New Consolidated Rules and Regulations 2011

7/30/2019 New Consolidated Rules and Regulations 2011

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The Securities and Exchange Commission Nigeria.

SECURITIESANDEXCHANGECOMMISSIONRULESANDREGULATIONS,2011

Introduction

In order to effectively and efficiently carry out the objectives of securities regulation as

embedded in the Investments and Securities Act (The Act), the Securities and Exchange

Commission(TheCommission),hasprescribedtheseRulesandRegulations.

TheseRulesandRegulationsprovideparticipants(regulatedpersons)inthecapitalmarketwith

more precise notice ofwhat isexpectedofthem, whatconduct will besanctioned and also

promotesfairnessandequalityoftreatmentamongsimilarlysituatedpersons.

TheCommissionrecognisesthatadoptionofformalrule-makingprocessismoreefficientthancase-by-caseadjudication,becauseitcanresolveamultiplicityofissuesinasingleproceeding.

A cleargeneralrulecan produce rapidanduniform complianceamong the affectedfirms or

individualsandprovidesindividualswithmoreprotection.

TheActhasgrantedtheCommissiongeneralandspecificrule-makingauthority.However,the

Commission inexercisingthisauthorityhasadopteda consultativeprocedurewherebyinputs

andcommentsareobtainedfrompersonssubjecttoitsjurisdiction.

Thepresent Rulesand Regulations weresubjected to commentsfrom market operatorsand

otherparticipantsbeforeitsfinaladoptionbytheCommission.

TheseRulesandRegulationsaremadeupof Fourteen(14)partsi.e.AtoNandhaveeleven(11)schedules.Theycontainbothrulesofgeneralandspecificapplicationsgoverningsecurities

exchanges; capital market operators; securities offered for sale or subscription; mergers,

acquisitions and combinations;collective investment schemes; borrowingby Federal, States,

localGovernmentandotherGovernmentagenciesaswellasSupranationalbodies amongst

otherthings.

Itshouldbenotedthatrule-makingisacontinuousprocess.Inadditiontotheselegislativeor

substantive rules, which may be amended from time to time, the Commission will also be

issuinginterpretativerulesandgeneralstatementsofpolicyallofwhichguideparticipantsin

themarket.

EverypersonsubjecttotheInvestmentsandSecuritiesActisthereforeadvisedtobefamiliar

withboththeprovisionsoftheActandalltheRulesoftheCommissionregulatingthecapital

market.

Inthecaseofanydoubtorneedforclarification,theCommissionshouldbeconsulted.


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Pursuant to the provision of Section313 and all other powers conferred upon it under the

Investments andSecuritiesAct (I.S.A.) of2007, the Commission hereby makes the following

RulesandRegulations:


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GENERALRULESANDREGULATIONS

PURSUANTTOTHEINVESTMENTSAND

SECURITIESACT,2007

ARRANGEMENTOFRULES

PARTA

A1.RulesofGeneralApplication

RULE

1 DefinitionoftermsusedintheRulesandRegulations.

2 BusinesshoursoftheCommission.

3 FilingofmaterialswiththeCommission.

4 Non-disclosureofinformationobtainedinperformingofficial

duties.

5 Disclosuredetrimentaltonationalsecurity.

6 Fees.

7 Fine/Penalty.

8 Exemptions.

9 Power of the Commission to demand andexamine records

requiredtobemaintained.

10

11

Inspectionofdocuments.

Requirementsforinspectionofdocument.

12 Copyingofinspecteddocuments.

13 Maintenanceofadequaterecordsofaffairsandtransactions.

14 AppointmentofComplianceOfficer.

A2.GeneralRulesonRegistration

15 Applicationforms.

16 Numberofcopies,signatures,codeofconduct,etc.

17 Requirementsastolanguage,printing,etc.

18 Additionalinformation.

19

20

SponsoredIndividualsandComplianceOfficers.

Qualifications of Sponsored Individuals and Compliance

Officers

21 Approval of appointment of Directors of Capital Market


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Operators

22 Minimumpaid-upcapital.

23 Amendmenttoapplication.24 Effectivenessofregistration.

25 Withdrawalfromregistration.

26 Suspension/Cancellationofregistration.

27

28

29

Changeofstatusofregistrant.

ApprovalofbranchesofCapitalMarketOperators.

ManagementofbranchesofCapitalMarketOperators.

A3.Post-registrationComplianceRequirementsbyCapitalMarket

OperatorsandotherRegulatedEentities

30 MembershipofSelf-RegulatoryOrganisations(S.R.O.).

31 CodeofConduct.

32 Fingerprinting/Policeclearance.

33 FidelityBond.

34 Inspections.

35 Requiredbooks,recordsandfinancialreports.

36 Netcapitalrequirement.

37 Changesininformationatthetimeofregistration.

PARTB

RegulationofPublicCompanies

38 Filingofauditedfinancialstatements

39 AnnualReport

40 Ruleonearningsforecast

41 QuarterlyReport

42 HalfyearlyReturns

43 Riskmanagementbypubliccompanies

44 IssueofDividendWarrantsetc


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PARTC

RegulationofCapitalMarketOperators

45

RegistrableFunctions

C1.GeneralProvisions

46 AilingMarketOperator.

47 Compromisewithcreditors.48 IssuingHousefees.

49 Broker/Dealerfees.

50 ExaminationbySelf-RegulatoryOrganisations.

51 Reportstobefiled.

52 RecognitionofExperts.

53 Expertsreport.

54 Exceptions.

SpecificProvisions

C2.Brokers/DealersandJobbers

55. Registrationrequirement.

56

Functions.57 Netcapitalrequirement.

58

Recordsoftransactionswithclients.

59Segregation of accounts/hypothecation/margin accounts,

etc.


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60

61

62

63

64

65

66

67

68

69

70

71

72

73

74

75

76

77

78

79

80

81

82

MarginLending.

Requirementofmarginagreement.

Categoriesofmarginaccounts.

Rulesforopeningandmaintainingmarginaccount

(regulationB).

Typesofmarginaccount.

Operationofmarginaccounts.

Marginlendingbybrokerstocustomers.

Dealermargintradingaccount.

Bankmarginaccount.

CentralBankofNigeriaRegulationC(Reg.C).

CentralBankofNigeria(CBN)RegulationCCall.

Componentsofthemarginaccount.

Loanvalue(Loansgivenagainstsecurities).

Thedebitbalance.

Determinationofexcessequity.

Specialmemorandumaccount(SMA).

RestrictedAccount.

Purchaseinarestrictedaccount.

Salesinarestrictedaccount.

Samedaysubstitutioninarestrictedaccount.

Marginmaintenancerequirementsforbrokerandbank

requirementsformarginaccounts.


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83

84

85

86

87

88

89

90

91

Marginrequirementforexemptsecurities.

Marginablesecurities.

Criteriafordeterminingmarginablesecurities.

Investoreligibility.

Trading/certificationofmarketoperatorspersonnelin

marginlendingandtrading.

Technologyformargintrading/financing.

Margintransactionreporting.Appointmentofcomplianceofficer.

DutiesoftheMarginComplianceOfficer.

AppointmentofPrincipalComplianceOfficer.

Valuationofsecuritiesusedforcollateralinmargin

account.

92 Periodicreportstoclients.

93 Solicitingdeposit.94 Mandatetopurchaseshares.

95 Brokeractingasagent.

96 SuspensionofaBroker.

C3.Sub-broker

97

98

99

100

101

102

103

104

105

RegistrationRequirements.

Functions.

Netcapitalrequirement.

RecordsofTransactionwithclient.

Periodicreporttoclients.

Prohibitionofsolicitationofdeposit.

Subbrokerscommission.

Relationshipbetweensubbrokerandbroker/dealers.

Suspensionofsubbroker.


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C4.MarketMaker

C5. Issuing

Houses

112 RegistrationRequirements.

113 Functions.

114 Separateaccountsforproceedsofissue.

115 Returnstobefiled.

C6.Underwriters


117 Definitionandfunctionsofunderwriting.

118

119

Eligibilityforunderwriting.

Contentofunderwritingagreement.

C7.Fund/PortfolioManagers


121 Functions.

122 Booksandrecordstobemaintained.123 Advertisements.

124 Custodyorpossessionoffundsorsecuritiesofclients.

C8.InvestmentAdvisers


106107

108

109

110

111

RegistrationRequirement.EligibilitytheMarketmaker.

Registrationrequirements.

Functions.

ObligationsofMarketmaker.

Infrastructure.


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126 Functions.

C9.Registrars

127 RegistrationRequirements

128 Functions.

129 Typesofregisterstobekept.

130 Entry in a register on transfer of existing

securities.

131 Entryofmembersnames.

132 Custodyofregister.

133 Issueandhandlingofcertificates.

134 Returnmonies.

135 Modeofreturn.

136 Custodyandtransferofunclaimedmonies.

137

PaymentofDividend

C10.Trustees

138

139

RegistrationRequirements

Functions.

140

141142

C11.Bankertoanissue

Eligibility

RegistrationRequirementsFunctions.

143

144

C12.Ratingagency



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Functions.

145

146

147

148

149

150

151

152153

154

155

156

157

158

159

160

161

162

C13.CustodianofSecurities


Exemption.

Denial/withdrawalofregistration.

Definitions.

Functions.

Codeofconduct.

Relatedfunctions.

Internalcontrols.Monitoring,reviewevaluation,andinspectingsystemsand

control.

Prohibitionofassignment.

Separatecustodyaccount.

Agreementwiththeclient.

Maintenance of records and documents/ furnishing o

information.

Preservationofrecords.

Disclaimerofliability.Responsibilityforshortfallininvestment.

Useofnominees.

Safekeepingofdocuments.

(A)

163

C14.DepositoryandParticipants

DEPOSITORY



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164

165

166167

168

169

170

171

172

173

174

175

176

177

178

179

(B)

180

181

182

183

184

185

186

187

188

189190

191

192

193

194

Definitions.

