Section 2

In this Order, unless the context otherwise requires-

of Securities Markets Order, 2013

ORDERIn forceProvision 2 of 288

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"accounting records" means, in relation to a corporation, invoices, receipts, orders for payment of money, bills of exchange, cheques, promissory notes, vouchers and other primary documentation and includes such working papers as are necessary to explain the methods and calculations by which accounts are made up and however compiled, recorded or stored;

"advertisement" means any advertisement

(a} inviting persons to enter or offer to enter an investment agreement or to exercise any rights conferred by an investment to acquire, dispose of, underwrite, or convert an investment; or

(bJ containing information calculated to lead directly or indirectly to persons doing so and, for the purposes of this Order, an advertisement or other information issued outside Brunei Darussalam shall be treated as issued in Brunei Darussalam if it is directed to persons in Brunei Darussalam;

"assets", in relation to a holder of a capital markets services licence, means all the assets of the holder, whether or not used in connection with the carrying on of the regulated activity by the holder;

"auditor" means an auditor authorised to perform the duties of the auditor under the Companies Act (Chapter 39);

"Authority" means the Autoriti Monetari Brunei Darussalam established by the Autoriti Monetari Brunei Darussalam Order, 2010 (S 103/2010);

"board", in relation to a corporation, means the board of directors or other governing authority of the corporation;

"books" includes -

(a)

any register;

(b)

any document or other record of information; and

(c)

any accounts or accounting records, however compiled, recorded or stored, whether in written or printed form or on microfilm or in any other electronic form or otherwise;

"borrower", in relation to a debenture, means the corporation that is or will be liable to repay money under the debenture;

"broker" means a person engaged in the business of buying and selling securities for the account of others;

"capital markets services licence" means a licence that is granted by the

Authority under section 157(5) to a person to carry on a business in any regulated activity;

"central securities depository" means a market operator who has been licensed by the Authority

(a} to establish and operate a system for the central handling of securities, whether or not listed on any licensed, recognised or designated securities exchange

(i)

whereby all such securities are deposited with and held in custody by, or registered in the name of, the company or its nominee company for the depositors and dealings in respect of these securities are effected by means of entries in securities accounts without the physical delivery of certificates; or

(ii)

which permits or facilitates the settlement of securities transactions or dealings in securities without the physical delivery of certificates; and 1228

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(b} to provide other facilities and services incidental thereto;

"clearing facility" means a licensed or recognised market operator who provides-fa} a facility for the clearing or settlement of transactions in securities as defined by this Order which are traded on a securities exchange;

(b} a facility for the guarantee of settlement of transactions referred to in paragraph (a}; or

{cf such other clearing or settlement facility or class of clearing or settlement facilities as the Authority may allow;

"clearing house" means a market operator whose activities or objects include the provision of clearing facilities;

"client", in relation to a holder of a capital markets services licence, means

(af a person on whose behalf the holder carries on or will carry on any regulated activity; or

(bf any other person with whom the holder, as principal, enters or will enter into transactions -

(i)

for the purposes of dealing in securities; or

(ii)

for the purposes of trading in futures contracts, but does not include such person or class of persons as may be prescribed;

"company" has the meaning assigned to it in the Companies Act

(Chapter 39);

"contract note" means the document issued by a holder of a capital markets services licence as prescribed by the Authority under section 198(2);

"corporation" has the meaning assigned to it in the Companies Act

(Chapter 39);

"credit institution" means an undertaking whose business is to receive deposits or other repayable funds from the public and to grant credits for its own account; or an electronic money institution namely an institution which has the facility to create an electronic store of monetary value on a technical device that may be widely used for making payments to undertakings other than the issuer without necessarily involving bank accounts in the transaction, but which acts as a prepaid general purpose instrument;

"credit rating" means an opinion regarding the creditworthiness

(a}

of an entity, a debt or financial obligation, debt security, preferred share or other security; or

(b)

of an issuer of such a debt or financial obligation, debt security, preferred share or other security, issued using an established and defined ranking system of rating categories;

"credit rating activities'' means data and information analysis and the evaluation, approval, issuing and review of credit ratings;

"credit rating agency" means a person whose occupation includes the issuing of credit ratings on a professional basis;

"custodian" means a person who, by way of business, is entrusted with safekeeping the property of another person and "custodian" in relation to a client of a holder of a capital markets services licence, means a bank which holds a licence from the appropriate regulatory authority or such other organisation as may be prescribed by regulations made by the Authority;

"dealer" means a person who buys or sells securities on his behalf and for his account;

"director" has the meaning assigned to it in the Companies Act !Chapter 39);

"discontinuance" means a discontinuance of listing;

"distribution channels" means a channel through which information is, or is likely to become publicly available and "likely to become publicly available information" shall mean information to which a large number of persons of the public have access;

"durable medium" means any instrument which enables a client to store information addressed personally to that client in a way accessible for future reference for a period of time adequate for the purposes of the information and which allows the unchanged reproduction of the information stored;

