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Securities and Exchange Act, B. E. 2535 (1992)


BHUMIBOL ADULYADEJ, REX. ,

Given on the 12th day of March, B. E. 2535;

Being the 47th Year of the Present Reign.

 

His Majesty King Bhumibol Adulyadej is graciously pleased to proclaim that:

Whereas it is expedient to enact a law on the securities and exchange;

Be it, therefore, enacted by His Majesty the King, by and with the advice and consent of the National Legislative Assemble functioning as both Houses of Parliament, as follows:

 

Section 1.

This Act shall be called the "Securities and Exchange Act, B. E. 2535"

Section 2.

This Act shall come into force after sixty days from the date of its publication in the Government Gazette, except Section 4, Section 7 to Section 16, Section 17 to Section 31, Section 262, Section 263, Section 318 to Section 320 and Section 332 which shall come into force on the day following the date of its publication in the Government Gazette.

Section 3.

The following Acts shall be repealed:

(1)   The Securities Exchange of Thailand Act, B. E. 2517;

(2)   The Securities Exchange of Thailand Act (No. 2), B. E. 2527.

Section 4.

In this Act

"Securities" means

(1)   treasury bills;

(2)   bonds;

(3)   bills;

(4)   shares;

(5)   debentures;

(6)   investment units which are instruments of evidence representing the rights to the property of a mutual fund;

(7)   certificates representing the rights to purchase shares;

(8)   certificates representing the rights to purchase debentures;

(9)   certificates representing the rights to purchase investment units;

(10)  any other instruments as specified by the SEC.

"Bill" means any bill issued for raising funds from the public as specified in the notification of the SEC.

"Debenture" means any debit instrument of whatever name excluding bills, divided into units, each with equal value and a predetermined rate of return, issued by any company to a lender of purchaser, representing the right of the holder of such Instrument to receive money or other benefit.

"Underwriter" means any person who underwrites the sale of securities to the public.

"Prospectus" means any document issued for the purpose of inviting any person to subscribe of purchase the securities issued or offered for sale by the issuer or the seller.

"Company" means any limited company of public limited company including a juristic person established by specific law with the object of undertaking business.

"Securities company" means any company, or financial institution licensed to undertake securities business under this Act.

"Securities business" means any of the following securities businesses:

(1)   securities brokerage;

(2)   securities dealing;

(3)   investment advisory service;

(4)   securities underwriting;

(5)   mutual fund management;

(6)   private fund management;

(7)   other businesses relating to securities as specified by the Minister up on the recommendation of the SEC.

"Securities brokerage" means brokering or representing any person in the purchase, sale or exchange of securities in the normal course of business in consideration of a commission, bee of the remuneration therefrom.

"Securities dealing" means a purchase, sale of exchange, outside the Securities Exchange or an over-the-counter center, of securities, for one's own account in the normal course of business.

"Investment advisory service" means giving advice in the normal course of business to the public whether directly of indirectly concerning the value of securities or the suitability of investing in those securities or the purchase of sale of any securities in consideration of a fee or other remuneration excluding the giving of advice to the public in the manner as specified in the notification of the SEC.

"Securities underwriting" means the underwriting of all of part of the securities from a company or owner of securities for sale to the public in consideration of a fee or the remuneration whether with or with out any conditions.

"Mutual fund management" means the management of investments under a mutual fund project by issuing investment units of each project for sale to the public and investing proceeds therefrom in securities or other properties of investing for profit by other means.

"Private fund management" means the management of funds of five or more persons or one or more groups of persons to invest insecurities in consideration of a fee or other remuneration excluding the management of funds under the law relating to provident funds.

 (As amended by Section 3 of the Securities and Exchange Act (No. 2) B. E. 2542)

"Listed securities" means registered or authorized securities for trading in the Securities Exchange.

"Office" means the Office of the Securities and Exchange Commission.

"Secretary-General" means the Secretary-General of the Office of the Securities and Exchange Commission.

"Minister" means the Minister in charge of the enforcement of this Act.

Section 5.

Unless otherwise specified by the provisions of this Act, the SEC, the Office, the board of directors of the Securities Exchange, and the Securities Exchange shall issue the notification to the public specifying the period for consideration of the issuance of a license and granting of an approval under this Act. In cases where an application for a license or for an approval is refused, the applicant shall be notified of the reasons therefor.

Section 6.

Where the signatures of the directors or registrar are required in securities certificates under this Act, the SEC may specify that such signatures may be stamped by machine or by other means. in such event, the rules and procedures as specified in the notification of the SEC must be complied with.

Section 7.

The Minister of Finance shall be in charge of the enforcement of this Act and shall have the power to issue ministerial regulations and appoint competent officers to perform duties in accordance with this Act. Such ministerial regulations shall come into force upon publication in the Government Gazette.

 

CHAPTER 1

SUPERVISION OF SECURITIES AND EXCHANGE

  

DIVISION 1 

SECURITIES AND EXCHANGE COMMISSION

 

Section 8.

A Securities and Exchange Commission hereby referred to as the "SEC" shall be established, comprising the Minister of Finance as Chairman, the Governor of the Bank of Thailand, the Permanent Secretary of the Ministry of Finance, the Permanent Secretary of the Ministry of Commerce and not fewer than four but not exceeding six experts appointed as commission members by the Cabinet upon the recommendation of the Minister, among whom there shall be at least one legal expert, one accounting expert and one financial expert. The Secretary-General shall be a commission member and the secretary of the SEC.

Section 9.

No commission member appointed by the Cabinet under Section 8 shall be a political official, an elected member of a district council or district administration, or a member or an official of a political party.

Section 10.

Each commission member appointed by the Cabinet under Section 8 shall hold office for a term of six years. When two years of the first term of office have elapsed, one-third of the commission members shall be retired by means of drawing lots. When four years have elapsed, half of the commission members who did not draw lots requiring them to retire after the first two years shall retire form the Office by means of drawing lots. A fraction resulting from such calculation shall be disregarded.

Retirement form the office by means of drawing lots shall be deemed retirement upon the expiration of term of office.

Upon the expiration of the term of office, the appointment of new commission members shall be made within sixty days. During the period when new commission members have not yet been appointed, the retiring commission members shall remain in office until their successors assume their duties.

The commission members who retire upon the expiration of the term of office may be re-appointed but shall not hold office for more than two consecutive terms.

Section 11.

Apart from retirement upon the expiration of the term of office under Section 10, the office of a commission member appointed by the Cabinet shall be vacated upon:

(1)   death;

(2)   resignation;

(3)   termination by the Cabinet due to gross incompetence in the performance of duty;

(4)   being a bankrupt;

(5)   being an incompetent or quasi-incompetent person;

(6)   having been imprisoned by the judgement of a court which is final, unless the offence is related to an act of negligence or a petty offence;

(7)   having the prohibited characteristics as prescribed in Section 9.

If the office of a commission member appointed by the Cabinet is vacated prior to the expiration of the term of office, the Cabinet may appoint another person to hold the office of such commission member. The appointed commission member shall retain office for the duration of the remaining term of the commission member whom he replaces.

Section 12.

At least half of the commission members of the SEC shall form a quorum. If the Chairman of the Sec is not present at the meeting or cannot perform his duty, and if there is a vice-Chairman, the Vice-chairman present at the meeting shall be the Chairman of the meeting. If there is no Vice-Chairman or there is a Vice-Chairman who is not present at the meeting or cannot perform his duty, the commission members present at the meeting shall elect one of the commission members to be the chairman of the meeting.

Decisions shall be made at the SEC meeting upon majority vote. Each commission member is entitled to one vote. In the event of a tired vote, the Chairman of the meeting shall have a casting vote.

Section 13.

Any commission member appointed by the Cabinet, who has an interest in the matter to be considered, shall be prohibited from participating in such consideration.

Section 14.

The SEC shall have the power and duty to formulate policies to promote and develop, as well as to supervise, matters concerning securities, securities business, the Securities Exchange, over-the-counter centers, and related businesses, organizations related to securities business, issue of offer of securities for sale to the public, acquisition of securities for business takeovers, and prevention of unfair securities trading practices. Such power shall include:

1.      the issuance of rules, regulation, notifications, orders, or directions under this Act;

2.      the determination of fees for application for an approval, application for obtaining a license, a license, or for operating the business as licensed;

3.      the issuance of rules relating to the duties of a sub-committee;

4.      the issuance of rules, orders and regulations relating to personnel, personnel relations system, placement, appointment, dismissal and discipline for personnel and employees of the Office, the determination of salary and other remuneration as well as welfare and assistance;

5.      any other activities to be implemented according to the objectives of this Act.

All rules, regulations, notifications, orders, or directions that are generally applicable shall come into force upon publication in the Government Gazette.

Section 15.

The SEC shall have the power to appoint a sub-committee to perform any matter as assigned by the SEC.

In the case of issuance of generally applicable rules, regulations, notifications, orders, or directions, the SEC shall submit the matter to the sub-committee under the first paragraph for consideration and the recommendation of the sub-committee shall be proposed to the SEC except for case which are confidential or require urgent action.

The sub-committee under the first paragraph shall be appointed by the Sec and shall consist of not fewer than five but not exceeding seven experts on the related matter.

The provisions of Section 12 shall apply to the meeting of the sub-committee mutatis mutandis.

Section 16.

The Chairman, commission members of the SEC as well as members of sub-committees shall receive remuneration as specified by the Minister. The remuneration shall be deemed to be expenses for the operation of the Office.

Section 17.

There shall be established an Office referred to as the "Office of the Securities and Exchange Commission" which shall be a juristic person.

Section 18.

The Office shall have its head office in Bangkok of the nearby provinces. The Office may establish its branches or representative offices anywhere.

Section 19.

The Office has the power and duty to perform any act necessary for the implementation of SEC resolutions and to perform any other acts under the provisions of this Act.

In exercising the power and duty of the Office under the first paragraph, the Office shall have the power to:

1.      own, possess, hold any proprietary rights, construct, purchase, provide, sell, dispose, rent, lease, hire purchase, grant of hire purchase, borrow, lend, accept pledge, accept mortgage, exchange, transfer, accept transfer, or take any action related to properties in or outside the Kingdom including to accept donated properties;

2.      borrow or lead money as well as make investment for profit;

3.      determine the fees filing registration statements, registration and any other application;

4.      accept fees as specified in the ministerial regulations or as determined by the Sec and the Office.

Section 20.

The cabinet, upon the recommendation of the Minister, shall appoint the Secretary-general who shall hold office for a term of four years and may be re-appointed, but who shall not hold office for more than two consecutive terms.

Section 21.

The Secretary-General shall have the qualifications and shall not possess any of the prohibited characteristics as follows:

1.      being able to perform his duty full time for the Office;

2.      not being or having been a bankrupt;

3.      not being a political official, and appointed member of a district council or district administration, or a member or official of any political party;

4.      not being a civil servant having permanent position or salary, or an officer of employee of any state enterprise, government organization, or district office;

5.      not having a position or any responsibility of having an interest in a securities company.

Section 22.

Apart form the expiration of the term of office, the position of the Secretary-General shall be vacated upon:

1.      death;

2.      resignation;

3.      Over sixty years old;

4.      lack of qualifications or possession of prohibited characteristics under Section 21;

5.      terminated by Cabinet resolution upon the recommendation of the SEC due to malfeasance in office as specified by this Act or due to gross incompetence in the performance of duty.

Section 23.

The Secretary-General shall have authority over the officers and employees and shall be responsible for the operation of the Office.

In the operation of the Office, the Secretary-General shall be responsible to the SEC.

Section 24.

The Secretary-General shall be the representative of the Office in the business of the Office relating to third persons, and for this purpose the Secretary-general may authorize an agent or any other person to perform a specified act.

Section 25.

The initial capital of the Office shall comprise the money transferred in accordance with the provisions of Section 319 and Section 320.

Section 26.

The Office shall maintain reserves in accordance with the rules and procedures as specified by the Sec with the approval of the Minister.

Section 27.

All fees specified in the ministerial regulations, other fees received by the Office, and other income derived from the operation of the SEC and the Office shall be the property of the Office. After deducting the expenses and reserves under Section 26, the remaining income shall be remitted to the state.

Section 28.

Officers shall retire from office upon reaching the age of sixty years.

Section 29.

The laws relating to labor protection concerning compensation and compensation fund contribution, the law relating to labor relations, and the law relating to government enterprise official relations shall not apply to the Secretary-General, officers and employees of the Office.

Section 30.

The office shall establish an accounting system suitable for the operation of the Office and shall have a regular internal audit.

Section 31.

The Office of the Auditor General of Thailand shall be the auditor of the office and shall submit its report to the Minister within ninety days from the end of the fiscal year.

CHAPTER 2

ISSUANCE OF SECURITIES

   

DIVISION 1 

APPROVAL FOR THE OFFERING OF NEWLY ISSUED SECURITIES

  

Section 32.

No promoter of a public limited company shall offer newly issued shares for sale to the public or other persons unless having obtained and approval from the Office and having complied with Section 65.

The application for approval under the first paragraph shall be made when such promoter has registered the memorandum of association in accordance with the law relating to public limited companies.

Section 33.

No public limited company shall offer for sale newly issued securities in the category of shares, debentures, bills certificates representing the rights to purchase shares, certificates representing the rights to purchase debentures, and other securities as specified by the SEC, unless having obtained and approval from the Office and complied with Section 65 or unless such offerings are made entirely to its shareholders in consideration of full payment for value offered.

Section 34.

No limited company shall offer for sale newly issued securities in the category of debentures, bills, certificates representing the rights to purchase debentures, and other securities as specified by the SEC unless:

1.      having qualifications as specified in the notification of the SEC;

2.      the securities so offered are not convertible into equity;

3.      having obtained an approval from the Office; and

4.      having complied with Section 65.

Section 35.

The application for the offering of newly issued securities and its approval under Section 32 Section 33 and Section 34 shall be in accordance with the rules, conditions and procedures as specified in the notification of the SEC. In such event, the SEC may specify the details of the following matters:

1.      debt to equity ratio;

2.      period for the offering for sale of securities;

3.      subscription, underwriting and distribution of securities;

Section 36.

In considering the application for approval, the Office shall notify the applicant of the result within forty-five days from the date of receipt of the application together with the correct and complete documents in accordance with Section 35.

Section 37.

The provisions of the Civil and Commercial Code prohibiting the issuance of debentures by a limited company shall not apply to a limited company which has been granted an approval to issue debentures in accordance with Section 34.

Section 38.

Section 654 of the Civil and Commercial Code shall not apply to securities in the category of debentures and bills that may be offered for sale in accordance with Section 33 and Section 34.

 

DIVISION 2 

DEBENTURES

 

Section 39.

The par value of debenture of a company shall not be less than one hundred Baht that shall be paid in money and the purchaser cannot avail himself of a set-off against the company as to payment of the debenture.

Section 40.

A debenture certificate shall contain at least the following particulars:

1.      name of the company;

2.      registration number of the company and the date of registration by the company registrar;

3.      the total amount of debentures issued;

4.      name of debenture holder of statement that it is a bearer debenture;

5.      type, value, serial number, number and amount of debentures issued, interest rate as will as repayment period;

6.      method, time and place for the payment of interest and redemption;

7.      right of the debenture holder in case the company incurred a debt before issuing the debenture;

8.      procedures for the conversion of rights (if any);

9.      signature of authorized director of debenture registrar;

10.  the date of issue;

11.  other particulars as specified in the notification of the SEC.

 

DIVISION 3 

ISSUANCE OF SECURED DEBENTURES

 

Section 41.

In applying for an approval in accordance with Section 33 or Section 34 to issue secured debentures, the applicant shall also:

1.      submit a draft of terms and conditions stating the rights and duties of the debenture issuer and the debenture holders;

2.      submit a draft agreement appointing a debenture holder representative;

3.      obtain approval for a person having qualifications as specified in the notification of the SEC to be a debenture holder representative;

4.      undertake any other acts as specified in the notification of the SEC.

In cases where a public limited company offers newly issued secured debentures for sale to its shareholders, which does not require approval in accordance with Section 33, that public limited company shall also comply with the provisions of the first paragraph prior to the making of such offer.

Section 42.

The terms and conditions stating the rights and duties of the debenture issuer and debenture holders shall contain at least the following particulars:

1.      rights and conditions under the debenture;

2.      return arising from the debenture;

3.      property used as collateral or other collateral;

4.      appointment, power and duty of debenture holder representative;

5.      conditions for the removal of debenture holder representative;

6.      consent of debenture holders permitting the debenture issuer to appoint a debenture holder representative who has received an approval in accordance with Section 41 (3);

7.      representation of the debenture issuer to mortgage pledge of provide other collateral against the debenture within the specified period of time in accordance with Section 44;

8.      procedures, time and place of payment of debt;

9.      procedures for the conversion of rights (if any);

10.  other particulars as specified in the notification of the SEC.

Section 43.

The agreement appointing a debenture holder representative shall contain at least the following particulars:

1.      powers and duties of the debenture holder representative in the acceptance of mortgage, pledge or other collateral, in the exercise of right to enforce such collateral, or in causing the debenture issuer to comply with the terms and conditions made with the debenture holders, including claims for compensation;

2.      rate and method of remuneration of the debenture holder representative;

3.      other particulars as specified in the notification of the SEC.

Section 44.