Functionsdutiesandresponsibilities.

Eligibility.Ownershipstructure.

Eligiblesecuritiesfordematerialisation.

Agreementbetweendepositoryandissuer.

DepositoryRules.

Systemsandprocedures.

Connectivity.

Transfertobeeffectedafterpayment.

Withdrawalbyparticipant.

Evaluationofsystemandcontrol.

MeasuresagainstRisks.

Safetyofrecords.

Recordstobemaintained.


PARTICIPANT


Definition.

Functions,dutiesandresponsibilities.

Eligibility.

Agreementbyparticipant.

Separateaccounts.

Statementofaccounts.

Transferorwithdrawalbyclient.

Connectivityforparticipant.

Monitoring reviewing and evaluating internal system &control.

Reconciliationforparticipant.

Returns.

Recordstobemaintained.

Safetyofrecords.


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195

196

197

198

199

200

201

202

203

204

205


Agreementbyissuer.

Handlingofsharetransferandmaintenancesofrecordstobesinglepoint.

Redressofgrievances.

Surrendering of certificate of securities to be

dematerialised.

ReconciliationforIssueroritsagent.

ConnectivityforIssueroritsagent.

Information.

Creationofpledgeorhypothecation.Investmentadvice.

Codeofconduct.

C15.SecuritiesClearingandSettlementCompany.

206

207


Functions.

PARTD CapitalMarketExperts/Professional


209 Reportingaccountants.

210 Solicitors.

211 EstateSurveyorsandValuers.

PARTE

RegulationofSecuritiesExchangesandTransactionsonExchanges,

CapitalTradePointsandotherSelf-RegulatoryOrganisations.

E1.SecuritiesExchanges


213

Approval of appointment of Chief Executive and

PrincipalOfficersofaSecuritiesExchange.


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etc.

238 Filingofreport.

239 Natureandformofreports.240 Use of statements filed with the Commission and the

Exchange.

241 Extensionoftimeforfilingreports.

E2.CapitalTradePoints

242

Registrationrequirements

243 Permissiontotradeinsecuritieslistedonotherexchanges.

244 Noticestomembersofexchange.

245 Securitiesexchangestorequiredisclosureofmaterialor

pricesensitiveinformationlikelytoaffectfinancial

condition.

246 Reportonsecuritiestraded.

247 Floortrading.

248 Tradingrules.

249 Disposalofreportsanddocumentsfiledwiththe

SecuritiesExchange,etc.

250 Reportsofproposedrulechangesbyasecurities

exchange.

251 Effectivenessoflistingandexchangecertification.

252 Requirementsastocertificationoflistingandquotationof

individualcompanies.

253 DateofreceiptofcertificateoflistingbyCommission.

254 Operationofcertificationonsubsequentamendment.

255 Withdrawalofcertification.

256 Suspensionoftrading.

257 Removalfromlisting.

258 Review of decisions of Self-Regulatory Organisations

(S.R.O.).

259 Dealingmembers.

260 Recordstobemaintainedbyexchangemembers,etc.

261 Records to be preserved by certain exchange members,


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etc.

262 Filingofreport.

263 Natureandformofreports.264 Use of statements filed with the Commission and the

Exchange.

265 Extensionoftimeforfilingreports.

E3.InterDealerBroker

266Definitions.

267 Registrationrequirements.

268 Grantingofinterdealerbrokerauthoriseduserregistration. 269 ObligationofanIDBauthoriseduser.

270 RestrictionsonanIDBauthoriseduser.

271AccesstoserviceofferedbyanIDBauthoriseduser.

272 RegistrationandfunctionofofficersofanIDBauthorizeduser.

273 Data.

274 Penalty.

E4.OvertheCounterMarket.

276 Rules of Over the counter market relating to

listings/quotations.

277 Overthecountermarket.

278 Fraudandmisrepresentation.

279 Identificationofquotation.

280 ReviewofdecisionsofSelf-regulatoryOrganisations(S.R.O.).

281 Dealingmembers.

282 Recordstobemaintainedbyexchangemembers,etc.

283 Recordstobepreservedbycertainexchangemembers,etc.

284 Filingofreport.

275



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285 Natureandformofreports.

286

287

Use of statements filed with the Commission and the

Exchange.Extensionoftimeforfilingreports.

E5.TradeAssociations

288

Registrationrequirements

E6.CommodityandFuturesExchange

289 Registrationrequirements.290 GoverningCouncilorBoard.

291

292

CodeofConduct.

CommissiontoapproveappointmentofDirectors&Board

orCouncilmembersofCommodityExchange.

293 Floorbrokers/futurescommissionmerchants/floortraders,

introducingbrokersandassociatedpersons.

294 Separationofaccount.

295 Commodityfuturestradingadviser.

296 ClearingandSettlementAgency.297 Registrationofcommodities,futures,optionscontracts.

298 Periodicreturns.

299 Fees.

300 Maintenance of adequate records of affairs and

transactions.

301 Businessrecords.

302 Fraudandothermalpractices.

303 Floor/pittrading.

304 Exchangemembers.

305 Minimumfinancialrequirements.

306 Cropmarketinformationletters,reports:copiesrequired.

307 Information requiredconcerning warehouses, depositories,

andothersimilarentities.

308 Recordsandreportsofwarehouses,depositoriesandother


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similarentities:visitationofpremises.

309 Deliveryofcommoditiesconformingtospecifiedstandards.

310 Definitions.

PARTF

RegistrationofSecurities

311 RegistrableSecurities.

RegulationofDistributionofSecurities

F1.PublicOffer

312

313

Filingofregistrationstatement.

Conditionforapprovalofsubsequentpublicoffers314 Prohibitionofsale.

315 Noticeofproposedoffering.

316 Guidelinesforadvertisement

317 Form,size,number,etc.,ofProspectus.

318 DateofProspectus.

319 Statementsrequiredinaprospectus.

320 Contentsofprospectus/rightscircular.

321 AbridgedProspectus.

322 ContentsofabridgedProspectus.

323 ContentsofstatementinlieuofProspectus.

324 Consentofparties.

325

326

327

Partiestoanissue/scheme.

Allpartiesmeeting.

PreOfferwaitingperiod(fixedpriceoffer).

328 Openingandclosingofoffer.

329 Applicationform.

330 Processingfeeonapplications.

331 Purposeoftheoffer.

332 Proceedsofissue.

333 Summaryreportoncompletionofapublicoffer.

334 Grantingofcreditfacility/bridgingloan.

335 Annualreportandaccounts.


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336 Notificationofrightsoffering.

337

338

Allotmentperiodandsubmissionofallotmentproposal.

Powersofthecommissiontoabortanissue.

339 Basisofallotment.

340 Under-subscription.

341 Publicationofallotment.

342 Costofissue.

343 Valuationofrightsissue.

344

345

UnderwritingofPublicissues.

UnderwritingofRightsIssues

346 Amounttobeunderwritten.

347 Underwritingcommission.

348 Timeamountunderwrittenismadeavailable.

349

350

351

352

353

Vendingagreement.

Bookbuilding.

Definitions.

HighNetworthInvestors.

Conditionforapproval.

F2.RightsIssue

354Generalandrestrictedinvitationtothepublic.

355Registrationofprospectus.

356Contractinprospectusetcnottobevariedwithoutleave.

357Documentwithofferofsecuritiesforsaletobedeemeda

prospectus.

358Interpretationastoprospectusstatement.

359Formofstatementinlieuofprospectus.

360Civilliabilityformisstatementinprospectus.

361Criminalliabilityformisstatementinprospectus.

362Criminalliabilityinrespectofstatementinlieuof

prospectus.


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363Allotmentofsecurities.

F3.PrivatePlacementbyPublicCompaniesandCollectiveInvestmentSchemes

364 Definitions.

365 Conditionsforapprovalofoffer.

366 Natureofofferees.

367 Accesstoinformation,etc.368

369

Filingrequirements.

Placementmemorandum.

PARTG

G1.RegulationofConductofSecuritiesBusiness

370 Electronicofferandtransferofsecurities.

371 Cashtransaction.

372 Knowyourcustomer.373

374

375

376

377

378

379

Exemptionfromapplicationofprovisionsrelatingtoprospectus

in

certaincases.

Prohibition of issuance ,circulation etc of certain notices

circulars

andadvertisement.

Exemptioncertificateandeffect.

Expertsstatementonprospectus.

Prospectusoninvitationtothepublictoacquireordisposeof

Securities.

Generalandrestrictedinvitationtothepublic.

Registrationofprospectus.

380

381

Securitiespledgedascollateral

SecuritiesLendingandBorrowing.


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382

383

384

Generalrequirements.

Criteriaforeligibilityasapprovedintermediary.

Obligationandresponsibilitiesofapprovedintermediary.

G2.TradinginSecurities

385 Personsrequiredtoregistertheirsecurities.

Exemptions.

Rulesrelatingtosecuritiesownership.

RulesrelatingtoShareBuy-back.

Rulesrelatingtoduallistingofsecurities.

Manipulativeanddeceptivedevicesandcontrivances.

Filingofnoticebydirectorsandotherinsidersuponsaleor

purchaseoftheirsharesinthecompany.

Disclosureofdirectorsinterestinstockbroking/dealingcompanies.

Disclosureofinterestinstockbroking/dealingcompaniesinquoted

companies.

Disclosureofinterestofpublicquotedcompaniesin

stockbroking/dealingcompanies.

Contractinprospectus,etc.,nottobevariedwithoutleave.

386

387

388

389

390

391

392

393

394

395

396

397

398

399

400

401

402

403

Documentwithofferofsecuritiesforsaletobedeemeda

prospectus.

Interpretationastoprospectusstatements.

Formofstatementinlieuofprospectus.

Civilliabilityformis-statementsinprospectus.

Criminalliabilityformis-statementinprospectus.

Criminalliabilityinrespectofstatementsinlieuofprospectus

Allotmentofsecurities.


