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ARRANGEMENT OF REGULATIONS
PART I—ELIGIBILITY AND CONDITIONS
FOR MEMBERSHIP OF GHANA STOCK
EXCHANGE
Regulation
1. Classes of members of Ghana
Stock Exchange
2. Qualification of a company for
membership of the Stock Exchange.
3. Qualification of a firm for
membership of the Stock Exchange
4. Application for membership of
the Stock Exchange
5. Invitation for objections
6. Procedure for admission
7. Period of membership
8. General conditions for an
admitted company
9. General conditions for an
admitted member firm
10. General conditions for
admitted subsidiaries of financial
institutions.
11. Expulsion from membership
12. Resignation of membership
13. Termination of membership
14. Effect of expulsion or being
declared in default
15. Power of admission and
readmission to membership
16. Minimum liquid funds of
members
17. Authorised Dealing Officers
18. Application for approval as an
Authorised Dealing Officer
19. Qualification for appointment
as an Authorised Dealing Officer.
20. Conditions to be complied with
by an Authorised Dealing Officer.
21. Discipline of Authorised
Dealing Officers
22. Admission fee and other
subscriptions
23. Accounts and Audit
24. Client’s account
25. Auditor’s function
26. Reporting requirements
27. Fidelity fund
28. Assignment of the right of
membership
29. Register of members
PART II—CODE OF CONDUCT
30. Code of conduct and
punishment for breach
RELATIONSHIP BETWEEN MEMBERS AND
THE INVESTING PUBLIC
31. Integrity and secrecy
32. Books of accounts
33. Records of clients
34. Credit balance of clients
35. Management of accounts of
clients
36. Execution of orders
37. Issue of contract note
38. Clients of other members
39. Disclosure of client’s
business
40. Abuse of client’s information
41. Betrayal of trust
42. Misuse of client’s funds
43. Misuse of documents of client
44. Mishandling of account of
client
45. Excessive business for client
46. Purchase and sale prices
47. Delay in delivery and payment
48. Business for commission
49. Failure to carry out
transactions for clients
50. Business for defaulting
clients
51. No dishonoured cheques to
clients
52. Speculative business with an
employee
53. Communication to non-clients
54. Business with defaulting
clients
55. Responsibility for the
dealings of Authorised Dealing
Officers, etc.
56. Dealing with clients as a
principal or as an agent
RELATIONSHIP AMONG MEMBERS
57. Entering into transactions
58. Comparison of unmatched
transactions
59. Documents constituting bad
delivery
60. Replacement of documents
declared as bad delivery
61. Introduction of forged
documents
62. Delivery of securities and
payment therefore
63. No dishonoured cheques
between members
64. Concealed bargains
65. Transactions with Authorised
Dealing Officer or employee
RELATIONSHIP BETWEEN MEMBERS AND
THE STOCK EXCHANGE AUTHORITIES
66. Improper conduct
67. Failure to comply with
resolutions, etc.
68. Failure to submit to or abide
by arbitration
69. Failure to testify or give
information
70. Failure to submit special
returns
71. False or misleading returns
72. Vexatious complaints
73. Failure to pay dues and fees
74. Fictitious name and dealings
75. Prejudicial business
76. Advice to clients
77. Unwarrantable and excessive
speculative business
78. Street dealing
79. Hawking in securities
80. Dealing in unlisted securities
81. Trading in suspended
securities
82. Compliance with rules and
regulations
83. Access to information not to
be used by members
84. Business for Exchange
employees
85. Evasion of margin requirements
86. Brokerage charge
87. Sharing of brokerage
88. Business with non-member
89. Inquiries and investigations
90. Periodic returns
91. Insurance covers
92. Minimum liquidity requirements
93. Interpretation
94. Commencement
IN exercise of the powers
conferred on an authorised stock
exchange by paragraph (a) of
section 4 of the Stock Exchange
Act, 1971 (Act 384), and with the
approval of the Secretary
responsible for Finance these
Regulations are made by the
Council of the Ghana Stock
Exchange this 9th day of January,
1991.
PART I—ELIGIBILITY AND CONDITIONS
FOR MEMBERSHIP OF GHANA STOCK
EXCHANGE
Regulation 1—Classes of Members of
Ghana Stock Exchange.
(1) The membership of the Ghana
Stock Exchange shall consist of—
(a) Licensed Dealing Members; and
(b) Associate Members.
(2) Licensed Dealing membership
is open to companies incorporated
under the Companies Code 1963,
(Act 179) and partnerships
incorporated under the
Incorporated Private Partnerships
Act 1962, (Act 152) which have
current licence from the Exchange
to deal in securities.
(3) Associate membership is open
to any individual, body of persons
or professional association which,
in the opinion of the Council of
the Exchange are law abiding,
identify themselves with the
objectives of the Exchange and
desire to contribute towards the
attainment of the objectives.
(4) Associate Members do not have
the right to deal in securities on
the Exchange.
Regulation 2—Qualification of a
Company for Membership of Stock
Exchange.
A
company shall not qualify to be
admitted as a member of the Ghana
Stock Exhange unless—
(a) its regulations have been
approved by the Council of the
Stock Exchange;
(b) subject to regulation 10 of
these Regulations, in the case of
a company with limited liability,
each of its directors enters into
an agreement with the Exchange to
be jointly and severally liable
for the debts and obligations of
the company, whether incurred
before or after he became a
director of the company;
(c) all its directors have
recognised academic or
professional qualifications or
experience in banking, law,
accountancy, economics, business
administration, secretarial
practice, dealing in securities or
any other relevant qualification
or experience acceptable to the
Council;
(d) each director is, in the
opinion of the Council, a person
of good repute and character and
has high business integrity;
(e) its sole business is dealing
in securities and business
activities relevant to such
dealings
(f) it has the required financial
resources to meet its obligations
as a member of the Stock Exchange;
(g) its issued capital consists of
fully paid shares; and
(h) it is solvent.
Regulation 3—Qualification of a
Firm for Membership of the Stock
Exchange.