When the issuer of secured debentures has offered the secured debentures for sale to its shareholders or the public or any person, the debenture issuer shall have the rights and duties as provided by the terms and conditions in accordance with Section 41 (1) and the provisions of this Act. The issuer of secured debentures shall with the consent of debenture holders appoint a debenture holder representative and put in place a mortgage, pledge of other collateral with the debenture holder representative within seven days form the closing date of the offer for sale.

Section 45.

The debenture holder representative shall have the power to act in his own name for the benefit of all debenture holders in accepting a mortgage, pledge or other collateral, exercising rights t enforce collateral and causing the issuer of secured debentures to comply with the terms and conditions made with debenture holders, including claims for compensation.

The act of the debenture holder representative in the first paragraph shall be deemed to be the act directly performed by the debenture holders.

Section 46.

The SEC shall have the power to issue rules, conditions and procedures for a debenture holder representative to act within his authority and responsibilities.

Section 47.

In addition to the duties as duties as specified in the appointment agreement, a debenture holder representative has the duty to look after the interests of the debenture holders.

In cases where the debenture holder representative acts, omits to act, or neglects or fails to perform his duties and provided in the first paragraph, causing damage to debenture holders, any debenture holder of the Office has the right to file a claim in court against the debenture holder representative for the benefit of the debenture holders as a whole.

In cases where the debenture holder has filed a claim in court, such debenture holder shall hold not less than ten percent of all secured debentures sold or be appointed by other debenture holders who collectively hold not less than ten percent of all the secured debentures sold.

Section 48.

In case the debenture holder representative commits an offence against property as stipulated in Chapter 1, Chapter 3, Chapter 4, Chapter 5, or Chapter 7, of Title 12 of the Criminal code, the Office shall be deemed to be the injured party under the Criminal Procedure Code.

In the event under the first paragraph, the public prosecutor, after having brought the criminal case to court, has the power to claim property or price of compensation for damages on behalf of the inferred person. For this purpose, the provisions concerning the procedure for filing a civil case in connection with a criminal case under the Criminal Procedure Code shall apply mutatis mutandis.

Section 49.

If the debenture issuer intends to arrange for a debenture holder representative when issuing any type of debentures other than secured debentures, the debenture issuer shall declare its intention while making an application for the issuance of debentures and in such case the provisions of Section 41, Section 42, Section 43, Section 44, Section 45, Section 46, Section 47 and Section 48, including related penalty provisions, shall apply mutatis mutandis to the application for approval, the preparation of terms and conditions, and at4eement appointing a debenture holder representative, the powers and duties of the debenture holder representative, including the filing of a case in court against the debenture holder representative.

  

DIVISION 4 

REGISTER AND TRANSFERABILITY

  

Section 50.

The company which issues debentures, certificates representing the rights to purchase shares, or certificates representing the rights to purchase debentures in accordance with Section 33 of Section 34 shall be required to keep a register of such securities holders in accordance with the rules and procedures as specified in the notification of the Office.

Section 51.

The transfer of name debentures, name certificates representing the rights to purchase shares, or name certificates representing the rights to purchase debentures issued in accordance with the endorsement of transfer by a person having his name as the owner or by the last transferee.

Section 52.

Any person possessing a name debenture certificate, a name certificate representing the rights to purchase shares, or a name certificate representing the rights to purchase debentures issued in accordance with Section 51, shall be presumed to be the owner of such securities.

Section 53.

The transferee of name debentures, or name certificates representing the rights to purchase shares, or name certificates representing the rights to purchase debentures issued in accordance with Section 33 or Section 34, who intends to register such transfer, shall submit the application to the company which he has signed his name as the transferee on the back of the certificates. In such event, the issuing company or the registrar, as the case may be, shall enter the transfer in the register and certify such transfer on the securities certificates or issue new certificates within the time as specified in the notification of the Office unless such transfer is against the law or against the restriction on transfer of the issuing company which has registered such restrictions with the Office.

When the issuing company or the registrar has received the application of transfer in accordance with the first paragraph, such transfer shall be binding on the issuing company but shall only be binding on a third party when the transfer has been entered into the register.

Section 54.

No company which issues securities shall provide any benefit to a person other than the person whose name is entered in the securities register in accordance with Section 53, except in case of bearer debentures, where the benefit shall be provided when the bearer has submitted the bearer certificates to the issuing company. In such event, the payment shall also be endorsed by the issuing company.

Section 55.

The transfer of bearer debentures, bearer certificates representing the rights to purchase shares or bearer certificates representing the rights to purchase debentures issued in accordance with Section 33 or Section 34 shall be valid upon the delivery of such securities certificates to the transferee.

 

DIVISION 5 

DISCLOSURE OF INFORMATION AND AUDITOR

   

Section 56.

A company which issues securities in accordance with Section 32, Section 33 of Section 34 shall prepare the following financial statements and reports concerning the financial condition and the business operation of the company and submit them to the Office:

1.      quarterly financial statement reviewed by an auditor;

2.      financial statement for any accounting period examined and for which an auditor has given an opinion;

3.      annual report;

4.      any other report concerning the information of the company as specified in the notification of the SEC.

The financial statements and reports in accordance with the first paragraph shall comply with the rules, conditions and procedures as specified in the notification of the SEC. In specifying such rules, conditions and procedures, the standards approved by the Board of Auditing Practices in accordance with the law relating to auditors shall be take into account.

Section 57.

A company which issues securities in accordance with Section 32, Section 33 or Section 34 shall submit a report with reasons to the Office immediately when one of the following incidents occurs:

1.      the company suffers serious damage;

2.      the company ceases operating all or part of its business;

3.      the company alters its objects or the nature of its business;

4.      the company enters into an agreement entrusting other persons with power in whole or in part in the management of the company;

5.      the company takes over another company or is taken over in accordance with Section 247;

6.      any incident which affects or is likely to affect the rights and interests of securities holders or the decision making on investment or the change in the securities price of the company as specified in the notification of the SEC.

Section 58.

In cases where the Office is of the opinion that the documents or reports furnished by the company which issues securities in accordance with Section 32, Section 33 or Section 34 are incomplete or ambiguous, or in case of emergency or any other case which is likely to affect the rights and interests of securities holders or the decision making on investment or change in the securities price of the company, the Office shall have the power to do one or more of the following:

1.      instruct the company to submit additional reports or documents;

2.      instruct the director, manager, or person with power of management over the company to provide additional explanation;

3.      instruct the company to arrange an audit by an auditor and report the result of the audit to the Office and disclose the information to the public.

Section 59.

The director, manager, person who holds management position as specifies in the notification of the Office, and auditor of a company which issues securities in accordance with Section 32, Section 33 or Section 34 shall prepare and disclose reports to the Office on each person's securities holding ad the holding of securities by his spouse and minor children of securities in the company including changes in such holdings under the rules and procedures as specified in the notification of the Office with the approval of the SEC.

Section 60.

For the benefit of disclosing information to the public about the condition and the business operation of a company which issues securities including the holding of securities in such company, the Office shall have the power to disclose the reports or the information received in accordance with Section 56, Section 57, Section 58, Section 59 under the rules and procedures as specified in the notification of the SEC.

Section 61.

The auditor as referred to in Section 56 shall be an auditor who has been given an approval by the Office.

Where an approval has been given in accordance with the first paragraph, the auditor may audit the accounts of a securities company as referred to in Section 106, a company issuing securities listed in the Securities Exchange as referred to in Section 199, and a company whose securities are traded in an over-the-counter as referred to in Section 217.

Section 62.

In making a review or audit, if the auditor finds that a company which issues securities in accordance with Section 32, Section 33 and Section 34 has inaccurately prepared a quarterly financial statement of financial statement for any accounting period, the auditor shall state his findings and disclose the facts material to the financial statement and notify such circumvent in his report on which he is to sign in order to give his opinion as well as report the matter to the Office.

The Office shall have the power to withdraw its approval of any auditor who does not comply with the provisions of the first paragraph in giving an opinion, on a financial statement, for any accounting period.
CHAPTER 3

PUBLIC OFFERING OF SECURITIES

 

Section 63.

The provisions of this Chapter shall not apply to the offer for sale of the following securities:

1.      treasury bills;

2.      government bonds;

3.      Bank of Thailand bonds;

4.      bonds whose principal and interest are guaranteed by the Ministry of Finance;

5.      any other securities as specified in the notification of the SEC.

Section 64.

The provisions of this Chapter shall not apply to the offer for sale of securities in the following cases:

1.      the offer for sale of newly issued investment units of a securities company licensed to manage mutual funds;

2.      the offer for sale of securities to the public or any person having a total value less than the amount specified in a notification of the SEC;

3.      the offer for sale of securities whose characteristics, type, or number of investors are specified in the notification of the SEC.

In an offer for sale of securities in accordance with (2) and (3), the promoters of a public limited company, a company of owner of securities shall report the result of the sale to the Office within fifteen days from the closing date of offer for sale.

Section 65.

The offer for sale of securities to the public or any person may be made only when the registration statement and the draft prospectus which have been filed with the Office by the promoters of a public limited company, a company or owner of securities have become effective.

Section 66.

In cases where the offer for sale of securities to the public or any person in accordance with Section 65 required an approval from the Office, the promoters of a public limited company, or a company may file the registration statement and draft prospectus together with the application for approval in accordance with Section 32, Section 33 and Section 34 or may such filing after the approval has been granted.

In cases where an approval has been granted in accordance with Section 33 or Section 34. to a company to offer for sale newly issued securities to the public or any person several times within the amount and time as specified by the Office and those securities are securities which have a repayment period not exceeding two hundred and seventy days, the company need not file a registration statement and draft prospectus each time the offer for sale is made but shall submit to the Office any changes in the information contained in the registration statement and draft prospectus which have previously been filed with the Office not less than five working days prior to the date of delivery or the date of distribution of the prospectus.

Section 67.

Subject to the provisions of Section 68, a registration statement and draft prospectus shall be effective upon the lapse of forty-five days after the receipt of such registration statement and prospectus by the Office, except where the SEC specifies an effective date before such period.

Section 68.

In cases where the promoters of a public limited company, or a company has submitted the registration statement and draft prospectus with an application for approval of an offer to sell newly issued securities in accordance with Section 32, Section 33 or Section 34, and the Office has not yet given an approval after the lapse of the time specified in Section 67, such registration statement and draft prospectus shall become effective only when the approval has been granted to the promoters of such public limited company, or such company to make an offer for sale of the newly issued securities.

Section 69.

A registration statement shall be in the form as specified in the modification of the SEC and shall have the following details:

1.      objective of the offer for sale of the securities to the public or any person;

2.      name of the issuing company which issues securities;

3.      capital of the company;

4.      amount and type of the securities offered for sale;

5.      expected selling price per unit of securities;

6.      nature of the business;

7.      financial condition, business operation, and material information of the business;

8.      management and major shareholders of the issuing company;

9.      auditor, regularly contacted financial institutions, and legal advisor of the issuing company;

10.  procedures for the subscription, underwriting and allocation of securities;

11.  other information as specified in the notification of the SEC.

In filing a registration statement, the Office may instruct the promoters of a public limited company, a company or owner of securities to attach any documents other than those specified in the registration statement.

Section 70.

In addition to the information to be provided in accordance with Section 69, the registration statement for the sale of securities in the category of bills or debentures shall also contain the following information:

1.      rights and restrictions related to the transfer of bills or debentures;

2.      return on debentures and bills;

3.      property or other collateral used as security for repayment (if any);

4.      debenture holder representative (if any);

5.      encumbrances on the property of the company which issues securities in case of unsecured securities;

6.      outstanding debt from previous issues of bills or debentures;

7.      procedure, time, and place of repayment;

8.      procedures for the conversion of rights (if any);

9.      other information as specified in the notification of the SEC.

Section 71.

In addition to the information to be provided in accordance with Section 69, the registration of certificates representing the rights to purchase shares, certificates representing the rights to purchase debentures, or certificates representing the rights to purchase investment units, shall also contain the following information:

1.      rights and conditions under the certificates;

2.      shareholders' resolution authorizing the issue of shares, or debentures, or approval by the Office to issue investment units for exercising rights under the certificates, as the case may be;

3.      amount of shares, debentures, or investment units to be issued under the certificates;

4.      procedures for the conversion of rights;

5.      other information as specified in the notification of the SEC.

Section 72.

The draft prospectus shall be in the form as specified in the notification of the Office and wherever there are corresponding particulars in the draft prospectus and the registration statement, the material facts stated therein shall be the same.

Section 73.

In cases where the Office is of the opinion that the statements or particulars in the registration statement and draft prospectus are incomplete, the Office has the power to order the person who files the registration statement and draft prospectus to file additional information or amend the registration statement and draft prospectus. However, the Office may not give such an order after the registration statement and draft prospectus have become effective in accordance with Section 67 or Section 68.

Section 74.

Prior to the effective date of the registration statement and draft prospectus, the promoters of a public limited company, a company or owner of securities who wishes to amend the particulars or information in the registration statement and draft prospectus may submit an application for such amendment to the Office. Where such amendment concerns material information, the Office may deem the date of the receipt of such amendment to be the commencement date of the period of time required under Section 67 for the filing of the new registration statement or the draft prospectus.

In cases where the Office is of the opinion that the amendment as referred to in the first paragraph shall affect the interests of investors, the Office has the power to order the promoters of a public limited company, a company or owner of securities to file additional documents or information.

Section 75.

In calculation the period of time in accordance with Section 67,the period from issuance by the Office of an order under Section 73 or under the second paragraph of Section 74, until receipt by the Office of the complete documents or information shall not be taken into calculation.

Section 76.

After the date on which the registration statement and draft prospectus have become effective, the Office shall have the following powers:

1.      In cases where the Office finds that the statements or particulars in the registration statement and prospectus are false or fail to disclose material facts that should have been stated therein which may cause damage to the purchasers effectiveness of the registration statement and draft prospectus, and in cases where the offer for sale of securities is given an approval in accordance with Section 32, Section 33 or Section 34, the Office has the power to order the withdrawal of such approval immediately;

2.      In cases where the Office finds that the statements or particulars in the registration statement and prospectus contain material facts which are incorrect, or there is an event which causes a material change in the information contained in the registration statement and draft prospectus which may affect the investment-making decisions of the purchasers of securities, the Office has the power to order the temporary suspension of the effectiveness of the registration statement and draft prospectus until a course of action has been taken to make a correction and other action is taken as specified by the Office in order to make public the amendment of such information;

3.      In cases where the Office finds that the statements or particulars in the registration statement and prospectus are incorrect in other aspects, the Office has the power to order the promoters of a public limited company, a company or owner of securities who files the said documents to make corrections.

The order of the Office under the first paragraph does not affect any act of the promoters of a public limited company, a company or owner of securities undertaken prior to such order and does not affect the rights of any person as provided in Section 82 to claim for compensation.

Section 77.

When the promoters of a public limited company, a company or owner of securities has filed the registration statement or draft prospectus, distribution of the information relation to the offer for sale of securities may be made prior to the effective date of such registration statement and draft prospectus. However, the information so distributed must contain material facts as specified in a notification of the Office, as well as a clear statement showing that such distribution of information is not a prospectus, provided that it shall be in accordance with the rules and procedures as specified in the notification of the Office.

Section 78.

Any person who wishes to examine or obtain a copy of a registration statement and draft prospectus filed with the Office may do so in accordance with the regulations as specified in the notification of the Office.

Section 79.

When a registration statement and draft prospectus have become effective, the offer for sale of securities to the public may be made only when the prospectus containing the date of filing of the registration statement and draft prospectus has been delivered or distributed.

Section 80.

Advertisement and invitation to the public or any other person to purchase securities by the promoters of a public limited company, a company or owner of securities which do not follow the procedure as referred to in Section 79 can be made only when the registration statement and draft prospectus have become effective in accordance with Section 67 or Section 68 and shall not contain exaggerated, false or misleading statement. In cases where the advertisement is made by means of printed matter, it shall also contain the following details:

1.      amount, type, offer price per unit and total value of securities offered;

2.      name of the promoters of the public limited company, the company or the owner of the securities;

3.      type of business to be or being operated;

4.      place and time at which the draft prospectus may be obtained;

5.      names of underwriters (if any);

6.      other particulars as specified in the notification of the SEC.

Section 81.

After the completion of the sale of securities, the promoters of a public limited company, a company or owner of securities shall report the result of the sale to the Office. In cases where an offering is made through an underwriter, the promoters of a public limited company, a company or owner of securities shall report the amount of securities and the amount of money paid for securities which have been purchased by the underwriter as well.

The report as referred to in the first paragraph shall be made in accordance with the rules and procedures as specified in the notification of the SEC.

Section 82.

In cases where the registration statement and prospectus contain false statements or particulars or fail to disclose material facts that should have been stated therein, any person who purchases securities from the promoters of a public limited company, a company or owner of securities, and such person is still the owner of such securities, who suffers damage from such purchase, shall have the right to claim compensation from the company or the owner of the securities.

The securities purchaser who has a right to claim compensation in accordance with the first paragraph must have purchased the securities before the facts under the first paragraph become apparent. However, the facts must become apparent within one year from the effective date of the registration statement and draft prospectus.

Section 83.

The following persons shall be liable in accordance with Section 82 jointly with the company or the owner of securities unless such persons can prove that they are not aware of the facts or by their positions they could not have been aware of the truthfulness of the information or the failure to disclose the facts required to be stated:

1.      directors who have the power to bind the company and signed their names in the registration statement and prospectus;

2.      promoters of a public limited company who signed their names in the registration statement and prospectus;

3.      underwriters, auditors, financial advisors, or appraisers of assets who intentionally or with gross negligence signed their names to certify the information in the registration statement and prospectus.