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Openingofsubscriptionlists.

PARTHRegulationofForeignInvestmentsandCross-borderSecuritiesTransactions

H1.ForeignInvestments

404 Definitions.

405

406

407

408

InvestinginSecurities

RegistrationofforeignCapitalMarketOperators

Requirementforcertificateofcapitalimportation

ProhibitedInvestment

409 Modalitiesforportfolioinvestments.

410 UseofCustodian

411 Divestmentofsecurities.

412 Repatriationofproceedsfromdivestment.

413 Saleorofferforsubscriptionofsecurities.

414

415

Filingofapplication

Exemptions

2.Cross-borderSecuritiesTransactions

416 Publicofferingofsecurities.


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417 Filingofregistrationstatement

418 ContentoftheProspectus.

419 DepositoryreceiptsbyNigerianentities.

PARTI

RegulationofMergers,Take-oversandAcquisitions

420 Definitions.

I1.Mergers

421 ScopeoftheRegulation.

423 ApprovalbytheCommission.

424 Exemptions.

425 ProceduresforObtainingApprovalforMergers.

426

427

428

RequirementsforMergerNotification.

Lowerandupperthreshold

Clearanceofschemedocument

429 Requirementsforformalapproval.

430

431

432

433

434

435

436

437

438

439

Post-approvalrequirements.

Postmergerinspection

PowertoordertheBreak-upofacompany

I2.Acquisition

Definition

Acquisitionofcontrollinginterestinacompany

ContentsofPublication

ContentsoftheinformationMemorandum

PostAcquisition

DissentingShareholders

PostAcquisitioninspection

I3.BusinessCombinations


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440

441

442

Definition

Procedure for obtaining approval for Business

Combination

RequirementforBusinessCombination

I4.Take-overs

443 Take-overbids.

445 Contentsofabid.

446 Authoritytoproceedwithtake-overbid.

447 Registrationoftake-overbid.

448 Rulesonmanagementbuy-out.

PARTJ

J1.RegulationofCollectiveInvestmentSchemes

449

450

451

452

453

454

455

GeneralRulesForCollectiveInvestmentSchemes

Schemeallowablefee/expenses

Schemeadvertising

Windingupofschemes

Rulesoncustodialservicesforregisteredcollective

investmentschemes

Functionsofthecustodianofcollectiveinvestmentscheme

Obligationofthecustodianofacollectivescheme

J2.UnitTrust

456 Applicationforauthorisationofunittrustscheme.

457 RequirementsastoformofProspectus.

458 StatementsasrequiredinProspectus.


460 ContentsofProspectus.


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461 Requirementastoform,number,etc.ofTrustDeed.

462 ContentsofTrustDeed.

463 FilingexecutedandregisteredTrustDeed.464 Calculationofpriceofunits.

J3.RealEstateInvestmentSchemes

465 ConstitutionofRealEstateinvestmentScheme

466 RequirementforauthorisationasaCompany

467 RequirementsastoformofProspectus.

468 StatementsasrequiredinProspectus.

469 DateofProspectus.470 ContentsofaProspectus.

471 Underwriting.

472 Amounttobeunderwritten.

473 UnderwritingCommission.

474 TimeAmountUnderwrittenismadeAvailable.

475 MinimumLevelofSubscription.

476 AssetAllocation

477 ValuationReport.

478 QuarterlyReport.

479 Insurance.

480 Borrowing.

481 RequirementforauthorisationasaTrust

482 RequirementsastoFormofProspectus.

483 StatementasrequiredinProspectus.


485 ContentsofaProspectus.

486 RequirementsastoForm,Number,etcofTrustDeed.

487 ContentsofTrustDeed.

488 FilingExecutedandRegisteredTrustDeed.

489 Underwriting.

490 AmounttobeUnderwritten.

491 UnderwritingCommission.

492 TimeAmountUnderwrittenismadeavailable.


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493 MinimumlevelofSubscription.

494 AssetsAllocation

495 RatingandValuationReports.496 QuarterlyReports.

497 Insurance.

J4.SpecialFunds

A.VentureCapitalFund

498 Requirementsforauthorisation.

499

500

501

502

503

504

505

506

507

508

509

510

511

512

513

514

515

516

517

518

ContentsofProspectus

B.MoneyMarketFund

Definition

Useofname/title

Approval/permissibleinstruments

Termofmaturityofinvestmentasset

Portfoliomaturity

AssetAllocation

Investmentrestriction

Governmentsecurities

Authorisedcollectiveinvestmentschemes

Valuation (Amortized cost method/Accumulated Net

AssetValue)

StableNetAssetvalueperunit

Valuablereview

Dividenddistribution

Fundrating

RiskAssessment

Prohibition

C.ExchangeTradedFund(ETF)

Definition

PartiestoanETF


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519

520

521522

523

524

526

527

528

529

530

531

532

533

534

535

536

537

538

General

Authoriseddealer(BrokerDealer)

OfferingandlistingofunitsofanETFListingofforeignETF

CreationandredemptionofETF

Pricinganddealing

Informationtobeprovided

Valuation

ContentofETFprospectus/offerdocument

Reportingandaudit

D.IslamicFundManagement

Definition

Qualificationforashariahadviser

Informationtobedisclosedbyfundmanager

Contentofatrustdeed

Fundmanager

Compositionofinvestmentcommittee

Portfoliomanagement

Writtendisclosureanddeclaration

Internalaudit

Acceptableprinciple/concepts

539

540

536

537538

539

540

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E.InvestmentsbyCollectiveInvestmentSchemein

UnlistedSecurities

Eligibilitycriteria

Investmentrestriction

Rating

Additionaldisclosure

Investorsprotection

Valuation

Reportsreturns

Targetinvestors


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542543

544

545

546

547

548

549

550

551

552

553

554

555

F.FundofFundsandFeederFunds

DefinitionofTerms

RegistrationRequirementofFundofFunds

RegistrationRequirementofFeederFunds

GeneralRequirementsofFeederFunds

ContentsofProspectusofaFeederFunds

ManagementoftheFeederFunds

TargetInvestoroftheFeederFunds

G.PrivateEquityFunds

DefinitionOfTerms

Applicability

Eligibility

Restrictions

GeneralRequirements

Reporting

Valuation

PARTK

FixedIncomeSecurities

A.BorrowingbyFederal,States,LocalGovernmentsandother

GovernmentAgenciesetc.

556 RegistrationofFederal,state,localgovernmentbonds/securitiesetc

557 RequirementforRegistration


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558

ConditionstobesatisfiedbytheIssuer

B.CorporateBonds559

560

RegistrationofCorporateBonds

Conditionforapproval

561

C.SupranationalBodies

PARTL

RegulationofSolicitationandUseofProxies562 Definitions.

563 Applicationofrules.

564 Requirementsastoproxy.

565 Presentationofinformationinproxystatement.

566 Servicesofproxystatementandproxyforms.

567 Filingrequirement.

568 Revisedmaterial.

569 Falseormisleadingstatement.

570 Contentofaproxystatement.

PARTM

AdministrativeProcedures

571SummaryActions

AdministrativeProceedings

NegotiatedSettlement

Sanctions

572

573

574

PARTN

MiscellaneousRules

575Attendance at A.G.M. of Securities Exchanges/other S.R.O.s,

public companies, collective investment schemes and court-

orderedmeetingsinmergersandtake-overs.


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SCHEDULES

SCHEDULEI

RegistrationFees,MinimumCapitalRequirements,SecuritiesAndOthers

SCHEDULEII

Penalties/Fines

SCHEDULEIII


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Forms

SCHEDULEIV

Information,ReturnsandReportsRequiredtobeFiledbyPublic

Companies,CapitalMarketOperatorsandotherSelf-Regulatory

Organisations

SCHEDULEV

ReportonSecuritiesandUseofProceeds

SCHEDULEVI

BasisofComputationofBidandOfferPricesforCollectiveInvestmentSchemes

SCHEDULEVII

MethodOfCalculationOfAnnualTurnoverOrAssetsToBeAppliedInRelation

ToMergerThresholds

SCHEDULEVIII

RulesofProcedureofS.E.C.AdministrativeProceedingsCommittee(APC)

SCHEDULEIX

CodeofConductforCapitalMarketOperatorsandtheirEmployeesSCHEDULEX

CodeofCorporateGovernanceforPublicCompanies

SCHEDULEXI

Anti-MoneyLaundering/CombatingFinancingofTerrorism(AML/CFT)

ComplianceManual forCapitalMarketOperators.