A
firm shall not qualify to be
admitted as a member of the
Exchange unless—
(a) the firm is registered under
the Incorporated Private
Partnerships Act, 1962 (Act 152);
(b) each partner in the firm is at
least 21 years of age at the time
of the application for membership;
(c) each partner has at the time
of the application a recognised
academic or professional
qualification or experience in
banking, law, accountancy,
economics, business
administration, secretarial
practice or any other relevant
qualification or experience
acceptable to the Council of the
Exchange;
(d) each partner is in the opinion
of the Council, a person of good
repute and character and has high
business integrity and experience
in dealing in securities;
(e) no partner has been convicted
of an offence involving fraud or
dishonesty;
(f) no partner has been expelled
or declared in default by any
recognised stock exchange;
(g) the firm has the required
financial resources to meet its
obligations as a member of the
Exchange; and
(h) the partners are resident in
Ghana.
Regulation 4—Application for
Membership of the Stock Exchange.
(1) Application for membership of
the Ghana Stock Exchange shall be
submitted in writing on a form
prescribed by the Council, to the
Managing Director of the Exchange.
(2) A company shall submit its
application together with—
(a) a copy of its regulations;
(b) a copy of the resolution of
its board of directors empowering
the directors or the
representatives of such company to
act, engage and deal on behalf of
the company; and
(c) a copy of the specimen
signature of each of its directors
or representatives.
(3) A firm shall submit with the
application a copy of its
partnership agreement.
(4) The applicant may also submit
such other materials or references
of credit as the applicant may
decide in evidence of its
financial capacity, technical
competence, integrity and
reputation.
Regulation 5—Invitation for
Objections.
(1) On receipt of an application,
the Managing Director shall by
means of a notice posted on the
notice board of the Exchange
invite objections from the members
against the admission of the
applicant as a member of the
Exchange.
(2) Any objections, may be filed
with the Managing Director in
writing within 15 days from the
date of the notice.
Regulation 6—Procedure for
Admission.
(1) After the expiry of the 15
days, the Managing Director shall
put the application before the
Council for consideration together
with such material by way of bank
references of credit as may have
been produced by the applicant or
as may have been collected by the
Exchange and any objections filed
under subregulation (2) of
regulation 5.
(2) The Council at its meeting
may by a majority accept or reject
the application or may impose such
other conditions as it may deem
fit subject to which the
application may be accepted or may
make any order which it deems
necessary or expedient;
(3) The Managing Director shall
post a notice on the board of the
Exchange notifying the admission
of a new member as soon as an
application for admission has been
granted by the Council.
(4) On the admission of an
applicant it shall be issued with
a Dealer’s Licence where the
application is for such licence.
Regulation 7—Period of
Membership.
(1) Membership of the Exchange
shall be for twelve months but
shall be renewed annually unless
the Council has reason to believe
that the member has not performed
its duties efficiently, honestly
or fairly or the Council decides
to refuse such renewal by reason
of the member’s failure to comply
with the regulations and rules of
the Exchange or with laws relating
to securities in Ghana.
(2) Where an application for
membership of the Exchange is
rejected, or where the Council
refuses to renew a membership, or
where a member is suspended or
expelled in accordance with the
regulations and rules of the
Exchange, or under any existing
law, the Chairman of the Council
shall within 7 days of such action
forward to the Governor of the
Bank of Ghana a written statement
of the grounds for such rejection,
non-renewal, suspension or
expulsion.
Regulation 8—General Conditions
for an Admitted Company.
A
company on admission as a Licensed
Dealing Member shall comply with
and observe throughout the term of
its membership the following—
(a) it shall not, without the
written approval of the Council,
effect any change in its company
regulations;
(b) it shall not go into
voluntary liquidation without
giving the Council at least 30
days’ prior written notice of its
intention to do so;
(c) it shall promptly notify the
Council of the death of any
director and of the fact that any
person has ceased for any reason
to be its member or a director;
(d) no director of the company
shall resign from his directorship
without prior approval of the
Council;
(e) before the resignation of a
director of the company, the
member company shall furnish the
Council with a certificate signed
by its auditors that the member
company has the minimum liquid
funds referred to in regulation 16
of these Regulations and, if it is
a limited liability company, that
it still has the paid-up capital
referred to in paragraph (g) of
this Regulation;
(f) it shall, at all times, have
not less than two directors but a
sole surviving director may apply
to the Council for permission to
carry on its business for a period
not exceeding 4 weeks;
(g) its minimum stated capital
shall be of such amount as may be
determined by the Council from
time to time;
(h) its directors shall hold at
least 51% of its issued shares;
(i)
no director of the member company
shall without the prior written
approval of the Council engage in
any business other than that of a
stockbroker or dealer in
securities but may, subject to the
rules and regulations of the
Exchange, hold shares or be a
director in a company, provided
that he does not actively engage
in executive management of such a
company without the prior approval
of the Council;
(j) its sole business shall be
that of a stockbroker or dealer in
securities and that of engaging in
associated business activities, it
shall not engage in any other
business and shall not have any
direct or indirect interest in
another member company or member
firm or any other company without
the prior written approval of the
Council;
(k) it shall file with the
Exchange a copy of the Annual
Return required under the
Companies Code 1963, (Act 179) to
be filed with the Registrar of
companies and such other documents
as may be required by the Council
from time to time;
(l) it shall at all times adhere
to the principles of good business
practice in the conduct of its
business affairs;
(m) it shall be active in its
business to an extent acceptable
to the Exchange; and
(n) it shall maintain at all times
the minimum liquid funds referred
to in regulation 16.
Regulation 9—General Conditions
for an Admitted Member Firm.
