ARRANGEMENT OF SECTIONS
1. Short title and application.
3. Construction of the terms "investment advisor" and "prescribed interest".
4. Construction of the term "associated person".
5. Persons deemed to have interest in securities.
THE CAPITAL MARKETS AND SECURITIES AUTHORITY
6. Establishment of the Authority.
7. Meetings of the Authority.
8. Appointment of Chief Executive and other staff.
9. General Fund, financial year and accounts.
9A. Powers of the Minister
10. General functions of the Authority.
11. Power of the Authority to require production of books by a stock exchange and certain persons.
12. Action on production of books or when books are not produced.
13. Order by District Magistrate to search premises.
14. Incriminating statement.
16. Copies of extracts of books to be admitted in evidence.
17. Protection of privileged communication with advocate.
18. Secrecy of information from books.
19. Disclosure to the Authority.
20. Where the Authority suspects breach of specified provision.
21. Investigation of certain matters.
22. Measures to be taken pending investigations.
23. Power of court to make certain orders.
24. Statements of principle.
25. Establishment of stock exchange.
26. Power of the Authority to approve a stock exchange.
27. Authority to approve amendments to rules.
28. Stock exchange to provide certain assistance to the Authority and the disciplinary power of the Authority.
29. Power of court to order observance or enforcement of rules of a stock exchange.
30. Power to issue directions to a stock exchange.
31. Power of the Authority to prohibit trading in particular securities.
32. Dealer's licence.
33. Dealer's representative's licence.
34. Investment adviser's licence.
35. Investment representative's licence.
36. Application for or renewal of licence.
37. Grant of dealer's licence or investment adviser's licence.
38. Grant of representative's licence.
39. False statements.
40. Power of the Authority to enquire into securities transactions in relation to the holder of a licence.
41. Power of the Authority to impose conditions or restrictions.
42. Deposit to be lodged in respect of dealer's licence.
43. Period of licence.
44. Notification of change of particulars.
45. Register of licence holders.
46. Revocation or suspension of licences.
47. Operation pending renewal of licence.
49. Exempt dealers.
REGISTERS OF INTERESTS IN SECURITIES
50. Application of this Part.
51. Register of securities.
52. Notice of particulars to the Authority.
53. Defence to prosecution.
54. Production of register.
55. Particulars of financial journalists.
56. Extract of register.
CONDUCT OF SECURITIES BUSINESS
57. Certain representations prohibited.
58. Issue of contract notes.
59. Certain persons to disclose certain interests in securities.
60. Recommendations by adviser.
61. Dealings as principal.
62. Dealings by employees of holders of licences.
63. Dealer to give priority to clients' orders.
64. Use by dealer of client's money.
65. Short selling.
ACCOUNTS AND AUDIT
66. Application of this Part.
67. Accounts to be kept by dealers.
68. Security documents in custody of dealer.
69. Dealer's trust accounts.
70. Purposes for which money may be withdrawn from a trust account.
71. Appointment of auditor by dealer.
72. Removal and registration of auditors.
73. Fees and expenses of auditors.
74. Dealer's account.
75. Auditor to report to the Authority in certain cases.
76. Certain matters to be reported to the Authority.
78. Right of stock exchange to impose obligations, on members not affected by this Part.
79. Power of Court to restrain dealings in certain bank accounts.
80. Duty of banker to make full disclosure.
81. Power of Court to make further orders and give directions.
82. Power of Court to make order relating to payment of moneys.
83. Establishment of fidelity funds.
84. Moneys constituting fidelity fund.
85. Fund to be kept in separate bank account.
86. Payments out of fidelity fund.
87. Accounts of fund.
88. Management committee.
89. Minimum amount of fidelity fund.
90. Measures where fidelity fund is reduced.
91. Levy to meet liabilities.
92. Power of stock exchange to make advances to fund.
93. Investment of fund.
94. Application of fund.
95. Claims against fund.
96. Notice calling for claims against fund.
97. Power of Council to settle claims.
98. Form of order of Court establishing claim.
99. Power of Council to require production of securities.
100. Subrogation of stock exchange to rights etc., of claimant upon payment from fund.
101. Payment of claims only from fund.
102. Provisions where fund insufficient to meet claims where claims exceed total amount payable.
103. Power of Council to enter into contracts of insurance.
104. Application of insurance moneys.
105. Interpretation of this Part.
TRADING IN SECURITIES
106. False trading and market rigging transactions.
107. Stock market manipulation.
108. False or misleading statements.
109. Fraudulently inducing persons to deal in securities.
110. Dissemination of information about illegal transactions.
111. Employment of manipulative and deceptive devices.
112. Prohibition of dealings in securities by insiders.
113. Penalties and compensation.
INTERIM STOCK TRADING FACILITY
114. Provision for interim stock trading facility.
COLLECTIVE INVESTMENT SCHEMES
115. Authorisation and regulation of schemes.
116. Restriction of promotion.
117. Authorised collective investment scheme.
118. Application to operate a collective investment scheme.
119. Qualifications of trustee or custodian.
120. Publication of scheme particulars.
121. Publication of alterations.
122. Revocation of approval.
124. Directions of the Authority.
126. Restitution order.
127. Application to Court.
128. Submission of reports.
PUBLIC OFFERS OF SECURITIES