Section 84.

The company or the owner of securities and the persons referred to in Section 83 are not liable to pay compensation in accordance with Section 82 in the following cases:

1.      the subscribers knew or should have known that the statements or particulars were false or that there was a failure to disclose material facts required to be stated therein;

2.      damage did not arise from the result of the receipt of false information or the failure to disclose material facts required to be stated therein.

Section 85.

The liability for damages under Section 82 shall be equivalent to the difference between the amount which the person who exercises the right to claim compensation has paid for the acquisition of such securities and the price which should have been, had the disclosure of information been correctly made as specified by the Office, and which price shall not be less than the par value of such securities. Provided that interest a the maximum average rate payable for fixed deposit of one year or more from at least four commercial banks specified by the Office shall be added to the difference.

Section 86.

The rights to claim for compensation in accordance with Section 82 shall have a limitation period of one year from the date on which the fact that the registration statement and prospectus contained false information became known of should have been known, but not exceeding two years from the effective date of the registration statement and draft prospectus.

Section 87.

The rights to claim for compensation in accordance with Section 82 shall have a limitation period of one year from the date on which the fact that the registration statement and prospectus contained false information became known of should have been known, but not exceeding two years from the effective date of the registration statement and draft prospectus.

Section 88.

The company or the owner of the securities shall deliver securities to the purchasers of the securities in accordance with the rules, conditions and procedures as specified in the notification of the SEC.

Section 89.

The auditor who gives an opinion on a financial statement, which is disclosed in the registration statement of newly, issued securities and prospectus in this Chapter shall be an auditor who has been given an approval by the Office.

CHAPTER 4

SECURITIES BUSINESS

 

DIVISION 1 

FORMATION AND ISSUANCE OF LICENSE

 

Section 90.

The Securities business can be undertaken only by formation of either a limited company or a public limited company, or by a financial institution established in accordance with other laws, and after having obtained a license from the Minister upon the recommendation of the SEC.

The formation of a limited company or of a public limited company to undertake securities business under the first paragraph may be commenced after having been given an approval of the Minister upon the recommendation of the SEC.

A merger of securities companies shall be deemed to be the formation of a limited company or of a public limited company, as the case may be.

Application for a license, application for an approval, the issuance of a license, and the granting of an approval under this Section shall be in accordance with the rules, conditions and procedures, and subject to the payment of fees, as specified in the ministerial regulations.

Section 91.

Where it is necessary to maintain the economic and financial stability of the country, or to protect public interest, the Minister upon the recommendation of the SEC has the power to specify conditions with which the license holder shall be required to comply in the undertaking of the securities business.

In cases where there has been a change in the necessary circumstances as provided in the first paragraph, the Minister upon the recommendation of the SEC may modify or change the conditions already specified.

Section 92.

A securities company may establish a branch office only when the Office has given an approval.

The application for and the granting of such approval shall be in accordance with the rules, conditions and procedures as specified by the SEC.

The establishment of a branch office of a financial institution established in accordance with other laws shall comply with such governing laws.

Section 93.

Any person wishing to act on behalf of a company established to undertake securities business under foreign law by setting up a representative office in the Kingdom shall obtain an approval from the Office.

The representative under the first paragraph shall undertake only those businesses specified in the approval.

The provisions of Section 95 shall not apply to a person receiving approval under this Section . However, such person shall comply with the regulations specified by the Office.

 

DIVISION 2 

SUPERVISION AND CONTROL

 

Section 94.

A securities company shall include in its name the words "Securities Company" at the beginning, and the word "limited" at the end.

Section 95.

No person other than a securities company shall, in the undertaking of its business, use the name or a description of "Securities Company" or any other word of the same meaning.

Section 96.

A securities company shall have a paid-up registered capital in an amount as specified by the SEC, which shall not be less than one hundred million Baht.

Section 97.

A securities company shall maintain capital adequacy in accordance with the rules, conditions and procedures as specified by the SEC.

Section 98.

No securities company shall:

1.      reduce its capital without an approval from the SEC;

2.      in any act which may mislead its customers or the public in any matter concerning the price, value and nature of the securities involved;

3.      engage in any act, which may cause damage or constitute an unfair advantage to its customers or other interested person as specified in the notification of the SEC;

4.      purchase and sell futures and options on securities whether in its own name or for customers unless the SEC issues a notification allowing such transaction;

5.      sell securities without having possession, or without receiving an order to sell from another person, unless the SEC issues a notification allowing such transaction;

6.      accept purchasing or selling orders from customers outside its head office or branch offices unless otherwise specified by the Office;

7.      purchase or hold shares, except:

a.      those acquired in the course of securities dealing, securities underwriting, or other securities businesses as specified in the notification of the SEC; or

b.      those acquired upon a permission from the Office and in accordance with the rules, conditions and procedures as specified in the notification of the SEC;

8.      engage in any other business which is not a licensed securities business, except when an approval has been granted by the SEC; Other business under the first paragraph does not include the lending of money for purchasing, selling or exchanging securities in the course of securities brokerage or securities dealing business or the purchase and sale or exchange of securities in the Securities Exchange and in an over-the-counter center by a securities company licensed to undertake securities dealing business;

9.      relocate its head office or branch offices without an approval from the Office;

10.  advertise its business, unless such advertisement is carried out in accordance with the rules, conditions and procedures as specified in the notification of the Office.

Section 99.

In cases where a question arises as to whether the securities company holds securities for its customers' or its own account or for the accounts of any customers, it shall be deemed that the securities certificates which are in the possession of the securities company at any time are held for the persons in the following order:

1.      the securities company's customers shall take precedence over the holding for the securities company's own account;

2.      the customer who placed a purchase order prior to the another customer shall take precedence over that other customer whether or not the said securities are held as collateral for a loan granted by the securities company.

Section 100.

The appointment of any person to be an agent or broker of a securities company shall require prior approval from the Office.

Application for an approval and the granting of an approval shall be in accordance with the rules, conditions and procedures as specified in the notification of the SEC.

Section 101.

Amendment of the securities company's memorandum or articles of association must be notified in writing to the Office within fifteen days from the date of such amendment.

Section 102.

The lending of money for the purchase, sale or exchange of securities by a securities company shall be in accordance with the rules, conditions and procedures as specified in the notification of the SEC upon the recommendation of the Bank of Thailand.

Section 103.

No securities company shall appoint or allow any person with any of the following prohibited characteristics to be or to perform the duty of a director, a manager or a person with power of management, or an advisor: 

1.      being or having been a bankrupt;

2.      having been imprisoned by the judgement of a court which is final for an offence related to property committed with dishonest intent;

3.      having been a director, a manager or a person with power of management of a financial institution which had its license revoked, unless an exemption has been granted by the SEC;

4.      being a director, a manager or a person with power of management of any other securities company;

5.      having been removed from a position of chairman, director or manager in accordance with Section 144 or Section 145 or in accordance with the provisions of other laws;

6.      being a political official;

7.      being a government official with responsibility to supervise securities companies, an officer of the Bank of Thailand or of the Office, except in cases where:

a.      an appointment is made with the approval from the SEC for the purpose of assisting in the operation of a securities company; or

b.      an appointment is made in accordance with Section 145;

c.      the securities company is a state enterprise under the law relating to budget procedures.

8.      being a manager or a person with power of management of a partnership or a limited company in which such person himself or any person or partnership or limited company as specified in Section 258 (1), (2), (3), (4), (5) or (6) is a partner or a shareholder, except:

a.      being an advisor or a director of a securities company who has no power of management in the securities company;

b.      in the case where the exemption has been granted by the SEC as being necessary to rectify the condition or operation of the securities company;

c.      in the case where an appointment is made in accordance with Section 145;

d.      in the case where the holding of contribution in such limited partnership is less than one percent of the total amount of the contribution of that limited partnership;

e.      in the case where the shareholding in such limited company is less than one percent of the total amount of the shares sold of that company;

9.      being a person not having educational qualification, work experience or other qualification as specified in the notification of the SEC;

10.  having other prohibited characteristics as specified in the notification of the SEC.

Section 104.

A securities company shall appoint directors or managers or enter into an agreement with other persons, giving the power, either in whole or in part, to manage the business of the securities company only with the approval from the Office.

In cases where it later appears that the persons under the first paragraph have the prohibited characteristics as specified in Section 103, the Office shall have the power to withdraw its approval and the securities company shall propose other persons for the approval from the Office within fifteen days from the date of the withdrawal.

The provisions of Section 103 shall apply mutatis mutandis to the persons with whom the securities company enters into an agreement allowing such persons as well as those who work for such persons to have full or partial managing power in the securities company.

Section 105.

A securities company shall prepare its accounts stating true and accurate business operation and financial condition, which must conform to the accounting standards as specified by a professional institution approved by relevant government authorities and in accordance with additional regulations specified in the notification of the SEC.

Section 106.

A securities company shall prepare a balance sheet and a profit and loss account for each accounting period of six months in the form specified in the notification of the Office. The balance sheet shall be examined and an opinion given thereon by an auditor approved by the Office to be the auditor for such financial year. Such auditor shall not be a director, officer or employee of the securities company.

The securities company shall publish its balance sheet and profit and loss account prepared in accordance with the first paragraph for each accounting period of six months. Such publications shall be posted in a prominent place at the office of such securities company, published in at least one local daily newspaper, and one copy shall be submitted to the Office.

Preparation of the balance sheet and the profit and loss account for the first six months of the financial year in accordance with the first paragraph and the publication in accordance with the second paragraph shall be completed within three months from the end of each accounting period. For each financial year, such preparation shall be completed within twenty-one days from the date of approval by the general meeting of the shareholders but not later than four months from the end of such financial year, unless otherwise specified by the Office.

Section 107.

The auditor as referred to in Section 106 shall adhere to the ethical code of auditors, perform the audit work and declare his opinion according to the provisions of the law relating to auditors and additional provisions as specified in the notification of the SEC.

Where the auditor finds that the securities company has made false supporting documents and/or made incorrect recordings in the accounts, the auditor shall disclose the facts material to the accounts which affect the financial statement in the auditing report in which the auditor has to sign his name for the purpose of declaring his opinion.

The Office shall have the power to withdraw its approval of the auditor who fails to comply with the provisions of the first or second paragraph.

Section 108.

A securities company shall publish particulars or disclose any other information concerning the securities company in accordance with the rules and the time specified by the Office. Such publications or disclosure shall be displayed in a prominent place at the office of such securities company. A report together with a copy of such publications or disclosure of such information shall be submitted to the Office.

Section 109.

The Office may require any securities company to submit any report or present any document for any period or from time to time as specified by the Office and may also require an explanation to elaborate or clarify such reports or documents in accordance with the rules and required as specified in the notification of the SEC.

The reports and documents submitted or presented or the explanations to elaborate or clarify in accordance with the first paragraph shall be complete and accurate.

Section 110.

A securities company shall open its office for business during business hours and close its office on the days specified by the Office, unless permission has been granted by the Office to open or close its office at any other hours or days.

Section 111.

The provisions of Section 94, Section 98 (1), (7), (8) and (9), Section 104, Section 106, Section 107, Section 108 and Section 110 shall not apply to financial institutions established under other laws and granted licenses in accordance with Section 90.

Section 112.

In operating the business of securities brokerage, a securities company shall enter into a written agreement with the customers who appoint it to act as securities broker. For the purpose of fairness to the parties, the SEC may specify any particulars which are material to the agreement.

Section 113.

In operating the business of securities brokerage in the Securities Exchange for listed securities, a securities company shall operate and collect fees or service charges in accordance with the rules, conditions and procedures as specified by the board of directors of the Securities Exchange.

In operating the business of securities brokerage outside the Securities Exchange for any securities, a securities company shall operate and collect fees or service charges in accordance with the procedures as specified in the notification of the SEC.

 

DIVISION 4 

SECURITIES DEALING

 

Section 114.

In operating the business of securities dealing, a securities company shall comply with the rules, conditions and procedures as specified in the notification of the SEC.

 

DIVISION 5 

INVESTMENT ADVISORY SERVICE

 

Section 115.

In operating the business of investment advisory service, a securities company shall comply with the rules, conditions and procedures as specified in the notification of the SEC. In this regard, the SEC may also specify fees of service charges which the securities company may charge its customers for performing investment advisory service.

 

DIVISION 6 

SECURITIES UNDERWRITING

 

Section 116.

In operating the business of securities underwriting, a securities company shall comply with the rules, conditions and procedures as specified in the notification of the SEC. In this regard, the SEC may also specify fees or service charges which the securities company may charge its customers for the performing underwriting service.

 

DIVISION 7 

MUTUAL FUND MANAGEMENT

 

Section 117.

In the management of a mutual fund, a securities company may set up and manage a mutual fund only when its application to set up the mutual fund had been given an approval by the Office in accordance with the rules, conditions and procedures as specified in the notification of the SEC.

Section 118.

In applying to set up a mutual fund in accordance with Section 117, a securities company shall also submit the following documents:

1.      details of the mutual fund project as specified in the notification of the Office;

2.      draft commitment between the unit-holders and the securities company;

3.      draft agreement appointing the mutual fund supervisor.

Section 119.

The commitment between the unit-holders and the securities company shall contain at least the following material provisions:

1.      powers, duties and responsibilities of the securities company;

2.      appointment, conditions for replacement, and remuneration of the mutual fund supervisor;

3.      rates and payment procedure of fees and remuneration for the mutual fund management;

4.      rights of the unit-holders;

5.      dissolution of the mutual fund either by expiration of the mutual fund project or due to any other reason;

6.      other particulars as specified in the notification of the SEC.

Section 120.

The commitment referred to in Section 119 and the agreement appointing a mutual fund supervisor shall not contain any unfair limitation of liabilities of the securities company and of the mutual fund supervisor towards the unit-holders.

Any provisions in the commitment or in the agreement, which are contrary to the provisions of the first paragraph, shall be void.

Section 121.

A mutual fund supervisor shall be a commercial bank or a financial institution, which has qualifications as specified in the notification of the Office.

In issuing the notification in accordance with the first paragraph, the Office shall specify the following important matters:

1.      capital fund, net total assets and business operation of the person who will become the mutual fund supervisor;

2.      relationship between the mutual fund supervisor and the securities company;

3.      arrangement of organizational structure and internal controls necessary for fulfilling the duties of the mutual fund supervisor.

Section 122.

When an approval has been given to a securities company to set up and manage a mutual fund in accordance with Section 117 and prior to the offer for sale of investment units to the public, the securities company shall arrange for the appointment of a mutual fund supervisor.

Section 123.

The offer for sale of investment units to the public shall be made only after a securities company has delivered or distributed a prospectus containing the date of approval for the setting up and the management of the mutual fund.

The prospectus shall be in the form as specified in the notification of the Office and wherever there are corresponding particulars in the prospectus and the details of the mutual fund project, the material facts stated therein shall be the same.

Section 124.

Money received from the sale of investment units of each mutual fund project shall constitute a pool of assets which the securities company shall be required to register with the Office as a mutual fund in accordance with the rules and procedures as specified in the notification of the SEC.

The registered mutual fund shall be a juristic person with the objective of enabling the securities company to make an investment in accordance with the approved mutual fund project in which case the securities company shall be responsible for the operation of the mutual fund.

The mutual fund under the second paragraph shall have the same nationality as the securities company responsible for the operation of the mutual fund.

Section 125.

In the management of a mutual fund, the securities company shall proceed as follows:

1.      manage the mutual fund strictly in accordance with the approved mutual fund project and the commitment made with the unit-holders;

2.      deposit the assets of the mutual fund into the custody of the mutual fund supervisor;

3.      prepare correct and complete accounts of investments of the mutual fund;

4.      prepare investment reports of the mutual fund for the mutual fund supervisor in accordance with the rules and procedures specified in the notification of the Office;

5.      prepare and maintain a unit-holders register in accordance with the rules and procedures specified in the notification of the Office with the approval from the SEC;

6.      arrange for the collection of returns on investments of the assets of the mutual fund and deposit them into the custody of the mutual fund supervisor.

Section 126.

In the management of a mutual fund, the securities company shall be prohibited from:

1.      engaging in any act which may create a conflict of interest with the unit-holders as specified in the notification of the Office;

2.      investing in or holding shares of the securities company responsible for the management of that mutual fund;

3.      investing in or holding investment units of other mutual funds managed by the same securities company;

4.      investing in or holding securities of any company exceeding the ratio specified in the notification of the Office; in this regard, the Office may set a requirement in accordance with the type of securities or the type of business of such company;

5.      borrowing in the name of the mutual fund or creating any encumbrances on the assets of the mutual fund.

In issuing the notifications under sub Section (4), the Office shall have the power to set requirements to be observed by the securities company for each or all of the mutual funds for whose operations the securities company is responsible.

Section 127.

The mutual fund supervisor shall have the power and duty to:

1.      ensure that the securities company strictly complies with the provisions of Section 125;

2.      accept into custody assets of the mutual fund and separate them from other assets as well as ensure the disposition of the mutual fund in accordance with the mutual fund project;

3.      prepare deposit and payment accounts of the assets of the mutual fund;

4.      prepare a report to the Office in the event that the securities company has done any act or omitted to do any act which has caused damage to the mutual fund or has not acted in accordance with Section 125;

5.      file a legal action in court to cause the securities company to perform its duties or to claim compensation for damage from the securities company for the benefit of unit-holders as a whole or when instructed by the Office.

