The minimum brokerage commissions for traditional and Internet trading are 0.25 per cent and 0.20 per cent per transaction, respectively.

The stock exchange and the Association of Securities Companies will review the rates one year before they expire on January 14, 2010, SET president-designate Patareeya Benchapolchai said after the meeting of SET's board of governors.

Commission rates here are close to or below other stock markets and activity on the local bourse is slower than expected due to the absence of large market-capitalisation stocks like Electricity Generating Authority of Thailand and Thai Beverage, she said in explaining the board's decision.

Thin volume on the Bond Electronics Exchange and Thailand Futures Exchange was also taken into consideration, she said.

"The extended period for the fixed minimum brokerage commission is to allow brokers to adjust and strengthen themselves to offer a wider range of financial services such as derivatives trading. Also, it will encourage brokers to prepare for upcoming liberalisation," she said.

In return for having their request granted, brokers must each maintain at least four fundamental stock analysts on board.

The rule governing compensation of securities marketing officers will also be extended for three years, Patareeya said.

The SET requires compensation of marketing officers to be based on either incentives or salaries.

Marketing officers who select the incentive scheme receive up to 27.5 per cent of the fee income they generate from trading volume, while those who choose remuneration in the form of a salary base must be paid up to 25 per cent.

The minimum brokerage commission was reintroduced on January 14, 2002 under Kittiratt Na Ranong's leadership to end the price-cutting war that broke out after the commission system was fully liberalised.

Siriporn Chanjindamanee

The Nation