Section 161

The Authority shall require the holder of a capital markets services licence to inform the Authority of the identity and any other subsequent changes of the persons who effectively direct the business and its operations before such changes are implemented.

The Authority shall refuse to approve proposed changes where it appears to the Authority that there are grounds for believing that the person or persons proposed to direct the business and its operations pose a material threat to the sound and prudent management and operation of the holder of a capital markets services licence.

A holder of a capital markets services licence is required to have the following organisational arrangements in place -

(a} to identify clearly and manage the potential adverse consequences of any conflict of interest;

(bj to be adequately equipped to manage the risks to which he is exposed, to implement appropriate arrangements and systems to identify all 1356

significant risks to his operation, and to put in place effective measures to mitigate those risks;

{cJ to ensure that any outsourcing of important operational functions shall not be undertaken in such a way as to impair materially the quality of its internal control and the ability of the Authority to supervise his compliance with its obligations under this Order or and any principles, regulations and codes made thereunder;

(dJ at the time of licensing and on an ongoing basis, sufficient financial resources to facilitate his orderly functioning, having regard to the nature and extent of the services provided and the range and degree of the risks to which he is exposed.

Power of Authority to impose conditions or restrictions on holder of capital markets services licence or representative's licence.