SC will implement Phase 3, the final phase of the DBR programme in 2003.
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