Hong Kong Ordinances

SECURITIES AND FUTURES ORDINANCE - SECT 43

Withdrawal of recognition of clearing house and direction to cease to provide facilities

(1) Subject to subsections (3), (4) and (5), the Commission may, after
consultation with the Financial Secretary, by notice in writing served on a
recognized clearing house-

   (a)  withdraw the company's recognition as a clearing house with effect
        from a date specified in the notice for the purpose; or

   (b)  direct the clearing house to cease to provide or operate with effect
        from a date specified in the notice for the purpose such clearing or
        settlement facilities as are specified therein.

(2) The Commission may by the notice served under subsection (1) permit the
recognized clearing house to continue, on or after the date on which the
withdrawal or direction is to take effect, to carry on such activities
affected by the withdrawal or direction as the Commission may specify in the
notice for the purpose of-

   (a)  closing down the operations of the clearing house; or

   (b)  protecting the interest of the investing public or the public
        interest.

(3) The Commission may only serve a notice under subsection (1) in relation to
a recognized clearing house that-

   (a)  fails to comply with any requirement of this Ordinance or with a
        condition imposed under section 37;

   (b)  is being wound up;

   (c)  ceases to operate as a clearing house; or

   (d)  requests the Commission to do so.

(4) Except where responding to a request under subsection (3)(d), the
Commission shall not exercise its power under subsection (1) in relation to a
recognized clearing house unless it has given the clearing house a reasonable
opportunity of being heard.

(5) Except where responding to a request under subsection (3)(d), the
Commission shall give the recognized clearing house not less than 14 days'
notice in writing of its intention to serve a notice under subsection (1) and
the grounds for doing so.

(6) Where the Commission withdraws a company's recognition as a clearing house
under subsection (1)(a), it shall cause notice of that fact to be published in
the Gazette.

(7) Where the Commission directs under subsection (1)(b) a recognized clearing
house to cease to provide or operate any clearing or settlement facilities, it
shall cause notice of the particulars of the direction to be published in the
Gazette.

(8) A notice served under subsection (1)(a) shall not take effect-

   (a)  subject to paragraph (b), until the expiration of the period within
        which an appeal against the notice may be made under section 44; or

   (b)  if an appeal against the notice is made under section 44, until the
        appeal is withdrawn, abandoned or determined.

(9) A notice served under subsection (1)(b) shall take effect immediately.