Expenses incurred from such legal action on behalf of the unit-holders of any mutual fund shall be paid from the assets of that mutual fund.

Section 128.

In cases where the securities company does any act or omits to do any act which causes damage to the mutual fund or fails to perform its duties in accordance with Section 125, the mutual fund supervisor shall prepare a detailed report concerning such matter and submit it to the Office within five days from the date on which the mutual fund supervisor has knowledge of such event.

In cases where the Office receives the report under the first paragraph and considers that the act of the securities company may have an adverse effect on the interests of unit-holders as a whole, the Office shall have the power to order the securities company to rectify the said act or to refrain from doing the act which may have such adverse effect or which is a violation of the duties of the securities company as referred to in Section 125.

In cases where the securities company fails to comply with the order of the Office given under the second paragraph, the Offence shall have the power to:

1.      remove the securities company responsible for the operation of the mutual fund and replace it with another securities company; in this regard, the replacing securities company shall be deemed to assume all rights and obligations of the securities company thus removed;

2.      order the securities company to dissolve the mutual fund.

Section 129.

In the management of a mutual fund, the securities company shall proceed in accordance with an approved mutual fund project.

Alteration or modification of the mutual fund project or alteration in the management if not made through the resolution by the majority of the unit-holders who hold more than half of all that mutual fund's investment units sold shall require an approval from the Office.

In cases where the alteration or the modification is made through a resolution of the unit-holders, the securities company shall submit a report thereof to the Office within fifteen days from the date of the resolution.

The securities company shall notify all the unit-holders of such alteration and modification and shall publish them in at least one local daily newspaper within fifteen days from the date on which the approval is given by the Office or the date on which the resolution is passed, as the case may be.

Section 130.

Upon the dissolution of the mutual fund, the securities company shall appoint a liquidator to collect and distribute assets to the unit-holders as well as to do all other acts as may be necessary for the completion of liquidation in accordance with the rules, conditions and procedures as specified in the notification of the SEC.

The liquidator under the first paragraph shall be given prior approval from the Office.

Expenses and remuneration arising from liquidation of any mutual fund shall be paid from the assets of that mutual fund.

Section 131.

After the completion of the liquidation, the liquidator shall apply for registration of the dissolution of the fund with the Office.

The liquidator shall transfer ownership of any assets remaining after registration of the dissolution of the mutual fund to the Office.

Section 132.

The provisions of Section 47, Section 48,Section 80, Section 81, Section 82, Section 83, Section 84, Section 85, Section 86, Section 87 and Section 89 including the related penalty provisions shall apply mutatis mutandis to the offer for sale of investment units to the public and to legal action taken against the mutual fund supervisor.

Expenses incurred from such legal action on behalf of the unit-holders of any mutual fund shall be paid from the assets of that mutual fund.

 

DIVISION 8 

PRIVATE FUND MANAGEMENT

 

Section 133.

In the management of a private fund, the securities company shall enter into a written agreement with a person or a group of persons who has authorized the securities company to manage their funds and shall comply with the rules, conditions and procedures as specified in the notification of the SEC. In this regard, the SEC shall have the power to specify the particulars which are material to the agreement.

Section 134.

In the management of a private fund, the securities company shall be prohibited from managing a private fund for;

1.      a group of persons comprising ten persons or more;

2.      any customer who has an account of less than one million Baht;

3.      any group of persons which has an account of less than ten million Baht. Provided that the notification of the SEC may specify otherwise.

Section 135.

In the management of a private fund, the securities company shall arrange for the appointment of a custodian who has been given an approval by the office in accordance with the rules, conditions and procedures as specified in the notification of the SEC.

Section 136.

The securities company shall keep separate the assets of the persons authorizing the management of the private fund from its assets, and the securities company shall deposit the assets which are securities with the custodian who has been given an approval under Section 135 within the business day following the day on which the securities company has received such securities, or within the time specified in the notification of the Office.

Section 137.

In accepting into custody the securities, the custodian shall keep separate the deposited securities from its own assets.

Section 138.

All assets of the persons authorizing the management of the private fund shall be in the name of the persons authorizing such management and the name of the securities company as the representative.

Section 139.

The securities company which undertakes the management of the private fund shall be prohibited from:

1.      investing in any securities for the person authorizing the management of the private fund other than those agreed upon in the agreement authorizing the management of the private fund;

2.      accepting fees or any service charges from the person authorizing the management of the private fund, except for fees or service charges specified at the rate and according procedures in the agreement authorizing the management of the private fund;

3.      purchasing or selling securities in its own name with the persons authorizing the management of the private fund without giving prior notice;

4.      making a representation to the persons authorizing the management of the private fund that there will be a profit at a certain rate or promising that the loss shall not be more than the rate already specified.

Section 140.

The securities company shall prepare an account showing the financial condition of each private fund in the form specified in the notification of the Office and shall keep the supporting documents which evidence the correctness of such account.

 

DIVISION 9 

REVOCATION OF LICENSE AND DISSOLUTION OF SECURITIES COMPANY

 

Section 141.

If the Office finds that any securities company:

1.      does not appropriately prepare accounts or does not complete the preparation of accounts within a reasonable period of time;

2.      does any act or omits to do any act which is specified in the notification of the Office with the approval of the SEC;

The Office shall have the power to order the securities company to rectify such act or refrain from doing such act as the Office may deem appropriate within a specified period of time.

Section 142.

Where there is evidence that the condition or operation of any securities company is such that damage may be caused to the public interest, the Office shall have the power to order such securities company to rectify such condition or operation within the period of time specified by the Office.

Section 143.

In cases where the SEC finds that the condition or operation of any securities company is such that serious damage may be caused to the public interest, the SEC shall have the power to order such securities company to take measures to rectify its management or to take any other action within the period of time specified by the SEC. In this regard, the SEC may also specify any condition to be complied with by the securities company for the purpose of rectifying the condition of operation of the securities company.

In cases where any securities company fails or is unable to rectify its operation, the Minister shall have the power to revoke the license of such securities company upon the recommendation of the SEC.

Section 144.

Where there is evidence that the condition or operation of any securities company is such that damage may be caused to the public interest, or where the directors, managers or persons responsible for the operation of any securities company fail to comply with the order of the Office under Section 141 or Section 142, the Office shall have the power to order such securities company to remove its directors, managers or persons responsible for its operation who have caused such events. In this regard, such securities company shall appoint other persons to replace the persons so removed within thirty days from the date of removal.

Section 145.

Where any securities company fails to remove such persons or removes but fails to appoint other persons in their places within thirty days from the date of removal, the Office with the approval of the SEC shall have the power to:

1.      remove its directors, managers or persons responsible for the operation of the securities company whom the securities company fails to remove;

2.      appoint one or more persons to replace the persons so removed for a period of not longer than three years. The persons so appointed shall be entitled to remuneration to be paid from the assets of the securities company as specified by the SEC. During the period in which the persons so appointed hold office, shareholders of the securities company may not pass a resolution to revoke or change the orders of the Office.

For the purpose of this Section , the order of the Office issued under the first paragraph shall be deemed to be a resolution of a shareholders' meeting in accordance with the Civil and Commercial Code or the law relating to public limited companies, as the case may be.

The persons so removed shall no longer be involved in or operate, directly or indirectly, any affair of that securities company, and shall give assistance and provide facts to the persons so appointed.

Section 146.

Where any securities company fails to comply with the order of the Office given in accordance with Section 144, the Office shall report the matter to the SEC. In such event, the Minister upon the recommendation of the SEC shall have the power to revoke the license of the securities company.

Section 147.

During any two year period, if any securities company does not undertake securities business of the type so licensed in the volume as specified in the SEC notification, the Minister shall have the power to revoke the license to operate all or any type of securities businesses so licensed upon the recommendation of the SEC.

Section 148.

In cases where the Minister orders the revocation of all types of securities businesses in accordance with Section 143, Section 146 or Section 147, the securities company whose license has been revoked shall be dissolved.

The provisions of the first paragraph shall not apply to the financial institutions established in accordance with other laws, which can undertake securities businesses.

Section 149.

In revoking a license of a securities company, the Minister shall communicate the order in writing to the securities company and shall post such order in a prominent place at the office of the securities company and shall publish the order in the Government Gazette and in at least one local daily newspaper.

Section 150.

Any securities company wishing to discontinue operating a securities business of the type so licensed shall seek an approval from the Minister through the SEC. In giving an approval, the Minister may specify any conditions.

Section 151.

When any securities company has discontinued its operation or ceased operating securities businesses, the securities company shall complete the purchase, sale or exchange of securities, settlement and delivery of the outstanding securities within the period of time specified by the Office.

Section 152.

Upon the dissolution of a securities company in accordance with Section 148, the securities company shall be liquidated and for this purpose the Office shall appoint a liquidator. Liquidation shall be done in accordance with the provisions of the Civil and Commercial Code on the liquidation of a limited company or the law relation to public limited companies on liquidation of a public limited company, as the case may be, provided that the power and duty of the general meeting shall be the power and duty of the Office.

Expenses for liquidation of any securities company shall be paid from the assets of that securities company.


 
 
 

CHAPTER 5

SECURITIES EXCHANGE

 

DIVISION 1 

ESTABLISHMENT

 

Section 153.

There shall be established a Securities Exchange referred to as the "Securities Exchange of Thailand" with the object of undertaking the securities exchange operations as follows, without the distribution of profits.

1.      Providing the service of being a center for trading of listed securities as well as providing the system and method of trading of securities in such center;

2.      Undertaking any businesses relating to the Securities Exchange, which are the rendering of services relation to listed securities by acting as a clearing house, securities depository center, securities registrar, the rendering of services on securities data or similar businesses;

3.      Undertaking any businesses other than (1) and (2) with the approval of the SEC. The Securities Exchange under the first paragraph shall be a juristic person.

Section 154.

The Securities Exchange shall have the power to do any acts within the scope of its objects as referred to in Section 153. Such power shall include the power to:

1.      acquire, own, hold any proprietary rights, possess, rent or lease, hire purchase, grant of hire purchase, transfer of accept transfer of the rights to lease or hire purchase, mortgage or accept mortgage, sell, or dispose by any other means movable or immovable properties;

2.      borrow or lend money as well as make investment for profit.

Section 155.

No person other than the Securities Exchange, which is established under this Act, shall engage in the business of securities exchange or similar businesses.

Section 156.

No person other than the Securities Exchange shall, in the operation of its business, make use of the name or the description of "Securities Exchange" or "Stock Exchange" or other words having the same meaning.

Section 157.

Securities that may be traded in the Securities Exchange shall be listed securities in accordance with Division 4 of this Chapter.

Section 158.

A securities company that acts as a broker or an agent for the trading of securities in the Securities Exchange must be a member of the Securities Exchange.

 

DIVISION 2 

BOARD OF DIRECTORS OF THE SECURITIES EXCHANGE

 

Section 159.

There shall be a board of directors of the Securities Exchange comprising not more than five persons appointed by the SEC and not more than five persons elected by members referred to in Section 158 to serve as directors and the manager of the Securities Exchange who shall ex officio be director of the Securities Exchange.

The persons appointed by the SEC under the first paragraph shall have an excellent knowledge of, and experience in, the operations of the Securities Exchange, securities or financial businesses and at least one person shall be a senior executive of a company whose securities are listed in the Securities Exchange.

The board of directors of the Securities Exchange shall elect a director, who is not the manager of the Securities Exchange, to be the chairman and may also elect another director of the Securities Exchange to be the vice-chairman.

Section 160.

Director of the Securities Exchange shall have the qualifications and shall not possess any of the prohibited characteristics as follows:

1.      having a Thai nationality;

2.      not being or having been a bankrupt;

3.      not having been imprisoned by the judgement of a court which is final unless the offence is related to an act of negligence or a petty offence;

4.      not being a civil servant having a permanent position or salary, a political official or an officer or employee of any government organization or state enterprise or district office or an elected member of a district council or district administration;

5.      not being a director who has been removed from the position by a resolution of the SEC.

Section 161.

Directors of the Securities Exchange, except for the manager of the Securities Exchange, shall hold office for a term of two years. When one year of the first term of office has elapsed, two of the SEC-appointed directors and two of the member-elected directors shall be retired by means of drawing lots. Retirement from the office by means of drawing lots shall be deemed retirement upon the expiration of the term of office.

The directors who retire upon the expiration of the term of office may be re-appointed but shall not hold office for more than two consecutive terms.

Section 162.

Apart from the expiration of the term of office, the office of the director of the Securities Exchange shall be vacated upon:

1.      death;

2.      resignation;

3.      removal by resolution of the SEC;

4.      lack of qualification or possession of prohibited characteristics under Section 160.

In cases where the office of a director of the Securities Exchange is vacated prior to the expiration of the term of office, the SEC or the members under Section 158 shall appoint or elect another person to assume the office, as the case may.

Section 163.

The provisions of the second paragraph of Section 10, the second paragraph of Section 11, Section 12 and Section 13 shall apply mutatis mutandis.

Section 164.

The board of directors of the Securities Exchange shall appoint the manager of the Securities Exchange who shall receive salary and other remuneration as specified by the board of directors of the Securities Exchange.

The manager of the Securities Exchange shall hold office for a term of not exceeding four years and may be re-appointed.

Section 165.

The manager of the Securities Exchange shall:

1.      have qualifications and not possess the prohibited characteristics under Section 160;

2.      be able to work full-time for the Securities Exchange.

Section 166.

Apart from the expiration of the term of office, the position of the manager of the Securities Exchange shall be vacated upon:

1.      death;

2.      resignation;

3.      reaching the age of sixty;

4.      removal by resolution of the board of director of the Securities Exchange;

5.      lack of qualifications or possession of prohibited characteristics under Section 160.

The resolution of the board of directors of the Securities Exchange removing the manager of the Securities Exchange from the office shall be passed by not less than three fourths of the votes of all directors of the Securities Exchange not including the vote of the manager of the Securities Exchange.

Section 167.

The manager of the Securities Exchange has the duty to manage the operation of the Securities Exchange in accordance with the policy and rules and regulations of the board of directors of the Securities Exchange and has authority over the officers and employees of the Securities Exchange.

In the management of the operation of the Securities Exchange, the manager of the Securities Exchange shall be responsible to the board of director of the Securities Exchange.

Section 168.

The manager of the Securities Exchange shall be the representative of the Securities Exchange in the business of the Securities Exchange relating to third persons, and for this purpose, the manager of the Securities Exchange may authorize any person to perform any act to the extent that such authorization is not contrary to the rules or regulations specified by the Board of the Directors of the Securities Exchange.

The authorization under the first paragraph shall be made in writing.

Section 169.

When the office of the manager of the Securities Exchange has become vacant or when the manager cannot fulfil his duty, the board of directors of the Securities Exchange shall appoint one of the directors or officers of the Securities Exchange to temporarily perform the duty of the manager of the Securities Exchange. In this regard, such person shall have the power and duty of the manager of the Securities Exchange.

Section 170

The board of directors of the Securities Exchange shall have the power and duty to formulate policies, supervise the operation of the Securities Exchange and perform any other function in accordance with this Act.

The powers and duties of the board of directors of the Securities Exchange under the first paragraph shall include the issuing of rules or regulations on the following matters:

1.      rules, conditions and procedures concerning the acceptance and the withdrawal of listed securities;

2.      rates for fees charged by brokers or agents in the trading of listed securities;

3.      rules and procedures concerning membership of the Securities Exchange, election of the directors of the Securities Exchange in accordance with Section 159, the numbers, procedures for admission, qualifications, rights and duties, disciplines, punishment, meetings, as well as the transfer and termination of membership in the Securities Exchange;

4.      determination of the admission fees for membership, subscription fees, deposits and other service charges payable by members to the Securities Exchange;

5.      rules concerning additional requirements for accounting and auditing to the extent that such requirements are not contrary to the standards as specified by a professional institute approved by the relevant government authorities;

6.      announcement of the names of the auditors who have been given an approval by the board of directors of the Securities Exchange to audit the accounts of the companies whose securities are listed in the Securities Exchange;

7.      rules, conditions and procedures concerning the preparation of the register of the listed securities' holders, disclosure of the financial condition and the business operation of the companies whose securities are listed in the Securities Exchange;

8.      rules, conditions and procedures concerning the preparation of agreements appointing a broker or agent for the trading of listed securities in the Securities Exchange for customers and securities companies which are not members;

9.      rules, conditions and procedures concerning the trading of listed securities in the Securities Exchange, the permission for members to trade listed securities outside the Securities Exchange and the settlement and delivery of listed securities which are traded in the Securities Exchange;

10.  rules, conditions and procedures concerning a temporary suspension of trading of listed securities in the Securities Exchange;

11.  rules, conditions and procedures concerning the inspection of documentation and accounts of members;

12.  daily trading hours and holidays for the trading of listed securities in the Securities Exchange;

13.  rules, conditions and procedures concerning the preparation and the disclosure of reports on the holding of securities, and the determination of time for certifying the transfer of securities and issuing securities certificates;

14.  placement, appointment, removal of officers and employees, disciplines and punishment for officers and employees of the Securities Exchange, as well as the petition for grievances and the rules and procedures for the operation of the Securities Exchange;

15.  determination of positions, scales of salaries, wages and bonuses of officers and employees;

16.  welfare and assistance to present and retiring officers and employees including their families;

17.  any other matters necessary for the operation of the Securities Exchange. The determination or alteration and modification of the rules or regulations under (2), (3), (4), (8), (9), (10), (11), and (12) shall require the prior opinion from the meeting of the members and the determination or alteration and modification of the rules or regulations under (1), (2), (3), (4), (5), (6), (7), (11) and (17) shall come into force only after an approval has been given by the SEC.