A
member firm shall on admission
comply with and observe throughout
the term of its membership the
following—
(a) except as provided in
paragraph (l) of this Regulation
there shall, at all times be not
less than two partners in the
firm;
(b) there shall exist a valid
partnership agreement in writing
made between the partners of the
member firm;
(c) every partnership agreement
shall be approved by the Council,
and an approved copy deposited
with the Managing Director;
(d) no change shall be made to any
partnership agreement without the
prior approval of the Council;
(e) the member firm shall not
change its name without the prior
written approval of the Council;
(f) the member firm shall not
voluntarily dissolve or permit any
partner to resign without giving
the Council at least 30 days
advance written notice of the
intended voluntary dissolution or
resignation;
(g) on the resignation of a
partner of the member firm the
member firm shall furnish the
Council with a certificate signed
by its auditors that it has the
minimum liquid funds referred to
in regulation 16;
(h) its sole business shall be
that of a stockbroker or dealer in
securities and that of engaging in
associated business activities; it
shall not engage in any other
business and shall not have any
direct or indirect interest in
another member firm or member
company or any other company
without the prior written approval
of the Council;
(i)
no partner of the member firm
shall engage in any business other
than that of a stockbroker or
dealer in securities or that of an
associated business without the
prior approval of the Council; but
he may hold shares or be a
director in a company, so long as
he does not actively engage in the
executive management of the
company without the prior approval
of the Council;
(j) every member firm shall
promptly notify the Council in
writing of the death of any of its
partners and of any person ceasing
for any reason to be a partner in
the firm.
(k) every member firm shall
maintain at all times the minimum
liquid funds referred to in
regulation 16;
(l) in the event of the number of
partners in the member firm being
reduced to one for any reason
through no fault of the continuing
partner, then the firm may, at the
discretion of the Council,
continue to carry on its
stockbroking business for such
period, not exceeding six months
as the Council may determine; and
if no additional partner joins the
continuing partner in the member
firm within the six months period,
the member firm must cease to
carry on business on the Exchange.
Regulation 10—General Conditions
for Admitted Subsidiaries of
Financial Institutions.
Where a company is certified by
the Bank of Ghana to be a
subsidiary of a financial
institution, it shall on admission
as a Licensed Dealing Member
comply with and observe throughout
the term of its membership—
(a) the requirements set out in
regulation 2, with exception of
paragraph (b); and
(b) the requirements set out in
regulation 8 except that its
directors shall not be required to
hold any of its issued shares.
Regulation 11—Expulsion from
Membership.
(1) The Council of the Exchange
may at any time after the date of
admission of a member cancel the
admission and expel the member if
the member has in its application
or at any time of consideration of
its application for admission or
during the course of the enquiry
made by the Council before its
admission—
(a) made any wilful
misrepresentation;
(b) suppressed any material
information required as to its
character; or
(c) directly or indirectly given
false particulars of information
or made a false declaration.
(2) A member may also be expelled
where it fails to pay its
admission fee and current sub-scription
due within one month from the date
of admission.
Regulation 12—Resignation of
Membership.
(1) A member who intends to resign
from the membership of the
Exchange shall serve on the
Exchange a written notice at least
30 days before the date of the
intended resignation and a copy of
the notice shall be posted on the
notice board of the Exchange by
the Managing Director of the
Exchange.
(2) Any member objecting to a
resignation that has been notified
shall communicate the grounds of
its objections to the Council in
writing within 15 days of the
posting of such notice.
(3) The Council, at its meeting to
consider such resignation, may
accept either unconditionally or
on such conditions as it may think
fit or may refuse to accept such
resignation until it is satisfied
that all outstanding transactions,
including debts of the member have
been settled.
(4) A resignation shall not
relieve a member from any
liability arising under the rules
and regulations of the Exchange
and the Council may require a
member resigning to enter into
such agreements and undertakings
with the Exchange as the Council
may decide.
Regulation 13—Termination of
Membership.
A
member ceases to be a member—
(a) by resignation;
(b) by expulsion;
(c) by being declared in default
in accordance with the rules and
regulations of the Exchange; or
(d) by being unable to pay its
debts resulting in a winding up
action and the appointment of a
liquidator or receiver of the
member.
Regulation 14—Effect of Expulsion
or Being Declared in Default.
(1) Where a member is expelled or
declared in default under the
regulations or rules of the
Exchange, the member shall cease
to be a member of the Exchange
with the consequent loss of the
rights and privileges of
membership but any right of other
members against such a member
accrued prior to such expulsion or
declaration shall remain
unimpaired.
(2) The Council shall notify or
cause to be notified to the public
that the member concerned has
ceased to be a member of the
Exchange.
Regulation 15—Power of Admission
and Readmission to Membership.
(1) The power of admission of
candidates to membership of the
Exchange or readmission of any
former member shall be
discretionary and shall be
exercised solely by the Council.
(2) A decision of the Council
under subregulation (1) shall not
be disputed or challenged by any
person.
(3) Subject to subregulation (2)
of regulation 7, the Council shall
be under no obligation to give any
applicant with regard, to an
admission or readmission or
refusal to do so any notice of the
grounds or reasons for its action.
Regulation 16—Minimum Liquid Funds
of Members.
(1) Member companies and member
firms shall at all times ensure
that the liquid funds employed in
the business are as follows—
(a) not less than ¢500,000 for
each partner of a member firm; and
(b) not less than ¢500,000 for a
director of a member company.
(2) Each member firm or member
company shall promptly notify the
Council if its liquid funds are at
any time less than the minimum
amount specified under
subregulation (1).
Regulation 17—Authorised Dealing
Officers.
(1) Members shall be entitled to
be represented in respect of their
business by Authorised Dealing
Officers who alone will be given
access to the Exchange “floor” by
the Exchange.
(2) No member shall nominate any
person as its Authorised Dealing
Officer without first having such
person approved by the Council.
(3) No restriction on the
authority of an Authorised Dealing
Officer can affect the liability
of members arising from
transactions on the Exchange.
(4) Authorised Dealing Officers
shall be regarded by the Exchange
as authorised by members to
conduct their business and to bind
them to an unlimited extent.
Regulation 18—Application for
Approval as an Authorised Dealing
Officer.
(1) A member who desires to
appoint an Authorised Dealing
Officer shall apply to the
Exchange on such form and shall
pay such fees as may be prescribed
by the Council.
(2) The Managing Director or his
nominee shall interview the
candidate and before or during
such interview shall obtain any
information he requires, including
the views of any present or past
employers or both or business
associates.
(3) The Managing Director shall
circulate the name of the
candidate to all members and shall
simultaneously post the said name
on the notice board allowing 10
days for objection.