GENERALRULESANDREGULATIONSPURSUANTTOTHEINVESTMENTSAND

SECURITIESACT,2007


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PARTA

A1.RulesofGeneralApplication

Rule1.DefinitionoftermsusedintheRulesandRegulations

As used in the Rules and Regulations made pursuantto the Investments and Securities Act,

2007,unlessthecontextotherwiserequires

ActmeansInvestmentsandSecuritiesAct,2007;

beneficialownerofasecurityshallinclude:-

(a) any person who directly or indirectly through any contract, arrangement,

understanding,relationshiporotherwisehasorshares;

(i) voting power which includes power to vote or to direct the voting of such

security;and/or;

(ii) investment power which includes the power to dispose, or to direct thedisposition,ofsuchsecurity;

(b) any person who directly or indirectly creates or uses a trust, proxy, power of

attorney,poolingarrangementoranyothercontract,arrangementordevicewith

thepurposeoreffectofdivestingsuchpersonofbeneficialownershipofasecurity

orpreventingthevestingofsuchbeneficialownershipaspartofaplanorscheme

to evade the requirement to notify the Commission of any direct or indirect

ownershipofmorethan5%ofanyclassofsecurities;

(c) subjecttotheprovisionsofparagraph(b)above,wherethatpersonhastherightto

acquirebeneficialownershipofsuchsecurity,asdefinedinparagraph(a)aboveat

anytimewithinsixtydaysincludingbutnotlimitedtoanyrighttoacquire:-

(i) throughtheexerciseofanyoptionorright;

(ii) throughtheconversionofsecurityor;

(iii) pursuant to the power to revoke a trust, discretionary account, or similar

arrangement,anysecuritiesnotoutstandingwhicharesubjecttosuchoptions,

rights or conversion privileges shall be deemed to be outstanding for the

purposeofcomputingthepercentageoftheclassownedbyanyotherperson:

Provided that a person who in the ordinary course of business is a pledge of

securitiespursuanttoabonafidepledgeagreementshallnotbedeemedtobethe

beneficial owner of such pledged securities merely because there has been adefaultundersuchanagreement,exceptduringsuchtimeastheeventofdefault

shallremainincurredformorethanthirty(30)daysoratanytimebeforeadefault

iscuredifthepoweracquiredbythepledgepursuanttothedefaultenableshimto

changeorinfluencecontroloftheissuer;


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(d) all securities of the same class beneficially owned by a person, regardless of the

formwhichsuchbeneficialownershiptakes,shallbe aggregated incalculatingthe

numberofsecuritiesbeneficiallyownedbysuchperson;

CapitalMarketOperatorasdefinedintheAct

C.A.C. means Corporate Affairs Commission established under the Companies and

AlliedMattersAct,1990;CommissionmeanstheSecuritiesandExchangeCommission

establishedundertheInvestmentsandSecuritiesAct,2007;

planshall includeallplans,contracts,authorisationsorarrangements,whetherornot

setforthinanyformaldocument;

registrant means the issuer of securities or any person for whom a registration

statementoraproxystatementoranapplicationisfiled;

registrationstatementmeanstheapplicationforregistrationofanysecurityprovidedforintheActoranyamendmentthereto,anystatement,report,Prospectus,consents,

undertakings,documentormemorandumaccompanyingsuchapplicationorincorporated

thereinbyreference;

RulesandRegulationsrefertoalltheRulesandRegulationsmadebytheCommission

pursuant to the Act including the forms for registration, reports and the related

instructionsthereto;

securitiesexchangeshallhavethesamemeaningasdefinedintheAct.

Qualified Institutional Investor means a purchaser of securities that is financially

sophisticatedandasdefinedbytheCommission.

Unlessthecontextotherwisespecificallyrequires,aruleorregulationwhichdefinesaterm

withoutexpressreferencetotheActortotherulesandregulations,ortoaportionthereof

definessuchtermforallpurposesasusedbothintheActandintheRulesandRegulations.

Rule2.BusinesshoursoftheCommission

(1)Theoffice ofthe Commissionshallbe opentothepublic for business, Monday toFriday

exceptonPublicHolidays.

(2)Theofficialhoursofbusinessshallbebetweenthehoursof8oclockinthemorningand4

oclockintheafternoon.

Rule3.FilingofmaterialswiththeCommission

(1)Allpapers,documentsandinformationrequiredtobefiledwiththeCommissionpursuant

totheprovisionsoftheActoranysubsidiarylegislationmadethereundershallbefiledat

theheadquartersoranyzonalofficeoftheCommission.


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(2)Such papers, documents or information may be filed by delivery to the Commission by

hand,postalcommunication,electronicmail,facsimile,licensedcouriercompaniesorsuch

othermodesofcommunicationasmaybeprescribedfromtimetotimebytheCommission.

(3)The date of filing of any paper, document or information shall be the date such paper,

documentorinformationisreceivedbytheCommission,providedthatalltherequirements

forfilinghavebeencompliedwithandtherequiredfeepaid,providedalsothattheoriginal

paper,documentorinformationoffilingsthroughelectronicmail,facsimileorothermodeof

communication required by the Commission shall thereafter be forwarded to the

Commissionwithin14days.

(4)Any paper, document or information filed with the Commission that contains false or

misleadingstatementsshallbesubjecttoapenaltyof100,000.00inthefirstinstanceand

5000.00perdayforeverydaytheviolationcontinues.

(5) (a)All correspondencetothe Commission bysecuritiesexchanges,other self-regulatoryorganisations (S.R.Os) and capital market operators shall be signed by the

authorisedsignatories;

(b)Allsecuritiesexchanges,otherS.R.Osandcapitalmarketoperatorsshallfurnishtothe

Commission the names and specimen signatures of the authorised signatories from

timetotime.

Rule4.Non-disclosureofinformationobtainedinperformingofficialduties

(1)EveryofficeroremployeeoftheCommissionshalladheretoaCodeofSecrecyinrespectof

any paper, documentor informationwhich hemay possess orhaveknowledge of, asthe

casemaybe,whetherinthecourseofanyexaminationorinvestigationconductedpursuanttoanyprovisionoftheActortheseRulesandRegulationsorinthecourseofhisofficialduty.

(2)Withoutprejudicetosubrule(1),anofficeroremployeeoftheCommissionmaydisclose

any information or produce any paper or documents under the following circumstances,

wheretheofficeris:-

(a) expressly authorised by the Commission to disclose such information or produce

suchpaperordocument;

(b) is served with a subpoena requiring the disclosure of such information or the

productionofsuchpaperordocumentbyacourtofcompetentjurisdiction.

(3)AnyofficeroremployeeoftheCommissionshallonlybeobligedtoproduceanypaperordocumentordiscloseanyinformationinrespectofwhichasubpoenahasbeenissued

andservedbyacourtofcompetentjurisdiction.

(4)AnyofficeroremployeeoftheCommissionservedwithasubpoenatoproduceapaperor

documentordiscloseanyinformationshallpromptlyinformtheCommissionoftheservice

ofthe subpoena, the nature ofthe information, paperordocumentsought, and ofany


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othercircumstancewhichmaybearuponthedesirabilityorotherwiseofmakingavailable

suchinformation,paperordocument.

Rule5.Disclosuredetrimentaltonationalsecurity

(1)Exceptwhereotherwiseexpresslyprovidedforbylaw,noregistrationstatement,report,

proxy statement, or other document filed with the Commission or any securities

exchangeshallcontainanydocumentorinformationwhichpursuanttoexecutiveorder

hasbeenclassified(byanyappropriatedepartmentoragencyofGovernmentinNigeria)

forprotectionintheinterestofnationalsecurityortheforeignpolicyofNigeria.

(2)Whereadocument,statement,reportorinformationisomittedpursuanttorule5(1)

there shall be filed in lieu of such document, statement, report or information, a

statementfromtheappropriatedepartmentoragencyofGovernmentinNigeriatothe

effectthatsuchdocument,statement,reportor informationhasbeenclassifiedorthat

thestatusthereofisawaitingdetermination.

(3)Whereadocument,statement,reportorinformationisomittedpursuanttosubrule(1)of

this Rule, and information relating to the subject matter of such document, statement,

reportorinformationisneverthelessincludedinanymaterialfiledwiththeCommission

pursuanttoadeterminationofanappropriatedepartmentorAgencyoftheGovernment

ofNigeria,thedisclosureofsuchinformationshallnotbeclassifiedasbeingcontrarytothe

interest of national security or the foreign policy of Nigeria and the appropriate

departmentoragencyofGovernmentinNigeriashallberequiredtosubmitastatementin

writinginformingtheCommission.

(4)The applicantmay rely upon any such statement in filingoromitting any documentorinformationtowhichthestatementrelates.

(5)The Commission may protect from disclosure any information in its possession which

may require classification in the interest of national security or the foreign policy of

Nigeria, pending the determination by an appropriate department or Agency of

GovernmentinNigeriaastowhetherornotsuchinformationshouldbeclassified.

(6)Beforefilinganypaper,documentsstatementorinformationwiththeCommission,the

applicant shall submit to the appropriate department or agency of Government in

Nigeriaanydocumentorinformationprotectedfromdisclosureinsubrule(1)ofthisRule

andobtainfromthedepartmentoragencyofGovernmentconcerned,relevantclearance

to file the document or information, or in lieu thereof, the statement referred to insubrule(2)ofthisRule.

(7)Allstatementsshallbeinwriting.

Rule6.Fees

(1)ThefeeschargeablebytheCommissioninrespectofregistrationsandalltransactions

withitshallbeasprescribedinScheduleItotheseRulesandRegulationsasamended


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from time totimebypublication intwo nationaldaily newspapers orby notice inthe

Gazette.

(2)At the time offiling byan issuer ormarket operatorof anapplication for registrationundertheAct,theapplicantshallpaytotheCommission,theappropriatefee,nopartof

whichshallberefundable.

(3)Paymentoffeesshallbemadeincash,certifiedbankcheque orbyelectronicmeansto

theCommissionorpaidintoanyoftheCommissionsdesignatedaccounts.Paymentsin

cashshouldnotexceedN50,000(fiftythousandnaira)andshallbemadeattheFinance

andAccountsDepartmentoftheCommissionwhichshallissueofficialreceiptsforsuch

fees.

Rule7.Fine/Penalty

Except as otherwise specified, any person who violates any provision of these Rules andRegulationsshallbeliabletoapenaltyofnotlessthanN100,000andafurthersumofnot

lessthanN100,000foreverydayofdefault.

Rule8.Exemptions

(1)TheprovisionsoftheActandtheseRulesandRegulationsrequiringregistrationshallnot

applyto:-

(a) anynote,draft,currency,billofexchangeorbankersacceptancewhicharisesout

ofacurrenttransactionortheproceedsofwhichhavebeenoraretobeusedfor

currenttransactionsandwhichhasamaturityatthetimeofissuancenotexceeding

ninemonthsexclusiveofdaysofgrace,orthematurityofwhichislikewiselimited; (b) anysecurityissuedbya person,organised andoperatedexclusively forreligious,

educational,benevolent,charitableorreformatorypurposesandnotforpecuniary

profit and nopart ofthenetearningwhich accruestothebenefitof any person,

shareholderorindividualandsubjecttosuchothertermsandconditionsasmaybe

stipulated by theCommission. Any issue of securities pursuant to thisexemption

shallnotexceedinaggregatevaluethesumof5,000,000(fivemillionnaira);

(2)The Commission may by rules add any class of securities or transactions to those

exemptedunderthisregulation.

