SECURITIES INDUSTRY ACT, 2016 (ACT 929) SS 1-115

SECURITIES INDUSTRY ACT, 2016 (ACT 929) SS 1-115

DATE OF PRESIDENTIAL ASSENT: 14th September, 2016.

DATE OF GAZETTE NOTIFICATION: 11th October, 2016.

AN ACT to revise and consolidate the Securities Industry Act, 1993 (PNDCL 333) and to provide for related purposes.

1. Establishment of the Commission

(1) There is established by this Act a body corporate to be known as the Securities and Exchange Commission.

(2) The Commission may for the performance of its functions acquire and hold movable and immovable property and may enter into a

(3) Where there is hindrance to the acquisition of property, the property may be acquired for the Commission under the State Lands Act, 1962 (Act 125) and the cost shall be borne by the Commission.

2. Object of the Commission

The object of the Commission is to regulate and promote the growth and development of an efficient, fair and transparent securities market in which investors and the integrity of the market are protected.

3. Functions of the Commission

To achieve the object the Commission shall

(a) advise the Minister on matters relating to the securities industry;

(b) maintain surveillance over activities in securities to ensure orderly, fair and equitable dealings in securities;

(c) register, license, authorise or regulate, in accordance with this Act or the Regulations,

(i) securities exchanges,

(ii) commodities and futures exchanges,

(iii) securities depositories,

(iv) clearing and settlement institutions,

(v) credit rating agencies,

(vi) fund managers,

(vii) investment advisers,

(viii) hedge funds,

(ix) private equity funds,

(x) venture capital funds,

(xi) nominees,

(xii) underwriters,

(xiii) issuing houses,

(xiv) registrars,

(xv) custodians,

(xvi) trustees,

(xvii) primary dealers,

(xviii) broker-dealers,

(xix) the representatives of the persons specified in subparagraphs (i) to (xx); and

(xx) any other institution in the securities industry to control and supervise their activities with a view to maintaining proper standards or conduct and acceptable practices in the securities business;

(d) formulate principles for guidance of the industry;

(e) monitor the solvency of licence holders and take measures to protect the interest of customers where the solvency of a licence holder is in doubt;

(f) protect the integrity of the securities market against any abuses arising from dealing in securities including insider trading;

(g) adopt measures to minimise and resolve any conflict of interest that may arise for market operators;

(h) review, approve and regulate takeover, mergers, acquisitions and all forms of business combinations in accordance with any law or code of practice requiring it to do so;

(i) create the necessary atmosphere for the orderly growth and development of the capital marker,

(j) perform the functions referred to in the Companies Act 1963 (Act 179); [NB: Act 179 has since been replaced with the Companies Act, 2019 (Act 992)]

(k) examine and approve invitations to the public made by issuers other than the government;

(l) authorise and regulate the issuing of securities in Ghana by foreign issuers; and

(m) undertake activities that are necessary or expedient for giving full effect to the provisions of this Act.

4. Governing body of the Commission

(1) The governing body of the Commission is a Board consisting of

(a) a chairperson;

(b) the Director-General;

(c) the trio Deputy Directors- General;

(d) one representative each from the following:

(i) Bank of Ghana not below the rank of a Director; and

(ii) Ministry of Finance not below the rank of a Director;

(e) the Registrar-General or the representative of the Registrar- General; and

(f) four other persons comprising

(i) a lawyer qualified to be appointed a Justice of the Superior Court of Judicature nominated by the General Legal Council;

(ii) a chartered accountant nominated by the Institute of Chartered Accountants, Ghana;

(iii) an academic researcher in a relevant field; and

(iv) a woman

(2) The members of the Board shall be appointed by the President in accordance with article 70 of the Constitution.

(3) The President shall in making appointments under section (1) consider gender balance and have regard to the expertise, knowledge and experience of the person in matters relating to securities or investment.

(4) The Board shall monitor and oversee the operations of the Commission and ensure the effective implementation of the object and functions of the Commission.

5. Tenure of Office

(1) A member of the Board shall hold office for a period not exceeding three years and is eligible for re-appointment but a member shall not be appointed for more than two terms.

(2) Subsection (1) does not apply to the Director-General and the Deputy Directors-General.

(3) A member of the Board may at any time resign from office in writing addressed to the President through the Minister.

(4) A member of the Board other than the Director-General and two Deputy Directors-General who is absent from three consecutive meetings of the Board without sufficient cause ceases to be a member of the Board.

(5) The President may by a letter addressed to a member revoke the appointment of that member.

(6) Where a member of the Board is for a sufficient reason unable to act as a member, the Minister shall determine whether the inability would result in the declaration of a vacancy.

(7) Where there is a vacancy

(a) under subsection (3) or (4),

(b) as a result of a declaration under subsection (6), or

(c) by reason of the death of a member,

the Minister shall notify the President of the vacancy and the President shall appoint a person to fill the vacancy.

6. Meetings of the Boards

(1) The Board shall meet at least once every two months for the despatch of business at the times and in the places determined by the chairperson.

(2) The chairperson shall at the request in writing of not less than four members of the Board, convene an extraordinary meeting of the Board at the place and time determined by the chairperson.

(3) The quorum at a meeting of the Board is seven members of the Board and shall include the Director-General or in the absence of the Director-General, a Deputy Director-General.

(4) The chairperson shall preside at meetings of the Board and in the absence of the chairperson, a member of the Board other than the Director-General or the Deputy Director-General elected by the members present from among their number shall preside.

(5) Matters before the Board shall be decided by a majority of the members present and voting and in the event of an equality of votes the person presiding shall have a casting vote.

(6) The Board may co-opt a person to attend a Board meeting but that person shall not vote on a matter for decision at the meeting.

7. Disclosure of Interest

(1) A member of the Board who has an interest in a matter for consideration

(a) shall disclose the nature of the interest and the disclosure shall form part of the record of the consideration of the matter; and

(b) shall not participate in the deliberation of the Board in respect of that matter.

(2) A member ceases to be a member of the Board, if that member has an interest in a matter before the Board an

(a) fails to disclose that interest, or

(b) participates in the deliberations of the matter.

8. Establishment of committees

(1) The Board may establish committees consisting of members of the Board or non-members or both to perform a function.

(2) A committee of the Board may be chaired by a member of the Board.

(3) Section 7 applies to members of committees of the Board.

9. Allowance

Members of the Board and members of a committee of the Board shall be paid the allowances approved by the Minister.

Administration
10. Ministerial Directives

The Minister may give directives of a general nature to the Board on matters of policy relating to the capital market and the Board shall give effect to the directives.

11. Appointment of Director-General

(1) The President shall in accordance with article 195 of the Constitution appoint a Director-General of the Commission who shall be the chief executive of the Commission.

(2) The Director-General shall hold office on the terms and condi- tions specified in the letter of appointment.

(3) The Director-General is responsible for

(a) the day-to-day administration of the affairs of the Com- mission and is answerable to the Board in the performance of function under this Act; and

(b) the implementation of the decisions of the Board.

(4) The Director-General may delegate a function to an officer of the Commission but shall not be relieved of the ultimate responsibility for the performance of the delegated function.

12. Appointment of Deputy Directors-General

(1) The President shall in accordance with article 195 of the Constitution, appoint two Deputy Directors-General for the Commission.

(2) A Deputy Director-General shall hold office on the terms and conditions specified in the letter of appointment.

(3) A Deputy Director-General shall assist the Director-General in the performance of functions of the Director-General and perform any other function determined by the Board.

13. Appointment of other Staff

(1) The President shall in accordance with article 195 of the Constitution appoint for the Commission, other staff that are necessary for the proper and e8éctive performance of functions of the Commission.

(2) The President may in accordance with article 195 (2) of the Constitution delegate the power of appointment of public officers under subsection (1).

(3) Other public officers may on the request of the Commission be transferred or seconded to the Commission or may otherwise give assistance to the Commission.

(4) The Commission may engage the services of advisers and consultants on the recommendation of the Board.

Finances of the Commission
14. Funds of the Commission

(1) The funds of the Commission include

(a) levies payable to the Commission under section 15;

(b) moneys approved by Parliament,

(c) grants to the Commission received from the Government or any other body or person for its activities;

(d) fees and other moneys that accrue to the Commission in the course of the performance of its functions; and

(e) interest and profits that accrue from the investments of the Commission.

(2) The moneys received by or on behalf of the Commission shall be deposited to the credit of the Commission in a bank approved by the Minister and used wholly for the discharge of the functions of the Commission.

15. Levies payable to the Commission

(1) There is imposed by this Act a levy on a person issued with a market operator’s licence under section 109.

(2) A person who holds a market operator’s licence for a financial year shall pay a levy prescribed towards the expenses of the Commission for that financial year.

(3) The Commission may consult licensees in calculating the levy payable under subsection (2).

(4) The Commission shall provide in writing

(a) the formula for calculating levy,

(b) the time and method of payment, including installment payments,

(c) the payment of interest on moneys overdue, and

(d) penalties for non-payment.

(5) The Commission shall issue directives, guidelines or circulars on the imposition of the levy payable to the Commission

(a) by a buyer and a seller that carries out a transaction in securities,

(b) by a collective investment scheme in respect of the asset value of the scheme, and

(c) on funds under the management of a fund manager other than funds of a collective investment scheme.

(6) The Commission may exempt the payment of the levy under paragraph (c) of subsection (5) in respect of funds under a pensions scheme registered under the National Pensions Act, 2008 (Act 766) and the Com- mission may arrange with the pensions Regulator for part of the fees payable to the Pensions Regulator on such funds.

16. Accounts and audit

(1) The Board shall keep books of accounts and proper records in relation to them in the form approved by the Auditor-General.