(4) The application, along with
objections, if any, shall be
placed before the next meeting of
the Council for a decision.
(5) An application relating to a
candidate who previously had been
acting as an Authorised Dealing
Officer to another member shall be
accompanied by a discharge
certificate from the former
employer.
(6) Where a discharge certificate
is not attached to an application
as provided under subregulation
(5) of this regulation, the
applicant shall submit its
explanation and the Council shall
then decide whether, and on what
conditions, the requirement
relating to the discharge
certificate shall be waived.
(7) The Council shall not be
obliged to give any reason for its
decisions under this regulation.
(8) On the approval of the
appointment of an Authorised
Dealing Officer, his name shall be
entered in the Register maintained
by the Exchange for the purpose.
Regulation 19—Qualification for
Appointment as an Authorised
Dealing Officer.
(1) No person shall be appointed
as an Authorised Dealing Officer
without the prior approval of the
Council.
(2) No member shall appoint any
person as its Authorised Dealing
Officer who has been suspended or
expelled by the Exchange.
(3) In determining a candidate’s
acceptability for appointment, the
Managing Director shall look for
evidence of—
(a) the integrity of the candidate
and a record of high standard of
business conduct, as shown in the
investigations and observations of
his employer, previous employers,
educational institutions attended
and other relevant references;
(b) his potential ability to
perform in a satisfactory manner
the duties of an Authorised
Dealing Officer as shown by a
period of specific training for
these duties in a member’s office
in the securities business.
(4) No person shall qualify to be
appointed as an Authorised Dealing
Officer unless he has attained the
age of 21 years.
(5) The minimum training
requirements under subregulation
(3) (b) for a candidate without
previous experience shall be one
month.
(6) A candidate must have passed,
or been exempted from, such
qualifying examinations as may be
conducted, or duly authorised to
be conducted by the Council or a
Committee appointed by the
Council.
(7) The examinations will be
conducted at such times during the
year as may be decided by the
Council or the Committee and
regulations governing such
examinations may be drawn up by
the Council or the Committee.
Regulation 20—Conditions to be
Complied with by an Authorised
Dealing Officer.
(1) An Authorised Dealing Officer
shall at all times adhere to the
principle of good business
practice in the conduct of his
business affairs and shall
transact business only on behalf
of his employer.
(2) An Authorised Dealing Officer
shall be engaged full-time in the
office of the member and shall
have no other business, unless the
Council has given him written
permission to be engaged in any
other business specified in the
permission.
(3) A member terminating the
employment of an Authorised
Dealing Officer shall give notice
of such termination to the
Managing Director.
(4) A member shall be liable for
all bargains made in the market by
its Authorised Dealing Officer;
and such liability shall continue
until the notice of the
termination of his employment has
been received by the Exchange, and
the termination of his employment
has been posted on the notice
board of the Exchange.
Regulation 21—Discipline of
Authorised Dealing Officers.
(1) The Council or any Committee
of it has power to enquire into
the conduct of any Authorised
Dealing Officer.
(2) Where an Authorised Dealing
Officer has been found by the
Council or the Committee to have
contravened any rule, regulation
or requirement of the Exchange or
to be guilty of any improper
conduct or method of business, the
Council or the Committee may
impose any one or more of the
following penalties—
(a) a reprimand;
(b) a fine to be imposed on the
Authorised Dealing Officer or on
the member or on both;
(c) suspension of the Authorised
Dealing Officer from trading for a
specific period;
(d) expulsion of the Authorised
Dealing Officer.
(3) Where the Council is
satisfied that any Authorised
Dealing Officer has acted
fraudulently or dishonestly in any
matter relating to transactions on
the Exchange, the Council may
terminate the approval of the
Authorised Dealing Officer,
whereupon the member shall
discontinue the employment of the
person as an Authorised Dealing
Officer.
Regulation 22—Admission Fee and
Other Subscriptions.
(1) Every member shall pay an
admission fee, for admission of an
Authorised Dealing Officer, annual
subscriptions and any other levies
or security deposits as the
members of the Exchange shall
determine by ordinary resolution
in a general meeting on the
recommendation of the Council.
(2) The subscriptions shall be due
and payable on admission of a
member to membership or approval
of an Authorised Dealing Officer
and after that on the first day of
January in each year, or in the
case of special levies, on such
other date as the resolution shall
provide.
Regulation 23—Accounts and Audit.
(1) Every member of the Exchange
shall maintain records in
sufficient detail to show
particulars of—
(a) all moneys received or paid by
the member;
(b) all purchases and sales of
securities made by the member and
the charges and credits arising
therefrom, and the names of the
buyer and seller respectively, of
each of those securities;
(c) all income received from
commissions, brokerage interest
and other sources and all
expenses, commissions, brokerage
and interest paid;
(d) all transactions by the member
with or for the account of—
(i)
clients; and
(ii) the member, showing
separately those held on account
of directors and employees of the
member;
(e) all assets and liabilities,
including contingent liabilities
of the member;
(f) all securities which are the
property of the member, showing by
whom they are held and if held
otherwise than by the member
itself, whether they are held as
collateral against loans or
advances;
(g) all securities which are not
the property of the member but for
which the member is accountable,
showing—
(i)
by whom and for whom they are
held;
(ii) the extent to which they are
held for safe custody; and
(iii) the extent to which they are
deposited with or otherwise
pledged or charged to any third
party as collateral available
against loans and advances;
(h) all underwriting transactions
entered into by the member, and
(i)
all arbitrage transactions entered
into by the member.
Regulation 24—Clients’ Account.
(1) Each member shall hold
clients’ money in trust and shall
keep in a bank or banks separately
the account, titled Clients’
Accounts, into which it shall pay
all receipts, less any commission
and other expenses for the
purchase of securities or from the
sale of securities.
(2) All sums received by the
member for or on account of any
person and required to be held in
a Clients’ Account shall be
retained in the account until—
(a) paid to the person entitled
to it or as such person
authorises;
(b) withdrawn for the purpose of
defraying commission and other
expenses;
(c) paid as otherwise authorised
by law.