Section 171

The board of directors of the Securities Exchange shall have the power to:

1.      accept as listed securities the securities, which are qualified in accordance with the rules, conditions and procedures concerning the acceptance of listed securities under Section 170 (1);

2.      temporarily suspend the trading of any listed securities in the Securities Exchange for a specified period deemed to be reasonable;

3.      temporarily prohibit any member from trading listed securities in the Securities Exchange for a specified period deemed to be reasonable;

4.      withdraw the listed securities from the Securities Exchange in accordance with the rules, conditions and procedures concerning the withdrawal of listed securities under Section 170 (1).

The Securities Exchange shall post the announcement of the acceptance and withdrawal of listed securities in a prominent place at the office of the Securities Exchange and shall disclose the matter to the public prior to the date on which such securities are accepted as or withdrawn from being listed securities.

Section 172

The board of directors of the Securities Exchange shall have the power to:

1.      accept as listed securities the securities, which are qualified in accordance with the rules, conditions and procedures concerning the acceptance of listed securities under Section 170 (1);

2.      temporarily suspend the trading of any listed securities in the Securities Exchange for a specified period deemed to be reasonable;

3.      temporarily prohibit any member from trading listed securities in the Securities Exchange for a specified period deemed to be reasonable;

4.      withdraw the listed securities from the Securities Exchange in accordance with the rules, conditions and procedures concerning the withdrawal of listed securities under Section 170 (1).

The Securities Exchange shall post the announcement of the acceptance and withdrawal of listed securities in a prominent place at the office of the Securities Exchange and shall disclose the matter to the public prior to the date on which such securities are accepted as or withdrawn from being listed securities.

Section 172

In order that the operation of the Securities Exchange may proceed in an orderly manner and in order to protect the interests of investors, the board of directors of the Securities Exchange shall have the power to order a company whose securities are listed in the Securities Exchange to do any act or omit to do any act concerning any matter which is necessary and reasonable.

In cases where a company whose securities are listed in the Securities Exchange fails to comply with the order of the board of directors of the Securities Exchange referred to in the first paragraph, the board of directors of the Securities Exchange may exercise the power under Section 171 (2) or (4).

Section 173

In cases where the board of directors of the Securities Exchange has ordered a withdrawal of any listed securities due to the failure of the company to comply with the order given under Section 172, the holders of such withdrawn securities have the right to claim compensation from the director, manager or person responsible for the operation of such company who has caused the failure to comply with such order.

The holder of securities who has the right to claim compensation as referred to in the first paragraph shall have acquired such securities prior to the withdrawal of such listed securities and shall neither have participated in nor given approval and permission to act against such order.

Section 174

The liability for compensation as referred to in Section 173 shall be equal to the reduction in the value of securities from the last selling price of such securities in the Securities Exchange.

Section 175

The Securities Exchange shall have the power to file a claim in court for compensation as referred to in Section 174 for the benefit of the securities holders as a whole.

Section 176

The Board of Directors of the Securities Exchange shall have the power to appoint a sub-committee of the Securities Exchange to perform any matter of the Securities Exchange as assigned by the Board of Directors of the Securities Exchange, and for this purpose the provisions of Section 12 shall apply mutatis mutandis.

The sub-committee of the Securities Exchange shall receive remuneration as specified by the board of directors of the Securities Exchange.

Section 177

The chairman, vice-chairman and directors of the Securities Exchange shall receive remuneration as specified at a meeting of members of the Securities Exchange.

 

DIVISION 3 

OPERATION

 

Section 178

The board of directors of the Securities Exchange shall submit to a meeting of members of the Securities Exchange within four months from the end of the calendar year a balance sheet and an annual income and expense account duly certified by the auditor.

Section 179

The meeting of members of the Securities Exchange shall appoint an auditor from among the persons nominated by the board of directors of the Securities Exchange and shall determine the remuneration for such auditor.

The auditor shall be a licensed auditor under the law relating to auditors and shall not be a director, manager, officer or employee of the Securities Exchange.

Section 180

The auditor shall have the power to examine all accounts and documents of the Securities Exchange and may require further explanation from the directors, manager, officers or employees of the Securities Exchange.

Section 181

The board of directors of the Securities Exchange shall submit to the Office a balance sheet with an annual income and expense account as well as prepare reports and submit documents to the Office in accordance with the rules, conditions and procedures as specified by the SEC.

Section 182

The Securities Exchange shall pay money for the purpose of facilitating the operation of the Office at the rate specified by the SEC.

Section 183

In order to protect the benefit or interests of the public, the Securities Exchange or any person authorized by the board of directors of the Securities Exchange shall have the power to disclose information of a company whose securities are listed in the Securities Exchange or of a securities company which is a member of the Securities Exchange to the public in accordance with the rules, conditions and procedures as specified by the board of directors of the Securities Exchange.

Section 184

The purchase or sale of listed securities in the Securities Exchange shall be conducted by a securities company, which is a member of the Securities Exchange.

In the purchase or sale of securities as referred to in the first paragraph, a member may act as a broker or agent for any person or securities company, which is not a member.

Section 185

No member of the Securities Exchange shall purchase or sell listed securities outside the Securities Exchange regardless of whether it is acting as a broker, agent or in its own name, unless such member has been given an approval from the Securities Exchange.

Section 186

In order to safeguard against the damage, which may be caused to the public or the economy of the country, the SEC shall have the power to:

1.      temporarily suspend the trading of all listed securities in the Securities Exchange for a specified period deemed to be reasonable;

2.      instruct the board of directors or the manager of the Securities Exchange to do any act or omit to do any act as the SEC deems appropriate.

In exercising the power under (1), the SEC shall give a written order which shall be posted in a prominent place at the office of the Securities Exchange as well as report the matter to the Minister immediately. In this regard, the Minister shall have the power to order any change or modification in such order.

Section 187

In cases where there has been a breakdown in the equipment used in the trading system of listed securities in the Securities Exchange which prevents the normal trading of listed securities in the Securities Exchange, the manager of the Securities Exchange shall have the power to order a temporary suspension of trading of all listed securities in the Securities Exchange, and shall submit a detailed report to the SEC immediately.

Section 188

Upon the termination of membership of any member, the Securities Exchange shall permit such member to complete transactions in progress.

 

DIVISION 4 

LISTED SECURITIES

 

Section 189

Any issuer of securities who wishes to have its securities traded in the Securities Exchange shall proceed to have such securities listed in the Securities Exchange.

Upon receiving the application for listing, the Securities Exchange shall consider and submit its opinion to the board of directors of the Securities Exchange for the purpose of making an order to accept or reject such securities as listed securities.

Section 190

In the purchase or sale of listed securities, the retention or the return of such securities which have been used as collateral for a repayment of loan under Section 195 or in any other cases as specified by the SEC, securities of the same category, type and amount of the same juristic person or the same mutual fund project may be used as substitutes.

Section 191

The company issuing securities, which are listed in the Securities Exchange shall be required to keep a register of securities holders in accordance with the rules and procedures as specified by the board of directors of the Securities Exchange.

In keeping the register referred to in the first paragraph, the issuing company may appoint the Securities Exchange or any other person who has been given a license to provide services of being a securities registrar in accordance with Section 221 to carry out such duty.

Section 192

In cases where shareholders who collectively hold not less than twenty-five percent of the total amount of shares sold in the company issuing securities which are listed in the Securities Exchange make a request to the Securities Exchange to act as securities registrar of the company, the Securities Exchange shall accept such request. In such case, the issuing company shall deliver relevant documents to the Securities Exchange within sixty days from the date on which the Securities Exchange has notified its acceptance to the issuing company and after the lapse of such period of time the issuing company can no longer act as the registrar.

Section 193

In cases where the company issuing securities which are listed in the Securities Exchange has determined the date on which it shall not accept the entry of the transfer of name securities into the register prior to the shareholders' meeting and there are securities holders who have requested the registration of transfer prior to the date of non-acceptance, the issuing company shall complete the registration of the transfer prior to the date of the shareholders' meeting.

Section 194

No company issuing securities which are listed in the Securities Exchange shall pay dividends or other benefits to persons other than the persons whose names are entered in the securities register and in cases where such securities are shares, no issuing company shall allow such other person to vote in the shareholders' meeting.

Section 195

In cases where the owner of securities has entered into an agreement allowing a securities company to retain listed securities, which have been purchased in the Securities Exchange as collateral for a loan relating to the purchase of such securities by the securities company on his behalf, the securities company shall:

1.      keep an account of such listed securities in accordance with the form specified by the Securities Exchange and shall make a complete and correct record of entry;

2.      maintain, at all times, listed securities corresponding with the category, type and net amount as appears in the securities account under (1), unless specified in the notification of the board of directors of the Securities Exchange, and shall return them to the borrower immediately upon the borrower having fully repaid the loan.

The provisions of Section 753 of the Civil and Commercial Code shall not apply to the retention of the listed securities as collateral for the repayment of a loan referred to in the first paragraph.

The provisions concerning pledge under the Civil and Commercial Code shall apply to the extent that they are not contrary to or inconsistent with the provisions of this Section and Section 196.

Section 196

Prior to the enforcement upon listed securities, which have been held as collateral by a securities company or other financial institution for the repayment of a loan, the lender shall notify the borrower in writing requiring him to make such repayment within a reasonable period of time. If the borrower fails to comply with such notice, the lender shall have the right to sell such retained securities in accordance with the procedures specified by the Securities Exchange.

Section 197

In issuing securities certificates, the securities registrar shall have the power to sign his name in the securities certificates in lieu of the signature of the directors of the company issuing securities which are listed in the Securities Exchange when authorized by such company.

Section 198

The provisions of Section 191, Section 192, Section 193, Section 194, Section 195 and Section 196 shall not apply to the following securities:

1.      bonds issued by government organizations or state enterprises;

2.      bills;

3.      any other securities as specified by the board of directors of the Securities Exchange.

Section 199

The provisions of Section 51, Section 52, Section 53 and Section 55 including related penalty provisions shall apply mutatis mutandis to the transfer and preparation of a listed securities register of the company issuing securities listed in the Securities Exchange which are not bills.

The provisions of Section 56, Section 57, Section 58, Section 59, Section 60 and Section 62 including related penalty provisions shall apply mutatis mutandis to the disclosure of information and to the auditor of the company issuing securities listed in the Securities Exchange which are not bonds issued by government organizations or state enterprises or any other securities as specified by the board of directors of the Securities Exchange. In cases where such company has already prepared and submitted a report to the Office concerning the disclosure of information in accordance with Section 56, the company may submit a copy of report to the Securities Exchange.

In cases where the provisions referred to in the first and second paragraphs specify the powers and duties of the Office or the SEC, such provisions shall be deemed to be the powers and duties of the Securities Exchange or the board of directors of the Securities Exchange, as the case may be.

Section 200

The balance sheet and profit and loss account for any accounting period of a securities company or financial institution whose securities listed in the Securities Exchange which have been prepared in accordance with the form specified under the first paragraph of Section 106 or in accordance with the law relating to the operation of such financial institution, shall be the financial statements for the accounting period as specified in Section 199. The auditor who has been given an approval in accordance with Section 106 of the said law shall be deemed to be the auditor who has been given an approval by the Securities Exchange.

 

DIVISION 5 

SETTLEMENT OF DISPUTES CONCERNING SECURITIES TRANSACTIONS

 

Section 201

In case where there are disputes concerning the purchase or sale of listed securities in the Securities Exchange either between members or between a member and its customers, the disputing parties may file an application for settlement by arbitrators to the Securities Exchange.

The arbitrators referred to in the first paragraph shall comprise a person appointed by the board of directors of the Securities Exchange as the chairman and other persons each of who shall be appointed by a disputing party.

Section 202

The application in accordance with Section 201 shall be in the form specified by the Securities Exchange and shall at least contain the following details:

1.      names and addresses of the disputing parties;

2.      the issues in disputes;

3.      relevant documents and evidences.

Section 203

The law relating to arbitration shall apply to the deliberation and the settlement of disputes in accordance with Section 201 mutatis mutandis.


OVER-THE-COUNTER CENTER AND FUTURES AND OPTIONS CENTER

 

DIVISION 1 

OVER-THE-COUNTER CENTER

 

Section 204.

An over-the-counter center may be established by not less than fifteen securities companies jointly applying for a license from the SEC for the purpose of trading securities that are not securities listed in the Securities Exchange.

Section 205.

The application for a license to establish an over-the-counter center in accordance with Section 204 shall be submitted to the SEC and shall have the following particulars:

1.      name of the over-the-counter center;

2.      location of the office of the over-the-counter-center;

3.      name of the securities companies which are founder members;

4.      capital and sources of capital for operation;

5.      regulations of the over-the-counter center;

6.      other details as specified in the notification of the SEC.

The application referred to in the first paragraph shall be accompanied by the documents concerning the establishment agreement, regulations applicable to members and other documents specified in the notification of the SEC.

Section 206.

The application for and the issuance of a license shall be in accordance with the rules, conditions and procedures specified in the notification of the SEC.

Section 207.

The SEC shall have the power to determine a fee for a license for the establishment of an over-the-counter center.

Section 208.

A licensed over-the-counter center shall be a juristic person.

Section 209.

No person shall engage in the business of over-the-counter center or similar businesses unless a license has been obtained in accordance with this Division.

Section 210.

After the establishment of an over-the-counter center in accordance with Section 204, there shall be a board of directors of the center comprising not more than nine members elected by the founder members.

The directors of the over-the-counter center shall elect the chairman, vice-chairman, manager of the over-the-counter center, and other positions as deemed appropriate from among the directors referred to in the first paragraph.

Names and positions of the directors of the over-the-counter center shall be submitted to the SEC without delay.

Section 211.

In cases where alterations and modifications have been made to the regulations of the over-the-counter center applicable to members, the over-the-counter center shall report such alterations and modifications to the SEC without delay.

Section 212.

Where the SEC determines that any regulations of the over-the-counter center applicable to members may cause damage or may affect the rights and interests of the public, the SEC shall have the power to order the over-the-counter center to revoke, alter or modify such regulations.

Section 213.

The over-the-counter center shall ensure that members enter into a commitment to comply with the provisions of this Act, or rules and regulations of such over-the-counter center, or rules and regulations specified by the SEC. In cases where there has been a contravention of or non-compliance with such rules and regulations by a member, the over-the-counter center shall punish such member.

The punishment referred to in the first paragraph shall be:

1.      probation;

2.      fine;

3.      temporary prohibition from trading in the over-the-counter center;

4.      termination of membership.

Section 214.

An over-the-counter center shall be dissolved in any of the following events:

1.      events specified in the agreement establishing the over-the-counter center as causes of dissolution;

2.      a resolution by the members' meeting to dissolve;

3.      the number of members has been reduced to less than fifteen and the SEC issues a resolution to dissolve;

4.      bankruptcy;

5.      when there is a reasonable cause for the SEC to order the dissolution.

The dissolution in accordance with (1) and (2) shall be effective when given an approval by the SEC.

Section 215.

After the dissolution of an over-the-counter center, the remaining assets of the over-the-counter center shall be equally distributed among members, unless otherwise specified in the agreement establishing the over-the-counter center or the regulations applicable to members.

Section 216.

The provisions of Section 91, Section 158, Section 160, Section 161, Section 162, Section 163, Section 186, Section 190, Section 193, Section 194, and Section 197 including related penalty provisions shall apply mutatis mutandis.

Section 217.

The provisions of Section 167, Section 168, Section 170, Section 171, Section 172, Section 178, Section 179, Section 180, Section 181, Section 182, Section 183, Section 184, Section 187, Section 188, Section 189, Section 191, Section 195, Section 196, Section 198, Section 199, Section 200, Section 201, Section 202 and Section 203 including related penalty provisions shall apply mutatis mutandis.

 

DIVISION 2

FUTURES AND OPTION CENTER

 

Section 218.

The establishment, operation, supervision and control of the operation of a futures and options center shall be in accordance with the governing laws.

 

CHAPTER 7

INSTITUTIONS RELATED TO SECURITIES BUSINESS

 

DIVISION 1 

CLEARING HOUSE, SECURITIES DEPOSITORY CENTER AND SECURITIES REGISTRAR

 

Section 219.

No person shall operate the business of a clearinghouse unless a license has been obtained from the SEC.

A clearinghouse means a center where services for the settlement and delivery of traded securities including related services are provided.

Section 220.

No person shall operate the business of a securities depository center unless a license has been obtained from the SEC.

A securities depository center means a center where services for the deposit and withdrawal of securities including related services for the purpose of account clearing are provided.

Section 221.

No person shall provide securities registrar services unless a license has been obtained from the SEC.

Section 222.

The provisions of Section 206 and Section 207 including the related penalty provisions shall apply to a clearinghouse, a securities depository center and a securities registrar mutatis mutandis.

Section 223.

In the operation of a clearinghouse, a securities depository center or a securities registrar, persons operating such businesses shall comply with the rules, conditions and procedures as specified in the notification of the SEC.

Section 224.

In cases where the operation of a clearinghouse, a securities depository center or a securities registrar is undertaken by the Securities Exchange, no license from the SEC shall be required. In this regard, the board of directors of the Securities Exchange, with the approval of the SEC, shall have the power to specify the rules, conditions and procedures for such operation.