(2) The Board shall submit the accounts of the Commission to the Auditor-General for audit within three months after the end of the financial year.

(3) The Auditor-General shall not later than three months after the receipt of the accounts, audit the accounts and forward a copy of the audit report to the Minister.

17. Annual Reports and other Reports

(1) The Board shall within one month after receipt of the audit report submit an annual report to the Minister covering the activities and operations of the Commission for the year to which the report relates.

(2) The annual report includes

(a) the report of the Auditor-General; and

(b) any other information that the Commission may consider necessary.

(3) The Minister shall within one month after the receipt of the annual report submit the report to Parliament with a statement that the Minister considers necessary.

(4) The Board shall also submit to the Minister any other reports which the Minister may require in writing.

Administrative Hearings Committee
18. Establishment of Administrative Clearings Committee

(1) Without limiting section 8 there is established an Administrative Hearings Committee of the Board.

(2) The Hearings Committee consists of three members of the Board elected by the members, except that the chairperson of the Board, the Director-General and the two Deputy Directors-General shall not be members.

(3) The members of the Committee shall elect a chairperson from among the three members.

(4) The functions of the Hearings Committee are

(a) to examine and determine complaints and disputes related to, in respect of, or arising out of a matter to which this Act applies; and

(b) to perform a duty related to the function specified under paragraph J«9 that may be referred to it by the Commission.

19. Submission of complaints and examination of issues

(1) A complaint, dispute or a violation arising under this Act shall, before any redress is sought in the courts, be submitted to the Commission for hearing and determination in accordance with this Act.

(2) A person who intends to submit a complaint or matter to which subsection (1) applies shall submit it in writing to the Director-General.

(3) The Director-General shall cause the matter to be investigated and unless the Director-General can settle the disputed matter or complaint, refer the matter together with the findings of the investigations to the Hearings Committee within thirty days of the receipt of the written complaint, dispute or viola0on; and at the same time inform the complainant or persons concerned of the submission to the Hearings Committee.

(4) Subject to section 22, the Hearings Committee shall on receipt of a complaint or a matter under this section, examine and determine the complaint or matter.

(5) The Hearings Committee shall not determine a complaint or matter which is the subject matter of an action before a court.

20. Representation before the Clearings Committee

A person appearing before the Hearings Committee may

(a) make a representation;

(b) be represented by a lawyer or other expert of the person’s choice; and

(c) produce the evidence which that person considers necessary for the adjudication of the complaint or matter.

21. Proceedings of the Hearings Committee

(1) The Hearings Committee may exclude persons from its proceedings, other than parties to the proceedings and their lawyers or experts, where the Hearings Committee considers it necessary in the interest of public order, public morality or the protection of the private lives and interest of persons concerned in the proceedings.

(2) The Hearings Committee may call witnesses and request the production of documents which it considers necessary to determine the issue before it.

(3) Witnesses appearing before the Hearings Committee may be paid allowances determined by the Board in consultation with the Minister.

(4) The Hearings Committee shall give a fair hearing to the persons who appear before it and shall be guided by the rules of natural justice.

(5) Where a complaint is submitted to the Hearings Committee under subsection (1) of section 19, the Hearings Committee shall, within a period of sixty days from the date of receipt of the complaint or matter, examine and determine the complaint or matter unless there is a delay caused by the complainant or the representative or witness of the complainant.

(6) Except as otherwise provided in this Act, the Hearings Committee shall determine the procedure for its hearings.

22. Referral of final decisions of hearings Committee

(1) The final decision of the Hearings Committee on a matter submitted to it for determination shall be referred to the Board.

(2) The Board on receipt of the final decision may

(a) approve of the decision;

(b) remit the matter to the Hearings Committee for further consideration; or

(c) modify the final decision.

23. Appeals from decisions of the Board with reference to the Hearings Committee

A person dissatisfied with a decision of the Board may seek redress at the High Court.

Production of Books and Documents
24. Power of Commission to require Production of Books

(1) The Commission may by notice in writing, where it considers that there is sufficient cause to do so, give directives to

(a) a licensee or former licensee;

(b) a member of the governing body of a securities exchange;

(c) an issuer or a former issuer;

(d) a person who is controlled by any other person referred to in paragraph (a), (b) or (c) or jointly controlled by two or more persons at least one of whom is a person referred to in these paragraphs;

(e) a person who is or has been an officer or an employee of, or an agent, lawyer, auditor or other person acting in any capacity for or on behalf of, a person referred to in paragraph (o), (b), (c), or (d);

(f) any other person who is or has been a party to a dealing in securities; or

(g) any other person,

to produce to the Commission or a person authorised by the Commission the books, subject to subsection (2), specified in the directive.

(2) For the purposes of subsection (1), books in respect of which a request to produce may be made relate to

(a) the business or affairs of an issuer, a securities exchange, a licensee or past licensee;

(b) a dealing in securities;

(c) a dealing in unit trusts and mutual funds;

(d) advice concerning securities or the issuing or publication of a report or analysis concerning securities;

(e) the character or financial position of, or any business carried on by, a person referred to in paragraph (c), (d) , (e), or of subsection (1);

(f) an audit of, or any report of an auditor concerning a dealing in securities or the accounts or records of a broker-dealer or of a fund manager; or

(g) information relating to the business of a person or to the business administered or managed by that person for that person’s clients.

(3) A directive to produce shall not be made to a person under subsection (1) unless the Commission has reasonable cause to believe that the person has custody or control of books which relate to a matter specified under subsection (2).

(4) Books shall not be directed to be produced by a person under subsection (1) (g) at a time or place that may unduly interfere with the proper conduct of the normal daily business of that person.

(5) The Commission may, in writing authorise a person possessed of a qualification that the Commission considers adequate, to exercise the power to request for the production of books conferred on the Commission under this section.

(6) A reference in subsection (1) to dealing in securities or to a business carried on by a person, includes a reference to a dealing in securities by a person as a trustee.

(7) An authorisation from the Commission to a person under subsection (5), may be of general application or may be limited to making requirements of a specific nature.

(8) Where the Commission, or a person authorised by the Commission, requires the production of books under this section and a person has a lien on the books, the production of the books shall not prejudice the lien.

(9) An authorised person shall where required to do so, produce evidence of authorisation.

(10) An action shall not lie against a person for complying with a directive or requirement made or given under this section to produce books.

(11) A power conferred by this section to make a requirement of a person, extends where that person is a body corporate, to making that requirement of any person who is or has been an officer of the body corporate whether that body corporate is in the course of being wound up or has been dissolved.

(12) The Commission may publish and disseminate any information

25. Action on production or non-production of books

(1) Where the required books are produced under section 24, the person to whom they are produced

(a) may take possession of them, make copies of them, or take extracts from them;

(b) may require the other person or any person who was party to the compilation of the books to make a statement providing an explanation of any of the books;

(c) may retain possession of the books for as long as the Commission considers necessary to enable the books to be inspected and copies of or extracts from the books to be made or taken by or on behalf of the Commission; and

(d) shall permit the person who produced them, upon giving a reasonable notice and specification of the books, to have access to them.

(2) Where the books are not produced, the Commission or the authorised person may require the person who should have produced the books

(a) to state, to the best of the knowledge and belief of that person, where the books may be found;

(b) to identify the person who, to the best of the knowledge and belief of that person, last had custody of the books and where the identified person may be found; or

(c) to state the reasons why the books cannot be produced.

26. Searches

(1) a person authorised by the Commission may

(a) enter any premises or property which the Commission has reason to believe is occupied or used by a person in contravention of this Act or any Regulations made under this Act;

(b) search for a book, record, statement, document or any other item;

(c) seize or make a copy of a book, record, statement, document or any other item;

(d) question a person, auditor, director, member or a partner of a person conducting business in the premises;

(e) direct that the premises or any part of it or anything on it be secured and left undisturbed for as long as necessary; and

(f) close down the business as the Commission considers necessary.

(2) For the purposes of subsection (1), the Commission may request the assistance of the Police for a specific assignment.

(3) In this section, “premises” includes a structure, building, place, aircraft, vehicle or vessel.

27. Non-disclosure of information from books

(1) An information obtained from a book that has been produced to a person authorised by the Commission under section 24, shall not be published or disclosed by that person without the prior consent in writing of the person who has custody or control of the books, except to the Commission and its officers and employees, unless the publication or disclosure is required

(a) with a view to the institution of, or for the purposes of criminal proceedings; or

(b) for the purposes of proceedings under section 24, 25 or 26.

(2) A person who publishes or discloses information in contravention of subsection (1) commits an offence and is liable on summary conviction to a fine of not less than one hundred and fifty penalty units and not more than five hundred penalty units or to a term of imprisonment of not less than one year and not more than three years or to both.

28. Incriminating Statement

(1) It is not an excuse for a person to fail to provide a statement explaining a matter relating to the compilation of books or a matter requested of that person under section 24 on the grounds that the statement might tend to incriminate the person.

(2) Where the person claims before making a statement required of the person that the statement might tend to incriminate the person, the statement provided in answer to the request shall not be admissible in evidence against the person in any criminal proceedings other than proceedings under section 24, 25 or 26.

(3) Subject to subsection (2), a statement made by a person in compliance with a requirement under section 24 may be used in evidence in criminal or civil proceedings against the person.

29. Penalties

A person who

(a) without reasonable excuse, refuses or fails to comply with a directive given under section 24, 25 or 26,

(b) furnishes information or makes a statement that is false or misleading in a material particular for the purposes of section 24, 25 or 26, or

(c) without reasonable excuse, obstructs or hinders the Commission or a person in the exercise of a power under section 24, 25 or 26

commits an offence and is liable on summary conviction to a fine of not less than one hundred and fifty penalty units and not more than five hundred penalty units or to a term of imprisonment of not less than one year and not more than three years or to both.