(3) Every member shall cause an
Annual Account including Profit
and Loss Account and Balance Sheet
prepared at a date which shall
not, without the consent of the
Council, be more than fifty-four
weeks after the date on which a
Balance Sheet was last prepared,
or the date on which the member
began to trade.
(4) Without prior approval of the
Council, no member shall change
its practice with regard to the
dates on which the said Balance
Sheet is prepared.
(5) Every member shall have his
accounts audited annually by an
auditor who shall be appointed by
the member with the approval of
the Council.
Regulation 25—Auditor’s Function.
(1) The auditor appointed by the
member to carry out an audit shall
furnish the Exchange with a report
stating whether, in his opinion—
(a) the member’s books of accounts
and records are those usual in a
business of that nature and appear
to have been kept in a proper
manner in accordance with the
provisions of the rules and
regulations of the Exchange; and
(b) the financial position of the
member is such as to enable it to
conduct its business on sound
lines, having regard to the nature
and volume of the business
transacted during its past
financial year as shown by its
books of accounts and records.
(2) Where, in the performance of
his duties an auditor, becomes
aware—
(a) of any matter which in his
opinion may adversely affect the
financial position of the member
to a material extent;
(b) of any matter which in his
opinion may constitute a breach of
any provisions of the Stock
Exchange Act, 1971 (Act 384) or
any other legislation dealing with
the securities industry or a
criminal offence involving fraud
or dishonesty;
(c) that irregularities that have
a material effect upon the
accounts have occurred, including
irregularities that jeopardise the
funds or property of the clients
of the member;
(d) that the accounting system,
internal accounting control and
procedures for safeguarding
securities are inadequate and the
inadequacies have a material
effect on the account,
the auditor shall immediately
report the matter to the Chairman
of the Council.
Regulation 26—Reporting
Requirements.
Each member shall promptly report
to the Exchange whenever such
member or any director,
Authorised Dealing Officer or
employee of the member—
(a) has violated any provision of
the rules, regulations or
requirements of the Exchange or
engaged in conduct which is
detrimental to the interests or
welfare of the Exchange;
(b) is the subject of any written
client complaint involving
allegations of theft or
misappropriation of funds or
securities or of forgery, or of
any offence involving fraud or
dishonesty;
(c) is arrested, indicted or
convicted of, or pleads guilty to
any criminal offence.
(d) is the subject of any
disciplinary action taken by or
against the member involving
suspension, termination, the
withholding of commissions or
imposition of fines or any other
penalty.
Regulation 27—Fidelity Fund.
(1) The Exchange shall establish
and keep a Fidelity Fund for
compensating investors in cases
where members are unable to
satisfy claims in respect of
liabilities incurred by them in
connection with their stockbroking
business.
(2) The Fund shall be managed,
controlled and administered by
trustees appointed by the Council
in accordance with the laws for
the time being in force on the
matter and rules made for that
purpose by the Council of the
Exchange.
(3) The rules and regulations
may—
(a) provide for administration of
a scheme;
(b) provide for the levying of
contributions and for the payment
of contributions and other money
into the Fund;
(c) specify the terms and
conditions on which, and the
extent to which, compensation is
to be payable and the
circumstances in which the right
to compensation is to be excluded
or modified; and
(d) contain such incidental and
supplementary provisions as are
considered necessary.
Regulation 28—Assignment of the
Right of Membership.
(1) A member shall not assign,
mortgage, pledge, hypothecate or
charge his right of membership or
any rights or privileges attached
to such membership, and no such
attempted assignment, mortgage,
pledge, hypothecation or charge
shall be effective as against the
Exchange for any purpose, nor
shall any right or interest in any
membership other than the personal
right or interest in any
membership other than the personal
right or interest of the member
therein be recognised by the
Exchange.
(2) The Council shall expel any
member of the Exchange who acts or
attempts to act in violation of
the provisions of this regulation.
Regulation 29—Register of Members.
A
Register of members shall be
maintained by the Exchange in
which shall be entered in respect
of each member—
(a) its name and address;
(b) its date of admission;
(c) the names of all directors or
partners of the member;
(d) the names of all Authorised
Dealing Officers; and
(e) the date of termination of a
member’s membership by resignation
default, suspension or expulsion.
PART II—CODE OF CONDUCT
Regulation 30—Code of Conduct and
Punishment for Breach.
(1) The provisions in this Part
constitute the Code of Conduct of
the Exchange and a member is
guilty of misconduct or
unprofessional conduct if he
violates any of the provisions of
this Part.
(2) The Council may impose any
one or more of the following
penalties on any Licensed Dealing
Member, or Authorised Dealing
Officer for violation of any of
the provisions of this Part—
(a) a fine;
(b) a reprimand;
(c) suspension from trading for a
specified period;
(d) expulsion;
(e) any other penalty or remedy
determined to be appropriate under
the circumstances.
RELATIONSHIP BETWEEN MEMBERS AND
THE INVESTING PUBLIC
Regulation 31—Integrity and
Secrecy.
A
member shall maintain high
standards of integrity,
promptitude and secrecy in all
dealings with its clients.
Regulation 32—Books of Accounts.
A
member shall maintain proper books
of accounts and records, shall
render a proper account to its
clients for their purchases and
sale of securities, and make
prompt payment in respect of
securities sold and arrange for
prompt delivery of securities
purchased by clients.
Regulation 33—Records of Clients.
A
member shall maintain in respect
of each client whose investments
it is managing, sufficient records
to enable it at any time without
undue delay to establish the
precise cash, investment and
business position of the client.
Regulation 34—Credit Balance of
Clients.
A
member shall not, unless otherwise
agreed to in writing by a client,
hold or retain the free credit
balances of its clients for more
than three working days.
Regulation 35—Management of
Accounts of Clients.
(1) A member may manage or
operate a discretionary account or
managed fund for or on behalf of a
client provided it has first
obtained from the client a written
authorisation signed by the client
setting out the terms and
conditions and the rates of
commission or fees or other
charges payable by the client for
the operation of the account.
