Investment Intermediaries Act, 1995
|
Directions by supervisory authority. |
21.—(1) Without prejudice to the power of a supervisory authority to impose conditions or requirements or both under this Act, and, without prejudice to the powers of a supervisory authority under subsections (2) or (4) of this section, where a supervisory authority considers it necessary to do so in the interests of the proper and orderly regulation and supervision of investment business firms of the protection of investors, the supervisory authority may give a direction to all or any of the following, namely— | |
(a) any or all authorised investment business firms, | ||
(b) any or all proposed investment business firms, | ||
(c) any or all investment business firms, | ||
(d) any or all former authorised investment business firms, | ||
(e) directors and those responsible for the management of authorised investment business firms, | ||
(f) any person purporting to act or whom the supervisory authority reasonably believes is acting as an investment business firm, | ||
in relation to any matter related to the operation of an investment business firm or any matter related to an acquiring transaction within the meaning of section 38 of this Act. | ||
(2) Without prejudice to the powers of a supervisory authority under subsection (1) of this section, and without prejudice to the powers of a supervisory authority to impose conditions or requirements or both under this Act, where a supervisory authority is of the opinion that it is necessary to do so in the interests of the proper and orderly regulation and supervision of investment business firms or for the protection of investors or both or where an investment business firm— | ||
(a) has become or is, in the opinion of the supervisory authority, likely to become unable to meet its obligations to its creditors or its clients or both, or | ||
(b) is not maintaining or is, in the opinion of the supervisory authority, unlikely to be in a position to maintain adequate capital resources having regard to the volume and nature of its business, or no longer complies with capital or other financial requirements specified by the supervisory authority from time to time, or both, or | ||
(c) has failed to comply with any condition or requirement imposed under this Act, and the circumstances are such that the supervisory authority is of the opinion that the stability or soundness of an investment business firm is materially affected by this failure, or | ||
(d) is conducting business in such a manner as to jeopardise or prejudice monies or investment instruments held by or controlled by it on behalf of clients, or the rights and interests of those clients, | ||
the supervisory authority may give a direction in writing to the investment business firm concerned to suspend for such period (not exceeding twelve months) as shall be specified in the direction any or all of the following, that is to say— | ||
(i) the provision of any investment business service or services or the provision of any investment advice, | ||
(ii) the making of payments to which subparagraph (i) of this subsection does not relate, | ||
(iii) the acquisition or disposal of any assets or liabilities, | ||
(iv) entering into transactions or agreements of any specified kind or entering into them except in specified circumstances or to a specified extent, | ||
(v) soliciting business from persons of a specified kind or otherwise than from such persons or in a specified country, | ||
(vi) carrying on business in a specified manner or otherwise than in a specified manner, | ||
which have not been authorised by the supervisory authority. | ||
(3) A direction under subsection (1) or (2) of this section may be given to a particular person or generally to all persons to whom those subsections apply or to a particular class of person or during a specified period of time or times, or by reference to any other matter which the supervisory authority may consider appropriate. | ||
(4) The First Schedule to this Act shall apply as respects a direction by the supervisory authority under this section. | ||
(5) Where a supervisory authority gives a direction under this section, which said direction shall have immediate effect, the supervisory authority may or, where the supervisory authority is of the opinion that the said direction is not being complied with, the supervisory authority shall apply to the Court in a summary manner for an order confirming the direction. | ||
(6) The Court may, on an application being made under subsection (5) of this section, hear evidence from creditors and the Court may make, in any application under this section, such interim or interlocutory order, if any, as it considers fit. | ||
(7) While a direction under this section is in force, no winding-up proceedings in relation to an authorised investment business firm or associated or related undertaking or, in the case of an authorised investment business firm or associated or related undertaking which is constituted as an unincorporated body of persons, no proceedings for an order of dissolution, or, in the case of an authorised investment business firm which is constituted as a sole trader, no bankruptcy proceedings, may be commenced or resolution for winding-up passed in relation to the authorised investment business firm or associated or related undertaking, and no receiver shall be appointed over the assets or over any part of the assets of the authorised investment business firm or associated or related undertaking and such assets shall not be attached, sequestered or otherwise distrained except with the prior sanction of the Court. | ||
(8) The Court may hear proceedings or part of proceedings under this section otherwise than in public. | ||
(9) A creditor who is affected by a direction under subsection (2) of this section may apply to the Court to vary or set aside that direction where it affects the interests of the creditor to a material degree. |