30. Period for keeping records and Books

(1) Despite a provision in any other enactment, a book or record required to be kept under this Act shall be kept for a period of at least seven years after the completion of the transaction to which it relates.

(2) A person who contravenes subsection (1) is liable to pay to the Commission an administrative penalty of one thousand penalty units.

31. Admission in evidence of copies or extracts of books

(1) Subject to this section and section 27, a copy of or extract from a book relating to a matter specified in subsection (1) or (2) of section 24 is admissible in evidence as if it were the original book.

(2) A copy of or extract from a book is not admissible in evidence under subsection (I) unless it is proved that, the copy or extract is a true copy of the book or of the relevant part of the book.

(3) For the purposes of subsection (2), evidence that a copy of or extract from a book is a true copy of the book or of a part of the book may be given by a person who has compared the copy or extract with the book or the relevant part of the book and may be given orally or by an affidavit or statutory declaration.

32. Savings for lawyers

Section 24, 25 or 26 shall not compel a legal practitioner to produce a document that contains privileged communication made by or to that legal practitioner in a professional capacity or authorise the taking of possession of that document which is in the possession of the legal practitioner but if the legal practitioner refuses to produce the document, the legal practitioner shall nevertheless be obliged to give the name and address of the person to whom or by or on whose behalf the communication was made.

Disclosure of Information
33. Disclosure of acquisition or disposal of securities to the Commission

(1) The Commission may, where it considers it necessary for the protection of investors, require a broker-dealer to disclose to the Commission, in relation to an acquisition or a disposal of securities, the name of the person from or through whom or on whose behalf the securities were acquired or disposed of and the nature of the instructions given to the broker-dealer in respect of the acquisition or disposal.

(2) The Commission may require a person who has acquired, held or disposed of securities to disclose to the Commission

(a) whether the person acquired, held or disposed of securities as a trustee for or on behalf of another person or as a nominee;

(b) the name of that person; and

(c) the nature of the instruction given as trustee or nominee in respect of the acquisition, holding or disposal.

(3) The Commission may require a stock exchange to disclose to the Commission, in relation to an acquisition or disposal of securities on that stock exchange, the names of the members of that stock exchange who acted in the acquisition or disposal.

34. Suspicion regarding breach of specified provisions

(1) Where the Commission considers

(a) that it may be necessary to prohibit trading in securities of, or made available by a body corporate pursuant to section 49, or

(b) that a person may have contravened the provisions of section 147 to 153 in relation to securities of, or made avail- able by a body corporate, or

(c) that a person may have contravened provisions of Chapter Two of the Companies Act, 1963 (Act 179) in relation to securities in a body corporate,

it may require a director, secretary or executive officer of the body corporate referred to in paragraph (a), (b) or (c) to disclose to the Commission an information of which the director, secretary or executive officer is aware, being information that might have affected a dealing that has taken place, or that might affect a future dealing in securities of, or made available by, the body corporal [NB: Act 179 has since been replaced with the Companies Act, 2019 (Act 992)]

(2) For the purposes of paragraph (a), (b) or (c) of subsection (1), the Commission may require a person whom the Commission believes on reasonable grounds to be capable of giving intonation concerning

(a) a dealing in relevant securities,

(b) an advice given by a broker-dealer, a fund manager, or an investment adviser or, a representative of a broker-dealer, of a fund manager, or of an investment adviser concerning securities,

(c) the issuing or publication of a report or analysis by a broker-dealer, a fund manager, an investment adviser, a representative of a broker-dealer, of a fund manager, or of an investment adviser concerning relevant securities,

(d) the financial position of a business carried on by a person who is or has been alone or together with other persons, a broker-dealer, a fund manager or an investment adviser and has dealt in, or given advice concerning relevant securities,

(e) the financial position of any business carried on by a nominee controlled by a person referred to in paragraph (c) or jointly controlled by two or more persons at least one of whom is a person referred to in that paragraph, or

(f) an audit of, or any report of an auditor concerning any accounts or records of a broker-dealer, a fund manager or of an investment adviser, being accounts or records relating to dealings in relevant securities,

to disclose to the Commission the information that the person has in relation to any of the matters specified in this subsection.

(3) For the purposes of subsection (2), “relevant securities” means securities of, or made available by, the body corporate referred to in subsection (1).

(4) A person is not excused from disclosing information to the Commission pursuant to a requirement made of that person under sub- sections (1) and (2), on the grounds that the disclosure of the information might tend to incriminate that person.

(5) Where a person claims, before making an oral statement disclosing information which that person is required to disclose under subsection (1) or (2), that the statement might tend to incriminate the person, that statement provided in answer to the request is not admissible in evidence against the person in criminal proceedings other than proceedings under this section.

(6) A person who or stock exchange which, without reasonable excuse, refuses or fails to comply with a requirement of the Commission under subsection (1), (2), or (3) of section 33 or subsection (1) or (2) of this section commits an offence and is liable on summary conviction to a fine of not less than one hundred and fifty penalty units and riot more than five hundred penalty units or to a term of imprisonment of not less than one year and not more than three years or to both.

(7) A person who, for the purposes of subsection (1), (2), or (3) of section 33 or subsection (1) or (2) of this section, discloses information, or makes a statement, that is false or misleading in a material particular commits an offence and is liable on summary conviction to a fine of not less than one hundred and fifty penalty units and not more than five hundred penalty units or to a term of imprisonment of not less than one year and not more than three years or to both.

(8) It is a defence to a prosecution for an offence under subsection (7) for the defendant to prove belief on reasonable grounds that the information or statement was true and was not misleading.

(9) In this section a reference to disclosing information includes, in relation to information that is contained in a document, the furnishing of the document.

(10) A person shall not be subject to a liability for having com- plied with a requirement made or purported to have been made under this section.

Investigation and Inspection
35. Investigation of certain matters

(1) Where the Commission

(a) has reason to suspect that a person has

(i) committed an offence under this Act or the Companies Act, 1963 (Act 179), or [NB: Act 179 has since been replaced with the Companies Act, 2019 (Act 992)]

(ii) been guilty of fraud or dishonesty in relation to dealing in securities and the business of an issuer; and

(b) is assisting other domestic and foreign regulatory authorities in their investigation, it may make the investigation it considers proper in pursuance of this Act.

(2) The Commission may delegate its powers under subsection (1) to a person with the qualifications that it considers appropriate.

(3) The person under investigation shall afford the Commission or its appointed person access to the books, documents, records and files that may be required to conduct the investigation.

(4) For the purpose of any investigation, or any other proceeding under this Act, a member of the Board or an officer designated by the Board is empowered to administer oaths and affirmations, take evidence, and require the production of any book, paper, correspondence, memorandum, or other records which the Commission deems relevant or material to inquire.

36. Inspection by the Commission

(1) The Commission may, inspect the books, accounts, documents and transactions of

(a) a licensee or former licensee; or

(c) an issuer or former issuer.

(2) The Commission may engage the services of a person who has the qualification that the Commission considers adequate to exercise the power of the Commission under subsection (1).

(3) For the purposes of an inspection under this section, persons referred to in subsection (1), shall

(a) afford the Commission access to;

(b) produce books, accounts and documents; and

(c) give the information and facilities that may be required to conduct the inspection.

(4) A person engaged by the Commission may copy or take possession of the books, accounts and other documents of a licensee, former licensee, issuer or former issuer.

(5) A licensee, former licensee, issuer or former issuer that fails, without reasonable excuse, to produce a book, account, document, information or facilities in accordance with subsection (3), is liable to pay to the Commission an administrative penalty of one thousand penalty units.

Orders of the Court Statements of Principle
37. Power to request back account records

(1) The Commission may, in writing, request the Bank of Ghana to provide banking records or information held by a bank or specialised deposit-taking institution on any transaction concerning a person under investigation where the Commission is of the opinion that the bank or specialised deposit-taking institution is a proper person to assist with the investigation.

(2) Where the Bank of Ghana provides the records or information requested, the Commission may request an authorised person of the Bank or institution to provide an explanation on the contents of the records or information, where necessary.

(3) When considering an application from the Commission pursuant to a request for assistance from a foreign securities regulatory authority, the Judge may only refuse the request if:

(a) the request is not made in accordance with the terms of the international agreement or memorandum of understanding between the Commission and the requesting securities regulatory authority; or

(b) criminal proceedings have already been instituted or final punitive sanctions issued in the country, in respect of the same facts and matters and against the same person as is the subject of the request for assistance.

(4) An application under subsection (1) made by the Commission and an appeal made by the Commission or the respondent institution shall be heard in camera.

(5) A provision of this Act shall not be construed to confer on the respondent institution in its capacity as appellant, a right to access the information contained within a request for international assistance.

38. Power of court to make certain orders

(1) Where

(a) on the application of the Commission, it appears to a court that a person has committed an offence under this Act, or bas contravened the conditions or restrictions of a licence or the rules or listing rules of a stock exchange or is about to do an act with respect to dealing in securities that, if done, would be an offence or a contravention, or

(b) on the application of a securities exchange, it appears to the court that a person has contravened the rules of that securities exchange,

(c) the court may, without prejudice to any other orders make an order as specified in subsection (2).

(2) For the purpose of Subsection (1), the court may make an order

(a) In the case of persistent or continuing breaches of this Act, or of the conditions or restriction of a licence, or of the rules of a securities exchange restraining the person from carrying on a business for which the person has been licensed, or from posing as carrying on that business or so acting;

(b) Restraining a person from acquiring, disposing or otherwise dealing with the securities that are specified in the order;

(c) appointing a receiver of the property of a broker-dealer or of property that is held by a broker-dealer for or on behalf of another person whether on trust or otherwise;

(d) declaring a contract relating to securities to be void or voidable;

(e) for the purposes ofsecurin8 compliance with any other order under subsection(1), directing a person to do or refrain from doing a specified act; or

(f) ancillary to any of the orders specified in paragraph (a) to (e) considered necessary.

