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As enacted
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Part II · Markets and Market Institutions

55. Application to operate a central depository

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

(1)

An application for a licence to establish or operate a central depository shall be made to the Commission in such manner and form as may be specified by the

Commission and shall be accompanied by such fee as may be prescribed.

(2)

An application for a licence to establish or operate a central depository shall only be made by a body corporate.

(3)

The central depository shall make rules which have satisfactory provisions with regard to –

(a)

conditions under which securities may be deposited, held by, withdrawn from or transferred to and recorded in the register of securities;

(b)

the processing of dealings in deposited securities;

(c)

facilitating the settlement of deposited securities;

(d)

the protection of the interests of account holders and the protection and control of information on deposited securities and dealings therein;

(e)

transparent and non discriminatory criteria for the admission of depository participants and the categories of depository participants;

(f)

the monitoring and supervision of depository participants and for the enforcement of the rules of the applicant company;

(g)

the expulsion, suspension, imposition of penalties or disciplining of depository participants for failure to comply with the rules of the central depository;

(h)

the settlement of disputes between the central depository and the depository participants and between depository participants; and

(i)

ensuring the segregation of the securities belonging to investors from those of the depository participants.

(4)

An applicant under subsection (1) shall provide such information as the Commission considers necessary in relation to the application.

(5)

The proposed central depository shall at all times have sufficient financial, human and other resources to ensure the provision of –

(a)

adequately and properly equipped premises for the conduct of its business;

(b)

competent personnel for the conduct of its business;

and

(c)

automated systems with adequate capacity, security arrangements and facilities to mitigate risks and to meet emergencies.

(6)

Where the Commission is satisfied that it is appropriate to do so in the public interest or for the proper regulation of the securities market, it may, grant a licence to the applicant to establish or operate a central depository subject to such terms or conditions as the Commission thinks fit.

(7)

Without limiting the generality of the terms and conditions attached to the licence referred to in subsection (6), the Commission, may amend or revoke any of the terms and conditions imposed or impose new terms and conditions, if the Commission is satisfied that it is appropriate to do so in the interest of the investors, or for the proper regulation of a central depository.

Read on from s 56

Part III

Issue of Securities

Read on from Part III

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