131. Prospectus to be approved by Authority.
132. Contents of prospectus.
134. Issuer of securities publicly held prior to the coming into operation of this Act.
ADVERTISEMENTS RELATING TO SECURITIES BUSINESS
135. Advertisements relating to securities business.
136. Advertisements for offer of securities.
137. Restriction on use of title "stock broker" or "stock exchange"
138. Offences by directors or managers.
139. Falsification of records by directors, employees and agents.
140. False reports to the Authority or stock exchange.
141. Immunity of the Authority and its employees.
142. Offences by body corporate.
143. Power of Court to prohibit payment or transfer of moneys, securities or other property.
145. General penalty.
146. Proceedings, by whom to be taken and power to compound offences.
147. Power of Minister to give directions to the Authority.
150. Court of original jurisdiction.
THE CAPITAL MARKETS AND SECURITIES ACT
An Act to establish a Capital Markets and Securities Authority for the purposes of promoting and facilitating the development of an orderly, fair and efficient capital market and securities industry in Tanzania, to make provisions with respect to stock exchanges, stockbrokers and other persons dealing in securities, and for connected purposes.
[1st October, 1994]
[G.N. No. 363 of 1994]
5 of 1994
4 of 1997
14 of 1997
15 of 1997
PRELIMINARY PROVISIONS (ss 1-5)
(1) This Act may be cited as the Capital Markets and Securities Act.
(2) This Act shall apply to Tanzania Zanzibar as well as Mainland Tanzania.
In this Act, unless the context otherwise requires–
"advertisement" includes every form of advertising whether in a publication, brochure, handout, by letter head, by display of notice, circular or other documents by exhibition of photographs or cinematography films or videos, or by sound broadcasting or television broadcasting or distribution of recordings or in any other manner;
"agent" in relation to a dealer, includes a person who is, or has at any time been, a banker of the dealer;
"arbitrage" means profiting from differences in price of the same security traded on two or more markets;
"auditor" means a company auditor qualified as such under the Companies Act *;
"Authority" means the Capital Markets and Securities Authority established by section 6;
"book" includes any register, document or other record of information and any account or accounting record, however compiled, recorded or stored whether in written or printed form or microfilm by electronic process or otherwise;
"collective investment scheme" means–
(a) an open-ended investment company;
(b) a unit trust scheme;
(c) such other arrangements being arrangements with respects to property of any description, including money, the purpose or effect of which is to enable persons taking part in the arrangements (whether by becoming owners of the property or any part of it or otherwise) to participate in or receive profits or income arising from the acquisition, holding, management or disposal of the property or sums paid out of such profits or income; and
(d) any other scheme or arrangement deemed by the Authority to be a collective investment scheme for the purposes of this Act;
"company" means a company formed and registered under the Companies Act;
"council", in relation to a stock exchange, means the persons for the time being in whom the management of the stock exchange is vested;
"court" means the court having jurisdiction under this Act;
"dealer" means a person who carries on the business of dealing in securities whether he carries on any other business or not, but does not include an exempt dealer;
"dealer's representative" means a person, in the direct employment of, or acting for, or by arrangement with, a dealer, who performs for that dealer any of the functions of a dealer, other than work ordinarily performed by accountants, clerks or cashiers, whether his remuneration is by way of salary, wages, commission or otherwise; and where the dealer is a body corporate, includes any director or officer of the body corporate who performs for the body corporate any of the said functions;
"dealing in securities" means whether as principal or agent making or offering to make with any person, or inducing or attempting to induce any person to enter into or to offer to enter into–
(a) any agreement for or with a view to acquiring, disposing of, subscribing for, or underwriting securities; or
(b) any agreement the purpose or the intended purpose of which is to secure a profit to any of the parties from the yield of securities or by reference to fluctuations in the price of securities;
"director" has the same meaning as is assigned to that expression in the Companies Act *;
"enterprise growth market" means a stock market segment that facilitates trading of securities of start up, small and medium size companies;
"executive officer", in relation to a body corporate, means any person by whatever name called who is concerned or takes part in the management of the body corporate whether or not he is a director of the body corporate;
"exempt dealer" means a person specified under section 49;
"investment adviser" subject to section 3, means a person who–
(a) carries on the business of advising others concerning securities;
(b) as part of a regular business, issues or publishes analyses or reports concerning securities; or
(c) pursuant to a contract or arrangement with a client, undertakes on behalf of the client, (whether on a discretionary authority granted by the client or otherwise) the management of a portfolio of securities for the purpose of investment;
"investment company" means a body corporate, which has its purpose the investment of its funds with the aim of spreading investment risk and giving its members the benefit of the results of the management of those funds by or on behalf of that body;
