Section 39 Investments and Securities Act 2025

Section 39 of the Investments and Securities Act 2025 is about Responsibilities of exchange holding company. It is under Part V (Registration and Regulation of Securities Exchanges, Financial Market Infrastructures and other Self Regulatory Organisations) of the Act. It provides as follows:

(1) An exchange holding company shall ensure —
(a) an orderly and fair market in relation to securities that are traded on the market through the facilities of the securities exchange of the exchange holding company or through the facilities of any of its subsidiaries that is duly approved as a securities exchange;
(b) the prudent risk management of its business and operations; and

(c) that the exchange holding company or any of its subsidiaries registered by the Commission to operate as a securities exchange, complies with any lawful requirements placed on it under this Act or the rules and regulations made under it and other laws applicable to it.

(2) In discharging its duty under subsection (1), the exchange holding company shall —
(a) act in the public interest, and in particular having regard to the protection of investors; and
(b) ensure that where its own interest conflicts with the interest referred to in paragraph (a), the interest in paragraph (a) shall prevail.

(3) An exchange holding company shall immediately notify the Commission if it becomes aware of —
(a) any matter which adversely affects or is likely to adversely affect the ability of —
(i) the exchange holding company to meet its obligations in respect of its business as an exchange holding company or a securities exchange, including its ability to comply with any requirement as may be specified by the Commission, where applicable, or
(ii) any subsidiary of the exchange holding company to meet its obligations in respect of its business, including the ability of any such subsidiary to comply with any requirement as may be specified by the Commission, where applicable; or

(b) any irregularity, breach of any provision of this Act or rules and regulations made under it, the rules of a securities exchange or any other matter which, in the opinion of the exchange holding company, indicates or may indicate, that the financial standing or financial integrity of any of its subsidiaries or the chief executive or directors of such subsidiary, as the case may be, is in question or may reasonably be affected.

(4) Where an exchange holding company, approved as a securities exchange undertakes any function of a subsidiary that is approved as a securities exchange, such exchange holding company shall enter into arrangements as the Commission may determine as to how the duties and obligations of the exchange holding company and the subsidiary, under this Act or rules and regulations made under it are satisfied.