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As enacted
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Contents

Part III · Issue of Securities

113. Disclose certain interests in securities

Official English translation. The Sinhala text prevails. Open the official Sinhala text, official PDF on documents.gov.lk

(1)

Where a market intermediary or a registered person sends a circular or other similar written communication in which he makes a recommendation, with respect to any securities, he shall include in the circular or other written communication in print not less legible than that used in the remainder of the circular or other written communication, a concise statement of the nature of any interest in the securities, or any interest in the acquisition or disposal of the securities that he or a person associated with or connected to him, has at the date on which the circular or other communication is sent.

(2)

Where a market intermediary or registered person is charged with an offence in respect of a contravention of subsection (1), it shall be a defence for the market intermediary or registered person to prove that at the time the circular or other communication was sent, he was not aware and could not reasonably be expected to have been aware —

(a)

that he had an interest in the securities, or an interest in the acquisition or disposal of the securities; or

(b)

that the person associated with or connected to him had an interest in the securities, or an interest in the acquisition or disposal of the securities as the case may be.

(3)

For the purposes of subsections (1) and (2) -

(a)

an interest of a person in the acquisition or disposal of any securities includes any financial benefit or advantage that will or is likely to accrue directly or indirectly to the person upon or arising out of the acquisition or disposal of the securities;

(b)

without limiting the generality of paragraph (a), a person who has entered into an underwriting agreement in respect of any securities shall be deemed to have an interest in the acquisition or disposal of the securities; and

(c)

notwithstanding subsection (1) or paragraph (b) of subsection (2), a person is not connected to or associated with another person unless the person and the other person are acting jointly or otherwise acting under or in accordance with an arrangement made between them, in relation to the sending of the circular or other communication.

(4)

When a market intermediary sends to a person a circular or other written communication to which subsection (1) applies, the market intermediary shall preserve a copy of the circular or other written communication for six years from the date on which the circular or other written communication is sent.

(5)

For the purposes of this section, a circular or other written communication sent to a person shall, if it is signed by an officer of a market intermediary, be deemed to have been sent by the market intermediary.

(6)

Any person who contravenes this section commits an offence under this Act.

Read on from s 114

Part IV

Trade In Unlisted Securities

Read on from Part IV

Part V

Market Misconduct

Read on from Part V

Part VI

Finance

Read on from Part VI

Part VII

General

Read on from Part VII