The board has drawn serious attention to the news and advertisement of a company like Sagun Inc., which is registered abroad, targeting Nepali investors. Article 27 (1) of the Securities Act 2063 provides that an organization must register with the Board before issuing securities in Nepal.
Similarly, according to Article 29 (1) of the same Act, if an organized organization sells and distributes securities to more than 50 persons at a time, such securities have to be issued for sale and distribution.
But the social network Sagun has been issuing securities in the name of mini-IPOs targeting Nepali investors against the Securities Act and the law. "It is illegal to issue securities in Nepal without the board's approval," the board said in a statement.
Stating that the existing legal system cannot protect the interest of the investors while investing in such securities, the board has warned the investors to invest only in the issuance of approved securities.
The board has also warned the investors not to make such information or advertisement through the media targeting such evictions which have not been approved as per the prevailing law.
Saying that it is a social network invested by Nepalis, Sagun has recently launched a campaign to raise investment through various social networks and media. It went public five years ago and has suffered huge losses as it did not work as expected.
Although the number of downloads of this app, which is using advertisements on Google and Facebook to show the number of downloads, has barely reached five lakhs, the number of active users is very small.
Govind Giri's personal company Sagun Inc., a subsidiary of Sagun Nepal Pvt. Ltd. in Tinkune and Sagun India Pvt. Ltd. in Noida, India, is headquartered in the United States. But the work of all these offices of Sagun always seems to be to issue shares.
The company, which has been running at a loss since its inception, has a face value of only ०० 0.0001, says Numnath Poudel, an investment expert. He says, "There is no other basis to raise investment with Sagun except to play in the sympathy of Nepalis by dreaming of becoming a company like Google-Facebook."
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