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SECURITIES AND EXCHANGE (AMENDMENT) ORDINANCE, 2000

 

An Ordinance further to amend the

Securities and Exchange Ordinance, 1969

[Gazette of Pakistan, Extraordinary Part I,

7th September, 2000

           

No. F. 2(1)/2000-Pub., dated 7-9-2000— The following ordinance made by the president is hereby published for general information: —

 

            Whereas it is expedient further to amend the Securities and Exchange Ordinance, 1969 (XVII of 1969), for  the purposes hereinafter appearing;

 

            And whereas the National Assemble and the Senate stand suspended in pursuance of the proclamation of the fourteenth day of October, 1999, and the provisional constitution order no. I of 1999;

 

            And therefore, in pursuance of the Proclamation of Emergency of the fourteenth day of October, 1999 and the provisional Constitution Order No .I of 1999, as well as order No. 9 of 1999, and in exercise of app power enabling him in that behalf, the president of the Islamic Republic of Pakistan is pleased to make and promulgate the following Ordinance:—

           

1.         Short title and commencement.—(1) This Ordinance may be called the Securities and Exchange (Amendment) ordinance, 2000.

            (2)        It shall come into force at once.

           

2.         Substitution of the expression “the Federal Government”, Ordinance XVII of 1969.— In the Securities and Exchange ordinance, 1969,(XVII of 1969), hereinafter referred to as the said ordinance, except in subsection (3) of section I and section 33, for the words “Federal Government”, wherever occurring, the word “commission” shall be substituted.

 

            3.         Amendment of section 2, Ordinance XVII of 1969.—In the said Ordinance,—

            (1)        section 2 shall be renumbered as subsection (1) of that section and in subsection (1), renumbered as aforesaid,–

            (a)        for clauses (a), (aa) and (aaa) the following shall be substituted, namely:–

            “(a)      “agent” means a person appointed by a member to act on his behalf for the purpose recognized by a stock exchange;  

(ab)      “associate” means any partner, employee, officer or director of a member;

(ac)      “asset management company” means a company which offers investment schemes under trust deeds and issues redeemable securities; and

(ad)      “balloter” means a person who provides service to an issuer for selecting the required number of applicants of public issue through a computer.

(b)        Clause (cc) shall be relettered as clause (ca) and after clause (ca), relettered as aforesaid, the following new clause shall be inserted, namely:–

(c)        “Commission” means the Securities and Exchange Commission of Pakistan established under the Securities and Exchange Commission of Pakistan Act, 1997 (XLII of 1997).

(d)        In clause (h), after the word “jobber” the words or dealer” shall be inserted;

(e)        Clause (ii) shall be omitted;

(f)         In clause (m), for the full stop at the end a semicolon shall be substituted and after clause (m), amended as aforesaid, the following new clauses shall be added, namely:-

“(n)       “Sub-underwriter” means a person who has made a contract with an underwriter to take up a part of the securities not fully subscribed by the public issue;

(o)        “Transfer agent” means a person appointed by the issuer to assist in the maintenance of record for issuance and transfer of securities and to perform functions of persons commonly known as Registrar;

(p)        “Underwriter” includes a person who has made a contract with an issuer to subscribe and pay in cash for those securities as are not fully subscribed by the public issue or a person who has initially bought the securities from an issuer for the purpose of selling such securities by means of a public offer; and

(q)        “Venture capital company” includes a company which is engaged principally in financing through direct equity investment in another company and provides managerial expertise thereto.”;

(2)        After subsection (1) renumbered as aforesaid, the following new subsection shall be added, namely:–

“(2)      The words and expressions used but not defined in this Ordinance shall have the same meaning as are assigned to them in the Companies Ordinance, 1984 (XLVII of 1984).

 

4.         Insertion of new section 5-A, Ordinance XVII of 1969.– In the said Ordinance after section 5, the following new section shall be inserted, namely:-

 

5A.      Brokers or agents not to engage in business without registration.–No person shall act as broker or agent to deal in the business of effecting transactions in securities unless he is registered with the Commission in such manner, on payment of such feeds and charges and on such conditions as may be prescribed.”.

5.         Amendment of section 7, Ordinance XVII of 1969.– In the said Ordinance, in section 7, in subsection (1), in clause (d), before the word “remove” the words “suspend or” shall be inserted.

6.         Amendment of section 8, Ordinance XVII of 1969.– In the said Ordinance, in section 8, in subsection (2), the words “or a bonus entitlement voucher” shall be omitted.

7.         Amendment of section 9, Ordinance XVII of 1969.–In the said Ordinance, in section 9.–

(a)        For subsection (7), the following shall be substituted, namely:–

“(7)      The Commission or a Stock Exchange may, if it considers it to be in the interest of trade in the public interest so to do, by order recording the reasons, suspend for a period not exceeding sixty days the trading of any listed security and may, from time to time, for the said reasons and in the said manner extend the suspension for further periods not exceeding sixty days at any time.”; and

(b)        Subsection (8), shall be omitted.

8.         Amendment of section 21, Ordinance XVII of 1969.– In the said Ordinance, in section 21, in subsection (1), for the word “.one-fifth word “one-tenth” shall be substituted.

9.         Amendment of section 22, Ordinance XVII of 1969.– In the said Ordinance, in section 22, in subsection (1), for the word “thirty” the words “one hundred” and for the word “one”, the word “two” shall respectively substituted.

10.       Amendment of section 24, Ordinance XVII of 1969.– In the said Ordinance, in section 24, in subsection (1), for the word “thirty” the wont “five hundred” shall be substituted.

11.       Omission of sections 26 and 28, Ordinance XVII of 1969,– In the said Ordinance, in sections 26 and 28 shall be omitted.

12.       Substitution of section 32, Ordinance XVII of 1969.– In the said Ordinance, in section 32, the following shall be substituted, namely:-

“32.      Regulation of business of asset management companies. investment advisers, investment companies and venture capital companies.-The business of asset management companies, investment advisers, investment companies and venture capital companies shall be regulated in such manner and on payment of such fees and charges as may be prescribed.”

13.       Insertion of new section 32C, Ordinance XVII of 1969.– In the said Ordinance, in section 32B, the following new section shall be inserted, namely:-

“32C.   Regulation of business of transfer agents, balloters and underwriters, etc.–The business of transfer agents, balloters, underwriters, sub-underwriters, consultants to a public issue and other ancillary business relating to stock market shall be regulated in such manner and on payment of such fees and charges as may be prescribed.”.

14.       Amendment of section 33, Ordinance XVII of 1969.— In the said Ordinance, in section 33, in subsection (2), in clause (a),-

(a)        After the figure “5” the comma, figure and letter”, 5A” shall be inserted;

(b)        For the word and figure “and 32” the figures, commas, letters and word “32, 32A, 32B and 32C” shall be substituted.

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