The word "Securities Exchange" referred to in the first paragraph and further referred to in this Division shall include any company established by the Securities Exchange with not less than seventy-five percent of total shares sold held by the Securities Exchange.

Section 225.

Where securities are deposited with the Securities Exchange, the depositor shall prepare a list of securities holders, whose securities have been deposited with the Securities exchange, in accordance with the rules and procedures as specified by the Securities Exchange. After the Securities Exchange has accepted the deposit of such securities, the Securities Exchange may accept the transfer of such deposited securities into its own name and shall hold such securities for the depositor or for any customer who is the owner of such securities

Securities which are in the name of the Securities Exchange in accordance with the first paragraph shall be presumed to be securities held by the Securities Exchange on behalf of those persons according to type, category and amount as appear in the list of names prepared by the depositor.

On the closing date of the register of the company that issues securities, the Securities Exchange shall collect the accounts of all deposited securities and the name lists of the holders of such securities, which existed on the date prior to the first closing day, from the depositor of such securities and deliver them to the registrar of the issuing company.  Such lists shall be deemed to be a part of the securities register, except for the names of those persons to whom the registrar of the issuing company has notified objection within three business days from the receipt of such lists, on the ground that the holding of securities by such persons is contrary to the law or any restriction on transferability which have been registered in accordance with the law.

Section 226.

Upon having submitted the application to register the transfer of securities certificates into the name of the Securities Exchange to hold securities on behalf of other persons in accordance with the first paragraph of Section 225 as well as the delivery of the securities certificates to the company which issues securities, the Securities Exchange may submit the request to the issuing company to provide a receipt in place of securities certificates. Such receipt shall have the particulars in the form specified by the Securities Exchange. In such event, it shall be deemed that securities certificates have been issued by the issuing company.

Section 227.

Any securities owner who has deposited securities with the Securities Exchange may request the Securities Exchange to issue the securities certificates in his own name by submitting an application in accordance with the form specified by the Securities Exchange.

Upon receiving the application referred to in the first paragraph, the Securities Exchange shall notify the company, which issues securities, of the name of the person who is the owner of such securities, and the issuing company so notified shall enter the name of the securities owner in the register of the company as well as issue new securities certificates, in the name of such securities owner.

In submitting the application referred to in the first paragraph, if the owner of the securities is a depositor who does not directly deposit such securities with the Securities Exchange, the owner of such securities shall apply through the depositor of such securities.

Section 228.

The transfer of securities from the account of a securities depositor to the account of another securities depositor may be made only when the Securities Exchange has received a request from the securities depositor or when the clearing house of the Securities Exchange has notified the Securities Exchange, at the end of each trading day, of the delivery of the securities between members who have traded the securities in the securities Exchange.

The transfer of securities referred to in the first paragraph shall be deemed to be the delivery of securities when the Securities Exchange has entered the name of securities depositor in the accounts of the securities depositors.

Section 229.

The provisions of this Division shall not apply to the Bank of Thailand.

 

DIVISION 2

ASSOCIATIONS RELATED TO SECURITIES BUSINESS

 

Section 230.

Securities companies may jointly establish an association related to securities business with an object of promoting, without seeking profit or sharing income among themselves, securities business, only by virtue of the provisions of this Act.

Section 231.

The establishment of an association related to securities business shall require a license from, and be registered with the Office.

Section 232.

In applying for a license and for registration, not less than fifteen securities companies who are the founders of the association shall submit the application to the Office in accordance with the rules and procedures as specified in the notification of the SEC.

In considering the application for the establishment of an association related to securities business, the Office shall have the power to issue a written order summoning any person to come forward for an inquiry or requiring the delivery of any documents.

Section 233.

The licensed and registered association related to securities business shall be a juristic person.

Section 234.

An association related to securities business shall have its regulations and such regulations shall at least contain the following particulars:

1.      name;

2.      object;

3.      location of the office;

4.      procedures for admission, rights and duties of members;

5.      disciplines and punishment of members;

6.      the operation of the association related to securities business, appointment and vacation of office as well as the meetings of directors including general meetings;

7.      other regulations as specified in the notification of the SEC.

Regulations of an association shall be submitted for registration with the Office together with the application for a license to establish an association related to securities business. Prior to the granting of a license, if the Office deems appropriate, it may order the alteration and modification of the regulations.

Section 235.

Members of an association related to securities business shall only be securities companies.

Section 236.

The name of an association related to securities business shall be the name as appears in the regulations only, and the name shall not use the phrase "of Thailand" or any other phrases with similar meaning constituting the name of the association related to securities business.

The association related to securities business shall have a clearly stated nameplate placed in front of its office.

Section 237.

Relevant provisions in the law relating to trade associations concerning the operation, control, dissolution and the related penalty provisions shall apply mutatis mutandis to the extent that they are not contrary to or inconsistent with the provisions of this Division. In this regard, the word "SEC" shall be substituted for the work "Minister", the word "Office" for the word "registrar", the words "association related to securities business" for the words "trade association" and the powers and duties of a competent officer in accordance with the law relating to trade associations shall be the powers and duties of a competent officer under this Act.

CHAPTER 8

UNFAIR SECURITIES TRADING PRACTECES AND THE ACQUISITION OF SECURITIES FOR BUSINESS TAKE-OVERS

 

DIVISION 1

PREVENTIONOF UNFAIR SECURITIES TRADING PRACTICES

 

Section 238.

No securities company or any person responsible for the operation of a securities company or company which issues securities or any person having an interest in the securities shall impart any false statement or any other statement with the intention to mislead any person concerning the facts relating to the financial condition, the business operation or the trading prices of securities of a company or juristic person whose securities are listed in the Securities Exchange or are traded in an over-the-counter center.

Section 239.

No securities company or any person responsible for the operation of a securities company or company which issues securities or any person having an interest in any securities shall disseminate news concerning any information which may cause any other person to understand that the prices of any securities will increase or decrease, except where the dissemination of information has already been reported to the Securities Exchange.

Section 240.

No person shall disseminate any false news to be removed which may cause any other person to understand that the price of any securities will increase or decrease.

Section 241.

In the purchase or sale of securities that are listed in the Securities Exchange or traded in an over-the-counter center, no person, whether directly or indirectly, shall purchase or sell, offer to purchase or sell or invite any other person to purchase, sell or offer to purchase or sell securities which are listed in the Securities Exchange or traded in an over-the-counter center in such a way as to take advantage of other persons by using information material to changes in the prices of securities which has not yet been disclosed to the public and to which information he has access by virtue of his office or position, and whether or not such act is done for his own or another person's benefit, or to disclose such information so that he will receive consideration from the person who engages in the aforesaid acts.

For the purposes of this Section , the person under the first paragraph shall include:

1.      director, manager, person responsible for the operation or auditor of a company whose securities are listed in the Securities Exchange or traded in an over-the-counter center;

2.      securities holder of a company whose securities are listed in the Securities Exchange or traded in an over-the-counter center, who holds securities the par value of which exceeds five percent of the registered capital. For the purpose of calculation the value of such securities held by such person, the securities held by his spouse and minor children shall be counted as his securities;

3.      state agency personnel, or director, manager, or officer of the Securities Exchange or of an over-the-counter center who is in an office or position with access to information which is material to changes in the price of securities;

4.      any person involved in securities and/or the trading of securities in the Securities Exchange or in an over-the-counter center;

Section 242.

In order that the person referred to in the second paragraph of Section 241 shall not receive any benefit from the contravention of the first paragraph of Section 241, the Office shall have the right to call on such person to deliver the benefit which he has gained from such trading of securities or from the disclosure of information within a six month period from the date on which he gained access to such information. In this regard, such person shall deliver the benefit as claimed by the Office within the time specified by the Office.

The benefit of the claim under the first paragraph shall be vested in the Office.

Section 243.

In the purchase or sale of securities which are listed in the Securities Exchange or traded in an over-the-counter center:

1. no person by colluding or agreeing with any other person shall purchase or sell securities in concealment in order to mislead the general public to believe that such securities are purchased or sold in great volume or the price of such securities has changed or has not changed at any time or during any period of time which is not consistent with the normal market conditions;

2. no person, either by himself of jointly with any other person, shall continuously trade securities which results in the purchase or sale of such securities which is not consistent with the normal market conditions and such trading is made to lure the general public to purchase or sell such securities unless such trading is made in good faith to protect his rightful benefit.

Section 244.

The following cases shall also be deemed to be the concealment to mislead the general public in accordance with Section 243 (1);

1. the purchase or sale of securities where the persons who finally receives benefit from such purchase or sale is the same person;

2. the order to purchase securities of the same category, type, and of the same juristic person, or mutual fund project, with the knowledge that he himself or jointly with any other person has ordered the sale or is going to order the sale, provided that the order shall be approximate amount, price and time;

3. the order to sell securities of the same category, type, and of the same juristic person or mutual fund project, with the knowledge that he himself or jointly with any other person has ordered the purchase or is going to order the purchase, provided that the order shall be in proximate amount, price and time.

 

DIVISION 2

ACQUISITION OF SECURITIES FOR BUSINESS TAKE-OVERS

 

Section 245.

In this Division:

"securities" means shares, or certificates representing the rights to purchase shares or other securities which may be converted into shares.

"business" means a company whose securities are listed in the Securities Exchange or traded in an over-the-counter center, or a public limited company.

Section 246.

Where any person acquires or disposes of the securities of any business and thereby increases or decreases the number of securities held by him or other persons in such business to a number which aggregately reaches any multiple of five percent of the total number of securities of such business sold, whether or not the transfer has been registered and regardless of the amount of such increase or decrease, such person shall report to the Office within the next business day each time such an acquisition or disposition has been made, unless the disposition does not result in the change of management or of the nature of business in accordance with the rules and procedures as specified in the notification of the SEC.

The report under the first paragraph shall be in accordance with the rules and procedures as specified by the SEC.

Section 247.

An offer to purchase or any other act which results in any person acquiring or holding securities in a business up to twenty-five percent or more of the total number of securities sold, shall be deemed to be an acquisition of securities for the purpose of taking over a business, except for acquisition by inheritance.

The acquisition of securities for the purpose of taking over a business under the first paragraph shall comply with the rules, conditions and procedures specified in the notification of the SEC. For this purpose, the SEC may require such person to make a tender offer for the purchase of securities 

In cases where the SEC requires that there shall be a tender offer for the purchase of securities under the second paragraph, such tender offer shall be filed with the Office and shall become effective after the lapse of time specified in the notification of the SEC.

Section 248.

The person making a tender offer to purchase securities shall announce or notify the offer to purchase securities in accordance with the rules and procedures specified in the notification of the SEC.

Section 249.

Upon the filing of the tender offer to purchase securities with the Office, the person making the tender offer shall immediately deliver a copy of the tender offer to the business from which he offers to purchase securities.

Section 250.

Upon the receipt of a tender offer to purchase securities in accordance with Section 249, such business shall prepare an opinion concerning the tender offer in the form specified by the SEC and shall submit such opinion to the Office and shall deliver a copy of such opinion to each shareholder within the time specified in the notification of the SEC.

Section 251.

No person making a tender offer to purchase securities shall purchase the securities of the business prior to the effectiveness of the tender offer which has been filed with the Office and prior to having complied with Section 248.

From the effective date of the tender offer until the date after the time specified in the tender offer for the purchase of securities, no person making the tender offer shall purchase such securities by any means other than those specified in the tender offer.

Section 252.

After the expiry of the period specified in the tender offer to purchase securities, if the amount of securities being offered for sale by the securities holders is in excess of the amount of securities specified in the tender offer, the person making the tender offer shall purchase all of such securities, only in the following cases:

1. such securities are listed securities or traded in an over-the-counter center and the person making the tender offer has the intention to withdraw such securities from being listed securities in the Securities Exchange or being traded in the over-the-counter center;

2. the person making the tender offer has the intention to change the main object of the business;

3. the person making the tender offer has the intention to become the holder of securities of that business in an amount of not less than seventy-five percent of the total securities sold;

4. other cases as specified in the notification of the SEC.

The person making the tender offer shall make payment for securities to the seller of securities immediately upon delivery of securities, and in case such securities are listed securities, it shall be deemed to be a purchase and sale in the Securities Exchange.

Section 253.

In cases where the amount of securities being offered for sale by securities holders at a certain price specified by the person making the tender offer is less than the amount specified in the tender offer and the person making such tender offer wishes to purchase up to the required amount, the person making such tender offer may offer a higher price for the purchase of securities. In such case, the person making the tender offer shall make an additional payment for the difference in price to the holders of securities who have previously made the offer for sale.

Section 254.

In cases where the person making the tender offer to purchase securities for the purpose of taking over a business intends to withdraw such securities from being listed securities or from being traded in an over-the-counter center, the person making such tender offer shall clearly state his intention in the tender offer.

Section 255.

Regardless of whether the take over of a business has succeeded or not, a person who has previously made a tender offer to purchase securities for the purpose of taking over such business shall be able to make another tender offer for the purpose of taking over the business only after a period of one year from the date after the time specified in the previous tender offer for the purchase of securities, unless otherwise permitted by the SEC.

Section 256.

The person making the tender offer who has already purchased the securities shall report the result of such purchase to the Office within the time specified by the SEC.

The report under the first paragraph shall be in accordance with the rules and procedures as specified in the notification of the SEC.

Section 257.

The Office shall keep the information concerning a tender offer to purchase securities and make it available for inspection by the public for a period of one year from the effective date of the tender offer.

Section 258.

Securities of a business held by the following persons or partnerships shall be regarded as securities held by the person referred to in Section 246 and Section 247:

1. the spouse of such person;

2. a minor child of such person;

3. an ordinary partnership in which such person or the person under (1) or (2) is a partner;

4. a limited partnership in which such person or the person under (1) or (2) is an unlimited liability partner or a limited liability partner who collectively holds contribution in an amount exceeding thirty percent of the total contribution of the limited partnership;

5. a limited company or a public limited company in which such person or the person under (1) or (2) or the partnership under (3) or (4) collectively holds shares in an amount exceeding thirty percent of the total shares sold of that company; or

6. a limited company or a public limited companies in which such person or the person under (1) or (2) or the partnership under (3) or (4) or the company under (5) collectively holds shares in an amount exceeding thirty percent of the total shares sold of that company;

7. a juristic person over which the persons under Section 246 and Section 247 have the power of management as representatives.

Section 259.

In cases where there is any doubt whether the holding of securities is of the characteristics which may be counted as held by the same person in accordance with Section 258, the Office shall inform such person to give an explanation or proceed to rectify such holding of securities. If such person fails to give an explanation or fails to rectify the situation within the time specified by the Office, the holding of such securities shall be deemed to fall within the characteristics specified in Section 258.

 

CHAPTER 9

APPELLATE COMMITTEE

 

Section 260.

There shall be an Appellate Committee comprising not fewer than five but not exceeding seven experts appointed by the Cabinet, among whom there shall be at least one highly qualified and experienced person from each field of law, accounting, and finance.

The provisions of Section 9, Section 10, Section 11, Section 12, Section 13 and Section 16 shall apply to the Appellate Committee under the first paragraph mutatis mutandis.

Section 261.

An owner of securities, a company which issues securities, a company, a securities company and a person who is directly affected by the orders issued under this Act, who is not satisfied with the decision or order of the Office or the SEC which has been made or issued in accordance with Section 32, Section 33, Section 34, Section 41 (3), Section 104, Section 141, Section 142, the first paragraph of Section 143, Section 144, Section 145, Section 212 and Section 259, may appeal to the Appellate Committee within fifteen days from the date of knowing such decision or order, as the case may be, in accordance with the rules and procedures as specified in the notification of the SEC.

The appeal under the first paragraph shall not be a ground for the stay of the execution of such decision or order of the Office or the SEC, as the case may be unless otherwise unanimously resolved by the Appellate Committee.

The decision of the Appellate Committee shall be final.

 

CHAPTER 10

SUPERVISION AND CONTROL

 

Section 262.

The Minister shall have the powers and duties of overall supervision and control for implementation in accordance with the provisions of this Act and for harmonization with the policies of the Government or the resolutions of the Cabinet.

Section 263.

All matters which are required to be submitted to the Cabinet in accordance with the provisions of this Act shall be submitted by the Minister.

 

CHAPTER 11

COMPETENT OFFICER

 

Section 264.