"eligible delivery agreement" means an agreement that is one of two or more standardised agreements the effect of which is that a person is under an obligation to make or accept delivery at a particular future time of a particular quantity of a particular instrument ~

(a)

for a particular price; or 1230

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{bj for a price to be calculated in a particular manner, whether or not

(i)

the subject matter of the agreement is in existence; or

(ii)

the agreement is capable of being varied or discharged before that future time, and in respect of which it appears likely at the relevant time, having regard to all relevant circumstances, that-

(A)

the obligation of the person in the short position to make delivery will be discharged except by the person making the delivery;

(B)

the obligation of the person in the long position to accept delivery will be discharged except by the person accepting the delivery; or

(C)

the person in the short position or long position will assume an offsetting long position or offsetting short position, as the case may be, under another agreement of the same kind;

"financial analyst" means a relevant person who produces the substance of investment research;

"financial institution" means any bank, merchant bank, or finance company licensed under any written laws of Brunei Darussalam;

"fund management" has the same meaning as investment business in the

Schedule;

"group", in relation to an investment firm, means the group of which that firm forms a part consisting of the parent undertaking, its subsidiaries and the entities in which the parent undertaking holds an interest;

"guarantor", in relation to a debenture, means a person who guarantees or has agreed to guarantee the repayment of any money secured or payable under the debenture;

"holding company" has the meaning assigned to it in the Companies Act

(Chapter 39);

"Hukum Syara"' has the same meaning as in the Syariah Financial

Supervisory Board Order, 2006 (S 5/2006);

"information service" means-

{a)

a broadcasting service;

{b)

an interactive or broadcast videotext or teletext service or other similar service;

{c)

an online database service or other similar service; or

{d)

any other service as may be prescribed by the Authority but does not include bond pricing facilities;

"insider" of an issuer means

{a) an officer, member of the Board of directors, and other senior management of the issuer or of an affiliated issuer;

{b)

a controlling shareholder in the issuer or in an affiliated issuer;

{c)

an individual who, because of a position in, or because of a relationship of trust and confidence with an issuer or insider that provides him access to inside information of that issuer or an affiliated issuer, has information that he knows or should know to be inside information; or

{d)

an individual who within the last 6 months has had a position or an affiliation referred to in paragraphs {a) to {c);

"insider information" means information that would likely affect the price of securities or information that a reasonable investor would consider important under the circumstances in determining whether to buy, sell or hold a security, when such information is disclosed to the public within a reasonable time for the market to absorb the information;

"investment advice" has the same meaning as in the Schedule;

"investment business" has the same meaning as defined in the Schedule;

"issuer" means -

{a)

in the case of shares or debentures, the corporation whose shares or debentures are being issued, offered for subscription or purchase or in respect of which an invitation to subscribe or purchase has been made;

{b)

in the case of units of a unit trust scheme or a collective investment scheme, the management company or the custodian; and

(c)

in the case of any other securities, the person making available, issuing, offering for subscription or purchase, or making an invitation to subscribe for or purchase, such securities;

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"listed", in relation to a security or a company, means such security or company whose securities or any class of its securities having gained admission to be quoted on a market operator;

"management company" means a company by which or on whose behalf a unit of a unit trust scheme or collective investment scheme fa} has been or is proposed to be issued or offered for subscription or purchase; or

(b)

in respect of which an invitation to subscribe or purchase has been made, and includes any person for the time being exercising the functions of the management company;

"market maker" means a person who holds himself out on the financial markets on a continuous basis as being willing to deal on own account by buying and selling securities against his proprietary capital at prices defined by him;

"market operator" means a person who manages or operates the business of a regulated market. The market operator may be the regulated market himself;

"material information" means information which a person considering acquiring securities of the kind in question would be likely to need, in order not to be misled about any facts essential for him to know in making a decision to purchase, to sell or to hold a security;

"member" means a regulated person who, under the membership regulations of a licensed, recognised or designated market operator, may participate in one or more of the services provided by that institution;

"Minister" means the Minister of Finance;

"nominee" means a person who holds securities on his behalf at the request of another person (security owner or another nominee) but who is not the owner of the security;

"officer", in relation to a corporation, includes-

{a) any director, secretary of the corporation;

fb} a receiver and manager, appointed under a power contained in any instrument, of any part of the undertaking or property of the corporation; and

(c)

any liquidator of a corporation appointed in a voluntary winding up, but does not include-

(iJ any receiver who is not also a manager;

(ii)

any receiver and manager appointed by the Court; or

(iii)

any liquidator appointed by the Court or by the creditors;

"official list", in relation to a securities market of a securities exchange, means a list specifying all securities which have been admitted for quotation on a licensed or recognised securities exchange;

"outsourcing" means an arrangement of any form between a regulated person and a service provider by which that service provider performs a process, a service or an activity which would otherwise be undertaken by the regulated person himself;

"Panel" means the Financial Markets Services Panel established under section 254;

"party", in relation to a proposed or discharged agreement, means a person who would be a party to the agreement if it were in effect;