(2) A member who
undertakes to manage the
investments of a client (whether
or not on a discretionary basis)
shall set out in writing the terms
and conditions which shall
include—
(a) the fees to be charged for
management and the basis on which
they are calculated;
(b) arrangements for the custody
of securities and cash;
(c) arrangements for the payment
of interest on uninvested
balances; and
(d) arrangements for reporting and
valuations.
Regulation 36—Execution of Orders.
(1) A member, in its dealings with
its clients and the general
investing public, shall faithfully
execute the orders for buying and
selling of securities at the best
available market price.
(2) A member shall give priority
to the execution of the orders of
its clients over its own.
Regulation 37—Issue of Contract
Note.
A
member shall issue promptly to its
clients an authenticated duly
stamped contract note for all
transactions in the prescribed
form.
Regulation 38—Clients of Other
Members.
A
member shall not deal with clients
of other members if such clients
have not conducted themselves
properly in their dealings with
other members.
Regulation 39—Disclosure of
Client’s Business.
A
member shall not disclose or
discuss with any other person the
details of personal investments
and other information of a
confidential nature of a client
which comes to its knowledge
through business relationship.
Regulation 40—Abuse of Client’s
Information.
A
member shall not use the knowledge
and information of a confidential
nature gained from a client in the
course of its business dealing
with such client for the
advancement of its financial
interests or those of its
associates whether directly or
indirectly.
Regulation 41—Betrayal of Trust.
A
member shall not betray the trust
and confidence of a client by
disclosing confidential
information about the client’s
dealings in investments or his
worth which comes to its knowledge
in the course of its business
relationship.
Regulation 42—Misuse of Client’s
Funds.
A
member shall not use the funds
deposited by a client with it
towards the purchase of
securities for speculative or
other operations of its own.
Regulation 43—Misuse of Document
of Client.
A
member shall not misuse documents
deposited with it by a client nor
pledge them with the banks to
borrow funds for its own business.
Regulation 44—Mishandling of
Account of Client.
A
member shall not make improper use
of the securities or funds of a
client or execute transactions in
securities for the account of a
client without his knowledge and
approval.
Regulation 45—Excessive Business
for Client.
A
member shall not effect for a
client any transactions which are
excessive in size or frequency in
view of the investment objectives,
financial situation and needs of
the client.
Regulation 46—Purchase and Sale
Prices.
(1) A member shall not pass on to
its client purchases made on his
behalf at prices too high compared
to the prevailing prices for the
securities on that day or at any
arbitrary price not related to the
market price.
(2) A member shall not pass on to
its client sales made on his
behalf at prices too low compared
to the prevailing prices for the
securities on that day or at any
arbitrary price not related to the
market price.
Regulation 47—Delay in Delivery
and Payment.
A
member shall not commit any wilful
delay in delivery of documents and
payment of sale proceeds or
neglect to complete the settlement
of transactions with clients.
Regulation 48—Business for
Commission.
(1) A member shall not encourage
sales or purchases of securities
with the sole object of generating
brokerage or commission.
(2) A member shall not furnish
false or misleading quotations or
give any other false or misleading
advice or information to clients
with a view to inducing them to do
business in particular securities
and enabling it to earn brokerage
or commission thereby.
Regulation 49—Failure to Carry
out Transactions for Clients.
A
member shall not fail to carry out
for its client stockbroking
transactions that it has committed
the client to nor shall it fail to
meet its business liabilities to
its clients.
Regulation 50—Business for
Defaulting Clients.
A
member shall not deal or transact
business directly or indirectly or
execute an order for a client who
has to the member’s knowledge
failed to carry out his
engagements relating to securities
and is in default to another
member unless such client has made
a satisfactory arrangement with
the member who is his creditor.
Regulation 51—No Dishonoured
Cheques to Clients.
A
member shall not allow any cheques
issued by it to a client to be
dishonoured for any reason.
Regulation 52—Speculative Business
with an Employee.
A
member shall not transact
speculative business directly or
indirectly for or with an employee
of any public or private
establishment without the written
consent of his employer.
Regulation 53—Communication to
Non-clients.
A
member shall not issue to persons
other than its clients any
circular or business communication
containing investment
recommendations or comments on
individual securities.
Regulation 54—Business with
Defaulting Clients.
A
member shall not transact any
business for any defaulting
client.
Regulation 55—Responsibility for
the Dealings of Authorised Dealing
Officers etc.
A
member shall be wholly responsible
to its clients for all the
dealings put through by its
Authorised Dealing Officers,
clerks or agents attached to it
irrespective of any private
understanding or agreement to the
contrary which it may have entered
into with such officers, clerks or
agents.
Regulation 56—Dealing with Clients
as a Principal or as an Agent.
(1) A member, when dealing with a
client, shall disclose whether it
is acting as a principal or as an
agent and shall issue an
appropriate contract note
ensuring at the same time that no
conflict of interest arises
between the member and the client.
(2) In the event of conflict of
interest, the member shall inform
the client accordingly and shall
not seek to gain a direct or
indirect advantage from the
situation and shall avoid any
prejudice to the interests of the
client with whom it has a
fiduciary relationship.
(3) A member shall not make a
recommendation to any client who
might be expected to rely on it to
acquire, dispose of, or retain any
involvement in securities unless
it has reasonable grounds for
believing that the recommendation
is suitable for the client upon
the basis of the facts, if
disclosed by such a client as to
his own security holdings,
financial situation and
objectives.
RELATIONSHIP AMONG MEMBERS
Regulation 57—Entering into
Transactions.
A
member while entering into
transactions with another member
in the trading floor of the
Exchange shall conduct himself
with proper dignity and honour.
Regulation 58—Comparison of
Unmatched Transactions.
A
member shall co-operate with an
opposite contracting party in
comparing unmatched transactions.
Regulation 59—Documents
Constituting Bad Delivery.
A
member shall not knowingly and
wilfully introduce documents which
constitute bad delivery.
Regulation 60—Replacement of
Documents Declared as Bad
Delivery.
A
member shall co-operate with an
opposite contracting party in
prompt replacement of documents
which are declared as bad
delivery.
Regulation 61—Introduction of
Forged Documents.
A
member shall not directly or
indirectly be responsible for the
introduction of forged documents
in the market.
Regulation 62—Delivery of
Securities and Payment Therefor.
