Section 172 Investments and Securities Act

Section 172 of the Investments and Securities Act 2025 is about Cancellation or suspension of registration of a manager. It is under Part XIII (Collective Investments Schemes) of the Act. It provides as follows:

(1) The Commission may cancel the registration of a manager where —
(a) the manager has contravened or failed to comply with any provision of this Act or rules and regulations made under it, and that such contravention or failure has resulted or may result in serious prejudice to the interests of the public or of investors;

(b) on completion of an investigation or inspection, the manner in which a manager carries on the business of a collective investment scheme is consistently unsatisfactory or undesirable or not calculated to serve the best interests of its investors; or
(c) the manager is wound up, either voluntarily or by the court.

(2) Whenever there is cause to cancel the registration of a manager on any of the grounds referred to in subsection (1), the Commission may, in lieu of such cancellation, suspend the registration of the affected manager for a period not more than 12 months at a time subject to such conditions as the Commission may determine.

(3) The Commission may not cancel or suspend the registration of a manager on any ground specified in subsection (1) unless it has —
(a) notified the manager of its intention and of the grounds upon which it proposes to do so;
(b) allowed the manager to make representations to it in connection with the proposed cancellation or suspension; and

(c) afforded the manager a reasonable opportunity to rectify or eliminate the defect, irregularity or undesirable practice.

(4) Where the registration of a manager is cancelled under subsection (1), the provisions of this Act with regard to the continuance or the winding-up of a scheme or the winding- up of the manager, shall apply:

Provided that the Commission may in any such case direct the former manager to defray, in whole or in part, the expenses incurred in continuing the administration of the scheme, or in realising any of its assets, and any remuneration to which a trustee or custodian may be entitled.

(5) Where the registration of a manager has been suspended under subsection (2), the manager shall not, during the period of suspension, issue any fresh participatory interests, but shall, in respect of participatory interests already issued, transfer the administration of the scheme to the trustee or custodian pending the appointment of another manager approved by the Commission on the recommendation of the trustee or custodian.