Financial Markets Act, 2012 (Act No. 19 of 2012)

Chapter VIII : Conduct Standards

75. Principles for conduct standards

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[Section 75 heading substituted by section 290, item 54(a) of Schedule 4, of the Financial Sector Regulation Act, 2017 (Act No. 9 of 2017), Notice No. 853, GG 41060, dated 22 August 2017 - effective 9 February 2018 (Notice R. 99, GG 41433, dated 9 February 2018)]

 

(1)A conduct standard for authorised users, participants or clearing members of independent clearing houses or central counterparties must be based on the principle that—
(a)an authorised user, participant or clearing member of an independent clearing house or central counterparty must—
(i)act honestly and fairly, with due skill, care and diligence and in the interests of a client;
(ii)uphold the integrity of the financial markets;
(iii)have and effectively employ the resources, procedures and technological systems for the conduct of its business;
(b)an authorised user, in addition to paragraph (a), must—
(i)seek information from a client regarding his or her financial position, investment experience and objectives where appropriate to the category of securities services provided and to the business of the client; and
(ii)act fairly in a situation of conflicting interests.

[Section 75(1) substituted by section 290, item 54(b) and (c) of Schedule 4, of the Financial Sector Regulation Act, 2017 (Act No. 9 of 2017), Notice No. 853, GG 41060, dated 22 August 2017 - effective 9 February 2018 (Notice R. 99, GG 41433, dated 9 February 2018)]

 

(2)A  conduct standard for regulated persons, other than the regulated persons mentioned in subsection (1), must be based on the principle that the regulated person must—

[Words preceding section 75(2)(a) substituted by section 290, item 54(d) of Schedule 4, of the Financial Sector Regulation Act, 2017 (Act No. 9 of 2017), Notice No. 853, GG 41060, dated 22 August 2017 - effective 9 February 2018 (Notice R. 99, GG 41433, dated 9 February 2018)]

(a)act honestly and fairly, with due skill, care and diligence and, where applicable, in the interests of a client or member; and
(b)uphold the integrity of the financial markets.

 

 

(3)A conduct standard may provide for—
(a)the disclosure to a client of relevant material information, including the disclosure of actual or potential own interests;
(b)proper record-keeping;
(c)avoidance of fraudulent and misleading advertising, canvassing and marketing;
(d)proper safekeeping of transaction documents of clients;
(e)proper separation and protection of funds and securities of clients; and
(f)any other matter which is necessary or expedient to be regulated in a conduct standard for the achievement of the objects of this Act.

[Section 75(3) substituted by section 290, item 54(e) and (f) of Schedule 4, of the Financial Sector Regulation Act, 2017 (Act No. 9 of 2017), Notice No. 853, GG 41060, dated 22 August 2017 - effective 9 February 2018 (Notice R. 99, GG 41433, dated 9 February 2018)]