A
member shall deliver the
securities sold by it promptly and
in like manner a member receiving
the securities shall pay for the
same promptly.
Regulation 63—No Dishonoured
Cheques between Members.
A
member shall not issue to another
member a cheque which is
dishonoured on presentation for
want of funds.
Regulation 64—Concealed Bargains.
Authorised Dealing Officers shall
not make any bargains intended to
be concealed from their company or
own firm.
Regulation 65—Transactions with
Authorised Dealing Officer or
Employee.
(1) A member shall not transact
directly or indirectly for or with
or execute an order for the
personal account of an Authorised
Dealing Officer or employee of
another member without the written
consent of the employing member.
(2) A member shall extend fullest
co-operation to other members in
protecting the interests of their
clients regarding their rights to
dividends, right or bonus share.
(3) A member shall not fail to
honour the obligations arising
from its stockbroking transactions
with fellow members nor shall it
fail to meet its business
liabilities or show negligence in
the completion of the settlement
of transactions with them.
RELATIONSHIP BETWEEN MEMBERS AND
THE STOCK EXCHANGE AUTHORITIES
Regulation 66—Improper Conduct.
A
representative of a member shall
not indulge in dishonourable or
disgraceful or disorderly or
improper conduct on the Exchange
nor shall he wilfully obstruct the
business of the Exchange.
Regulation 67—Failure to comply
with resolutions, etc.
A
member shall not contravene or
refuse or fail to comply with or
abide by any lawful resolution,
order, notice, direction, decision
or ruling of the Council or the
Managing Director or of any
Committee or officer of the
Exchange or other person
authorised in that behalf under
the rules and regulations of the
Exchange.
Regulation 68—Failure to Submit or
Abide by Arbitration.
A
member shall not neglect or fail
or refuse to submit to arbitration
or to abide by or carry out an
award, decision or order of the
Council or an arbitration
committee or arbitrators made in
connection with a reference under
the rules and regulations of the
Exchange.
Regulation 69—Failure to Testify
or give Information.
A
member shall not neglect or fail
or refuse—
(a) to submit to the Council or to
a Committee or an officer of the
Exchange authorised in that
behalf, any books, correspondence,
documents and papers or any part
thereof required to be produced;
(b) to appear and testify before
or cause any of its Authorised
Dealing Officers or employees to
neglect, fail or refuse to appear
and testify before the Council or
the Managing Director or a
Committee or Officer of the
Exchange.
Regulation 70—Failure to Submit
Special Returns.
A
member shall not neglect, fail or
refuse to submit to the Managing
Director within the time notified
in that behalf special returns
together with such other
information as the Council or the
Managing Director may require.
Regulation 71—False or Misleading
Returns.
A
member shall not neglect or fail
or refuse to submit or make any
false or misleading statement in
its returns required to be
submitted to the Exchange.
Regulation 72—Vexatious
Complaints.
A
member or its agent shall not
bring before the Council or the
Managing Director or a Committee
or an officer of the Exchange or
other person authorised in that
behalf a charge, complaint or
dispute which is frivolous,
vexatious or malicious.
Regulation 73—Failure to Pay Dues
and Fees.
(1) A member shall pay its
subscription, fees, arbitration
charges or any other money which
may be due from it or any fine or
penalty imposed on it.
(2) An expelled member and the
estate of a deceased partner of a
member firm shall remain liable
for all arrears, subscription,
special subscription, levies,
fines and other monies owed to the
Exchange or any account
whatsoever.
Regulation 74—Fictitious Name and
Dealings.
A
member shall not—
(a) transact its own business or
the business of its client in
fictitious names;
(b) make a fictitious transaction
or give an order for the purchase
or sale of securities, execution
of which would involve no change
of ownership.
Regulation 75—Prejudicial
Business.
(1) A member shall not knowingly
make or be a party to the carrying
out of any plan or scheme for the
purchase or sale or offer of
purchase or sale of securities for
the purpose of upsetting the
equilibrium of the market or
bringing about a condition of
demoralisation in which prices
will not fairly reflect market
values.
(2) A member shall not directly or
indirectly or in any manner
whatsoever circulate or cause to
be circulated rumours of a
sensational character likely to
have an impact on the securities
market.
(3) A member shall not indulge in
manipulative, fraudulent or
deceptive transactions or schemes
or spread rumours with a view to
distorting market equilibrium or
making personal gains.
(4) A member shall not create a
false market either singly or in
concert with others or indulge in
any malpractice detrimental to the
public interest or which leads to
interference with the market
mechanism and the smooth
functioning of the Exchange.
(5) A member shall report to the
Council or the Managing Director
of the Exchange, any suspicious or
attempted operation or transaction
which would result in the creation
of a false market or misleading
appearance or trading or lead to
upsetting the market equilibrium
which comes to its notice
immediately.
Regulation 76—Advice to Clients.
A
member shall not give false and
misleading information to its
clients about companies based on
rumours or gossip.
Regulation 77—Unwarrantable and
Excessive Speculative Business.
(1) A member shall not engage in
reckless, unwarrantable or
unprofessional dealings in the
market or effect purchases or
sales for its client’s account in
which it is directly or indirectly
interested nor make any purchase
or sale which is excessive in view
of its client’s or its own means
and financial resources or in view
of the market for such security.
(2) A member shall not involve
itself in excessive speculative
business in the market beyond
reasonable levels not commensurate
with its financial resources.
Regulation 78—Street Dealing.
A
member shall not call out prices
or make bids or offers or trade in
the street or at the entrance to
or in the vicinity of the
Exchange, on carry or any form of
trading after trading hours in any
security.
Regulation 79—Hawking in
Securities.
A
member shall not itself and shall
not knowingly permit any other
company or firm in which it has an
interest in the conduct of its
business for the sale, disposal,
purchases, exchange or acquisition
of securities to make use of share
hawking or other methods which are
not approved of by the Council, or
which in the opinion of the
Council, advertises securities for
sale or purchase and shall not
knowingly transact business for or
on behalf of any person, firm or
company which conducts business in
whole or in part in the manner
described in this regulation.