"investment representative" means a person, in the direct employment of or acting for or by arrangement with an investment adviser, who performs for such investment adviser any of the functions of an investment adviser (other than work ordinarily performed by accountants, clerks or cashiers) whether his remuneration is by way of salary, wages, commission or otherwise, and includes any director or officer of a body corporate who performs for such body corporate any of the said functions;
(a) a dealer's licence;
(b) an investment adviser's licence; or
(c) a representative's licence, issued under Part IV;
"listing rules", in relation to a body corporate that maintains or provides or proposes to maintain or to provide, a stock market or a stock exchange, means rules governing or relating to–
(a) the admission to the official list of the body corporate, of bodies corporate, governments, unincorporate bodies or other persons for the purpose of the quotation on the stock market, or made available by bodies corporate, governments unincorporated bodies or other persons or the removal from that official list and for other purposes; or
(b) the activities or conduct of bodies corporate, governments, unincorporate bodies and other persons who are admitted to that list,
whether those rules–
(i) are made by the body corporate or are contained in any of the constituent documents of the body corporate; or
(ii) are made by another person and adopted by the body corporate;
"market intermediary" means an individual or corporate body whose activities are provided for under this Act including but not limited to dealers, dealers' representatives, investment advisors, investment advisors' representatives, nominated advisors, nominated advisors' representatives, stock exchanges, collective investment schemes, securities depositories and custodian of securities;
"member company" means a company which carries on a business of dealing in securities and is recognised as a dealing member by a stock exchange;
"member firm" means a partnership which carries on a business of dealing in securities and is recognised as a dealing member by a stock exchange;
"Minister" means the Minister for the time being responsible for finance;
"nominated advisor's" means a company licensed by the authority to undertake the responsibility of nurturing and assisting an issuer for a public office of securities, listing of those securities on the enterprise growth market of the stock exchange and advising the issuer listed on the enterprise growth market;
"nominated advisors representative" means a person in full time employment of a nominated advisor, who performs for such nominated advisor any of the functions of the nominated advisor;
"open-ended investment company" means a body corporate–
(a) which has as its purpose the investment of its funds with the aim of spreading investment risk and giving its members the benefit of the results of the management of those funds by or on behalf of that body; and
(b) the members in which have rights represented by share or securities of that body which–
(i) those members are entitled to have redeemed or purchased from them by, or out of funds provided by, that body; or
(ii) the body ensures it can be sold by the members on an investment exchange at a price related to the value of the property to which they relate;
"prescribed interest" subject to section 3, means any right to participate or any interest, whether enforceable or not and whether actual, prospective or contingent–
(a) in any profits, assets or realisation of any financial or business undertaking or scheme whether in Tanzania or elsewhere;
(b) in any enterprise, whether in Tanzania or elsewhere, in relation to which the holder of the right or interest is led to expect profits, rent or interest from the efforts of the promoter of the enterprise or a third party; or
(c) in any investment contract, whether or not the right or interest is evidenced by a formal document and whether or not the right or interest relates to a physical asset;
"prospectus" means any prospectus, notice, circular, advertisement or other invitation offering to the public for subscription or purchase any shares or debentures of company and includes a prospectus in respect of the issue of any other security;
"public company" means a company whose articles of association do not restrict the right to transfer its shares, do not limit the number of its members and do not prohibit any invitation to the public to subscribe for any shares or debentures of the company;
"relevant authority" means–
(a) in relation to a member company or member firm, the stock exchange by which the company is recognised; and
(b) in relation to any other person, the Authority;
"rules", in relation to a stock exchange, means the rules governing the conduct of the stock exchange or its members by whatever name called and includes rules contained in the regulations of the stock exchange;
(a) debentures, stock, shares, bonds or notes issued or proposed to be issued by a body corporate and any right, warrant or option in respect thereof;
(b) bonds or other loan instrument of the Government of Tanzania or of any other country or corporation;
(c) rights or interests, whether described as units or otherwise under any collective investment scheme;
(d) any right, warrant, option or futures in respect of any debenture, stocks, shares, bonds, notes or in respect of commodities;
(e) options and warrants on shares, depository receipts, derivatives and options on derivatives;
(f) such other rights, interests or instruments as the Authority may, by notice published in the Gazette prescribe.