In the execution of his duties, a competent officer shall have the power to:

1. enter into the place of business or premises of a securities company, mutual fund supervisor, custodian, the Securities Exchange, over-the-counter center, clearing house, securities depository center, securities registrar or the place where the data of such securities company or institution is collected or processed by computers or any other equipment, during the hours between sunrise and sunset, or during the business hours of such places, in order to examine the operations, assets and liabilities of such securities company or institution, including documents, evidence or information concerning such securities company or institution;

2. enter into the place of business of a promoter of a public limited company, a company which issues securities or an owner of securities who offers for sale securities to the public or any person, or the place where the data of such person is collected or processed by computers or any other equipment, during the hours between sunrise and sunset, or during the business hours of such places, to inspect accounts or other related documents and evidence;

3. enter into a commercial bank, financial institution or any place during the hours between sunrise and sunset, or during the business hours of such places, to inspect accounts, documents or evidence which may be related to the commission of offences under the provisions of this Act;

4. seize or attach documents, or evidence related to the commission of offences under the provisions of this Act for the purpose of inspection or taking legal action;

5. order a director, officer, employee or auditor of a securities company, mutual fund, mutual fund supervisor, custodian, the Securities Exchange, over-the-counter center, clearing house, securities depository center, securities registrar and persons who collect or process the data of such securities company or institution by computers or any other equipment, to testify or to deliver copies of or present accounts, documents, seals or other evidence related to the businesses, operations, assets and liabilities of such securities company or institution;

6. order any person who purchases or sells securities with or through a securities company or member of the Securities Exchange or over-the-counter center to testify or deliver copies of or present accounts, documents and other evidence related to the purchase or sale of securities;

7. order any person who may be of use in the execution of the duties of the competent officer to testify or deliver copies of or present accounts, documents, evidence or any objects related to or necessary for the execution of the duties of the competent officer;

8. enter into a place of business to inspect the condition or the operations of any debtor of any securities company during the hours between sunrise and sunset or during the business hours of such place.  In the execution of the duties of the competent officer under the first paragraph, the persons concerned shall give reasonable assistance. After having entered and inspected in accordance with (1), (2), (3) or (8), if the inspection has not been completed, the competent officer may continue the inspection into the night or beyond the business hours of such places. The exercise of powers of the competent officer in accordance with (6), (7) and (8) shall be carried out against the person who is directly involved in the matter under inspection and shall require prior approval from the Office and in the case of (6) and (7), the competent officer shall specify a reasonable period for such person to comply with the order.

Section 265.

In the execution of his duties, the competent officer shall present his identification card to the persons involved. The identification card of the competent officer shall be in the form specified in the ministerial regulations.

Section 266.

In the execution of his duties in accordance with this Act, the competent officer shall be an official under the Criminal Code.

Section 267.

In cases where there is evidence that any person has committed an offence under this Act which may cause damage to the interests of the public and the Office has reasonable grounds to believe that the wrongdoer would remove or dispose of his properties, the Office with the approval of the SEC shall have the power to order seizure or attachment of such person's properties or the properties for which there is reasonable evidence to believe that they belong to such person.  However, the period of seizure or attachment may not exceed one hundred and eighty days unless an action is brought in court and such seizure or attachment order shall still be effective until court orders otherwise. Where circumstances render it impossible to bring the case into court within one hundred and eighty days, the court having jurisdiction may extend the period of seizure or attachment as requested by the Office, but may not extend the period beyond another one hundred and eighty days.

The Office shall have the power to authorize the competent officer to proceed with the seizure or attachment of the properties under the first paragraph.

The first provisions of the Revenue Code shall apply to the seizure or attachment of the properties under the paragraph mutatis mutandis.

In a case under the first paragraph, where there are reasonable grounds to suspect that such person will abscond from the Kingdom, upon the request by the Office, the Criminal Court shall have the power to prohibit such person from leaving the Kingdom, and in the case of extreme urgency, the SEC shall prohibit such person from leaving the Kingdom on a temporary basis for a period not exceeding fifteen days until the Criminal Court orders otherwise.

CHAPTER12

PENAL PROVISIONS

 

Section 268.

Any person who contravenes Section 32, Section 33 or Section 34 shall be liable to imprisonment for a term not exceeding two years or a fine not exceeding two times the price at which all securities were offered for sale by such person but not less that five hundred thousand Baht, or both.

Section 269.

Any person who contravenes or fails to comply with the conditions issued in accordance with Section 35 shall be liable to a fine not exceeding five hundred thousand Baht and a further fine not exceeding ten thousand Baht for every day during which the contravention continues.

Section 270.

Any debenture issuer who issues debentures the particulars of which do not comply with Section 40 or who fails to comply with the second paragraph of Section 41 or who makes terms and conditions or agreements which lack the material particulars as specified in accordance with Section 42 or Section 43 shall be liable to a fine not exceeding two hundred thousand Baht.

Section 271.

Any debenture issuer who fails to comply with Section 44 shall be liable to a fine not exceeding five hundred thousand Baht and a further fine not exceeding ten thousand Baht for every day during which the contravention continues.

Section 272.

Any debenture holder representative who contravenes or fails to comply with the rules, conditions or procedures issued in accordance with Section 46 shall be liable to a fine not exceeding five hundred thousand Baht and a further fine not exceeding ten thousand Baht for every day during which the contravention continues.

Section 273.

Any company which contravenes or fails to comply with Section 50, Section 53, Section 191, Section 192 or Section 193 or contravenes or fails to comply with the rules or procedures issued in accordance with Section 50 or Section 191 shall be liable to a fine not exceeding one hundred thousand Baht and a further fine not exceeding three thousand Baht for every day during which the contravention continues.

Section 274.

Any company which contravenes or fails to comply with Section 56, Section 57 or Section 58 (1) or (3) shall be liable to a fine not exceeding one hundred thousand Baht and a further fine not exceeding three thousand Baht for every day during which the contravention continues.

Any director, manager, or person with power of management of any company who fails to provide an explanation in accordance with Section 58 (2) shall be liable to imprisonment for a term not exceeding three months or a fine not exceeding one hundred thousand Baht, or both.

Section 275.

Any director, manager, person who holds management position, or auditor who contravenes or fails to comply with Section 59, or contravenes or fails to comply with the rules or procedures issued in accordance with Section 59 shall be liable to a fine not exceeding five hundred thousand Baht and a further fine not exceeding ten thousand Baht for every day during which the contravention continues.

Section 276.

Any person who offers for sale or sells securities to the public or to any person without having filed the registration statement and draft prospectus with the Office in accordance with Section 65 or during the period for which the Office orders the suspension of the effectiveness of the registration statement and draft prospectus in accordance with Section 76 shall be liable to imprisonment for a term not exceeding two years or a fine not exceeding two times the price at which all securities were offered for sale by such person but not less than five hundred thousand Baht, or both.

Section 277.

Any person who offers for sale or sells securities to the public or to any persons prior to the effectiveness of the registration statement and draft prospectus which have been filed with the Office in accordance with Section 65 shall be liable to imprisonment for a term not exceeding one year or a fine not exceeding one times the price at which all securities were offered for sale by such person but not less than three hundred thousand Baht, or both.

Section 278.

Any person who makes a false statement or conceals material facts which should have been stated in the registration statement or draft prospectus which have been filed in accordance with Section 65 shall be liable to imprisonment for a term not exceeding five years and a fine not exceeding two times the price at which all securities were offered for sale by such person but not less than five hundred thousand Baht.

Section 279.

Any person who contravenes or fails to comply with the second paragraph of Section 64, the second paragraph of Section 66, the first paragraph of Section 81, or contravenes or fails to comply with the rules or procedures issued in accordance with the second paragraph of Section 81 shall be liable to a fine not exceeding one hundred thousand Baht and a further fine not exceeding three thousand Baht for every day during which the contravention continues.

Section 280.

Any person who contravenes or fails to comply with Section 77, Section 79 or Section 80 shall be liable to imprisonment for a term not exceeding one year or a fine not exceeding three hundred thousand Baht, or both.

Section 281.

Any person who contravenes or fails to comply with Section 88 shall be liable to a fine not exceeding three hundred thousand Baht and a further fine not exceeding ten thousand Baht for every day during which the contravention continues.

Section 282.

Any securities company which contravenes or fails to comply with Section 92, Section 94, Section 96, Section 97, Section 98, Section 100, Section 101, Section 102, Section 103, Section 104, Section 105, Section 106, Section 108, Section 109, Section 110, Section 112, Section 113, Section 114, Section 115, Section 116, Section 117, Section 122, Section 123, Section 124, Section 125, Section 126, Section 129, Section 130, Section 133, Section 134, Section 135, Section 136, Section 195 or contravenes or fails to comply with the rules, conditions or procedures or orders issued in accordance with the fourth paragraph of Section 90, Section 91, Section 92, Section 98 (7) or (10), the second paragraph of Section 100, Section 117, Section 141, Section 142, Section 143, Section 144, or Section 150 shall be liable to a fine not exceeding three hundred thousand Baht and a further fine not exceeding ten thousand Baht for every day during which the contravention continues.

Section 283.

Section 105, Section 106, Section 108, Section 109, Section 110, Section 113, Section 114, Section 115, Section 116, Section 117, Section 123, Section 129, Section 130, Section 133, Section 135, Section 140, Section 151 or the first paragraph of Section 195 or contravenes or fails to comply with the rules, conditions or procedures or orders issued in accordance with Section 92, Section 117 or Section 150, and if it can be proved that the commission of such offences resulted from the instruction from, the act of, or the failure to give instruction or to act which is a duty required to be performed by, the director, manager or any person responsible for the operation of such securities company, such person shall be liable to imprisonment for a term not exceeding three months or a fine not exceeding two hundred thousand Baht, or both.

In cases where any securities company commits an offence under Section 97, Section 98, Section 112, Section 122, Section 124, Section 125, Section 126, Section 134, Section 136, Section 138 or Section 139 or contravenes or fails to comply with the rules, conditions or procedures or orders issued in accordance with the fourth paragraph of Section 90, Section 91, Section 98 (7) or (10), Section 141, Section 142, Section 143 or Section 144, and if it can be proved that the commission of such offences resulted from the instruction from, the act of, or the failure to give instruction or to act which is a duty required to be performed by, the director, manager or any person responsible for the operation of such securities companies, such person shall be liable to imprisonment for a term not exceeding one year or a fine not exceeding three hundred thousand Baht, or both.

Section 284.

Any mutual fund supervisor who neglects or fails to perform his duty in accordance with Section 127 or the first paragraph of Section 128 shall be liable to a fine not exceeding five hundred thousand Baht and a further fine not exceeding ten thousand Baht for every day during which the contravention continues.

Section 285.

Any auditor who contravenes or fails to comply with Section 130 or Section 131 shall be liable to imprisonment for a term not exceeding three months or a fine not exceeding one hundred thousand Baht and a further fine not exceeding three thousand Baht for every day during which the contravention continues, or both.

Section 286.

Any custodian who contravenes or fails to comply with Section 137 shall be liable to a fine not exceeding three hundred thousand Baht and a further fine not exceeding ten thousand Baht for every day during which the contravention continues.

Section 287.

Any auditor of a company which issues securities in accordance with Section 32, Section 33 or Section 34, a securities company, a mutual fund, or a company whose securities are listed in the Securities Exchange or traded in an over-the-counter center, who performs audit work on the accounts in order to give his opinion on financial statements which does not comply with the provisions of the law relating to auditors or additional requirements as specified in the notification of the SEC or makes false reports or contravenes the first paragraph of Section 62 or Section 107 shall be liable to imprisonment for a term not exceeding two years or a fine not exceeding five hundred thousand Baht, or both.

Section 288.

Any person who contravenes or fails to comply with Section 93, Section 95 or Section 156 shall be liable to imprisonment for a term of six months to three years and a fine of sixty thousand Baht to three hundred thousand Baht and a further fine not exceeding three thousand Baht for every day during which the contravention continues.

Section 289.

Any person who undertakes securities business without having obtained a license from the Minister in accordance with Section 90 or contravenes Section 155, Section 209, Section 219, Section 220 or Section 221 shall be liable to imprisonment for a term of two to five years and a fine from two hundred thousand Baht to five hundred thousand Baht and a further fine not exceeding ten thousand Baht for every day during which the contravention continues.

Section 290.

Any over-the-counter center which contravenes of fails to comply with the second paragraph of Section 171, Section 188, Section 212 or Section 213 or contravenes or fails to comply with the conditions or orders issued in accordance with Section 186 (1) or Section 206 shall be liable to a fine not exceeding three hundred thousand Baht and a further fine not exceeding ten thousand Baht for every day during which the contravention continues.

Section 291.

Any person who contravenes or fails to comply with orders issued in accordance with Section 186 (2) shall be liable to imprisonment for a term not exceeding one year or a fine not exceeding three hundred thousand Baht, or both.

Section 292.

Any person who operates a business of a clearing house, a securities depository center or a securities registrar who fails to operate in accordance with the rules, conditions or procedures issued in accordance with Section 223 shall be liable to imprisonment for a term not exceeding one year or a fine not exceeding three hundred thousand Baht and a further fine not exceeding ten thousand Baht for every day during which the contravention continues, or both.

Section 293.

association related to securities business which contravenes or fails to comply with Section 236 shall be liable to a fine not exceeding one hundred thousand Baht and a further fine not exceeding three thousand Baht for every day during which the contravention continues.

Section 294.

Any securities companies which agree to promote securities business without seeking profit or sharing income among themselves, by not establishing as an association related to securities business in accordance with this Act shall be liable to a fine not exceeding five hundred thousand Baht and a further fine not exceeding ten thousand Baht for every day during which the contravention continues.

Section 295.

Any person who fails to comply with the order of the Office in accordance with the second paragraph of Section 232 shall be liable to a fine not exceeding on hundred thousand Baht.

Section 296.

Any person who contravenes Section 238, Section 239, Section 240, Section 241 or Section 243 shall be liable to imprisonment for a term not exceeding two years or a fine not exceeding two times the benefit received or which should have been received by such person as a result of such contravention but such fine shall be not less than five hundred thousand Baht, or both.

Section 297.

Any person who analyses the financial condition, business operation or trading prices of securities of a company or a juristic person who issues securities or whose securities are listed in the Securities Exchange or traded in an over-the-counter center by distorting the facts concerning the information used in the analysis or by using information, with the knowledge that it is false, in the analysis, and the results of the analysis may cause damage to the company, the juristic person or any person, or may affect the trading prices of securities of such company or juristic person, shall be liable to imprisonment for a term not exceeding two years or a fine not exceeding five hundred thousand Baht, or both.

Section 298.

Any person who contravenes or fails to comply with Section 246, Section 247, Section 248, Section 249, Section 251, Section 252, Section 253, Section 254, Section 255 or Section 256 or contravenes or fails to comply with the conditions issued in accordance with Section 247 shall be liable to imprisonment for a term not exceeding two years or a fine not exceeding five hundred thousand Baht and a further fine not exceeding ten thousand Baht for every day during which the contravention continues, or both.

Section 299.

Any person who contravenes or fails to comply with Section 250 shall be liable to a fine not exceeding three hundred thousand Baht and a further fine not exceeding ten thousand Baht for every day during which the contravention continues.

Section 300.

In cases where a person who commits an offence under Section 268, Section 269, Section 270, Section 271, Section 272, Section 273, Section 274, Section 279, Section 280, Section 281, Section 284, Section 286, Section 290, Section 292, Section 296, Section 297, Section 298 or Section 299 is a juristic person, and if it can be proved that the commission of such offences resulted from the instruction from, the act of, or the failure to give instruction of to act which is a duty required to be performed by, the director, manager or any person responsible for the operation of such juristic person, such person shall also be liable to the penalties as provided for such offences.

Section 301.

In cases where a person who commits an offence under Section 278, Section 288 or Section 289, is a juristic person, and if it can be proved that the commission of such offences resulted from the instruction from, the act of, or the failure to give instruction or to act which is a duty required to be performed by, the director, manager or any person responsible for the operation of such juristic person, such person shall also be liable to the penalties as provided for such offences.

Section 302.

Any person who gives false testimony to the competent officer, which may cause damage to other persons or to the public shall be liable to imprisonment for a term not exceeding six months and a fine not exceeding sixty thousand Baht.

Section 303.

Any person who obstructs or fails to comply with the orders of or fails to give assistance to, the competent officer who executes his duty in accordance with Section 264 or Contravenes the third paragraph of Section 145 shall be liable to imprisonment for a term not exceeding six months and a fine not exceeding sixty thousand Baht.

Section 304.

Any person who removes, damages, destroys or renders useless any seal or mark which the competent officer has stamped or affixed on any object in the execution of his duty in accordance with Section 264 as evidence for the seizure, or attachment or the keeping of such object shall be liable to imprisonment for a term not exceeding three years and a fine not exceeding three hundred thousand Baht.

Section 305.

Any person who damages, destroys, conceals, takes away, or loses or renders useless any property to document which the competent officer has seized, attached, kept, or ordered to be delivered as evidence in accordance with Section 264, and regardless of whether or not the competent officer would keep such property or document himself or would order such person or other persons to deliver or to keep it, shall be liable to imprisonment for a term of six months to three years and a fine of sixty thousand Baht to three hundred thousand Baht.

Section 306.

Any director, manager, or person responsible for the operation of any juristic person under this Act, who dishonestly deceives the public by the assertion of a falsehood or the concealment of facts which should be revealed to the public, and by such deception, obtains property from the public or from a third person so deceived, or leads the public or third person so deceived to execute, revoke, or destroy a document of right, shall be liable to imprisonment for a term of five to ten years and a fine of five hundred thousand Baht to one million Baht.

Section 307.

Any director, manager, or person responsible for the operation of any juristic person under this Act, who is entrusted to manage the property of such juristic person, or property of which such juristic person is a co-owner, who dishonestly violates his duties by any means and causes damage to the usefulness in the nature as being a property of such juristic person, shall be liable to imprisonment for a term of five to ten years and a fine from five hundred thousand Baht to one million Baht. .

Section 308.

Any director, manager, or person responsible for the operation of any juristic person under this Act, who possesses property belonging to such juristic person, or of which such juristic person is a co-owner, and dishonestly converts such property to himself or a third party, shall be liable to imprisonment for a term of five to ten years and a fine from five hundred thousand Baht to one million Baht.

Section 309.