Rule9.PoweroftheCommissiontodemandandexaminerecordsrequiredtobemaintained

(1)The Commission may pursuant to the provisions of the Act, at any time it deems fit,

examinetherecordsandaffairsoforcallforinformationfromanyentitycoveredbythe

provisionsoftheAct.

(2)An entity whose affairs are being inspected and every director, officer and employee

thereofshallproduceto theinspectingofficersuchbooks,securities,accounts,records

andotherdocumentsinitscustodyorcontrolandfurnishhimwithsuchstatementsand


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information relating to its activities as the inspecting officer may require within such

periodastheinspectingofficermayspecify.

(3)Anentitybeinginspectedshallallowtheinspectingofficertohaveaccesstohisoritspremises or any premises occupied by any other person on his or its behalf and also

extendfacilityforexamininganybooks,records,documentsandcomputerdatainhisor

itspossessionorsuchotherpersonandprovidecopiesofdocumentsorothermaterials

which, in the opinion of the inspecting officer, are relevant for the purposes of the

inspection.

(4)The inspecting officer shall examine and may record the statements of any director,

officeroremployeeoftheentity.

(5)Everydirector,officeroremployeeoftheentitybeinginspectedshallgivetheinspecting

officer all assistance in connection with the inspection as the inspecting officer may

require.

(6)The Commission may appoint an auditor or any other professional to inspect or

investigate,asthecasemaybe,thebooksofaccounts,records,documentsoraffairsof

theentity;

Provided that the auditors or other professionals so appointed shall have the same

powersasvestedintheinspectingofficerundersub-rules(4)and(5)andtheentityand

its directors, officers and employees shall be under the same obligations towards the

auditorsoappointedasmentionedinthesaidsub-rules.

(7)TheCommissionshallrecoverfromtheentitysuchexpensesincludingfeespaidtothe

auditororotherprofessionalasmaybeincurredbyitforthepurposesofinspectingthebooksofaccounts,recordsanddocumentsoftheentity.

(8)Anyentitywhichfailsorneglectstocomplywithanyrequestorstipulationinaccordance

withtheforegoingprovisionsofthisregulationshallbeliabletoafineof2,500.00for

everydaysuchfailure,refusalorneglectpersistsandinadditiontoanyotherdisciplinary

measuretheCommissionmayimposefortheprotectionofinvestors.

(9)Entity under this rule means market operator, person or institution covered by the

provisionsoftheAct.

Rule10.Inspectionofdocuments

Everydocumentdelivered totheCommission for filingpursuant tothe Act and theseRules

and Regulations shall be open to inspection by any person upon payment of a fee

prescribedbytheCommissioninScheduleIoftheseRulesandRegulationandanyperson

may obtain copies or certified true copies of any such document on payment of a fee

prescribedinScheduleIthereof.ProvidedthatdocumentsdeliveredtotheCommissionfor

filinginrespectofregistration(otherthanregistrationofcapitalmarketoperators)shallonly


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be available for inspection from the commencement date specified in the transaction

document.

Rule11.Requirementsforinspectionofdocuments 1.(a)Any person wishingtoinspectanydocumentshall priorto the inspection writea

letterorfileFormS.E.C.IDnotifyingtheDirector-Generalofhisintentiontoinspect

suchdocument;

2.(b)Suchlettershallstate:-

(a) proposeddateandtimeofinspection;

(b) purposeforinspection;

(c) whetherphotocopyingandcertificationwillberequired;

(d) fullnameandaddressofapplicant;

(e) addressofregisteredoffice,ifacorporatebody; (f) occupationofapplicant.

Rule12.Copyingofinspecteddocuments

(1)Pursuant to rule 11 above, documents will be available for inspection in the

CommissionsheadofficeonMondaytoFriday(exceptonpublicholidays)betweenthe

hoursof11a.m.and2p.m.

(2)Nopersonshallbeallowedtomakemorethanone(1)copyofanydocument

(a) notwithstandingtheprovisionsofrule11above,theCommissionreservestheright

toclassifycertaindocumentsinaccordancewiththeOfficialSecretsAct,Cap.335of

theLawsoftheFederation,1990;

(b)suchclassifieddocumentsshallbeexemptedfromdisclosureto/inspectionbythe

public.

Rule13.Maintenanceofadequaterecordsofaffairsandtransactions

(1)AllS.R.O.sandmarketoperatorsshallmaintaincorrectandadequaterecordsoftheir

affairsandall transactionstheyareinvolvedinasrequiredundertheprovisionsoftheir

RulesandRegulations.

(2) The Commission may, whenever it deems it necessary, prescribe the nature,

formandcontentofthe recordstobekeptbyany,orallofthepersonsreferredtoinsubrule(1)ofthisRegulationanditshallbe the duty of any such person or

personstocomply.

(3) Anypersonwhocontravenes,fails,neglectsorrefusestocomplywiththeprovisionsof

subrules(1)and (2)ofthisRegulationshallbeliabletoafineof1,000foreverydaysuch

contravention,failure,neglect or refusal persists; in addition to any other sanction the

Commissionmayimpose.


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Rule14.AppointmentofComplianceOfficer`

(1) Every market operatorshall appointa Compliance Officer who shallpossess requisite

knowledgeof relevantcapitalmarketregulationsandwhoshallberesponsibleformonitoringandensuringcompliancewith the Act,Rules andRegulations, notifications,

guidelines,instructionsetc.issuedbytheCommission ortheFederalGovernment.

2) TheComplianceOfficershallberegisteredbythemarketoperatorwiththeCommission

asasponsored individual by filing Form S.E.C. 2 as contained in ScheduleIII of

theseRulesandRegulations.

(3)TheComplianceOfficershallimmediatelyandindependentlyreporttotheCommission

anynon- complianceobservedbyhim.

(4) The Compliance Officer shall be responsible for educating other members of staff on

compliancerelated issues.

(5) TheComplianceOfficershallonanannualbasisattendatleasttwotrainingsorganized

byinstitutions recognizedbySEC.

A2.GeneralRulesonRegistrations

Rule15.Applicationforms

(1)Applicationforregistrationshallbe made inaccordancewiththeseRulesandRegulations

andtheformprescribedthereofbytheCommissionasineffectonthedateoffiling.

(2)An application for registration shall be filed in duplicate as the case may be, in the form

containedinScheduleIIItotheseRulesandRegulationsorasprescribedfromtimetotimeby

theCommission.

(3)ApplicationformsareobtainableonpaymentoffeesasprescribedinScheduleIofthese


Rule16.Numberofcopies,signatures,codeofconduct,etc.

(1)TwocopieseachofthecompletedapplicationformandthedraftProspectusandall

otherdocumentslistedaspartoftheRegistrationStatementshallbefiledwiththe

Commission.(2)Bothcopiesoftheapplicationformshallbedulyexecutedasindicatedontheform

(3)Ifanapplicationformissignedpursuanttoapowerofattorney,twocopiesofsuch

dulyexecutedpowerofattorneyshallbefiledwiththeapplicationform.

(4)Allquestionsontheapplicationform(s)shallbeansweredandtheapplicationsworn

tobythecompanysecretarybeforeaCommissionerforOathsorNotaryPublic.


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(5)Theapplicablefeeshallaccompanyallapplications.

(6)AnyundertakingrequiredtobefiledunderthisRegulationshallbesworntobefore

aNotaryPublicorCommissionerforOaths.(7)Every application for registration as a market operator shall in addition to other

requirementsbeaccompaniedbyadulyexecutedundertakingbytheapplicantto

comply and secure compliance of its employees with the Code of Conduct for

MarketOperatorsasapprovedbytheCommission.

Rule17.Requirementsastolanguage,printing,etc.

(1)TheregistrationstatementandanyotherapplicationfiledwiththeCommissionshallbe

in the English language. If any paper or document to be filed with the registration

statement is in any other language, it shall be accompanied by a certified translated

versionofthatpaperordocument.

(2)The registration statement and, in so far as practicable, all papers and documents

accompanyingsuchapplicationshallbeprintedortype-written.However,theapplication

oranyportionthereofmaybepreparedbyanysimilarprocesswhichintheopinionof

the Commission produces copies suitable for a permanent record. Irrespective of the

processused,allcopiesofanysuchdocument,shallbeclear,easilyreadableandsuitable

forrepeatedphotocopying.

(3)Whereanyspaceintheapplicationformisinsufficient,astatementmaybeattachedand

marked as an addendum, cross-referencing each statement to the item to which it

pertainsprovideditismanuallyinitialledbytheregistrant.

(4)Alldocumentspertainingtoanyquestionshallbeattachedtotheapplicationformandshallbeproperlymarked.

Rule18.Additionalinformation

Inadditiontotheinformationexpresslyrequiredtobeincludedinaregistrationapplication

or statement, there shall be added such further material information, if any, as may be

necessarytomaketherequiredstatements,inthelightofthecircumstancesunderwhich

theyaremade,notmisleading.

Rule19.SponsoredIndividualsandComplianceOfficers

(1)SponsoredindividualsandComplianceOfficersforpurposesofthisRegulationarethe

principalofficersand/orprofessionalsheldoutbytheapplicantasexpertsandonwhose

adviceor actionsinvestorsareexpectedtorely.Thesaidsponsoredindividualsshallbe

registeredassuchbytheCommission.

(2)Sponsored individuals and Compliance Officers are required to file Form S.E.C.2 as

containedinScheduleIIItotheseRulesandRegulations.

(3)All sponsored individuals and Compliance Officers are required to undergo police

clearanceinamannerspecifiedbytheCommissionfromtimetotime.