(3) The Court may, before making an order under subsection (1) direct that notice of the application be given to a person who the court considers fit or direct that notice of the application be published in the manner that the court considers fit, or both.

(4) A person appointed by order of the Court under subsection (1) as a receiver of the property of a broker-dealer may

(a) require the broker-dealer to deliver to the receiver, property of which the latter has been appointed receiver or to give to the receiver the information concerning that property that may reasonably be required;

(b) acquire and take possession of property of which that person has been appointed receiver;

(c) deal with property that person has acquired or taken possession of in a manner in which the broker-dealer might lawfully have dealt with the property; and

(d) exercise any other powers in respect of the property specified in the order.

(5) In subsections (1), (2) and (4), “property" in relation to a broker-dealer, includes moneys, securities and documents of title to securities or other property entrusted to or received on behalf of any other person by the broker-dealer or any other person in the course of or in connection with a business of dealing in securities carried on by the broker-dealer.

(6) A person who, without reasonable excuse, contravenes or fails to comply with

(a) an order under subsection (1), or

(b) a requirement of a receiver appointed by order of the court under subsection (1),

commits an offence and is liable on summary conviction to a fine of not less than one hundred and fifty penalty units and not more than five hundred penalty units or to a term of imprisonment of not 1ess than one year and not more than three years or to both.

(7) Subsection (6) does not affect the powers of the Court to punish for contempt of court.

(8) The Court may on an application by the Commission compel a person to give a statement or testimony under oath investigations and other matters relating to securities.

(9) The Court may rescind, vary or discharge an order made under this section or suspend the opera0on of an order.

39. Statements of principle

(1) The Commission may issue statements of principle with respect to the conduct and financial standing expected of persons licensed under this Act.

(2) The conduct expected may include compliance with

(a) a code or standard issued with the permission of the Com- mission by a person or body; or

(b) a code or standard acceptable to the Commission.

(3) Failure to comply with a statement of principle under this section is a ground for the taking of disciplinary action or the exercise of powers of intervention, but does not constitute an offence or give rise to a right of action by investors or other persons affected or affect the validity of any transaction.

(4) The exercise of disciplinary action under subsection (3) includes the exercise of power under section 118 or 122 and those sections shall be construed accordingly.

(5) Where a statement of principle issued by the Commission relates to compliance with a code or standard issued by a person or body other than the Commission, that statement of principle may provide

(a) that failure to comply with the code or standard shall be a ground for taking disciplinary action or exercising a power under section 118 or 122 only in the cases and to the extent that may be specified; and

(b) that an action shall not be taken, or power exercised, except at the request of the person or authority by whom the code or standard in question was issued.

(6) The Commission shall exercise its power in the manner that appears to it appropriate to secure compliance with statements of principle under this section.

40. Exchange of information and mutual assistance

(1) Where the Commission is satisfied that a foreign regulatory authority has the capacity to protect the confidentiality of information, the Commission may enter into an agreement or arrangement for the exchange of that information with that foreign regulatory authority ma responsibility to regulate financial institutions and the conduct of financial markets and the provision of financial services.

(2) In addition to the exchange of information, an agreement or arrangement between the Commission and a foreign regulatory authority may require that the Commission provide mutual assistance to the foreign regulatory authority that may be required for the purposes of its regulatory functions.

41. Co-operation insecurities regulation

(1) On request made by a foreign regulatory authority, the Commission may provide the foreign regulatory authority with assistance in accordance with section 40 if that foreign regulatory authority states that it is conducting an investigation to determine whether a person has violated, is violating, or is about to violate any law or rule relating to securities matters, irrespective of where the securities are issued or listed.

(2) Assistance may be provided without regard as to whether facts stated in the request may constitute a violation of the domestic laws of this country.

(3) In deciding whether to provide assistance, the Commission shall consider whether

(a) the foreign regulatory authority has agreed to provide reciprocal assistance in securities matters to the Commission; and

(b) compliance with the request is likely to adversely affect the public interest of the country.

42. Establishment of securities exchanges

A person shall not establish or assist in establishing or maintaining or pose as providing or maintaining a securities exchange unless that person is authorised under this

43. Power of Commission to approve a securities exchange

(1) An application for approval u a securities exchange shall be made to the Commission in the prescribed form.

(2) An approval shall not be granted to a person to operate as a securities exchange other than a body corporate.

(3) The Commission may approve a body corporate as a securities exchange if the Commission is satisfied

(a) that at least three members of the body corporate will carry on the business of dealing in securities independently of and in competition with each other;

(b) that the rules of the body corporate will make satisfactory provision

(i) for the exclusion from membership of persons who are not of good character and high business integrity;

(ii) for the expulsion, suspension or discipline of members for conduct inconsistent with just and equitable principles in the transaction of business or for a contravention of or failure to comply with the rules of the securities exchange or a provision of this Act;

(iii) for the making of a report to the Commission by the body corporate where it rejects an application for membership or where it suspends or expels a member;

(iv) for the terms and conditions of the chief executive officer of the body corporate,

(v) with respect to the conditions under which securities may be listed for trading in the market proposed to be conducted by the body corporate;

(vi) with respect to the conditions governing dealing in securi0es by members;

(vii) with respect to the class of securities that may be dealt in by members;

(viii) with respect to a fair representation of persons in the selection of members of its governing body and administra6on of its affairs and provide that one or more members is or are representative of listed companies, investors, and the professions relevant to securities trading and not be associated with a stock broker, or dealer; and

(ix) generally, for the carrying on of the business of the securities exchange with due regard to the interest of the public; and

(c) that the interests of the public will be served by the granting of the approval.

(4) The grant by the Commission of approval as a securities exchange shall be within three months horn the date of application for approval as a securities exchange.

(5) This section does not preclude Commission from appointing not more than two persons who are knowledgeable in the securities industry and who are not associated with a broker- dealer, to be on the governing body of a securities exchange to represent the public interest.

(6) A person appointed under subsection (5)

(a) shall have the same rights, powers, duties and obligations, liberties and privileges as any other member of the governing body of the securities exchange; and

(b) shall hold office for a period specified by the Commission which may at any time revoke the appointment.

(7) The Commission shall publish in the Gazette, notice of approval for the establishment of a securities exchange and every cancellation or suspension of an approval.

(8) Where the Commission is of the opinion that an approval granted to a securities exchange under subsection (3) should be withdrawn in the public interest, it may serve on the governing body of that securities exchange a written notice that it is considering the withdrawal of the approval for the reasons stated in the notice and after giving an opportunity to the governing body to be heard on the matter, it may cancel the approval granted under subsection (3).

(9) A cancellation under subsection (8) shall not take effect until after the expiration of the three months in the date on which the cancellation is published in the Gazette.

(10) With effect from the date on which a notice of cancellation of approval under subsection (9) is published in the Gazette, the governing body shall ensure that trading on the securities exchange ceases.

(11) During the three months between the publication and the effective date of the cancellation, the governing body shall take steps to wind up the business of the securities exchange.

44. Approval by Commission of amendments to rules

(1) Where an amendment is made, whether by way of rescission, alteration or addition, to the rules of a securities exchange, the governing body of the securities exchange shall forward a written notice of the amendment to the Commission for approval.

(2) The Commission shall within three months, give notice in writing to the securities exchange concerned that it approves the amendment or that it disapproves the whole or any specified part of the amendment in question and until the notice is given the amendment shall not have effect.

(3) This section does not preclude the Commission after consultation ma the governing body of a securities exchange from amending the rules of a securities exchange by written notice specifying the amendments and the dates those amendments shall come into force.

(4) A notice under this section may be served personally or by registered post.

45. Provision of assistance by securities exchange to the Commission

(1) A securities exchange shall provide assistance to the Commission that the Commission reasonably requires for the performance of its functions and duties, including the furnishing of returns and providing the information relating to the exchange's business or in respect of its dealing in securities or any other specified information that the Commission may require for the proper administration of this Act

(2) Where a securities exchange reprimands, fines, suspends, expels or otherwise takes disciplinary action against a member of the exchange, it shall within seven days, give to the Commission written particulars of the name of the member, the reason for and nature of the action taken, the amount of the fine, if any, and the period of the suspension.

46. Disciplinary power of the Commission

(1) The Commission may review a disciplinary action taken by a securities exchange under subsection (2) of section 45 and may affirm or set aside a decision of an exchange after giving the member and the exchange an opportunity to be heard.

(2) Subsection (1) does not preclude the Commission, in a case where a securities exchange fails to act against a member of the exchange, from suspending, expelling or otherwise disciplining a member of a, exchange but before doing so the Commission shall give the member and the exchange an opportunity to be heard.

(3) A person who is aggrieved by the decision of the Commission under this section may, within one month after notification of the decision, appeal to the High Court.

47. Observance or enforcement of rules of a securities exchange

(1) Where a person who is under an obligation to comply with, observe, enforce or give effect to the rules or regulations of a securities exchange fails in performing the duty, the Court, on the application of the Commission, that securities exchange or a person aggrieved by the failure, and after giving to the person against whom the order is sought an opportunity of being heard, may make an order giving directives to that person to perform the duty.

(2) For the purposes of subsection (1),

(a) a body corporate which is admitted to any official list of a securities exchange and has not been removed from that official list; or

(b) a person associated ma a body corporate which is admitted to an official list of a securities exchange and has not been removed from that official list

is under an obligation to comply with, observe and give effect to the directives of that securities exchange to the extent to which those rules apply in relation to it or that person.