Any director, manager, or person responsible for the operation of any juristic person under this Act, who takes away, damages, destroys, causes depreciation in value or renders useless any property which the juristic person has the duty to look after or which is in the possession of such juristic person, if it is committed in order to cause damage to other persons or the public, shall be liable to imprisonment for a term not exceeding five years and a fine not exceeding five hundred thousand Baht.

Section 310.

Any director, manager, or person responsible for the operation of any juristic person under this Act, who knows that a creditor of such juristic person, or that a creditor of another person who is entitled to exercise his right as a creditor against such juristic person to enforce the payment of debt from such juristic person, uses or may use his right through the court to enforce payment:

1. removes, conceals or transfers to another person the property of such juristic person; or

 2. maliciously creates a false debt for such juristic person;

If such action is done in order to prevent his creditor from receiving full or part payment, shall be liable to imprisonment for a term of five to ten years and a fine of five hundred thousand Baht to one million Baht.

Section 311.

Any director, manager, or person responsible for the operation of any juristic person under this Act, who acts or omits to act in order to obtain unlawful gains for himself or another person and causes damage to such juristic person, shall be liable to imprisonment for a term of five to ten years and a fine of five hundred thousand Baht to one million Baht.

Section 312.

Any director, manager, or person responsible for the operation of any juristic person under this Act, who commits or permits another to act so as to:

1. damage, destroy, alter, abridge, or falsify accounts or documents or collateral of such juristic person or related to such juristic person;

2. make false entries or fail to enter any material statement in the accounts or documents of such juristic person or related to such juristic person; or

3. keep incomplete, incorrect, out-of-date, or inaccurate accounts;

if such action is done or permitted to be done to deceitfully deprive the juristic person or its shareholders of their rightful benefit or to deceive any person, shall be liable to imprisonment for a term of five to ten years and a fine of five hundred thousand Baht to one million Baht.

Section 313.

Any director, manager, or person responsible for the operation of a company or a juristic person whose securities are listed in the Securities Exchange or traded in any over-the-counter center, and who contravenes Section 307, Section 308, Section 309, or Section 311, shall be liable to imprisonment for a term of five to ten years and a fine of two times the price of the property or benefit which the person obtains through the contravention of such Section, as the case may be, but such fine shall be not less than five hundred thousand Baht.

Section 314.

Any person who causes a director, manager, or any person responsible for the operation of any juristic person under this Act, or an auditor to commit an offence as provided in Section 287, Section 306, Section 307, Section 308, Section 309, Section 310, Section 311, or Section 312, whether by instruction, order, threat, employment or by any other means, shall be liable to the penalties an provided in such Section s.

Section 315.

Any person who does any act to assist or facilitate a director, manager, or any person responsible for the operation of any juristic person under this Act, or an auditor to commit an offence as provided in Section 287, Section 306, Section 307, Section 308, Section 309, Section 310, Section 311, or Section 312 whether before or at the time of the commission of the offence, shall be liable to the penalties as provided in such Section s, unless the person is not aware of such assistance or facilitation.

Section 316.

Any person, in the performance of his duty under the powers and duties provided in accordance with this Act, having acquired confidential information of any person which, under normal circumstances, should not be disclose, who discloses such information to another person, shall be liable to imprisonment for a term not exceeding one year or a fine not exceeding one hundred thousand Baht, or both.

The provisions of the first paragraph shall not apply to disclosure in the following cases:

1. disclosure in the performance of his duty;

2. disclosure for the purpose of investigation or trial;

3. disclosure relation to the commission of offences under this Act;

4. disclosure for the purpose of rectifying the condition or operation of a securities company;

5. disclosure to an auditor of any juristic person under this Act;

6. disclosure to the authorities or domestic and international agencies which are responsible for the supervision of securities, the Securities Exchange or the supervision and examination of financial institutions;

7. disclosure upon written consent of such person.

Section 317.

A Settlement Committee appointed by the Minister shall have the power to settle offences under Section 268, Section 269, Section 270, Section 271, Section 272, Section 273, Section 274, Section 275, Section 276, Section 277, Section 279, Section 280, Section 281, Section 282, Section 283, Section 284, Section 285, Section 286, Section 287, Section 290, Section 291, Section 292, Section 293, Section 294, Section 295, Section 296, Section 297, Section 298, Section 299, and Section 300.

The Settlement Committee appointed by the Minister under the first paragraph shall comprise three persons, one of whom shall be an investigating officer under the Criminal Procedure Code.

Where a case has been settled by the Settlement Committee and the alleged offender has paid the fine as determined by the Settlement Committee within the period of time specified by the Settlement Committee, such case shall be regarded as settled.

CHAPTER 13

TRANSITIONAL PROVISIONS

 

Section 318.

In the first term for a period of four years from the date of the publication of this Act in the Government Gazette, Section 21 (4) shall not apply to the tenure and vacancy of the Office of the Secretary-General.

Section 319.

The Ministry of Finance shall arrange for a transfer of the following funds to the Office within thirty days from the date of the publication of this Act in the Government Gazette, to be the initial capital of the Office in accordance with Section 25:

1. the remaining amount from the Fund for Solving Securities Business Problems in the amount of five hundred and five million six hundred forty-two thousand six hundred forty-four Baht and sixty Satang, with interest;

2. the remaining amount from the Capital Market Development Fund in the amount of two hundred million Baht.

Section 320.

The Bank of Thailand shall transfer money in the amount of five hundred million Baht to the Office within thirty days from the date of the publication of this Act in the Government Gazette, to be the initial capital of the Office in accordance with Section 25.

Section 321.

A securities company or securities and finance company, which has been granted a license to undertake any type of securities business under the law relating to the undertaking of finance business, securities business and credit foncier business on the date of this Act coming into force, shall be deemed to be a company which has been granted a license to undertake securities business of such type under this Act.

The provisions of Section 94 shall not apply to the securities and finance company under the first paragraph.

Section 322.

A securities company or securities and finance company as referred to in Section 321 which has paid-up registered capital of less than one hundred million Baht shall proceed to:

1. raise its paid-up registered capital to not less than fifty million Baht within one year from the date of this Act coming into force;

2. raise is paid-up registered capital to not less than one hundred million Baht within two years from the date of this Act coming into force.

Section 323.

A person acting on behalf of a company established to undertake securities business in accordance with foreign laws, and having a representative office in the Kingdom which has been given an approval under the law relating to the undertaking of finance business, securities business and credit foncier business on the date of this Act coming into force, shall be deemed to be a person acting on behalf of the securities company established in accordance with foreign laws which has been given an approval under Section 93 of this Act.

Section 324.

A securities company which has been granted a license to undertake the business of investment management under the law relating to the undertaking of finance business, securities business and credit foncier business, shall continue to manage the approved investment project in accordance with such law until the expiration of the project. In this regard, such securities company shall comply with the rules and procedures as approved in accordance with such law. For this purpose, any matters specified to be the powers and duties of the Bank of Thailand, shall be the powers and duties of the Office.

Prior to the expiration of the investment project, if the securities company referred to in the first paragraph wishes to convert the investment project into a mutual fund in accordance with this Act, such securities company shall comply with the rules, conditions and procedures as specified by the SEC. After such compliance, the provision relation to mutual fund management under this Act shall apply mutatis mutandis.

Section 325.

In cases where a securities company referred to in Section 321 which has been granted a license to undertake the business of mutual fund management has purchased or held shares for its own account and not for the account of the mutual fund project prior to the date of this Act coming into force and which falls within the prohibition of Section 98 (7) of this Act, the securities company shall have the right to continue to hold or possess such shares. However, if there is a disposition of such shares in any amount, the securities company shall have the right to continue to hold or possess the remaining amount of such shares only.

Section 326.

A certified auditor of a securities company or a finance and securities company who has been given an approval under the law relating to the undertaking of finance business, securities business and credit foncier business prior to the date of this Act coming into force shall be deemed to be an auditor of such securities company who has been given an approval under this Act.

Section 327.

In cases where a company referred to in Section 321 which has had a director, manager, or person with power of management, or advisor who has been given an approval under the law relating to the undertaking of finance business, securities business and credit foncier business on the date of this Act coming into force, such person shall be deemed to be a person who has been given an approval under this Act.

Section 328.

All ministerial regulations, notifications of the Ministry of Finance or notifications of the Bank of Thailand concerning the undertaking of securities business which have been issued in accordance with the provisions of the law relating to the undertaking of finance business, securities business and credit foncier business which have been in force prior to the date of this Act coming into force, shall remain in force until ministerial regulations, notifications, rules, regulations, or orders issued under this Act come into force.

Any matter which the ministerial regulations and notifications referred to in the first paragraph specify to be the powers and duties of the Minister of Finance or the Bank of Thailand, shall continue to be the powers and duties of the Minister of Finance or the Bank of Thailand, as the case may be, until the SEC and the Secretary General have been appointed, such powers and duties shall become the powers and duties of the Minister, the SEC or the Office, as the case may be.

Section 329.

The Securities Exchange of Thailand, which has been established under the Securities Exchange of Thailand Act, B. E. 2517 shall be the Securities Exchange under this Act. The board of directors of the Securities Exchange of Thailand and the manager of the Securities Exchange of Thailand who remain in office on the date of this Act coming into force shall continue to perform their duties until there has been the appointment and election of the board of directors of the Securities Exchange and the manager of the Securities Exchange in accordance with this Act which shall not exceed one hundred and twenty days from the date of this Act coming into force.

Section 330.

The officers and employees of the Securities Exchange, established under the Securities Exchange of Thailand Act B. E. 2517 shall be transferred to the Securities Exchange under this Act.

Section 331.

All businesses, capital, assets, rights, indebtedness, liabilities and budget of the Securities Exchange including all the money in the Compensation Fund established under the Securities Exchange of Thailand Act, B. E. 2517 shall be transferred to the Securities Exchange under this Act.

Section 332.

The Securities Exchange shall pay to the Office an amount of fifty million Baht annually for a period of five years.  The payment in the first year shall be made within thirty days from the date of the publication of this Act in the Government Gazette, and the payment in the following years shall be made within thirty days from the last day of the calendar year of this Act coming into force and of each following year until the end of the five-year period.

The money paid under the first paragraph shall be deemed to be money payable by the Securities Exchange in accordance with Section 182 as long as there has been a payment under the first paragraph.

Section 333.

Members of the Securities Exchange, established under the Securities Exchange of Thailand Act, B. E. 2517, shall be members of the Securities Exchange under this Act.

Section 334.

Securities, which have been traded in the Securities Exchange established under the Securities Exchange of Thailand Act, B. E. 2517, shall be listed securities under this Act. In cases where a company whose securities are listed in the Securities Exchange is limited company under the Civil and Commercial Code on the date of this Act coming into force, such company shall convey into a public limited company under the law relating to the public limited companies within two years from the date of this Act coming into force.  In cases of necessity, the SEC may extend such period, but may not extend such period beyond five years from the date of this Act coming into force.

Section 335.

In cases where any company has proceeded to submit an application for approval from the Minister of Finance to accept its securities to be registered or authorized securities through the board of directors of the Securities Exchange in accordance with Section 18 and Section 19 of the securities Exchange of Thailand Act, B. E. 2517 as amended by the Securities Exchange of Thailand Act (NO. 2), B. E. 2527 and the Minister of Finance has not yet issued an order accepting such securities to be registered or authorized securities prior to the date of this Act coming into force, the aforesaid matter shall continue to proceed in accordance with Section 18 and Section 19 of such Acts and the powers and duties of the Minister of Finance shall be the powers and duties of the SEC.

When the SEC has issued an order accepting the securities of the applying company as registered or authorized securities in accordance with the first paragraph, such securities shall be deemed to be listed securities under this Act and the company whose securities are so listed shall convert into a public limited company in accordance with Section 334 of this Act.

Section 336.

In cases where any company has proceeded to submit an application for approval to the board of directors of the Securities Exchange to offer newly issued shares or debentures for sale to the public in accordance with Section 19 ter of the Securities Exchange of Thailand Act, B. E. 2517 as amended by the Securities Exchange of Thailand Act (No,2), B. E. 2527 and the board of directors of the Securities Exchange has not yet issued an approval to such company to offer newly issued shares and debentures for sale to the public prior to the date of this Act coming into force, the board of directors of the Securities Exchange shall proceed to consider such application in accordance with the rules and procedures specified by the board of directors of the Securities Exchange with the approval of the Minister of Finance under Section 19 ter of such Acts. In cases where it is necessary to alter or modify such rules and procedures in order that the consideration of the application may be accomplished, the board of directors of the Securities Exchange may specify any rules or procedures with the approval of the SEC.

Section 337.

A company which has been given an approval to offer newly issued shares or debentures for sale to the public in accordance with Section 19 ter of the Securities Exchange of Thailand Act, B. E. 2517 as amended by the Securities Exchange of Thailand Act (No. 2), B. E. 2527 prior to the date of this Act coming into force, or a company which has been given an approval to offer newly issued shares or debentures for sale to the public in accordance with Section 336 of this Act, such company shall continue to offer newly issued shares or debentures for sale to the public in accordance with the rules and procedures as specified by Section 19 ter of such Acts. Where it is necessary to alter or modify such rules and procedures in order that the offer of newly issued shares or debentures for sale to the public can be accomplished, the board of directors of the Securities Exchange may specify any rules or procedures with the approval of the SEC.

Section 338.

All ministerial regulations and notifications of the Ministry of Finance which have been issued in accordance with the provisions of the Securities Exchange of Thailand Act, B. E. 2517 as amended by the Securities Exchange of Thailand Act (No. 2), B. E. 2527, rules of the Securities Exchange of Thailand, regulations of the Securities Exchange of Thailand, procedures of the Securities Exchange of Thailand, procedures concerning shares register and notifications of the Securities Exchange of Thailand which have been in force prior to the date of this Act coming into force shall remain in force until the ministerial regulations, notifications, rules, regulations or procedures issued under this Act come into force. Any matter specified by the ministerial regulations, notifications, rules and regulations under the first paragraph to be the powers and duties of the Minister of Finance or the board of directors of the Securities Exchange of Thailand shall continue to be the powers and duties of the Minister of Finance of the board of directors of the Securities Exchange of Thailand until the SEC or the board of directors of the Securities Exchange have been appointed in accordance with this Act, such powers and duties shall become the powers and duties of the Minister, the SEC or the board of directors of the Securities Exchange, as the case may be.

Section 339.

Any person providing a service of a securities registrar prior to the date of this Act coming into force may continue to provide such service, provided that an application for a license to provide such service shall be submitted within one hundred and twenty days after the date of this Act coming into force. After the application has been submitted such persons may continue to provide the service unless application for a license has been refused.

Section 340.

All associations, which have the same characteristics or objects as the associations related to securities business and which have been registered as trade associations under the law relating to trade associations prior to the date of this Act coming into force, wishing to become the associations related to securities business in accordance with this Act, shall submit an application for approval to be an association related to securities business within ninety days from the date of this Act coming into force. After the approval has been granted in accordance with this Act, the registrar of trade associations under the law relating to trade associations shall delete the name of such association from the trade association register.

All assets and liabilities of associations having the same characteristics or objects as associations related to securities business which have been given an approval and registered as associations relating to securities business in accordance with this Act shall be transferred to the associations related to securities business which have been newly established.

In cases where any association having the same characteristics or objects as an association related to securities business which is a trade association under the law relating trade associations does not submit an application to become an association related to securities business in accordance with this Act within the time specified in the first paragraph, it shall be dissolved. In this regard, the registrar of the trade associations under the law relating to the trade associations shall delete the name of such association from the trade associations register.

In cases where any trade association is not satisfied with the order of the registrar of the trade associations under the law related to trade associations to delete the name of such association from the register, the trade association shall have the right to appeal against such order by submitting an appeal to the SEC within fifteen days from the date of the receipt of the order. The decision of the SEC shall be final.

Section 341.

Competent officers who have been appointed in accordance with the law relating to the undertaking of finance business, securities business and credit foncier business, and in accordance with the Securities Exchange of Thailand Act, B. E. 2517 as amended by the Securities Exchange of Thailand Act (No. 2), B. E. 2527 shall be the competent officers which have been appointed under this Act until the SEC shall order otherwise.

In the execution of his duty, identification cards issued to the competent officers referred to in the first paragraph shall be the identification cards of the competent officers under this Act. After the appointment of the Secretary-General has been made, the competent officer shall report the execution of his duty to the Office.

Section 342.

The Settlement committee under this Act shall have the power to settle only offences concerning securities business which may be settled under the law relating to the undertaking of finance business, securities business and credit foncier business or under the Securities Exchange of Thailand Act, B. E. 2517 as amended by the Securities Exchange of Thailand Act (No. 2), B. E. 2527

Section 343.

Any securities company which contravenes the provisions of Section 322 of fails to comply with the rules and conditions of the first paragraph of Section 324 shall be liable to a fine not exceeding three hundred thousand Baht and a further fine not exceeding ten thousand Baht for every day during which the contravention continues.

In cases where there have been contravention or non-compliance by the securities company under the first paragraph, if it can be proved that such offences by the securities company resulted from the order, the act or the failure to order or the commission to act which are duties to be performed by any director, manager or person responsible for the operation of such securities company, that person shall be liable to imprisonment for a term not exceeding one year or a fine not exceeding three hundred thousand Baht, or both.

Section 344.

The Settlement Committee referred to in Section 317 shall have the power to settle the offences under Section 343.

   

 

Given on the 12 th day of March B. E. 2535

As amended by Section 3 of the Securities and Exchange Act (No. 2) B. E. 2542