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(4)Except as otherwise directed by the Commission, all applicants for registration shall

appearbeforetheCommissionsCommitteeonRegistrationofCapitalMarketOperators

andInstitutionsforinterview-

(a) exceptwith thepermission oftheCommission,anyapplicantwho failsto appear

before the Commissions Registration Committee shall be liable to a fine as

containedinScheduleIIoftheseRulesandRegulations;

(b) any applicant who fails to demonstrate sufficient knowledge of capital market

operationsbeforetheCommissionsRegistrationCommittee,shall,onappearanceat

asubsequentinterview,payare-appearancefeeascontainedinScheduleIIofthese


(5)Everystockbrokeremployedinaninstitutioninvolvedincapitalmarketactivitiesshall

besponsoredforregistrationbythatinstitution.

(6)AllsponsoredindividualsandComplianceOfficersproposedbyanapplicantshallbeemployeesofthatapplicant.

(7)Companiesregistered/seekingregistrationtocarryoutmultiplefunctionsshallsponsor

thetotalnumberofindividualsprescribedforeachfunction.

Providedthatanapplicantforanyofthefollowingrelatedfunctionsmaysponsoronly

theminimumnumberprescribedfortheleadfunction:

(a) issuinghouse

relatedfunctions

(a) underwriter;

(b) investmentadviser; (b) broker,broker/dealer

relatedfunctions

(a) portfolio/fundmanager;

(b) investmentadviser;

Rule20.QualificationsofSponsoredIndividualsandComplianceOfficers

(1)SponsoredindividualsandComplianceOfficersarerequiredtohaveanyofthefollowing

qualificationsandjobexperience:

(a) a first or higher degree or its equivalent in a relevant field including banking,finance, accounting, business management, law, economics and company

secretarialstudieswithaminimumof4yearsrelevantpost-qualificationexperience

(excludingtheNationalYouthServiceCorpsyear);or

(b) afirstor higher degree or itsequivalent in anon-relevant fieldincludingscience-

oriented courses, the Arts, etc., with a minimum of 6years relevant post-

qualificationexperience(excludingtheNationalYouthServiceCorpsyear);or


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(c) a West African School Certificate (W.A.S.C.)/S.S.C.E., General Certificate of

Education(G.C.E.)orHigherSchoolCertificateoritsequivalentwithaminimumof

15yearsrelevantpost-qualificationexperience.

(2)Where thesponsored individualandComplianceOfficer intendstoberegisteredasa

Registrar, such officer must in addition to (1) above have any of the following

qualificationsandjobexperience:

(a) alegalpractitionerwithaminimumof5yearspost-callexperience;

(b) a firstdegreeor its equivalent with a minimumof seven years relevant working

experienceinaRegistrarsestablishmentregisteredbytheCommission;

(c) a school certificate holder with a minimum of 15 years working experience in a

RegistrarsestablishmentdulyrecognisedbytheCommission.

(3)Wheretheindividualissponsoredbyaratingagencysuchofficershallcomplywith rule

141(3)(vii).

(4)WhereanindividualissponsoredbyaSub-Broker,suchapersonshallbeanAssociate

MemberoftheCharteredInstituteofStockbrokers(CIS)orhaveanyofthequalifications

specifiedinone(1)aboveorsuchotherprofessionalqualificationsas acceptabletothe

Commission.

(5)Allsponsoredindividualsandcomplianceofficersarerequiredtoforwardcopiesoftheir

credentialswiththeirapplicationsforregistrationwhiletheoriginalsaretobepresented

forsightingduringtheregistrationinterviews.

(6)Allsponsoredindividuals andcomplianceofficers arerequiredonanannualbasistofile

with the Commission evidence of attendance of at least one training organized by

institutionsrecognizedbytheCommission.

Rule21.ApprovalofappointmentofDirectorsofCapitalMarketOperators

1. ExecutiveDirectors of Market Operators shall be approved by the Commission

priortotheirappointment;

2. A Director of a Market Operator shall have the minimum qualifications as

specifiedinrule20oftheseRulesandRegulations.

Rule22.Minimumpaid-upcapital

(1)Theminimumpaid-upcapitalforthepurposeofregistrationisascontainedin PartCof

theseRulesandRegulationsorasprescribedfromtimetotimebytheCommission.

(2)ThefollowingdocumentsshallbefiledwiththeCommissionasevidenceofcompliance

withthepaid-upcapitalrequirements:-

(a) copyoftheShareholdersresolutionauthorisingtheincreaseinsharecapitalcertified

bytheCompanysecretary;

(b) CopyofcertificateofincreasecertifiedbytheCorporateAffairsCommission;


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(c)ReturnonAllotmentcertifiedbytheCorporateAffairsCommission;

(d)audited statement of account or management account signed by two directors with a

letterofconfirmationbyanexternalauditor,orstatementofaffairs(forcompaniesinexistencefor less than two years)signed byanauditor, showing that the increase has

beenpaid-up;

(e) where capitalcontributed is in form of real property,titledocuments in thenameof

the company inrespect ofthecapitalised property(ies) inanyof the following ways

shallsuffice:

(i) thepropertyshouldberelevanttotheoperationsofthecompany;

(ii) thet itled eedmusth aveb eenp erfecteda ndregistered int hen ameoft he

company;

(iii) an estate valuers report and the search report by an independent solicitor

shallbeattached; (iv) whereitisanyothertypeofproperty,anappropriatevaluersreportshallbe

attached;

(f) bank statement showing evidence of deposit of prescribed paid-up capital before

deductiontoacquire

fixedassets.

(3)The minimum paid-up capital for multiple functions shall be the aggregate of the

minimumpaid-upcapitalofallthefunctionsappliedfor.

(4)Thecash/assetmixratioforcoreoperatorsinthemarketshallbe60%liquidassetsand

40%fixedandotherassetswhilenon-coreoperatorscash/assetsmixratioshallbe30%

cashand70%fixedandotherassets.

Rule23.Amendmenttoapplication

(1)Whenever any information contained in any application for registration or in any

amendment thereto or in any of the documents submitted therewith becomes

inaccurate for any reason, the registrant shall file anamendment onForm S.E.C.7 as

contained in Schedule III to these Rules and Regulations correcting the informationwithin10workingdaysoftheoccurrenceoftheevent.

(2)Thefilingofanyamendmenttoanapplicationforregistrationbyaregistrantpursuantto

subrule (1)of thisRule,whichregistrationhasnotbecomeeffective,shall postponethe

effective date of the registration until the 30th day following the date on which the

amendmentisfiledwhicheverlastoccurs,unlesstheCommissiontakesaffirmativeaction

toaccelerate,denyorpostponetheregistration.


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(3)Everyamendmentfiledpursuanttosubrule(1)ofthisRulebyasecuritiesexchangeshall

constituteareport.

Rule24.Effectivenessofregistration

An applicant for registration shall not be deemed to have been registered by the

Commissionunlessanduntilitreceivesaformalletterconveyingtheconfirmationofthe

BoardoftheCommissiongrantingitsregistration:

Provided that the Commission may where it deems fit, issue a provisional letter of

registrationpendingconfirmationbyitsBoard.

Rule25.Withdrawalfromregistration

(1)(a)Anoticeofwithdrawalfromregistrationasamarketoperatororfromaregistered

functionpursuanttotheActshallbefiledonFormS.E.C.8asprovidedinScheduleIII

totheseRulesandRegulations.(b)NoticeofwithdrawalfromregistrationofsecuritiesshallbefiledonFormS.E.C.8A

asprovidedinScheduleIIItotheseRulesandRegulations.

(2)Except as hereinafter provided, a notice to withdraw from registration shall become

effectiveonthe60thdayafterfilingthereofwiththeCommissionorwithinsuchshorter

periodoftimeastheCommissionmaydetermine.

(3)Notwithstanding the provisions of (2) above, a notice of withdrawal from registration

filedaftera registrationcertificatehasbeenissuedshallnotbecomeeffective,untilthe

originalcertificateofregistrationisreturnedtotheCommissionforcancellation.

(4)Ifpriortotheeffectivedateofanoticeofwithdrawalfromregistration,theCommissionhas initiated proceedingsto suspend orrevoke the registration ortoimpose termsor

conditions upon such withdrawal, thenotice of withdrawal shall notbecome effective

exceptatsuchtimeanduponsuchtermsandconditionsastheCommissionmaydeem

necessaryinthepublicinterestorfortheprotectionofinvestors.

(5)Themarketoperatorshall:-

a.file with the Commission, a list of all its clients with the outstanding liabilities written

againsttheirnames;

b.fileevidenceofsatisfactorydischargeofitsobligationtoclients;theCommissionreserves

therighttoverifytheinformation;

c.dischargealloutstandingobligationstotheCommissione.g.returns,fees,penalties,etc.;

d.fileinformationaboutthemarketoperatortakingoveritsoperations;

e.file a sworn statement of indemnity, in favour of the market operator taking over its

operations;

f.file a copy of the agreement between it and the market operator taking over its

operations;


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g.fileacopyofthepublicnoticeofthewithdrawal,whichshallbepublishedintwonational

dailynewspapers.

Rule26.Suspension/Cancellationofregistration

(1)TheCommissionmaysuspendorcanceltheregistrationgrantedtoamarketoperatorfor

anyregisteredfunctionwherethemarketoperatorcontravenesanyoftheprovisionsof

theAct,theRulesandRegulations,thecodeofconductforcapitalmarketoperatorsor

failstodoanyofthefollowing:

(a) furnishany informationrelating toitsactivitiesas requiredbythe Commissionor

furnishesinformationwhichisfalseandmisleadinginanymaterialparticular;

(b) submitperiodicreturnsorreportsasrequiredbytheCommission;

(c) co-operateinanyenquiryorinspectionconductedbytheCommission;

(d) updateitssystemsandproceduresasrecommendedbytheCommission; (e) resolve the complaints of clients or fails to give a satisfactory reply to the

Commissioninthisregard;

(f) meetrenewalrequirements.

(2)The Commission may cancel the registration granted a market operator where it is

found:

(a) guiltyoffraudorhasbeenconvictedofanoffenceinvolvingmoralturpitude;or

(b) guiltyofrepeateddefaults.