"prescribed" means prescribed under this Order or any regulations made under this Order;

"private offering" is any offer to sell securities to a group of investors who are not accredited investors within the meaning of this Order totalling less than fifty during a 12-month period;

"prospectus" is the document prepared by or on behalf of an issuer to sell or offer its securities for sale to the public through a registration statement filed with the Authority;

"proxy" is a written authorisation issued by a shareholder to another person granting the right to vote on behalf of the shareholder;

"public offering" is any offer to sell a security which has been made to at least more than fifty who are not accredited investors for the purposes of this Order;

"publically tradable company" means a company that is required by this

Order to file periodic reports due to the fact that

(aJ it has a class of securities listed for trading on a securities exchange;

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1235 6th. AUGUST, 2013

(b} it has sold a class of its securities pursuant to registration under this

Order; and

{c}

such securities are owned by fifty or more persons who are not accredited investors for the purposes of this Order;

"rated entity" means a person whose creditworthiness is explicitly or implicitly rated in the credit rating, whether or not it has solicited that credit rating and whether or not it has provided information for that credit rating;

"recommendation" means research or other information recommending or suggesting an investment strategy, explicitly or implicitly, concerning one or several securities or the issuers of securities, including any opinion as to the present or future value or price of such securities, intended for distribution channels or for the public;

"regulated activity" includes any of the types of activities constituting investment business specified in Part II of the Schedule;

"regulated per~on" means persons regulated under this Order;

"regulatory functions" means the functions of issuing regulations, making statements of principle, codes of practice or guidance by the Authority and monitoring and enforcing compliance with these;

"relevant circumstances", in relation to an eligible delivery agreement, includes-

(a} the provisions of any agreement;

(b}

the regulations and practices of any market; and

{c}

the manner in which the respective obligation of persons in the short positions and persons in the long positions under agreements of the same kind as the agreement concerned are generally discharged, but does not include the respective intention of the persons in the short positions and the persons in the long positions under the agreement concerned;

"relevant time", in relation to an eligible delivery agreement, means the time-

{a}

when the agreement concerned is entered into; or

{b}

if the agreement concerned is not a delivery agreement at the time when it is entered into, becomes a delivery agreement;

"representative" means a person, by whatever name called, in the direct employment of, or acting for, or by arrangement with, a person who carries on business in any regulated activity, who carries out for that person any such regulated activity;

"research or other information recommending or suggesting investment strategy" means

{a}

information produced by an independent financial analyst, an investment person, a credit institution, any other person whose main business is to produce recommendations or a firm working for them under a contract of employment or otherwise, that, directly or indirectly, expresses a particular investment recommendation in respect of a security or an issuer of securities; and

(b)

information produced by a person other than the persons referred to in paragraph {a} which directly recommends a particular investment decision in respect of a security;

"securities" includes any of the types of investment instruments specified in

Part I of the Schedule;

"securities exchange" means a market operator that is licensed, recognised or designated as such by the Authority under Part III;

"securities market" means a regulated market or other place at which, or a facility by means of which -

{a} offers to sell, purchases or exchanges of securities are regularly made or accepted;

{b)

offers or invitations that are intended, or may reasonably be expected to result, whether directly or indirectly, in the making or acceptance of offers to sell, purchase or exchange securities, are regularly made; or

{c)

information concerning the prices at which or the consideration for which, particular persons or particular classes of persons, propose, or may reasonably be expected to sell, purchase or exchange securities is regularly provided;

"self-regulatory organisation" means an organisation that is licensed or recognised by the Authority as such under Part IV;

"senior management" means the person or persons who effectively direct the business of the regulated person or the market operator and includes the member or members of his Board;

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"settlement", in relation to a market contract, means the discharge of the rights and liabilities of the parties to the market contract whether by performance, compromise or otherwise; and includes partial settlement effected in accordance with the regulations of an approved clearing house;

"significant" means significant for the purpose of an investor making an informed assessment of the securities being admitted to listing;

"specify", where no mode is mentioned, means specify in writing, and a power to specify includes the power to specify differently for different persons, or types of investment transactions;

"subsidiary" has the meaning assigned to it in the Companies Act

(Chapter 39);

"suspension" means a suspension of listing;

"trust account" means a trust account established under section 194;

"underwriter" is any person, who acquires securities from an issuer with a view to distrib.ute them, or offers or sells for an issuer in connection with the distribution of any security, or participates in any agreement or contract with respect to such underwriting, with the exceptions that may be defined by the decision of the Authority;

"unit", in relation to a unit trust scheme or a collective investment scheme, means any right or interest therein by whatever name called and includes any subunit thereof;

"unit holder" means the unit holder of a unit trust scheme or a collective investment scheme;

(2)

Any reference to this Order shall, unless otherwise expressly stated, include a reference to any regulations or other subsidiary legislation made under this Order.

(3)

For the avoidance of doubt, any reference in this Order to delivery or service of documents shall include delivery and receipt by electronic means.

Controlling interest over regulated persons.

Read in full context — Securities Markets Order, 2013 →