Malaysia legislation
Section 51
Section 51
The principal Act is amended by inserting after Part IIIa the following Parts:
“Part IIIb
MANAGEMENT OF SYSTEMIC RISK IN the CAPITAL MARKET
Interpretation 31ze. For the purposes of this Part—
“market participant” includes an investor, issuer, intermediary, capital market service provider, exchange holding company, stock exchange, derivatives exchange, central depository and clearing facility;
“systemic risk in the capital market” means a situation when one or more of the following events occur or is likely to occur:
(a)
financial distress in a significant market participant or in a number of market participants;
(b)
an impairment in the orderly functioning of the capital market; or
(c)
an erosion of public confidence in the integrity of the capital market.
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Information for purpose of systemic risk 31zf. (1) The Commission may, notwithstanding any provision under the securities laws, by notice in writing request any person to submit to the Commission any information or document—
(a)
which the Commission considers necessary for the purposes of monitoring, mitigating and managing systemic risks in the capital market; or
(b)
where the Commission receives a request from Bank
Negara Malaysia under section 30 of the Central
Bank of Malaysia Act 2009.
(2)
For the purposes of subsection (1), where the person concerned is solely under the supervision or oversight of
Bank Negara Malaysia, the notice shall be issued through
Bank Negara Malaysia.
(3)
Any person who is required to submit any information or document under this section shall provide such information or document notwithstanding any obligation under any contract, agreement or arrangement whether express or implied to the contrary.
(4)
Any person who fails to comply with the notice issued under subsection (1) shall be guilty of an offence and shall, on conviction, be liable to a fine not exceeding ten million ringgit or to imprisonment for a term not exceeding ten years or to both.
Power of Commission to issue directive for systemic risk 31zg. (1) Where the Commission considers it necessary in the interest of monitoring, mitigating or managing systemic risk in the capital market, the Commission may issue a directive in writing requiring any person to take such measures as the
Commission may consider necessary.
(2)
In exercising its power under subsection (1), the
Commission shall take into consideration the interest of financial stability.
(3)
For the purposes of subsection (1), where the person concerned is solely under the supervision or oversight of Bank Negara Malaysia, the Commission shall make a recommendation to Bank Negara Malaysia to issue such directive.
(4)
Before issuing a directive under subsection (1), the
Commission shall give the person an opportunity to be heard.
(5)
Notwithstanding subsection (4), the Commission may issue a directive under subsection (1) without first giving the person an opportunity to be heard if any delay in issuing such directive would aggravate systemic risk in the capital market.
(6)
Where a directive is issued pursuant to subsection (5)
the person shall be given an opportunity to be heard after the directive has been issued.
(7)
When a person is given an opportunity to be heard under subsection (6), a directive issued under subsection (1)
may be amended or modified.
(8)
Any person who fails to comply with the directive issued under subsection (1) shall be guilty of an offence and shall, on conviction, be liable to a fine not exceeding ten million ringgit or to imprisonment for a term not exceeding ten years or to both.
Arrangements with other supervisory authorities 31zh. (1) Notwithstanding any provision in the securities laws, the Commission may for the purposes of monitoring, mitigating and managing systemic risk in the capital market or contributing towards financial stability—
(a)
provide assistance to any supervisory authority or
Government agency responsible for promoting financial stability;
(b)
obtain any information or document from, or share any information or document with, any supervisory authority or Government agency responsible for promoting financial stability if the Commission considers it
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necessary that such information or document be so obtained or shared in managing systemic risk in the capital market or promoting financial stability; or
(c)
enter into arrangements to cooperate with other supervisory authorities and co-ordinate stability measures with such supervisory authorities.
(2)
Where the Commission shares any information or document under paragraph (1)(b)—
(a)
with any supervisory authority or Government agency responsible for promoting financial stability in
Malaysia, such information or document shall not be disclosed to any person except with the written consent of the Commission; or
(b)
with any supervisory authority outside Malaysia, such supervisory authority shall give an appropriate undertaking for protecting the confidentiality of such information or document and the purposes for which the information or document may be used.
(3)
For the purposes of this section, “supervisory authority”
means any authority, body, agency or entity—
(a)
responsible for monitoring, mitigating and managing systemic risk in the capital market or promoting financial stability; or
(b)
responsible for the supervision or oversight of capital market intermediaries or participants.