Whole Section

  • Part IV Disciplinary Proceedings

    Amended on 7 October 20157 October 2015.

    • Initiation of proceedings

      • 314

        (1) Upon the conclusion of investigations, the Exchange may initiate disciplinary proceeding against a Relevant Person if the Exchange is of the opinion that the Relevant Person has contravened a Relevant Rule.
        (2) Where the Exchange initiates disciplinary proceeding against a Relevant Person, the Exchange shall provide to the Relevant Person and the Disciplinary Committee, a charge which contains the following details:
        (a) the particulars of the Relevant Person;
        (b) the Relevant Rule which has been contravened;
        (c) the brief facts giving rise to the alleged contravention; and
        (d) where applicable, a summary of the outcomes of enforcement or disciplinary proceedings taken against other Relevant Persons related to that matter.
        (3) Where there is more than 1 charge to be preferred against a Relevant Person, the Exchange may prefer an amalgamated charge which deals with 2 or more similar contraventions. An amalgamated charge shall include all material information required under Rule 314(2).
        (4) The Exchange may prefer 1 or more charges. Where a Relevant Person faces more than 1 charge, the Exchange may:
        (a) proceed on all charges at a single hearing;
        (b) choose to first proceed on only selected charges ("proceeded charges") and proceed with the remaining charges only after the conclusion of the proceeded charges ("stood down charges"); or
        (c) choose to proceed on only proceeded charges, but apply to have the remaining charges be taken into consideration as part of the sanctions to be imposed on the Relevant Person ("TIC charges").

        Added on 7 October 20157 October 2015.

      • 315

        (1) Upon receipt of the charge, the chairman shall determine all pre-hearing administrative issues under Rule 303(6) and may issue relevant directions to parties to facilitate the convening of a hearing.
        (2) Upon the resolution of all pre-hearing administrative matters under Rule 303(6), the chairman shall provide a notice of hearing which includes the following details:
        (a) the identity of the members of the Disciplinary Committee who will be present at the hearing;
        (b) the dates and locations of the hearing;
        (c) the time parties will be allocated during the hearing;
        (d) the procedural rules to be complied with at the hearing;
        (e) the disputed issues to be dealt with at the hearing (where necessary);
        (f) the witnesses to be called at the hearing (where necessary); and
        (g) the exhibits which may be relied upon at the hearing (where necessary).
        (3) Upon the issuance of the notice of hearing under Rule 315(2), parties shall inform the Disciplinary Committee within 14 business days of the following:
        (a) whether there is any objection to the matters stated in the notice; and
        (b) whether the party wishes to attend the hearing, and if so, the particulars of the persons who would be attending the hearing.
        (4) Where a party does not respond to a relevant direction issued under Rule 315(1), the party is deemed to have no objection to the relevant direction, and the Disciplinary Committee may proceed as it deems fit.
        (5) Where a party does not indicate that the party is intending to attend the hearing, the party is deemed to have no intention of attending the hearing and the hearing can proceed in the absence of that party.
        (6) Where objections are raised in relation to any pre-hearing issues, the chairman shall determine the issue and inform the parties accordingly. The chairman's determination of a pre-hearing issue shall be final.

        Added on 7 October 20157 October 2015.

    • The hearing

      • 316

        (1) The chairman shall determine the manner by which a hearing is to be conducted, having due regard to the notice of hearing issued under Rule 315(2).
        (2) No member of the Disciplinary Committee shall participate in a hearing if he has a conflict of interest.
        (3) Where the Disciplinary Committee is of the opinion that the charge is defective, the Disciplinary Committee may invite the Exchange to amend the charge, or directly amend the charge.
        (4) The Exchange may withdraw charges at any time before the decision of the Disciplinary Committee by providing the Disciplinary Committee and the Relevant Person a notice of discontinuance in relation to the withdrawn charges.
        (5) Where the Exchange has preferred more than 1 charge and has applied for the charges to be TIC charges under Rule 314(4)(c), the Disciplinary Committee shall determine from the Relevant Person if there is any objection to the application.
        (6) The Exchange and the Relevant Person may be represented by legal counsel at the hearings.
        (7) The secretariat of the Disciplinary Committee must be informed in writing of the name of the legal counsel at least 14 business days before the hearing.

        Added on 7 October 20157 October 2015.

