Investment Intermediaries Act, 1995
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Restrictions on advertising. |
23.—(1) Any person who causes to be advertised, or supplies, or offers to supply, investment business services or investment advice, or makes any other solicitation in respect of investment business services or investment advice or who holds himself out to be an investment business firm, where the provision of such services or advice would be an offence under section 9 of this Act shall be guilty of an offence. | |
(2) Without prejudice to the generality of any section of this Act empowering a supervisory authority to impose conditions or requirements, or both, a supervisory authority may impose such conditions or requirements or both, on the investment business firm concerned in respect of advertising by that investment business firm as the supervisory authority considers necessary, in the interests of— | ||
(a) the orderly and proper regulation and supervision of authorised investment business firms, or | ||
(b) the protection of investors. | ||
(3) A supervisory authority may impose a requirement on an investment business firm or all investment business firms to publish specified information or to display specified information at their premises. | ||
(4) The Minister may prescribe information to be displayed by an authorised investment business firm at its premises. | ||
(5) (a) If, with respect to any investment business firm, a supervisory authority considers it expedient to do so, in the interest of the proper and orderly regulation and supervision of investment business firms or the protection of investors, the supervisory authority may give such investment business firm a direction in relation to the content and form of any advertisement or other means of soliciting client money or investment instruments or business or in relation to the content and form of any advertisement relating to any service provided or business being undertaken by the investment business firm, or to withdraw an advertisement or to cease advertising. | ||
(b) Without prejudice to the generality of paragraph (a) of this subsection, a direction under this section may do all or any of the following— | ||
(i) prohibit the issue by the investment business firm of advertisements of all descriptions or any specified description, | ||
(ii) require the investment business firm to modify advertisements of a specified description in a specified manner, | ||
(iii) prohibit the issue by the investment business firm of any advertisements which are, or are substantially, repetitions of a specified advertisement, | ||
(iv) require the investment business firm to withdraw any specified advertisement or any advertisement of a specified description, | ||
(v) require the investment business firm to include specified information in any advertisement to be published by it or on its behalf or in any statement to the public to be made by it or on its behalf. | ||
(6) If, in contravention of subsection (1) of this section or in contravention of a direction under this section, a person issues, or causes to be issued, an advertisement inviting persons to enter or offer to enter into an investment agreement or containing information calculated to lead directly or indirectly to persons doing so, then, subject to subsection (9) of this section— | ||
(a) he shall not be entitled to enforce any agreement to which the advertisement related and which was entered into after the issue of the advertisement, and | ||
(b) the other party shall be entitled to recover any money or other property or investment instruments paid or transferred by him under the agreement, together with compensation for any loss sustained by him as a result of having paid money or transferred property or investment instruments under the agreement. | ||
(7) If, in contravention of subsection (1) of this section, or in contravention of a direction issued under this section, a person issues or causes to be issued an advertisement inviting persons to exercise any rights conferred by an investment or containing information calculated to lead directly or indirectly to persons doing so, then, subject to subsection (8) of this section— | ||
(a) that person shall not be entitled to enforce any obligation to which a person is subject as a result of any exercise by him after the issue of the advertisement of any rights to which the advertisement related, and | ||
(b) such a person shall be entitled to recover any money or other property or investment instruments paid or transferred by him under any such obligation, together with compensation for any loss sustained by him. | ||
(8) The compensation recoverable under subsection (6) or (7) of this section shall be such as the parties may agree or as the Court may, on the application of either party, determine. | ||
(9) The Court may allow any such agreement or obligation as is mentioned in subsection (6) or (7) of this section to be enforced or money or property or investment instruments paid or transferred under it to be retained if it is satisfied— | ||
(a) that the person against whom enforcement is sought or who is seeking to recover the money or property or investment instruments was not influenced, or not influenced to any material extent, by the advertisements in making his decision to enter into the agreement or as to the exercise of the rights in question, or | ||
(b) that the advertisement was not misleading as to the nature of the investment, the terms of the agreement or, as the case may be, the consequences of exercising the rights in question and fairly stated any risks involved in those matters. | ||
(10) Where a person elects not to perform an agreement or an obligation which by virtue of subsection (6) or (7) of this section is unenforceable against him or by virtue of either of those subsections recovers money paid or other property or investment instruments transferred by him under an agreement or obligation, he shall repay any money and return any other property or investment instruments received by him under the agreement or, as the case may be, as a result of exercising the rights in question. | ||
(11) Where any property or investment instruments transferred under an agreement or obligation to which subsection (6) or (7) of this section applies has passed to a third party the references to that property or investment instruments in this section shall be construed as references to its value at the time of its transfer under the agreement or obligation. | ||
(12) If an advertisement or other solicitation to which this section relates is published and it does not include the name and address of the person who arranged with the publisher for the advertisement or solicitation, a supervisory authority may, at any time within the period of 12 months after any publication of the advertisement or solicitation, request the publisher to supply the name and address of that person to the supervisory authority and the publisher shall forthwith comply with that request. | ||
(13) A supervisory authority may— | ||
(a) direct a person to arrange the publication of a correction of a misleading advertisement concerning services of investment business firms, or | ||
(b) direct a person to arrange the publication of a correction of an advertisement which contravenes the provisions of this section, or | ||
(c) direct a person to arrange the publication of the fact that an offence under this section has taken place and that a fine, if any, has been imposed, or | ||
(d) direct a person to arrange the publication of the fact that a determination that there has been a breach of a condition or requirement under this section has been made under section 74 of this Act, or | ||
(e) arrange the publication of an advertisement correcting any misleading aspects of advertisements, published by an investment business firm, | ||
in a manner specified by the supervisory authority. | ||
(14) In this section “specified” means specified in a direction under this section. | ||
(15) Any person who fails to comply with a direction or a prescription imposed under subsections (4), (5) or (13) of this section, or who fails to comply with a request of a supervisory authority under subsection (12) of this section, shall be guilty of an offence. |