(3)EffectofSuspensionandcancellationofregistration

(a)Fromthedateofthesuspensionofregistration,themarketoperatorshallceaseto

carry on any capital market activity and shall be subject to the directives of the

Commission with regard toany records,documents orsecurities that may be in its

custodyorcontrolrelatingtoitsactivitiesasamarketoperator.

(b)From the date of cancellation of registration, the market operator shall, with

immediateeffect,ceasetocarryonanycapitalmarketactivityasamarketoperator

andshallbesubjecttothedirectivesoftheCommissionwithregardtothetransferof

anyrecords,documentsor securitiesthatmaybe initscustodyor controlrelatingto

itsactivitiesasamarketoperator.

(c) where the registration of a market operator is suspended or withdrawn by theCommission,theregistrationofitssponsoredindividualalsostandssuspendedor

withdrawn.

(4)PublicationofOrderofSuspensionorCancellation.

TheCommissionshallpublishtheorderofsuspensionorcancellationofregistrationinat

leasttwonationaldailynewspapers.


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Rule27.Changeofstatusofregistrant

(1)Whereanysponsoredindividualresignsorforanyotherreasonleavestheemployment

of a sponsoring corporate body, the corporate body shall notify the Commission inwritingwithin5workingdaysfromthedateofhisleavingtheemployment.

(2)Thecorporatebodyshallwithin30daysreplacethesponsoredindividualwhohasleftits

employmentwithanotherofficerbyfilingFormS.E.C.2Aaccompaniedby:-

a. completedFormS.E.C.2fromthenewofficerbeingsponsored;

b. acopyoftheletterofresignationfromitsprevioussponsoredindividual;

c. letterofterminationfromthecompany(whereapplicable);

d. letterofacceptanceofresignationfromthecompany:

Providedthatwherethecompanystillhastherequiredminimumnumberofsponsored

officers,itmaynotreplacetheofficerwholeftitsservice.

(3)Theofficerinsubrule(2)(a)aboveshallcomplywiththerequirementsofrules19and20.

(4)Where a registered sponsored individual intends to transfer to another registered

corporate body, the following shall be complied with by the affected sponsored

individual:

(a) where the registration of a market operator is suspended or withdrawn by the

Commission, the registration of its sponsored officer also stands suspended or

withdrawn;

(b) whereasponsoredofficerresignshisemployment inthesponsoringcompany,he

may transfer his registration to another registered corporate body by complyingwiththefollowing:

(i) notify the Commission in writing within 5 working days from the date he

resignsfromhispreviousemployment,

(ii) fileFormS.E.C.2Bwithin14daysofassumptionofdutywiththenewoperator

accompanied by a copy of letter of employment issued by the present

employerandacopyofletterofacceptanceofresignationfromtheprevious

employer,

(iii) file completed Form S.E.C. 2 as a sponsored individual by the present

employer:

Providedthatwheretheindividualhasbeenoutofcapitalmarketoperationsfor3

yearsormore,heshallfileafreshapplicationforregistrationwiththeCommission;

(c) whereanemployeeofacapitalmarketoperatorresignsorisdismissedongrounds

of fraudulent or manipulative acts, the capital market operator shall notify the

Commission in writing within 2 working days from the date of the employees

resignationordismissal.


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Rule28.ApprovalofbranchesofCapitalMarketOperators

EveryCapitalMarketOperatorshallseekandobtaintheapprovaloftheCommission

beforetheestablishmentofanewbranchandshallnotifytheCommissionofits

intentiontocloseanybranch.ThisrulealsoappliestocompaniesapplyingforCapital

marketFunctions.

Rule29.ManagementofbranchesofCapitalMarketOperators

AllbranchofficesofaCapitalMarketOperatorshallbemanagedbyasponsored

individual.

A3.Post-registrationComplianceRequirementsbyCapitalMarketOperatorsandotherRegulatedEntities

Rule30.MembershipofSelf-RegulatoryOrganisations(S.R.O.)

(1)InadditiontoregistrationwiththeCommission,abrokerordealerisrequiredtobea

memberofoneormoreSelf-regulatoryOrganisations(S.R.O).

(2) A broker ordealer shall bea member of an associationofsecurities dealers toeffect

transactionsinanover-the-countermarket.

(3)Wherethebrokerordealereffectstransactionsonanyexchangeandover-the-counter

market, the appropriate Self-regulatory Organisation shall be the exchange(s) and the

AssociationoftherelevantOTC.

Rule31.CodeofConduct

(1)AllCapitalMarketOperatorsandotherregulatedentitiesshallcomplywiththeseRules

and Regulations the Code of Conduct for Capital Market Operators and the Code of

CorporateGovernanceforPublicCompaniesapprovedbytheCommissionandcontained

inScheduleIXandXoftheseRulesandRegulations.

(2)AllregisteredCapitalMarketOperatorsshalldisplaythecertificateofregistrationissued

bytheCommissionatthereceptionoftheiroffices.

Rule32.Finger-printing/Policeclearance

1. Everypartner,officer,director,chiefexecutiveandsponsoredindividualshallbecleared

bythepoliceatthecentralcriminalregistry.

2. Suchperson shall inthe presenceof anauthorised officer ofthe Commission make his

thumbimpressionontheprescribedformforthepurposeofthepoliceclearance.


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3. Allpromotersanddirectorsoftheregistrantshallfiletheirpersonalandphysicaldatain

theprescribedform.

4.

Adversereportshallbegroundfora) Denialofregistration

b) Withdrawal of registration where the Commission granted registration without

knowledgeofsuchadversereport.

Rule33.FidelityBond

(1)Everyregisteredcorporatebodyshallprovideandmaintainabondwhichshallbeissued

byan insurancecompanyacceptabletotheCommissionagainsttheft/stealing,fraudor

dishonesty,coveringeachofficer,employeeandsponsoredindividualofthecompany.

(2)Thebondshallprovidethatitshallnotbecancelled,terminatedormodifiedexceptafter

written notice shall have been given by one party to the other party and to the

Commissionnotlessthan60dayspriortotheeffectivedateofcancellation,termination

ormodification.

(3)Thebond shall be insuch reasonable form and amount asthe fiduciary duties ofthe

officer, employee or sponsored individual require but with due consideration to all

relevant factors including but not limited to the value of the aggregate assets of the

registeredcorporatebodytowhichanyofficer,employeeorsponsoredindividualmay

have access, the type and terms of the arrangements made for the custody and

safekeepingofsuchassetsandthenatureofthesecuritiesinthecompanysportfolio,

providedhoweverthattheminimumamountofthebondshallbeasprescribedbythe

Commissionfromtimetotime.

(4)Everyregisteredcorporatebodyshall:-

(a) filewiththeCommissionwithin5daysafterthemakingofanyclaimunderthebond

astatementofthenatureandamountoftheclaim;

(b) filewiththeCommissionwithin5daysofthereceiptthereof,acopyofthetermsof

thesettlementofanyclaimmadeunderthebond.

Rule34.Inspections

(1) A registered person shall be subject to inspection by the Commission for compliance

withregulatoryrequirementswithinonemonthofregistration.

(2)The Commission may after the inspection in subrule(1) above inspect any registered

persononaperiodicbasis.


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(3)Books, records and any other information required shall be made available by every

registeredpersontotheCommissionwithoutnoticewithinareasonabletime.

Rule35.Requiredbooks,recordsandfinancialreports

(1)All registered persons shall keepandmaintainall books, records andfinancialreports

requiredundertheActandtheseRulesandRegulations.

(2)All such books, records and financial reports shall be maintained and preserved in a

readilyaccessibleplaceforaperiodofnotlessthan5yearsfromtheendoftheyear

duringwhichthelastentrywasmadeonsuchrecord,providedthatinthefirst2years

suchdocumentsmaintainedshallbeinanappropriateofficeoftheregisteredperson.

Rule36.Netcapitalrequirement

All registered persons shall maintain the prescribed minimum paid-up capital and are

requiredtohaveatalltimessufficientliquidassetstocovertheircurrentindebtedness.

Rule37.Changesininformationatthetimeofregistration

AllregisteredpersonsshallfilewiththeCommissionthefollowinginformation:

1. Anymajorchangesinthecompanythatcouldaffecttheinformationfiledinrespect

ofthecompanysregistrationwhichatthetimeofregistrationwasnotknown.Thisshall

befiledintheappropriateform;

2. wherechangesmentionedinparagraph(i)aboveaffecttheauditedaccounts,such

amended accounts shall be filed with the Commission within six months of the

occurrenceoftheaforementionedchange.

PartB

RegulationofPublicCompanies

Rule38.FilingofAuditedFinancialStatements

(1)Allpubliccompanieswhosesecuritiesarerequiredtoberegisteredshallfilewiththe

Commission on a periodic or annual basis and on a specified format its audited

financialstatementandotherreturnsasmaybeprescribedbytheCommissionfrom

timetotime.

(2)Everypubliccompanyshallappointacomplianceofficerwhoinconjunctionwiththe

Chief Financial Officer shall ensure compliance withall regulatory requirements of

theCommission.


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Rule39. AnnualReport

TheAnnualReporttobefiledwiththeCommissionshallinallmaterialfactscomplywith

the relevant Accounting Standard. It shall also make disclosures of its unclaimed

dividendfundwithrespecttobankbalance,investmentsandearnedincomebywayof

notestotheauditedaccountsandotherperiodicreportsfiledwiththeCommission.

1. TheAnnualReportsshallbefiledwiththeCommission,notlaterthan90daysafter

thefinancialyearendinlinewiththeprovisionsofCAMA;

2.

the Chief Executive Officer and Chief Financial Officer or Officers or Personsperformingsimilarfunctionsinapubliccompanyshallinfilingtheannualaccount,

attachadulysignedcertificationlettertothemattersspecifiedinsection60(2)of

theAct;

3. TheAuditortothepubliccompanyshallberegisteredbytheCommissioninlinewith

Section62oftheAct;

4. The Auditor ofa public company shall in his audit report tothe company issue a

statement as to the existence, adequacy and effectiveness or otherwise of the

internalcontrolsystemofthecompany;

5. TheannualreportshallstatethelevelofcomplianceofthepubliccompanywiththeCodeofCorporateGovernanceforpubliccompaniesascontainedinSchedule

Xoftheserulesandregulation.

