17 DECEMBER

NEW ZEALAND GAZETTE

3783

2. Objects

2 (1) As prescribed by Section 4(1) of the Act, the functions of the Exchange are:

(a) To operate a national stock exchange, which may be wholly or in part operated through the establishment of regional stock exchanges;

(b) To promote and specify the conditions and terms for the listing and trading of securities on its exchange;

(c) To regulate and promote uniformity in the conduct of its members and of business by its members;

(d) To promote the interests of its members and members of the public in relation to the listing, trading, underwriting, and marketing of securities.

2 (2) As prescribed by Section 4(2) of the Act, the Exchange shall have all such powers as are reasonably necessary or expedient to carry out its functions.

3. Membership

3 (1) Members shall consist of all persons who have become members pursuant to any rule for the time being in force and all persons admitted to membership as hereinafter provided.

3 (2) Membership of the Exchange shall comprise the following classes:

(a) individual members; and

(b) company members.

3 (3) The Board shall admit as an individual member of the Exchange a natural person who has applied for membership of the Exchange in accordance with Rule 4 if:

(a) The person supplies evidence satisfactory to the Board to the effect that:

(i) He holds a sharebroker’s licence; and

(ii) He has been employed full time for a total of not less than three years in the five year period immediately preceding his application for membership in the sharebroking office of a member or of a member of an overseas stock exchange recognised by the Exchange, and he has obtained a pass in such examinations as the Board may from time to time prescribe.

(iii) In exceptional circumstances the Board may consider and accept evidence of experience or qualifications, either in reduction of the three year full time employment requirement or extension of the five year period, or exemption from the examination qualifications required, but not both.

(iv) He will carry out his responsibilities as a member and sharebroker honestly and diligently. Without limiting the power of the Board to satisfy itself with regard to this requirement, it may accept references from at least 2 suitable persons as evidence of the candidate’s intentions in this matter.

3 (4) The Board shall admit as a company member of the Exchange a company that has applied for membership in accordance with Rule 4 if:

(a) The company provides evidence satisfactory to the Board to the effect that:

(i) The requirements of Rule 6(5) are met; and

(ii) The company holds a sharebroker’s licence.

(b) Each director of the company has delivered to the committee a statutory declaration stating that the requirements of Rule 6(5) are met and that the director will ensure that the company will abide by the Rules of the Exchange.

3 (5) A person shall cease to be a member:

(a) If he shall have delivered his resignation in writing to the Board and the Board shall have accepted the same (and no such acceptance shall be withheld without good reason); or

(b) On termination or expulsion pursuant to Rule 3(13) or Rule 18(10).

3 (6) The Board may at its discretion appoint as an honorary member, any individual member who may have resigned in terms of Rule 3(5)(a).

3 (7) An honorary member shall have no voting rights at any general meeting of the Exchange but he shall be entitled to attend such meetings in a non voting capacity.

3 (8) An honorary member shall have no liability for any fee, levy or other charge made by the Exchange and shall hold his honorary status at the complete discretion of the Board.

3 (9) Where a sharebroking firm has been declared a defaulter in terms of Rules 20(1) or 20(4), every principal of that sharebroking firm shall, from the time such declaration of default has been made, be deemed to be suspended until further notice.

3 (10) Any member suspended under Rule 3(9) shall, as a condition of retaining his membership:

(a) Provide all reasonable assistance to the receiver, liquidator, special manager or any other appropriate person to enable both the financial position of the sharebroking firm to be established and the reconciliation of accounts with all other members to be completed; and

(b) Contribute financially his appropriate share—

(i) to the costs of the resolution of the sharebroking firm’s affairs; and

(ii) to the funding of any liability which the firm might have to its clients and sharebroking creditors after determining the sharebroking firm’s recoverable assets.

3 (11) The amount of the appropriate share in Rule 3(10)(b) shall be determined by the Board and in making such a determination the Board shall have regard to the interest which a member has in the sharebroking firm, the extent to which the member was in a position to influence or control the direction of the sharebroking firm and any other matters which the Board could reasonably regard as relevant to enable the appropriate share to be determined.

3 (12) Any member who has been suspended in terms of Rule 3(9) may apply in writing to the Board for that suspension to be lifted. Without limiting the discretion of the Board to decide the matter, it shall be reasonable grounds for the suspension to be lifted where:

(a) The member is able to show to the satisfaction of the Board that in the circumstances of his case, it might not have been appropriate for the suspension to be imposed; or

(b) The member is able to provide evidence satisfactory to the Board of his ongoing commitment to meet the obligations set out in Rules 3(10)(a) and 3(10)(b).

3 (13) The Board may without further notice, terminate the membership of any member who, in the judgement of the Board, does not provide satisfactory evidence of his ongoing commitment to meet the obligations set out in Rules 3(10)(a) and 3(10)(b). Alternatively, the member may tender his resignation from membership by advice to the Board in writing.