Section 36 Investments and Securities Act 2025

Section 36 of the Investments and Securities Act 2025 is about Prohibition of trading in particular securities. 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) Where the Commission deems it necessary for the protection of persons transacting in particular securities on a securities exchange, it may suspend or prohibit further trading in the securities and give notice in writing to the securities exchange.

(2) Where, after receiving the notice given under subsection (1), the securities exchange fails to take action to prevent trading in the securities to which the notice relates, and the Commission still deems it necessary to prohibit trading in the securities, the Commission may, by notice in writing, to the securities exchange, prohibit trading in the securities for such period, not exceeding 14 days:
Provided that the Commission shall have the power by notice in writing to increase
the period for a further period not exceeding 30 days at a time.

(3) A securities exchange which permits trading in securities in contravention of a notice under subsection (2) is liable to a penalty of not less than N1,000,000 and a further sum of N50,000 for every day the contravention continues.

(4) In addition to the provisions of subsection (3), the Commission may —
(a) revoke the registration of the securities exchange;
(b) refuse to consider or process any further request or application for approval, registration or consent made or to be made to the Commission by the securities exchange;

(c) apply to a court of law under the Companies and Allied Matters Act for —
(i) a beneficial, efficient and orderly administration or winding up, as the case may be, of the securities exchange in the best interest of the market, or
(ii) an administrator, liquidator or an official receiver, being in each case, a qualified professional and not necessarily a court official, to take-over management under the supervision of the court in respect of the securities exchange as if the Commission were a creditor:

Provided that a person appointed under subparagraph (i) or (ii) have the same powers which would be available to a liquidator under winding up proceedings;

(d) after giving opportunities to the executive officers of the securities exchange to be heard, appoint other competent persons to serve in a committee in place of the serving chief executive officer and executive management and board of the securities exchange; or

(e) apply to the Tribunal for an enforcement order in respect of its directive to suspend trading on the specified securities:

Provided that the Commission may take any of the actions where it considers that the interest of investors or of members of the public or the integrity of the market so requires.