Regulation 80—Dealing in Unlisted
Securities.
A
member shall not make quotations
or deal in securities of a new
company being formed, or where a
new issue or placement of
securities has been made in an
unlisted company, for the purpose
of qualifying the company for
official listing on the Exchange,
or where a new class or additional
shares of the existing class of
shares is issued by a listed
company, until the Council has
given its consent.
Regulation 81—Trading in Suspended
Securities.
A
member shall not trade or transact
any business in any security while
the listing of that security is
suspended by the Council.
Regulation 82—Compliance with
Rules and Regulations.
A
member shall strictly comply with
the rules and regulations of the
Exchange and instructions,
directions, orders issued from
time to time by the Council or the
Managing Director, or a Committee
or an officer of the Exchange
authorised in that behalf.
Regulation 83—Access to
Information not to be Used by
Members.
An Authorised Dealing Officer or a
member shall not trade in any
security if he had access to price
sensitive information by virtue of
his position of being a member of
the Council until the information
is placed on the notice board of
the Exchange or otherwise released
for the information of members.
Regulation 84—Business for
Exchange Employees.
A
member shall not make a
speculative transaction in which
an employee of the Exchange is
directly or indirectly interested.
Regulation 85—Evasion of Margin
Requirements.
A
member shall not evade or attempt
to evade or assist in evading the
margin requirements prescribed in
the rules and regulations of the
Exchange.
Regulation 86—Brokerage Charge.
(1) A member shall not deviate
from or evade the rules and
regulations relating to charging
and sharing of brokerage.
(2) A member shall not deviate
from the schedule of brokerage
prescribed nor fail to observe the
provisions of the rules and
regulations of the Exchange in
this regard.
Regulation 87—Sharing of
Brokerage.
A
member shall not share brokerage
or commission with persons other
than those permitted under the
rules and regulations of the
Exchange.
Regulation 88—Business with
Non-member.
A
member shall strictly abide by any
directions or instructions issued
by the Council or Managing
Director prohibiting any member
knowingly transacting any further
business for and on behalf of any
specified non-member or class of
non-members or for any one acting
in its or their behalf.
Regulation 89—Inquiries and
Investigations.
A
member shall co-operate fully with
respect to any inquiries or
investigations undertaken by any
competent authority relating to
the securities industry.
Regulation 90—Periodical Returns.
A
member shall file periodic returns
of all the transactions effected
in securities, both purchases and
sales, with other members and its
clients, together with the
contract rates and the total value
of the securities, in such form
and for such periods as may be
prescribed by he Stock Exchange.
Regulation 91—Insurance Covers.
A
member shall take such insurance
cover as may be prescribed by
notices.
Regulation 92—Minimum Liquidity
Requirements.
A
member shall comply with the
requirement of the exchange in
respect of minimum liquidity, net
capital and margins.
Regulation 93—Interpretation.
In these Regulations, unless the
context otherwise requires—
“associated business activities”
or “associated business” includes
acting as registrar to the issue
of shares or as share transfer
agents, investment advice,
portfolio management, discount
broking and general financial
consultancy;
“Authorised Dealing Officer” means
a person, by whatever name
described, in the direct
employment of, or acting for, or
by arrangement with a Licenced
Dealing Member who performs for
that member or dealer any of the
functions of a member or dealer
(other than work ordinarily
performed by accountants, clerks,
or cashiers) whether his
remuneration is by way of salary,
wages, commission or otherwise;
and includes any executive
director of a member company or a
partner in a member firm who
performs any of the said
functions;
“Committee” means any Committee
appointed by the Council of the
Exchange such as the Arbitration
Committee or the Disciplinary
Committee;
“company” has the same meaning as
in the Companies Code, 1963 (Act
179);
“contract” means a contract for or
relating to the purchase or sale
of securities;
“Council” means the governing body
of the Exchange;
“Licensed Dealing Member” means a
member company or member firm
licensed to deal in securities
under regulation 6 (4);
“liquid funds” means the amount of
total tangible assets less total
liabilities, all assets being
valued at a fair value but not in
excess of the market value
thereof, but shall not include the
value of the following—
(a) membership of the Exchange;
(b) furniture, fixtures, real
estate and other fixed assets;
(c) securities which have no ready
market;
(d) unsecured loans or advances
made to a member or partner in a
member firm or director of a
member company;
(e) amounts owed by clients the
recovery of which is considered
doubtful; and
(f) non-trade stocks;
“member” except in regulation 1
means a Licensed Dealing Member;
“member company” means a company
incorporated under the Companies
Code, 1963 which is a Licensed
Dealing Member;
“member firm” means in
incorporated private partnership
which is a Licensed Dealing
Member;
“Secretary” means the Secretary
responsible for Finance;
“Stock Exchange” or “the Exchange”
means Ghana Stock Exhange.
Regulation 94—Commencement.
These Regulations shall be deemed
to have come into force on the 7th
day of November, 1990.
1. Mrs. Gloria Nikoi .. ..
.. .. .. .. .. .. ..
.. .. .. .. Chairperson
2. Mr. Kwasi Akoto
.. .. .. .. .. .. ..
.. .. .. .. Member
3. Mr. Edward Kingsley
Akyea-Djamson .. .. ..
.. .. .. Member
4. Mr. Yeboa Amoa ..
.. .. .. .. .. .. ..
.. .. .. Member
5. Mrs. Stephanie Henrietta
Baeta Ansah .. .. ..
.. .. .. Member
6. Mr. Ebenezer Joseph Amaboye
Aryee .. .. .. ..
.. Member
7. Mr. Guri Dobo
.. .. .. .. .. .. ..
.. .. .. .. Member
8. Mr. Afare Apeadu Donkor
.. .. .. .. .. .. ..
.. .. .. Member
9. Ms. Lauretta Vivian Lamptey
.. .. .. .. .. ..
.. .. .. Member
10. Mr. Emmanuel Noye Nortey
.. .. .. .. .. ..
.. .. .. Member
11. Mr. Samuel Yaw Osafo-Maafo
.. .. .. .. .. ..
.. .. Member
Date of Gazette Notification: 11th
January, 1991.
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