Stock Exchange Act, 1995

Grant of authorisation.

18.—(1) Subject to the provisions of this Act, the Bank may grant or refuse to grant to any person applying to it under this section an authorisation to operate as an authorised member firm.

(2) The grant of an authorisation under subsection (1) of this section may be given unconditionally or it may be given subject to such conditions or requirements or both as the Bank considers fit.

(3) Whenever the Bank refuses to grant authorisation to a proposed member firm under this section, it shall serve notice on the proposed member firm of its intention to refuse to authorise it and stating the reasons therefor and the proposed member firm may within 21 days of receipt of such notice appeal to the Court against the decision.

(4) An application for authorisation under subsection (1) of this section shall be in such form and contain such particulars as the Bank shall specify from time to time and, without prejudice to the generality of the aforesaid, shall include a copy of the memorandum of association and articles of association of the proposed member firm and such particulars as the Bank may request in relation to—

(a) the type of business to be carried on or likely to be carried on by the proposed member firm, and

(b) any person or persons having control or ownership of the proposed member firm including any natural or legal person whose shareholding or other commercial relationship with the proposed member firm might influence the conduct of the proposed member firm to a material degree.

(5) A proposed member firm shall not be authorised by the Bank unless—

(a) it is a company incorporated by statute or under the Companies Acts, or a company made under Royal Charter or it draws up a partnership agreement, where it is constituted as an unincorporated body of persons, if such an agreement does not already exist,

(b) it satisfies the Bank that the memorandum of association and articles of association of the proposed member firm contain sufficient provisions so as to enable it to operate in accordance with this Act, and in accordance with any conditions or requirements or both as the Bank may impose,

(c) it has the minimum level of capital which shall be specified by the Bank under this section,

(d) it satisfies the Bank as to the probity and competence of each of its directors and managers,

(e) it satisfies the Bank as to the suitability of each of its qualifying shareholders,

(f) it satisfies the Bank as to the organisation and management skills of the proposed member firm and that adequate levels of staff and expertise will be employed to carry out its proposed activities,

(g) it satisfies the Bank that it has and will follow established procedures to enable the Bank to be supplied with all information necessary for its supervisory functions and to enable the public to be supplied with any information which the Bank may specify,

(h) it satisfies the Bank that the organisation of its business structure is such that it and any of its associated or related undertakings, where appropriate and practicable, are capable of being supervised adequately by the Bank,

(i) its registered office and its head office are in the State, and

(j) it satisfies the Bank as to its conduct of business, its financial resources and any other matters as the Bank considers necessary in the interests of the proper and orderly regulation and supervision of approved stock exchanges or of member firms or both or in the interests of the protection of investors.

(6) The Bank may set out conditions and requirements, either through the rules of an approved stock exchange or otherwise, in order to monitor the solvency of an authorised member firm which is constituted as an unincorporated body of persons and the solvency of its proprietors.

(7) The Bank shall impose conditions or requirements, from time to time, in respect of the level of capital to be maintained by an authorised member firm.

(8) Any appointment to the Board of Directors of an authorised member firm or proposed member firm or to the post of manager, chief executive or post equivalent thereto, on or after the granting of an authorisation under this section, shall be subject to the prior approval in writing of the Bank, which said approval shall not be given unless the authorised member firm satisfies the Bank as to the probity and competence of the proposed appointee.

(9) The Bank may direct an authorised member firm to alter its memorandum of association and articles of association in the interest of the proper and orderly regulation of approved stock exchanges and their member firms or the protection of investors or both.

(10) A proposed amendment to the memorandum of association or articles of association of an authorised member firm shall not be made without the prior consent in writing of the Bank.

(11) An authorisation granted under subsection (1) of this section by the Bank shall specify the classes of investment services which may be provided by the authorised member firm concerned and the authorisation may specify additional services which an authorised member firm may provide, including those set out in Annex C to Council Directive 93/22/EEC of 10 May, 1993(1) as amended or extended from time to time and the Bank may amend or vary the classes of investment services or other services which may be so provided and such authorisation shall be taken as authorisation of the said firm for the purposes of the said directive.

(12) The Bank may at any time prior to the grant or refusal of an authorisation request further information from the proposed member firm or may instruct an authorised officer to make such inquiries or carry out such investigations as may be necessary for the purpose of evaluating properly an application under this section, and such inquiries or investigations shall be carried out in accordance with this Act.

(13) (a) In the case of a member firm, the Bank shall apply this Act, having regard to the division of responsibilities between the home and host member states of the member firm concerned which are set out in Council Directive 93/22/EEC of 10 May, 1993(1) and Council Directive 93/6/EEC of 15 March, 1993(1) and the relevant sections of this Act shall be construed accordingly.

(b) Subject to the provisions of this section, member firms shall be subject to such conditions or requirements or both as may be imposed on them by the Bank in the interests of any or all of the following, namely—

(i) the proper and orderly regulation of stock exchanges and their member firms;

(ii) the protection of investors or clients or both.

(14) The Bank may impose requirements on a proposed member firm or an authorised member firm to organise its business or corporate structure, or control of any associated undertaking or related undertaking not supervised by the Bank, such that that member firm when authorised under this Act and, where appropriate and practicable, the business of any associated undertaking or related undertaking, either collectively or individually, is capable of being supervised to the satisfaction of the Bank under this Act.

(15) A proposed member firm shall be informed whether or not authorisation has been granted—

(a) within six months of the date of receipt of the application, or within six months of the coming into operation of this section, whichever is the later; or

(b) where additional information in relation to the application has been sought by the Bank, within a period of six months after the receipt by the Bank of the additional information or the period of twelve months after the receipt of the application, whichever is the sooner.

(16) It shall be an offence for a proposed member firm to apply for authorisation under this section knowingly or recklessly using false or misleading information or knowingly or recklessly making false or misleading statements.

(1) O.J. No. L 141 11/6/93.

(1) OJ. No. L141 11/6/93.