9 SEPTEMBER 2010 NEW ZEALAND GAZETTE, No. 115 3105

Securities Markets Act 1988

The Authorised Futures Exchange (NZX Limited) Notice 2010

Pursuant to section 37(8) of the Securities Markets Act 1988, the Securities Commission gives the following notice.

Notice

1. Title, commencement and expiry—(1) This notice may be cited as the Authorised Futures Exchange (NZX Limited) Notice 2010.

(2) This notice shall come into force on the day after the date of its publication in the New Zealand Gazette and shall continue in force until revoked by the Securities Commission.

2. Interpretation—(1) In this notice, unless the context otherwise requires:

Act means the Securities Markets Act 1988 and includes any re-enactment or replacement thereof.

Client has the meaning given to that term in the Rules.

Company means NZX Limited.

Contract has the meaning given to that term in the Rules.

Contract Specifications has the meaning given to that term in the Rules.

Directors has the meaning given to that term in the Rules.

Error Trade Register has the meaning given to that term in the Rules.

Head of Market Supervision means the person employed by the Company occupying that position within the Company from time to time.

Market means the derivatives market operated by the Company and conducted in accordance with the Rules and the Procedures and declared an authorised futures exchange under Part 3 of the Act by this notice.

Market Maker Programme has the meaning given to that term in the Rules.

NZ Markets Disciplinary Tribunal Rules has the meaning given to that term in the Rules.

NZX Designated Person has the meaning given to that term in the Rules.

Participant has the meaning given to that term in the Rules.

Person has the meaning given to that term in the Rules.

Personnel has the meaning given to that term in the Rules.

Procedures means the Derivatives Market Procedures in relation to the derivatives market operated by the Company and as amended or replaced from time to time.

Rules means the Derivatives Market Rules in relation to the derivatives market operated by the Company and as amended or replaced from time to time.

Trading Day has the meaning given to that term in the Rules.

Trading System has the meaning given to that term in the Rules.

(2) Any term or expression that is defined in the Act and used, but not defined, in this notice has the same meaning as in the Act.

3. Authorisation – NZX Limited declared an authorised futures exchange—(1) The Company is declared to be an authorised futures exchange for the purposes of Part 3 of the Act.

(2) The authorisation in clause 3(1) of this notice is subject to the conditions set out in clauses 4 to 7 of this notice.

4. Conditions—(1) The Company must ensure that copies of the Rules and the Procedures are available for public inspection, free of charge and during normal office hours, at the registered office of the Company.

(2) The Company must notify and obtain the written consent of the Securities Commission (such consent not to be unreasonably withheld or delayed) in relation to any amendments to existing Contract Specifications or for designations of new Contract Specifications by the Company prior to such amendments or designations becoming effective.

(3) The Company must notify the Securities Commission of any proposed amendments to the Procedures before they are effected, and must obtain the written consent of the Securities Commission before making any amendments which, in the opinion of the Securities Commission, materially modify the application of any of the Rules.

(4) The Company must notify and obtain the written consent of the Securities Commission if it seeks to transfer or assign any of its rights, entitlements, or obligations under the Rules, the Procedures, the NZ Markets Disciplinary Tribunal Rules and related procedures to any Person.

(5) The Company must maintain real-time surveillance of the Market and undertake such surveillance to a standard satisfactory to the Securities Commission.

(6) The Company must notify the Securities Commission of any proposed amendments to the Rules and obtain the written consent of the Securities Commission before such amendments are effected in accordance with the Rules.

5. Conditions relating to directions by the Securities Commission to the Company—(1) The Company must, immediately upon receipt of a direction from the Securities Commission under this clause 5, comply with that direction and must not allow any trading to take place on the Market contrary to the direction.

(2) The Securities Commission may make a direction to the Company if, after taking into account the purpose of subpart 1 of Part 2 of the Act and the criteria stated in section 19A of the Act or any other matters it considers relevant, it is satisfied that the direction is necessary or desirable in the public interest to protect people trading Contracts and that there is no more appropriate course of action to address the situation.

(3) A direction under this clause 5 may, for up to 21 days:

(a) require the Company to suspend trading of one or more Contracts, or a class of Contracts, traded on the Market; or

(b) give the Company any other direction in relation to trading on the Market.

(4) Before giving a direction under this clause 5, the Securities Commission must follow the procedures set out in the Schedule to this notice.

(5) The Securities Commission may vary a direction given under this clause 5 in the same way as it made that direction.

(6) The Securities Commission may revoke a direction given under this clause 5 by giving written notice to the Company.

6. Conditions relating to reporting obligations—(1) The Company must notify the Securities Commission if the Company:

(a) takes any disciplinary action for a contravention of the Rules or Procedures against any person; or

(b) knows or suspects that a person has committed, is committing, or is likely to commit a significant contravention of:

(i) the Rules or Procedures; or