48. Directives to securities exchange

(1) The Commission may, where it appears to be in the public interest, issue a directive to a securities exchange

(a) with respect to trading on or through the facilities of that securities exchange or with respect to a security traded on that securities exchange;

(b) with respect to the manner in which a securities exchange carries on its business, including the manner of reporting off-market trading; or

(c) with respect to any other matters which the Commission considers necessary for the effective administration of this Act and the securities exchange shall comply with the directives.

(2) A securities exchange which, without reasonable excuse, fails or refuses to comply with a directive given under subsection (1), is liable to pay to the Commission an administrative penalty of five hundred penalty units and to a further administrative penalty of fifty penalty units for each day that the default continues.

(3) Where the Commission is satisfied that an executive officer of a securities exchange

(a) has wilfully contravened a provision of this Act or any Regulations made under it or the rules of a securities exchange; or

(b) has without reasonable justification or excuse, failed to enforce compliance with that provision by a member of the securities exchange or a person associated with that member,

the Commission may, in the public interest or for the protection of the investors, and after giving the executive officer an opportunity of being heard, direct by notice in writing the securities exchange to remove from office or employment the executive officer, and the securities exchange shall comply with the directive; or the Commission may instead censure the executive officer.

49. Prohibition of trading in particular securities

(1) Without limiting section 48, where the Commission is of the opinion that it is necessary to prohibit trading in particular securities of, or made available by, a body corporate on a securities exchange in order to protect the interest of the public, the Board may give notice in writing to the exchange stating that it has formed that opinion and setting out its reasons.

(2) If, after the receipt of the notice, the exchange does not take action to prevent trading in the securities to which the notice relates, and the Commission is still of the opinion that it is necessary to prohibit trading in those securities on that exchange, the Commission may, by notice in writing to that exchange, prohibit trading in those securities on that exchange during the period, not more than fourteen days, that may be specified in the notice.

(3) Where the Commission gives a notice to a securities exchange under subsection (2), the Commission shall

(a) at the same time send a copy of the notice to the body corporate together with a statement setting out the reasons for the giving of the notice; and

(b) as soon as practicable furnish to the Minister a written report setting out the reasons for giving the notice and send a copy of the report to the securities exchange.

(4) A securities exchange which permits trading in securities on the exchange in contravention of a notice under subsection (2) is liable to pay to the Commission an administrative penalty of five hundred penalty units and to a further administrative penalty of twenty-five penalty units for each day that the defaults continues.

Self-regulatory Organisations
50. Recognition of a self-regulatory organisation

(1) The Commission may, subject to the terms and conditions that the Commission considers fit, accord recognition to a company or organisation as a self-regulatory organisation in relation to a specified segment of the securities industry, where the Commission is satisfied that that company or organisation

(a) has a constitution and internal miles and policies which are consistent with this Act and any enactment applicable to the relevant sector or industry;

(b) has the capacity and the financial and administrative resources required to carry out its functions to perform as a self-regulatory organisation including dealing with breaches of the law or of applicable standards or guidelines;

(c) shall not discriminate against a person in offering access to its services or in carrying out its functions as a self-regulatory organisation;

(d) is a fit and proper person;

(e) Managed or controlled by competent officers;

(f) and satisfies other criteria specified in the rules of the Commission.

(2) The Commission may, by written arrangement, delegate a power or function of the Commission to a self-regulatory organisation.

(3) An arrangement under subsection (2), shall provide for

(a) a power or function delegated to the self-regulatory organisation by the Commission;

(b) the terms and conditions by which the power or function has been delegated and may be exercised by the self-regulatory organisation;

(c) the person authorised to exercise the delegation on behalf of the self-regulatory and;

(d) the submission to the Commission of periodical reports in respect of the exercise of a delegated power in the function by the self-regulatory organisation.

51. Rules of a self-regulatory organisation

(1) A self-regulatory organisation may make rules, not inconsistent with this Act, the Regulations or rules of the Commission or any applicable enactment, with respect to the matters for which it has functions, including the functions delegated to it by the Commission.

(2) Rules made by a self-regulatory organisation under subsection (1), and amendments to the rules, shall be of no effect unless approved by the Commission.

(3) The Commission shall be deemed to have granted approval for the purposes of subsection (1) where it has not objected to the rules within three months after the rules have been submitted to the Commission for approval.

(4) The rules of a self-regulatory organisation may make provision with respect to shareholding and voting rights in a self-regulatory organisation, interests of the members of a self-regulatory organisation, the consumers, investors and the users of their services.

52. Restriction on decision-making

A self-regulatory organisation shall not make a decision under its rules that is likely to adversely affect the rights of a person unless

(a) that self-regulatory organisation has given that person an opportunity to make representations about the manner or;

(b) the self-regulatory organisation considers, on reasonable grounds, that any delay in making the decision will adversely affect a class of consumers, investors or members of the relevant sector or industry.

53. Obligations of officers of a self-regulatory organisation

A self-regulatory organisation shall notify the Commission of the appointment of an officer in the manner specified in the rules of the Commission, at least fourteen days before that person is appointed as an officer of the self-regulatory organisation.

54. Directives by Commission to self-regulatory organisation

(1) The Commission may, after giving a self-regulatory organisation reasonable opportunity to make representations about a matter, give a written directive to

(a) suspend for the period specified in the directive, a specified provision of its constitution or its rules;

require, subject to the Companies Act, 1963 (Act 179) or any other enactment, the amendment of its constitution as specified in the directive to bring it in conformity with this Act, the Regulations or any rules of the Commission; [NB: Act 179 has since been replaced with the Companies Act, 2019 (Act 992)]

(b) require the amendment of its rules as specified in the directive so as to bring them in conformity with the relevant Act; or

(c) for the implementation or enforcement of its constitution or its rules.

(2) Where the Commission has reasonable grounds to believe that

(a) an officer of a self-regulatory organisation is not a fit and proper person; or

(b) a particular person’s appointment or continuing in office as an officer of a self-regulatory organisation is likely to be detrimental to the self-regulatory organisation or to adversely affect the interest of investors and consumers of financial services or of members of the relevant sector or industry

(c) the Commission may, after giving the officer and the self-regulatory organisation reasonable opportunity to make representations, direct the self-regulatory organisation not to appoint the officer, or to remove the officer from office.

(3) Subsections (1) and (2) do not limit the directives that the Commission may give to a self-regulatory organisation.

55. Termination of arrangements and revocation of recognition

(1) The Commission may revoke a recognition where

(a) the self-regulatory organisation has failed to commence operations within three months after recognition;

(b) the Commission is not satisfied that the self-regulatory organisation is properly performing or is able to perform the functions or powers delegated to it, or its other functions;

(c) the Commission determines that the self-regulatory organisation has committed a material breach of this Act or other applicable enactment;

(d) it appears to the Commission that the self-regulatory organisation is involved in a financial crime; or

(e) the self-regulatory organisation fails to comply with a directive of the Commission.

(2) The Commission shall not revoke a recognition unless the Commission has

(a) notified the self-regulatory organisation of its intention and the reasons for the Commission’s action, and
(b) given the self-regulatory organisation a reasonable opportunity to make representations to the Commission.

(3) The Commission shall publish the notice of the revocation under subsection (1) in the gazette.

56. Amendments to the Constitution of self-regulatory organisation

Despite a provision in the Companies Act, 1963 (Act 179), an amendment to the constitution of a self-regulatory organisation is of no effect unless it is approved by the Commission. [NB: Act 179 has since been replaced with the Companies Act, 2019 (Act 992)]

57. Protection of self-regulatory organisation

A self-regulatory organisation, an officer or employee of a self- regulatory organisation or a member of a committee of a self-regulatory organisation is not liable for any loss sustained or damage caused to a person as a result of anything done or omitted by that person in the performance of functions and the discharge of duties in connection with the functions of the self-regulatory organisation, including those delegated to it by the Commission.

58. Annual report of self-regulatory organisation

(1) A self-regulatory organisation shall within ninety days from the end of its financial year, submit to the Commission, an annual report which includes

(a) a report on the corporate governance policy of the self-regulatory organisation and any other information required by the Commission;

(b) audited financial statements prepared in accordance with the accounting standards adopted by the Institute of Chartered Accountants (Ghana); and

(c) other requirements specified by the Commission.

(2) The financial statements to be included in an annual report under subsection (1), shall

(a) be audited by an audit firm approved by the Commission, and

(b) be in accordance with the auditing standards by the Institute of Chartered Accountants (Ghana).

(3) Where, in the course of audit, the auditor of a self-regulatory organisation has reason to believe that

(a) there has been a material adverse change in the risks inherent in the business of that self-regulatory organisation with the potential to adversely affect the ability of the self-regulatory organisation to continue as a going concern;

(b) the self-regulatory organisation may be in contravention of this Act, the Regulations or rules of the Commission;

(c) a financial crime has been, is being or is likely to be come

(d) serious irregularities have occurred;

(e) that auditor shall report immediately in writing the matter to the Commission.

A report made under subsection (3) does not constitute a breach of the duties of the auditor.

PART THREE-UNIT TRUST AND MUTUAL FUND
Unit Trust
59. Prohibition to operate unit trust without licence

(1) A person shall not unless that person is licensed by the Commission,

(a) establish or operate a unit trust;

(b) issue an invitation to the public to acquire units in a unit trust or;

(c) maintain or pose as carrying on the business of dealing in units of a unit trust .

A licence shall not be granted to a person to operate a unit trust unless that person is a company incorporated under the Companies Act, 1963 (Act 179). [NB: Act 179 has since been replaced with the Companies Act, 2019 (Act 992)]

(2) A person who contravenes subsection (1) is liable to pay to the Commission an administrative penalty of four thousand five hundred

60. Manager and trustee

(1) A company seeking to establish a unit trust shall be the manager of the unit trust.