6. AnycompanywhofailstofileitsannualreportwiththeCommissionasin (a)above

shall be liable toa fine ofN1million and the sum ofN25,000.00 for everydaythe

defaultcontinues.

Rule40. Ruleonearningsforecast

1. All public quoted companies shall release its earnings forecast to the relevant

SecuritiesExchange,theCommissionandtheinvestingpublic20dayspriortothe

commencementofaquarter.

2. Theforecastshallbeinlinewiththecompanyspolicy,SecuritiesExchangelisting

requirementsandtherulesoftheCommission;

3. Underlying assumptions that formed the bases of the forecast shall also be

disclosed;


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4. The forecast shall be certified by the Chief Executive Officer and Chief Financial

Officerorofficersorpersonsperformingsimilarfunctionsinthecompany;

5.

AllpubliccompaniesshallnotifytherelevantSecuritiesExchanges,theCommission

andtheinvestingpublicassoonasitisknownthattheforecastwillnotberealized

andthereasonsforthenon-realisationshallbestated.

Rule41. QuarterlyReport

Publicquotedcompaniesshallnotlaterthan30daysfromtheendofeachquarterfile

withtheCommissionandsimultaneouslywiththerelevantSecuritiesExchangesandthe

investing public a quarterly report prepared in accordance with the Statement of

AccountingStandards(SAS)30andIAS34.

1. Thequarterlyreportshallcontainthefollowingbywayofnotes:a) Accountingpolicychanges;

b) Seasonalityorcyclicalityofoperations;

c) Unusualitems;

d) Changesinestimates;

e) Issuance,repurchase,andrepaymentofdebtsandequitysecurities;

f) Dividends;

g) Itemsofsegmentinformation(forthoseentitiesrequiredbySAS24andIAS

14toreportsegmentinformationannually);

h)

Significanteventsaftertheendoftheinterimperiod;i) Businesscombinations;

j) Longterminvestments;

k) Restructuringandreversalsofrestructuringprovisions;

l) Discontinuingoperations;

m) Correctionofpriorerrors;

n) Write-downofinventorytonetrealizablevalue;

o) Impairmentlossofproperty,plant,equipment,intangibleorother;assets,

andreversalofsuchimpairmentloss;

p) Litigationsettlements;

q) Anydebtdefaultoranybreachofadebtcovenantthathasnotbeen

correctedsubsequently;r) Relatedpartytransactions;

s) Acquisitionsanddisposalsofproperty,plantandequipment;

t) Commitmentstopurchaseproperty,plantandequipment.


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2. The Chief Executive Officer and Chief Financial Officer or officers or personsperforming similar functions in a public company shall in filing the quarterly

Reportattachadulysignedcertificationletter.

3. PublicationofInterimFinancialStatement.Allpubliccompaniesshallpublishtheirsignedquarterlybalancesheet,income

statement and cash flow statements in at least one National daily newspaper.

However,theaccountingpolicies,notesandotherrelevantinformationshallbe

posted on the companys website which address shall be disclosed in the

newspaperpublication.Thepublicationshallbesignedbytheofficersmentioned

in(ii)above.

4. Any company which fails to file quarterly report with the Commission shall beliabletoafineofN1millionandthesumofN25,000.00foreverydaythedefault

continues.

Rule42. HalfYearlyReturns

(1)PubliccompaniesshallfilehalfyearlyreturnswiththeCommissionintheprescribed

mannerandshallcontainthefollowing:

(a) Generalinformation;

(b) CorporateGovernanceissues;

(c)

Unclaimeddividends;(d) AuditCommittee;

(e) UndertakingbytheCompanySecretary,Chief InternalAuditor,Financial

Controller, Managing Director, Board Chairman and Chairman of Audit

Committee certifying the reliability of the information in the format

provided.

(2) ThecompletedformshallbereturnedtotheCommissionwithin30daysfromtheend

ofthehalfyearperiod;eitherinhardorelectroniccopy.

(3) UnclaimedDividendAllpubliccompaniesshallfilewiththeCommissionintheprescribedformareportof

unclaimeddividendsonhalfayearlybasisinaccordancewiththefollowingguidelines:

(4) AuditCommittee

a.EverypubliccompanyshallestablishanAuditCommitteewithwrittentermof

reference. The Committee shallbe independentin carryingout its termsof

reference.


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b. TheauditCommitteeshallmaintainrecordsofattendanceanddeliberationsof

itsmeetingandinteractions.

c.The Audit Committee of every public company shall review the companys

financial statements prior to approval by the Board of the company and

presentthereportattheAnnualGeneralMeeting.

(5)AnycompanywhichfailstofileitshalfyearlyreturnswiththeCommissionshallbeliable

toafineofN1millionandthesumofN25,000.00foreverydaythedefaultcontinues.

Rule43.RiskManagementbyPublicCompanies

1. Allpubliccompaniesshall:

a. includeriskmanagementaspartofitsaccountingpolicies;

b.

disclosebywayofnotesanymaterialeffectofunmitigatedriskoncorporateprofitability;

by way of notes disclose strategies for preventing risks the company is

exposedto.

Rule44.IssueofDividendWarrants,etc.

1. Dividenddeclaredshallbepaiden-blocbytheissuanceofachequeortransferof

funds to the Registrar not later than seven working days after the Annual

GeneralMeetingwherethedividendwasdeclared.

2. Dividendshallbepaidonlyoutofthecurrentprofitsorrevenuereservesofthe

company.No companyshallborrowforthepurposeofpayingdividend.

3. Acompanyshallnotdeclareorpaydividendiftherearereasonablegroundsto

believe that the company is or would be, after payment, unable to pay its

liabilitiesastheyfalldue.

4. i.Alldirectorswhopayorarepartytothepaymentofdividendoutofcapital

shallbe personallyliable torefundtothecompanyanypayment

somade.

ii.Alldirectorswhorecommendthepaymentofdividendwhenitisapparent

thatthecompany hasnoresourcestopay,shallbepersonallyliableto

paythedeclareddividendtoshareholders.

PARTC


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RegulationofCapitalMarketOperators

Rule45.RegistrableFunctions

(1)Thefollowingarecapitalmarketoperators:

a. issuinghouses/merchantbankers;

b. underwriters;

c. broker/dealers;

d. sub-brokers;

e. receivingbankers;

f. Registrars;

g. trustees;

h. investmentadvisers(corporateandindividuals); i. fund/portfoliomanagers;

j. ratingagencies;

k. Marketmakers

l. Custodian

m. AnyotherfunctiontheCommissionmaydeterminefrom

timetotime.

(2)Onlycorporatebodiesarequalifiedtofileapplicationsforthefollowingfunctions:

a. Broker/dealer;

b. Underwriter; c. Issuinghouse;

d. Registrar;

e. Trustee;

f. Fund/portfoliomanager;

g. Ratingagency

h. Marketmakers

i. Receivingbankers

ProvidedthatwhereanexistingentityintendstoperformthefunctionsofaRegistrar,itshall

incorporateaseparatebodyforthatpurpose.C1.GeneralProvisions

Rule46.AilingMarketOperator

TheCommissionmay,whereitdeemsfit,appointanindividualorbodycorporatetooversee

the affairs ofa suspended orailing capitalmarket operator inthe interestofthe general

investingpublic.


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Rule47.Compromisewithcreditors

AnymarketoperatorshallnotifytheCommission,atleastthreemonthsbeforethemeeting

ofcreditors,ofitsintentiontocompromisewithitscreditors.Rule48.IssuingHousefees

Issuing house fees on equities and interest bearing securities shall not exceed the limit

approvedbytheCommissionfromtimetotime.

Rule49.Broker/Dealerfees

(1)Broker/dealerfeesforthepurchaseorsaleofsecuritiesonbehalfoftheirclientsshall

notexceedthelimitapprovedbytheCommissionfromtimetotime.

(2)Everybroker/dealershallpaytotheCommissiontheprescribedfeesasperScheduleIof

theseRulesandRegulationsoneverysecuritytradedonanExchangeoranyotherregistered

S.R.O.

Rule50.ExaminationbySelf-RegulatoryOrganisations

(1)Amarketoperator,subject totheseRegulations,shallpermitdulyauthorisedofficer(s)

ofanS.R.O.towhichthemarketoperatorbelongstoexaminetheactivitiesandrecords

ofsuchoperator.

(2)An S.R.O. shall furnish copies of all reports of examination of any person who is a

member ofsuch S.R.O. tothe Commission not laterthan 30days afterthe quarter in

whichsuchinspectionswerecarriedout.

Rule51.Reportstobefiled

(1) EveryMarketOperatorwhetheractiveornotshallfilewiththeCommissionreports

listedinScheduleIVoftheseRulesandRegulations:-

(a) Quarterlyreturnsshallbefiledwithinthirtydaysaftertheendofthequarter.

(b) Annualaccountscertifiedbyanauditorandpreparedonacalendarorfiscal

year basis, shall be filed not later than six months after the end of the

accountingyear.

(c) Whereamarketoperatorfailstofilequarterlyreturnstwiceinayearandnine

monthsaftertheannualaccountsbecomesdue,themarketoperatorshallbe

referredforfurtherenforcementaction.

Providedthatanoperatorwhowasnotactiveduringareportingperiodshallfilea

nilreturnsupportedbyaffidavit.

(2) Upon thediscoveryofthetheft orlossofanysecurity,acapitalmarket operator

shall report to the Commission, the Exchange to which it is a member, and the

Regist

New Consolidated Rules and Regulations 2011

Documents

Transcript of New Consolidated Rules and Regulations 2011