    • The written grounds of the Disciplinary Committee and sanctions

      • 317

        (1) Upon conclusion of the hearing, the Disciplinary Committee shall within a specified period of no more than 6 weeks determine if the proceeded charges are made out and provide a written grounds of decision.
        (2) Where the Disciplinary Committee makes a finding that the proceeded charges are made out, the Disciplinary Committee shall also include in the written grounds, the sanctions which are to be imposed against the Relevant Person. The Disciplinary Committee may impose one or more of the following sanctions:
        (a) issuing a private warning;
        (b) issuing a public reprimand;
        (c) in the case of an issuer:
        (i) requiring an issuer to appoint special auditors, compliance advisers, legal advisers or other independent professionals for specified purposes;
        (ii) requiring an issuer to implement an effective education or compliance programme;
        (iii) requiring an issuer to appoint independent advisers to minority shareholders;
        (iv) requiring an issuer's directors or executive officers to undertake a mandatory education or training programme;
        (v) requiring an issuer to undertake an independent review of internal controls and processes;
        (vi) requiring an issuer to perform other remedial action to rectify the consequences of contraventions;
        (vii) issuing an order for the denial of facilities of the market, prohibiting an issuer from accessing the facilities of the market for a specified period;
        (viii) requiring an issuer to comply with conditions on the activities undertaken by the issuer;
        (ix) imposing fines payable to the Exchange, of not more than $250,000 per contravention, subject to a maximum of $1,000,000 per hearing for multiple charges. Fines may be paid by way of instalments which shall not exceed 12 months from the date of the imposition of the fine;
        (x) issuing an order for the suspension of the trading of an issuer's securities for a specified period; or
        (xi) issuing an order for the removal of an issuer from the Official List;
        (d) in the case of a sponsor:
        (i) imposing conditions on the authorization of a sponsor;
        (ii) imposing fines payable to the Exchange, of not more than $250,000 per contravention, subject to a maximum of $1,000,000 per hearing for multiple charges. Fines may be paid by way of instalments which shall not exceed 12 months from the date of the imposition of the fine;
        (iii) issuing an order for the revocation of the authorization of a sponsor;
        (iv) suspending or restricting the activities that the sponsor undertakes; or
        (v) requiring an education program to be undertaken;
        (e) In the case of a director or executive officer of an issuer:
        (i) requiring the resignation of the director or executive officer from an existing position with any issuer listed on the Exchange;
        (ii) issuing an order prohibiting any issuer for a period not exceeding 3 years, from appointing or reappointing the director or executive officer, as a director or executive officer, or both;
        (f) in the case of a registered professional;
        (i) imposing conditions on the registration of a registered professional;
        (ii) imposing fines payable to the Exchange, of not more than $100,000 per contravention, subject to a maximum of $500,000 per hearing for multiple charges. Fines may be paid by way of instalments which shall not exceed 12 months from the date of the imposition of the fine;
        (iii) suspending or restricting activities that the registered professional undertakes;
        (iv) issuing an order for the cancellation of the registration of a registered professional; or
        (v) requiring an education program to be undertaken;
        (g) issuing an order for costs, requiring that the proceedings be paid by a Relevant Person if the Relevant Person's conduct during proceedings was unreasonable; or
        (h) issuing any other order which the Disciplinary Committee is of the opinion is appropriate.
        (3) Where the Disciplinary Committee finds that proceeded charges are made out, and the Relevant Person did not object under Rule 316(5) to an application for charges to be TIC charges, the Disciplinary Committee shall consider the TIC charges before determining the appropriate sanctions. The Disciplinary Committee shall include in the written grounds of decision, the effect that the TIC charges had on the determination of the sanctions imposed.
        (4) Where the Disciplinary Committee considers a TIC charge and has included in the written grounds of decision, the effect that the TIC charge had on the determination of the sanctions imposed, the Exchange may not take any further disciplinary action against the Relevant Person in respect of the TIC charge.
        (5) Where a Relevant Person objects to an application for charges to be taken into consideration under Rule 316(5), the charges shall be deemed to be stood down charges. The Disciplinary Committee shall not consider stood down charges when determining sanctions to be imposed.
        (6) The Exchange may proceed on the stood down charges by convening a separate Disciplinary Committee hearing.
        (7) Failure by a Relevant Person to comply with such requirements or orders issued by the Disciplinary Committee under Rule 317(2) shall be deemed a contravention of the Rules.

        Added on 7 October 20157 October 2015 and Amended on 1 August 2021.

    • Post-hearing

      • 318

        (1) The Disciplinary Committee's written grounds of decision shall be published by the Exchange, unless the sanction imposed involves the issuance of a private warning. Where a private warning is issued by the Disciplinary Committee, the Disciplinary Committee shall determine whether the written grounds of decision is to be published, and if so, whether the written grounds of decision is to be published in part or in whole.
        (2) Where the Exchange has reason to believe that the requirements imposed or orders issued under Rule 317(2) have not been complied with, the Exchange may report the non-compliance to the Disciplinary Committee, and the Disciplinary Committee may provide a supplemental grounds of decision to impose further sanctions.
        (3) Where a fine or order for costs of the proceedings has been imposed against a Relevant Person and the Relevant Person does not make payment within the specified period, the outstanding sum shall be a debt payable to Exchange. The Exchange may commence legal action to recover that debt, subject to any subsequent payments made by the Relevant Person. The Exchange shall be entitled to claim reasonable interest, a month after the payment is due, based on the sum outstanding.
        (4) If a fine or order for costs imposed against a sponsor or registered professional remains unpaid 7 days after the deadline, the sponsor or registered professional may be suspended. Any suspension ends upon full payment of the fine.
        (5) The Exchange may allow a stay of execution of the sanctions, or an extension of the relevant timelines, which may be subject to conditions imposed by the Exchange in its absolute discretion, when:
        (a) a Relevant Person has filed a notice of appeal against the decision of the Disciplinary Committee;
        (b) if a Relevant Person requires more time to comply with the sanctions imposed; or
        (c) if the Exchange is of the opinion that the circumstances warrant it.

        Added on 7 October 20157 October 2015 and amended on 1 August 2021.