(2) The manager shall appoint a trustee for the unit trust but the manager and the trustee shall be independent of each other.

61. Trust deed

(1) A unit trust is constituted by a document made under seal between the manager of the unit trust and the trustee and the document is the trust deed.

(2) The trust deed shall be in the prescribed form and contain the prescribed particulars.

62. Application for licence to operate a unit trust

(1) An application for a licence for a unit trust shall be made to the Commission in the form determined by the Commission.

(2) The applying manager shall also submit to the Commission

(a) the names and qualifications of the directors and other principal officers and that of the trustee;

(b) its certificate of incorporation;

(c) a copy of the trust deed; and

(d) the prescribed particulars.

63. Licence to operate a unit trust

(1) The Commission may license a unit trust if the Commission is satisfied that

(a) the manager and trustee are qualified to act in that capacity;

(b) the manager is a company incorporated in the Republic;

(c) the trustee is a bank, an insurance company or a financial institution or a wholly owned subsidiary of any of them approved by the Commission;

(d) the trustee has the minimum paid up capital required by the Commission;

(e) the business of the manager in relation to the unit mist is administered independently of the trustee; and

(f) the trust deed complies with this Act and the Regulations.

(2) The Commission shall within ninety days of receipt of an application for a licence communicate its decision on the application in writing to the applicant.

(3) A licence granted under subsection (1) is subject to the conditions specified in the licence or in relation to the licence.

(4) The Commission shall not refuse to grant or renew a licence without first giving the applicant or the holder of the licence an opportunity of being heard.

64. Prohibition of activities in unlicensed unit trust

(1) A person shall not undertake an activity in or related to a unit trust directly or indirectly unless

(a) the unit are those of a unit trust licensed by the Commission; and

(b) the particulars of the unit trust have been approved by the Commission.

(2) A person who contravenes subsection (1) is liable to pay to the Commission an administrative penalty of four thousand five hundred penalty units.

65. Interest of investors in unit trust and pricing of unit

(1) The interest of a unit holder in a unit trust consists of unit including fractions of a unit.

(2) The calculation of prices at which units of a unit trust may be bought or sold shall be in accordance with provisions prescribed by the Commission.

66. Scheme particulars

(1) A letter, notice, circular, document or prospectus prepared by a manager of a unit trust for the purpose of offering its units to the public shall be approved by the trustee of the scheme and the Commission before publication.

(2) A document of the kind referred to in subsection (1), shall include information in relation to the matters prescribed or specified by the Commission.

67. Redemption of units

(1) The manager of a licensed unit trust shall, if requested by a holder of units of the unit trust, buy from the holder any number of units the holder may specify at the price at which the manager buys the unit.

(2) Where the licence of a unit trust is revoked, the manager shall buy the units under the scheme at the last bid price at which the manager bought units of the unit trust before the revocation.

68. Duties and powers of a manager of a unit trust

(1) The manager of a unit trust shall manage the assets of the unit trust on a day to day basis and shall select the investments to be made on behalf of the trust in the best interest of the unit holders.

(2) The manager shall act in accordance with the trust deed and comply with its investment objectives and policy under the directions given by the trustee.

(3) The manager shall provide information on the management and administration of the unit trust that the trustee may request.

(4) The manager of a unit trust shall maintain the minimum capital requirement determined by the Commission.

(5) The manager shall ensure that its directors or other persons concerned with the management of its business have the qualifications and experience that are specified by the Commission.

69. Duties and powers of trustee

(1) The trustee of a unit mist shall comply with this Act, the Regulations, the trust deed and the prescribed particulars of the unit trust.

(2) The trustee shall take into the custody of the trustee or under the control of the trustee, the property of the unit trust and hold the property in trust for the investors in accordance with this Act, the Regulations, the trust deed and any other applicable enactment.

(3) The trustee shall ensure that an asset attributable to a particular unit trust is separately identified.

(4) The trustee shall

(a) ensure that the method used by the manager in the calculation of prices at which interest is issued and redeemed is within the limits determined by the Commission; and

(b) maintain the minimum paid up capital determined by the Commission.

(5) The trustee may execute documents to secure acquisition, disposals and loans made by the manager in accordance with this Act or the Regulations and the mist deed.

(6) Subject to subsection (7), this Act or the Regulations and the terms of trust deed, the trustee shall easy out the instructions of the manager in respect of investments which constitute the property of the scheme.

(7) The trustee may give notice to the manager that the trustee is unwilling to accept the transfer of a property which contravenes this Act or the Regulations or the trust deed.

(8) The manager may, with the approval of the trustee, determine that each unit shall be subdivided into two or more units or that two or more units shall be consolidated.

70. Prohibited transaction by manager

(1) A company which is a manager of a unit trust or is a subsidiary or holding company of the manager shall not

(a) borrow money on behalf of the unit mist for the purpose of acquiring securities or other property for the unit mist;

(b) lend money that is subject to the unit trust to a person to enable that person to purchase units of the unit trust;

(c) mortgage, charge or impose any other encumbrance on any securities or other property subject to the unit trust; or

(d) engage in a transaction which in the opinion of the Commission is not in the interest of the holders of the units of the unit trust.

(2) Paragraphs (a) and (c) do not apply to borrowings made on behalf of the trust solely for the purpose of meeting obligations to redeem units from the holders when requested.

(3) The borrowings under subsection (2) are subject to the conditions and restrictions determined by the Commission.

(4) A company that contravenes subsection (1) and every officer of the company who acted in breach of this section, is liable to pay to the Commission

(a) in the case of the company, an administrative penalty of one thousand penalty units; and

(b) in the case of an officer, an administrative penalty of five hundred penalty units.

Mutual Fund
71. Prohibition of operation of mutual fund without licence

(1) A person shall not unless the mutual fund is licensed by the Commission

(a) establish or operate a mutual fund;

(b) issue an invitation to the public to acquire shares in a mutual fund; or

(c) maintain or pose as carrying on the business of dealing in a mutual fund.

(2) A person who contravenes subsection (1) is liable to pay to the Commission an administrative penalty of four thousand five hundred penalty units.

72. Appointment of a manager and custodian

(1) The directors of a company applying to operate as a mutual fund shall appoint for the mutual fund

(a) a company incorporated in the Republic, approved by the Commission and independent of the mutual fund company as manager; and

(b) a custodian which is independent of the mutual fund company and is a bank, an insurance company or any other financial institution approved by the Commission or a wholly owned subsidiary of any of them approved by the Commission.

(2) The custodian shall have and maintain the minimum capital requirement determined by the Commission.

73. Application for a mutual fund licence

(1) The Commission may on an application made to the Commission by

(a) a public company incorporated under the Companies Act, 1963 (Act 179); or

an external company with a place of business in the Republic within the meaning of Chapter V of the Companies Act, 1963 (Act 179) license the company as a mutual fund company. [NB: Act 179 has since been replaced with the Companies Act, 2019 (Act 992)]

(2) The company referred to in subsection (1) must have been incorporated solely to hold and manage securities or other financial assets.

(3) The application shall be in the prescribed form and contain the particulars specified by or under this Act and as directed by the Com- mission.

(4) The Commission shall within ninety days of receipt of the application communicate its decision on the application in writing to the applicant.

74. Licence for operation of mutual fund

(1) The Commission shall not grant a licence to a company to operate as a mutual fund company unless the Commission is satisfied that

(a) if an invitation is made to the public to subscribe for its shares, the price at which the shares will be offered will be based on the net value of the company’s assets at the time of the offer without an addition except for a reasonable service charge;

(b) the company will repurchase the shares from the holder at a price based on the net value of its assets at the time of the repurchase without a deduction other than a reasonable service charge but where the shares of the mutual fund company are to be listed on an approved stock exchange, the Commission may waive or modify the requirements of this paragraph;

(c) a manager and custodian for the scheme have been appointed by the directors;

(d) the manager is a company incorporated in the Republic and is separate from and independent of the custodian; and

(e) the custodian being a bank or an insurance company or a wholly owned subsidiary of either of them has and maintains the required minimum capital.

(2) The licence may be subject to other conditions that may specify.

(3) The Commission shall not refuse to grant or renew a licence without first giving the applicant or the holder of the licence an opportunity of being heard.

75. Interest of an investor in a mutual fund

The interest of an investor in a mutual fund consists of shares in the company.

76. Exemption from specific provisions of the Companies Act

The following provisions of the Companies Act, 1963 (Act 179) shall not affect the mutual fund company unless otherwise specified in writing by the Registrar of Companies acting in consultation with the Commission [NB: Act 179 has since been replaced with the Companies Act, 2019 (Act 992)]

(a) Section 59 on acquisition by a company of its own shares;

(b) Section 60 on redemption of redeemable preference shares;

(c) Section 61 on purchase by company of its own shares;

(d) Section 62 on limit on number of shares acquired;

(e) Section 63 on opening of share deals account;

(f) Section 66 on stated capital;

(g) Section 67 on reduction of stated capital;

(h) Section 275 to 279 relating to invitation to the public and prospectus;

(i) Section 281 to 284 relating to waiting periods after publication of prospectus; withdrawal of application for shares; invitations in respect of securities to be dealt in on a stock exchange and minimum subscription; and

(j) Section 314 on control of public invitations relating to external companies.

77. Regulations of a mutual fund

A mutual fund shall make regulations which shall be in the form and contain the matters that are prescribed by Regulations or as directed by the Commission.

78. Directions by directors of a mutual fund

(1) Subject to the Companies Act, 1963 (Act 179), the directors of a mutual fund shall determine the investment and general policies of the company and shall give directions to the manager. [NB: Act 179 has since been replaced with the Companies Act, 2019 (Act 992)].

