The Securities and Exchange Commission of Pakistan (SECP) has proposed revised set of regulations for the registration of agents (accredited representatives) and representatives of the securities market regulated persons including registered brokers. Sources said that the new regulations are more comprehensive in nature as opposed to the previous registration regulations existing prior to the introduced of the Securities Act 2015.
In this connection, the SECP has issued SRO No. 832(I)/2017 here on Friday to introduce Licensing of Accredited Representatives Regulations, 2017. The draft Licensing or Accredited Representatives Regulations, 2017 proposed to be made by SECP are hereby published for the information of all persons likely to be affected by and notice is hereby given that objections and suggestions, if any received within the next 15 days will be taken into consideration.
The provisions of these regulations shall be applicable to the accredited representatives of regulated persons, by whatever name called. The regulations have also specified the eligibility criteria for licensing of an accredited representative. Subject to ongoing compliance with the provisions of the Securities Act, the Futures Act and these regulations, a regulated person, hereinafter referred to as the principal, may apply to the Commission for licence for a person as its accredited representative, hereinafter referred to as the applicant, if the applicant.
General Conduct of Business: No accredited representative shall deal with customers in his own name. All transactions and communications shall be in the name of the principal. Explanation.- Dealing with customers includes receiving cash or cheque from the customer in the representative's own name and issuing cash memos, receipts, delivery notes or any other document in his name. An accredited representative must act in accordance with the best interests of the market and the customers, and must follow the internal code of practice/ethics and code of conduct put in place by its principal. A branch manager accredited with a principal shall be deployed at such branch office which he/she is operating or supervising on behalf of the principal
A branch manager accredited with a securities/futures broker shall not match the purchase and sale orders of his customers and each such order must invariably be routed through his principal in accordance with the regulations. A principal shall enter into an agreement with its accredited representative for specifying the scope of his authority and responsibilities, confidentiality of information, remuneration or compensation, termination clause, etc.
The regulations said that an accredited representative shall maintain high standards of integrity, promptitude and farmers in the conduct of his business. An accredited representative shall act with due skill, care and diligence in the conduct of all his business. An accredited representative shall abide by the conduct of business, accounting and record keeping requirements and code of conduct if any, applicable on the representative as specified in the respective regulations of the principal, and as detailed in the agreement between the principal and the accredited representative, while discharging its duties in such capacity.
An accredited representative shall abide by all the provisions of the Securities Act and/or the Futures Act as the case may be, and the rules, regulations, directives, guidelines, codes etc. issued by the Commission, the exchange/association from time to time, as may be applicable to him and an accredited representative shall not neglect, fail to refuse to submit to the Commission, the exchange/association, such books, special returns, correspondence, documents and papers or any part thereof as may be required, the SECP added.
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