17 DECEMBER NEW ZEALAND GAZETTE 3785

without it being specifically delineated but in circumstances that require all members to respect absolutely that confidentiality;

in such circumstances that in any case where the Board is satisfied that a member is misusing the access to those services for the purpose of promoting or conducting business in the course of its association with any other organisation as defined in Rule 6(2) herein, the Board may at any time restrict or suspend access to that member to the services or suspend participation by that member in the facilities provided by the Exchange.

6 (3) Every member shall maintain accounting and other records of his sharebroking business separate and distinct from the accounting and other records of any other business in which he may be involved.

6 (4) Every sharebroking firm shall, in respect of every individual member associated with that firm whether as a partner, director, shareholder, employee or otherwise, pay such fees, levies and other expenses as shall from time to time be fixed or incurred on behalf of such member by the Exchange. In addition, each individual member shall also be liable to pay such fees, levies or other expenses in the event that his firm is unable, through default or other financial difficulty, to make or complete the appropriate payment and the member’s liability shall be limited to the amount owing and still unpaid. There may be differentiation as regards the amount of such fees, levies or other expenses as between different classes of membership, between company members, individual members who are shareholders of company members, and individual members who are shareholders of company members and between individual members themselves, if in the opinion of the Board, such differentiation is not unreasonable in the particular circumstances.

6 (5) Every company member, and every individual member who is a director of a company member, shall ensure that at all times:

(a) A majority of the directors of the company are individual members of the Exchange:

Provided that for the purposes of this Rule 6(5), the Board may resolve that a member of an overseas stock exchange shall be deemed to be a member until and if such resolution is revoked.

(b) Shareholders’ funds of the company are at least equal to $1 million.

(c) The articles of association or constitution of the company provide that:

(i) The company agrees to be bound by the Rules of the Exchange, in force from time to time; and

(ii) The directors’ meeting shall include a majority of directors who are members of the Exchange; and

(iii) The directors may not delegate their powers by power of attorney or in any other manner:

Provided that a director who is a member of the Exchange may appoint as his alternate director a person who is a member of the Exchange.

(d) The registered office of the company is located at a sharebroking office of the company except that where the company is a wholly owned subsidiary of any other company with its registered office in New Zealand, the member’s registered office may be situated at the same location as that of its parent company.

(e) The articles of association or constitution of the company comply in all material respects with the standard form (if any) prescribed from time to time for such articles by the Board and the determination of the Board that the articles of association of a company do or do not at any time comply with this Rule 6 (5) (e) shall be final and binding on the company member.

6 (6) The shares of a company member may be held in the name of a nominee but where any shares of a company member are held in or transferred into the names of nominees, the directors of the company member shall immediately advise the Board of the identity of the beneficial owner or owners of such shares.

6 (7) No company member shall have any of its shares held in such a way that the identity of the beneficial owner of those shares cannot be determined or disclosed to the Board and to all other members. All company members shall provide the Managing Director with a schedule of their shareholders, listing the identity of the beneficial owners of such shares and the number of shares held by each beneficial owner. The Managing Director shall maintain a file of such schedules and the file shall be open for inspection by any person at an office of the Exchange nominated by the Managing Director.

6 (8) Where there is a change in either the registered ownership or the beneficial ownership of any shares in a company member, the directors shall immediately advise the Managing Director, giving full details of the change and also confirming the identity of the beneficial owner of such shares so that the register referred to in Rule 6(7) may be updated.

6 (9) Failure by a company member to disclose either changes in shareholdings or the identity of the beneficial owners of its shares shall render the member liable to suspension by the Board. A suspension pursuant to this rule shall continue until such disclosure shall have been made to the satisfaction of the Board.

6 (10) Whenever a new director of a company member is appointed, the company shall forthwith deliver to the Exchange a statutory declaration by the director stating that the company is complying with Rule 6(5) and that the director will ensure that the company will abide by the Rules of the Exchange.

6 (11) Whenever a company member files with the Registrar of Companies an annual return or a notice of a change in its share capital, or its directors or articles of association or constitution, it shall at the same time send a copy of such return or notice to the Managing Director.

6 (12) Every sharebroking firm shall designate one individual member to be Managing Principal.

7. Sharebroking Offices

7 (1) No member shall operate any sharebroking office under a name which is different from that of his sharebroking firm.

7 (2) Every sharebroking office shall be under the direct full time control of either at least one individual member or a suitably qualified and experienced employee of that member.

7 (3) Where a member proposes to operate a sharebroking office under the control of a non-member employee, that member shall first seek the consent of the Board to the proposal by satisfying the Board that the employee concerned has the necessary qualifications and experience to be in charge of a sharebroking office.