(2) A director shall not give a direction which is likely to make the manager act in contravention of this Act or of the Regulations and the directors shall act in accordance with the terms of the Regulations or the constitution of the mutual fund and any management agreement.

(3) A director who contravenes subsection (2) is liable to pay to the Commission an administrative penalty of five hundred penalty units.

79. Custodian of mutual fund and its duties

(1) The custodian appointed under section 72 shall take into its custody or put under its control the property of the mutual fund which shall be held in accordance with this Act and any relevant agreement not inconsistent with this Act.

(2) The custodian of a mutual fund shall have the minimum capital requirement determined by the Commission.

(3) The custodian may give notice to the manager that it is not prepared to accept the transfer of assets in contravention of this Act and may require the manager to give security for the transfer of the assets.

(4) Subject to subsection (3), the terms of its contract of appointment and this Act, the custodian shall carry out the instructions of the manager as regards investments which comprise the assets of the company.

80. Duties of directors of a mutual fund

The directors of a mutual fund shall take reasonable care

(a) to ensure that the property of the mutual fund is managed by the manager in accordance with this Act, the Regulations and the constitution or regulations of that mutual fund;

(b) that the manager performs functions and discharges duties under this Act and the Regulations; and

(c) that the methods used by the manager to calculate prices at which shares are issued and redeemed are legal; and shall carry out periodic checks to verify whether the manager has determined prices within those limits.

81. Duties of a manager of a mutual fund company

(1) A manager of a mutual fund shall manage that mutual fund on a day to day basis, select investments to be owned by the company and carry out any other functions assigned to the manager under contract from the mutual fund.

(2) The manager is subject to the directions of the directors of the mutual fund and shall perform the normal functions performed by the managing director of a company.

(3) Where the directions given to the manager by the directors of the mutual fund contravene this Act or any other enactment, the manager shall refer the matter to the Commission for guidance.

(4) The manager of a mutual fund shall maintain the required minimum capital and have the amount and type of financial and material resources determined by the Commission.

(5) The manager shall not allow the property of the company to be used or invested contrary to the investment restrictions under this Act or the Regulations.

(6) The manager shall ensure that the directors or other persons concerned with the management of the business have the necessary qualifications and experience required by the Commission.

(7) The manager shall act in accordance with investment policies laid down by the directors under this Act.

Spread of Investment and General Provisions on Unit Trust and Mutual Fund
82. Spread of investments and restrictions

(1) The value of a scheme’s holding of securities issued by a single issuer shall not exceed twenty per cent at book value or twenty five per cent at market value.

(2) A scheme shall not hold more than ten per cent of a class of securities issued by a single issuer.

(3) The value of a scheme’s holding of securities not listed or quoted on a stock exchange shall not exceed fifteen per cent of its total net asset value.

(4) Up to thirty per cent of a scheme’s total net assets value may be invested in government securities of the same issue.

(5) A scheme shall not enter into a future financial contract or hold a physical commodity.

(6) The value of a scheme’s holding of units or shares in other collective investment schemes shall not in aggregate exceed ten per cent of its total net value.

(7) A scheme shall not invest more than ten per cent of its net asset value in any type of real estate including buildings or interests in real estate except in the shares of real estate companies.

(8) Subsection (7) does not apply to a scheme set up as a real estate investment fund.

(9) The provisions on the level and spread of investments of a unit trust and a mutual fund and the prohibited investment of a unit trust and a mutual fund specified in this section may be waived or modified by the Commission in appropriate circumstances.

83. Prohibition of increase in charges, fees and other costs

Except with the approval of the trustee of a unit trust or directors of a mutual fund and with the consent of the Commission, an increase in the total of initial charges, the manager’s annual fee or any other cost and charges borne by the investors or by a scheme shall not be made.

84. Unit Trust and mutual fund company annual fee for licence

There shall be paid in respect of a licence issued under sections 62 and 73 the application fee and annual licence fee determined by the Commission.

85. Inconsistency with this Act and the Regulations

Where a provision in a trust deed establishing a unit trust or a provision in the regulations or constitution of a mutual fund is inconsistent with a provision of this Act or the Regulations, that provision is void to the extent of the inconsistency.

86. Changes in unit trust and mutual fund

(1) A proposal for change in scheme particulars, regulations and any other documents used to operate a unit trust or mutual fund is subject to approval by a special resolution of holders of interests in the unit trust or mutual fund.

(2) The manager of a unit trust or mutual fund shall submit the proposal to the Commission for approval and the Commission shall acknowledge receipt in writing within seven days of receipt.

(3) Where the Commission does not make a decision on the proposal approved by holders of interest in the unit trust or mutual fund within sixty days after its submission, the manager may assume that it has been approved.

87. Change and retirement of trustee or custodian

(1) The manager of a unit trust or the directors of a mutual fund shall give written notice to the Commission of a proposal to replace the trustee or custodian of a scheme and seek the approval of the Commission and the Commission shall acknowledge in writing the receipt of the proposal within seven days of receipt.

(2) A proposal for a change of a trustee or custodian is subject to approval by a special resolution of holders of interest in the scheme.

(3) Where the Commission does not indicate its decision on the proposal within a period of sixty days after the submission, it may be assumed that the proposal has been approved.

(4) A trustee or a custodian shall be replaced by a person who satisfies the requirements of this Act.

(5) A trustee or a custodian shall retire upon giving notice of not less than ninety days.

88. Change of manager of unit trusts and mutual funds

(1) A trustee of a unit trust or directors of a mutual fund, shall give written notice to the Commission of any proposal to replace a manager of a scheme and seek the approval of the Commission and the Commission shall acknowledge receipt in writing within seven days of receipt.

(2) Where the Commission does not indicate its decision on the proposal within a period of sixty days after the submission, it may be assumed that there has been approval.

(3) The manager shall be replaced by a person who satisfies the requirements of this Act.

(4) The manager shall cease to hold office where

(a) the manager goes into liquidation, except a voluntary liquidation to reconstruct or amalgamate on the terms previously approved in writing by the trustee or directors;

(b) a receiver is appointed in respect of the unit trust or mutual fund;

(c) the unit holders or shareholders decide to remove the manager in terms of this Act; or

(d) the trustee of a unit trust or the directors of a mutual fund state in writing giving reasons that a change of manager is desirable in the interest of the investors and the Commission approves.

(5) Where the name of the scheme makes reference to the name of the former manor, the former manager may require the new manager to propose a change in the name of the scheme.

(6) Where the manager ceases to act as a manager, the trustee of a unit trust or the directors of the mutual fund shall appoint a person eligible under this Act to be the manager of the scheme subject to that person entering into an agreement with the trustee of the unit trust or the directors of the mutual fund to secure the due performance of its functions as manager.

89. Retirement of manager

(1) The manager may retire in favour of another eligible person on the written approval of the trustee of a unit trust or the directors of the mutual fund where

(a) in the case of a unit trust, the is appointment is made under the seal of the retiring manager;

(b) the rights and duties of the retiring manager have been assigned to the new manager; and

(c) any other act required to be done for the assumption of duty as manager has been done.

(2) The retiring manager shall be absolved from an obligation on retirement but this is without prejudice to the rights of a person for an act or omission of the retiring manager before retirement.

(3) On assuming once as the new manager, the manager shall enjoy the rights and exercise the powers as manager and be subject to the duties and obligations of a manager.

90. Liability of manager, director, trustee and custodian

The manager of a unit trust, the trustee of a unit trust or the director, the manager or custodian of a mutual fund is liable to an investor for any loss suffered by the investor by reason of failure to perform the functions of office under this Act or the Regulations.

91. Prohibited transactions under mutual fund

(1) A manager or custodian of a mutual fund shall not

(a) borrow money on behalf of the mutual fund for the purpose of acquiring securities or other property for the mutual fund;

(b) lend money that is subject to the mutual fund to a person to enable that person acquire an interest in the mutual fund or for any purpose;

(c) mortgage, charge or impose any other encumbrance on the securities or any other property subject to the mutual fund;
or

(d) engage in a transaction which in the opinion of the Commission is not in the interest of the shareholders of the mutual fund.

(2) Paragraphs (a) and (c) of subsection (1) do not apply to borrowings made on behalf of the fund solely for the purpose of meeting obligations to redeem shares from the holders when requested.

(3) The borrowings are subject to the restrictions as prescribed by the Commission.

92. Limitation on securities in which officers have interest

A scheme shall not invest in any securities of a class in a company or other body if an officer or collectively, officers of the manager own more than ten percent of the total nominal amount of the issued securities of that class.

93. Limitation on nil-paid or partly paid securities

(1) The portfolio of a scheme shall not include any securities where a call is made for a sum unpaid on that security unless that call can be met in full out of cash by the scheme’s portfolio.

(2) Subject to subsection (1), the portfolio of a scheme shall include a security where a call is to be made for a sum of money unpaid on that security if the issue has been allotted under the terms of a rights issue or an existing holding.

94. Unlimited liability

A scheme shall not acquire an asset which involves the assumption of an unlimited liability.

95. Register of investors

(1) The manager of a scheme shall keep at a prescribed place a register of persons who hold interest in the scheme containing the particulars prescribed by the Regulations.

(2) The Regulations shall provide for inspection of the registers of the licensed schemes.

96. Ratification by court

The Court may on an application

(a) order the rectification of a register of investors if it is just to do so; or

(b) order the manager to pay for a loss or damage if the Court is satisfied that a person has suffered loss or damage by an error or defect in the register of investors.

97. Register of unit trust and mutual fund

(1) The Commission shall keep a register of licensed unit trusts and mutual fund companies.

(2) A person may inspect the register and on payment of a fee obtain a copy of or extract from the register.

98. Appointment of temporary manager of a scheme

(1) The Court may, on application, order the appointment of a person as a temporary manager of a scheme.

(2) The application may be made by

(a) the Commission;

(b) the manager;

(c) the directors or a mutual fund;

(d) the trustee or custodian; or

(e) an investor in the scheme.

(3) The appointment shall not be for more than ninety days but the Court may, on application by the temporary scheme manager, extend the appointment.

(4) A temporary scheme manager shall, before the end of the appointment, report to the Court recommending a course of action to be taken in relation to the scheme.

(5) The Court may make the orders that are just, including orders to call an investors’ meeting to consider a proposed resolution to nominate a replacement scheme manager or for the termination of the scheme.

(6) A temporary scheme manager shall have the same powers and rights in respect of the property of the scheme as the manager of the scheme.

99. Termination of scheme

(1) A scheme is terminated when an event, date or state of affairs specified for the purpose in the constitution of the scheme occurs.

(2) A provision in the constitution of a scheme, which provides or has the effect of providing that the scheme is terminated if the manager is removed as manager, is void.

100. Termination by manager

(1) The manager of a scheme may, in writing and with the approval of the Commission, terminate the scheme on the grounds that the purpose of the scheme has been, or cannot be accomplished.

(2) A manager shall not terminate a scheme unless that manager has given notice as required under subsection (3) and a period of sixty days has passed.

(3) The notice shall include

(a) an explanation

(b) a statement of the circumstances under which the purpose of the scheme has been, or cannot be accomplished; and

(c) a statement of the right of the investors to requisition a meeting of the investors.

101. Termination by court

(1) The trustee shall after the termination of a scheme realise the assets and after the payment from that scheme of the liabilities and costs of the winding up, distribute the proceeds of the realisation to the manager and the investors on the production by the manager and investors of evidence as to the proportion of their entitlement or interest in the scheme.

(2) The trustee shall pay into court any unclaimed net proceeds or other cash held by the trustee after the expiration of twelve months after the day on which the net proceeds became payable.

(3) The trustee may deduct the reasonable expenses incurred by the trustee in making that payment into court from the unclaimed net proceeds.

(4) The trustee shall notify the Commission after the completion of the winding up.

103. Revocation of licence of a scheme

(1) The Commission may, subject to this Act and on notification revoke the licence of a scheme where

(a) in the opinion of the Commission the interest of the holders of the units or shares created or held under the scheme require that; or

(b) the Commission is satisfied that the scheme as operating no longer qualifies as provided under this Act.

(2) The Commission shall before revoking the licence notify the manager and trustee of the unit trust or the directors of the mutual fund of the intention to revoke the licence.

(3) The manager of the unit trust or the directors of the mutual fund may within thirty days of the notification make representations in writing in respect of the proposed revocation to the Commission.

(4) The Commission my revoke the licence of a scheme if

(a) after the expiration of the period the scheme has not made representations; or

(b) it is not satisfied with representations made by the scheme.

(5) The Commission shall communicate its decision to revoke the licence of the scheme within thirty days after representations have been made or if none is made, within thirty days after the last day for making the representation.

104. Suspension of licence of unit trusts and mutual funds

(1) This Part does not prevent the Commission from suspending the licence of any unit trust or mutual fund subject to the conditions the Commission shall specify in writing.

(2) The Commission shall

(a) before suspending a licence notify the unit trust or mutual fund of its intentions; and

(b) by the notice, invite the unit trust or mutual fund to make, within a period of not more than twenty-one days from the date of the service of the notice, the representations it may desire to make in respect of the suspension of the licence.

(3) The Commission may suspend the licence of the unit trust or mutual fund if

(a) after the expiration of the period the unit trust or mutual fund has not made representations; or

(b) it is not satisfied with the representations made by the unit trust or mutual fund.

(4) The Commission shall communicate its decision to suspend the licence of the unit trust or mutual fund within thirty days after the representations have been made or if none is made, within thirty days after the last day for making the representation.

105. Winding up of a mutual fund company

A mutual fund shall wound up in accordance with the provisions of the Companies Act, 1963 (Act 179) and any Regulations made under this Act. [NB: Act 179 has since been repealed by, and replaced with, the Companies Act, 2019 (Act 992)]

106. Cancellation of licence

The Commission shall cancel the licence of a scheme on the termination of the scheme in accordance with the law.

107. Unauthorised schemes and use of words “mutual fund” or “unit trust”

(1) A person shall not operate any form of collective investment scheme unless that person is licensed by the Commission.

(2) A person other than a mutual fund or a unit trust approved by the Commission shall not describe itself, or use the words “mutual fund” or “unit trust” as part of its name.

(3) A person who contravenes this section is liable to pay to the Commission and administrative penalty of four thousand five hundred penalty units.

108. General Penalty

1. A person who

(a) Fails to comply with, observe and give effect to the directive of a securities exchange to the extent to which rules apply to the person, contrary to section 47;

(b) being a self-regulatory organisation, fails to notify the Commission of the appointment of an officer, contrary to section 53;

(c) being a self-regulatory organisation, fails to submit its annual report to the Commission within ninety days from the end of its financial year, contrary to section 58;

is liable to pay to the Commission an administrative penalty of five hundred penalty units.

PART FOUR – LICENCES OF MARKET OPERATORS
Market Operators’ Licences
109. Licences

(1) A person shall not carry on business as a securities exchange, hedge fund, private equity fund, venture capital fund, nominee, credit rating agency, broker-dealer, primary dealer, investment adviser, fund manager, trustee, custodian, securities depository, clearing and settlement services, registrar, underwriter, issuing house or as any other operator required to hold a licence as the Minister by notice in the Gazette may prescribe, or pose as carrying on the business unless that person holds a valid licence issued under this Act.

(2) A person shall not act as a representative for a person referred to in subsection (1) unless that person is the holder of a relevant representative’s licence issued under this Act.

(3) A person desirous of performing the functions of a market maker in the securities industry shall obtain a licence from the Commission and shall comply with the rules or guidelines issued by the Commission.

110. Exemption from obtaining licence of a representative

The Commission may exempt representatives of a person indicated in section 109 who do not deal directly with clients on behalf of the person from holding a licence of a representative.

111. Application for licence or renewal

(1) An application for a licence or for the renewal of a licence shall be made to the Commission in the prescribed form and shall be accompanied by the prescribed fee and, in the case of an application for renewal of a licence, shall be made at least three months before the expiry of the licence.

(2) The Commission may require an applicant to supply it with any further information that it considers necessary in relation of the application.

(3) The Commission shall not refuse to grant or renew a licence without first giving the applicant or the holder of the licence an opportunity of being heard.

(4) The fee paid for the processing of licensing of an application is not refundable.

112. Grant or refusal of licence of a market operator

(1) Subject to subsection (3), where an applicant meets the requirements of section 111, the Commission shall grant the applicant licence.

(2) A licence to a market operator other than an investment adviser shall not only be granted to a body corporate, including an incorporated private partnership.

(3) A licence shall only be granted to a market operator if that market operator meets and continues to meet the minimum financial requirements determined by the Commission generally or specifically.

(4) A licence granted by the Commission is subject to conditions specified in the licence.

(5) Subject to section 111(3) and the Regulations, where an application is made for the grant or renewal of a licence, the Commission shall refuse the application if in the case of an applicant who is an individual

(a) the applicant has been adjudged bankrupt anywhere;

(b) the applicant has been convicted, either within the Republic or elsewhere, within the period of ten years immediately preceding the date on which the application is made, of an offence involving fraud or dishonesty punishable on conviction with imprisonment for a term of three months or more;

(c) the Commission is not satisfied as to the educational qualification or experience of the applicant having regard to the nature of the duties of a holder of the licence;

(d) the Commission has reason to believe that the applicant is not of good reputation or character; or

(e) the Commission has reason to believe that the applicant will not perform the function of a holder of the relevant licence efficiently, honestly and fairly.

(6) Subject to section 111(3) and the Regulations, where an application is made for the grant or renewal of a licence by a body corporate including and incorporated private partnership, the Commission shall refuse the application where

(a) the body corporate or the partnership is in the course of being wound up under the Companies Act, 1963 (Act 179) or the Incorporated Private Partnership Act, 1962 (Act 152); [NB: Act 179 has since been repealed by, and replaced with, the Companies Act, 2019 (Act 992)]

(b) the body corporate is one in respect of which a receiver, or a receiver and manager, has been appointed under the Companies Act, 1963 (Act 179); [NB: Act 179 has since been repealed by, and replaced with, Act 992]

(c) the body corporate or partnership has, whether within or outside the country, entered into a compromise or scheme of arrangement with its creditors, which is still in operation;

(d) the Commission is not satisfied as to the educational qualifications or experience of the officers of, or partners of the applicant who are to perform functions in connection with the licence of the market operator; or

(e) the Commission has reason to believe that the applicant will not perform the functions of a market operator efficiently, honestly and fairly.

113. Grant or renewal of licence to representatives of market operators

Subject to section 11(3) and the Regulations, the Commission shall grant or renew a licence granted to the representative of a market operator if after consideration of the application it considers that the applicant will perform the functions efficiently, honestly and fairly.

114. Banks and other financial institutions doing business in the capital market

A  bank or other financial institution which intends to do business in the capital market other than the business of trustee, custodian, primary dealer, nominee, registrar, issuing house and underwriter, shall incorporate a subsidiary company under the Companies Act, 1963 (Act 179) and apply for the relevant licence. [NB: Act 179 has since been repealed by, and replaced with, the Companies Act, 2019 (Act 992)]

115. Changes by the Commission to licensing requirements

The Commission may, in consultation with the Minister by notice published in the Gazette, alter the capital requirements as well as any other pre-licensing requirements.

Leave a Reply

Your email address will not be published. Required fields are marked *

Back to top button
Close
Close