"securities business" means the business of dealing in or advising on securities and includes such other activity as may be prescribed;
"share" means the interest of members of a body corporate who are entitled to share in the capital or income of such body corporate,
"stockbroker" means a person who is–
(a) a director of a member company; or
(b) a partner of a member firm.
"stock exchange" means any body corporate which has been approved by the Authority under section 26;
"stock market" means a market, exchange of other place, at which, or a facility by means of which, securities are regularly offered for sale, purchased or exchanged;
"substantial shareholder" means a shareholder entitled to exercise or control the exercise of 30% or more of the voting power at general meetings of the company or one who is in a position to control the composition of a majority of the board of directors of a company;
"Tribunal" means the Capital Markets Tribunal established under this Act;
"trust account" means a trust account opened and maintained under section 69;
"underwriting" means the purchase or commitment to purchase or distribute by dealers or other persons of any issue or offer of securities for immediate or prompt public distribution by or through them;
"unit" in relation to a unit trust, means a right or interest, whether described as a unit, sub-unit or otherwise which may be acquired under the trust; and
"unit trust scheme" means any arrangement made for the purpose, or having the effect, of providing facilities for the participation by persons as beneficiaries under a trust, in profits or income arising from the acquisition, holding, management or disposal of securities or any other property.
For the purposes of this Act and notwithstanding the provisions of section 2–
(a) the phrase "investment advisor" shall not be construed to include–
(i) a bank as defined in the Banking and Financial Institutions Act *.
(ii) an insurance company;
(iii) an Advocate or accountant whose carrying on of that business is solely incidental to the practice of his profession;
(iv) a dealer or his employee or a dealer's representative or an exempt dealer whose carrying on of that business is solely incidental to the conduct of his business of dealing in securities; or
(v) a person who is the proprietor of a newspaper where–
(aa) in so far as the newspaper is distributed generally to the public, it is distributed only to subscribers to, and purchasers of, the newspaper for value;
(bb) the advice is given or the analyses or reports are issued or published only through that newspaper;
(cc) that person received no commission or other consideration for giving the advice or for issuing or publishing the analyses or reports; and
(dd) the advice is given and the analyses and reports are issued or published solely as incidental to the conduct of that person's business as a newspaper proprietor; and
(vi) such other persons as the Minister may, by notice in the Gazette, prescribe;
(b) the phrase "prescribed interest" shall not be construed to include–
(i) any share in, or debenture of a body corporate;
(ii) any interest in, or arising out of a policy of life insurance;
(iii) an interest in a partnership agreement, unless the agreement or proposed agreement–
(aa) relates to an undertaking, scheme, enterprise or investment contract promoted by or on behalf of a person whose ordinary business is or includes the promotion of similar undertakings, schemes, enterprises or investment contracts whether or not that person is, or is to become, a party to the agreement or proposed agreement; or
(bb) is or would be an agreement, within a class of agreements, prescribed by the regulations for the purposes of this paragraph;
(iv) a right or interest, or a right interest included in a class or kind of rights or interests, declared by the regulations to be an exempt right or interest, or a class or kind of exempt rights or interests;
(1) A reference in this Act to "a person associated with another person" shall be construed as follows–
(a) where the other person is a body corporate;
(i) a director or secretary of the body corporate;
(ii) a body corporate that is related to the other person; or
(iii) a director or secretary of such a related body corporate;
(b) where the matter to which the reference relates is the extent of power of exercise, or to control the exercise of, the voting power attached to voting shares in a body corporate, a person with whom the other person has, or proposes to enter into, an agreement, understanding or undertaking, whether formal or informal and whether express or implied–
(i) by reason of which either of those persons may exercise, directly or indirectly control the exercise of, or substantially influence the exercise of, any voting power attached to a share in the body corporate;
(ii) with a view to controlling or influencing the composition of the board of directors, or the conduct of affairs, of the body corporate; or
(iii) under either of those persons may acquire from each other shares in the body corporate or may be required to dispose of such shares in accordance with the directions of the other person;
(c) a person in concert with whom the other person is acting, or proposes to act, in relation to the matter to which the reference relates;
(d) where the matter to which the reference relates is a matter, other than the extent of power to exercise, or to control the exercise of, the voting power attached to voting shares in a body corporate–
(i) subject to subsection (2), a person who is a director of a body corporate that carries on a business of dealing in securities and of which the other person is also a director;
(ii) subject to subsection (2), a person who is a director of a body corporate of which the other person is a director, not being a body corporate that carries on a business of dealing in securities; or
(iii) a trustee of a trust in relation to which the other person benefits or is capable of benefiting otherwise than by reason of transactions entered into the ordinary course of business in connection with the lending of money;
(e) a person with whom the other person is, by virtue of any law regarded as associated in respect of the matter to which the reference relates;
(f) a person with whom the other person is, or proposes to become, associated, whether formally or informally, in any other way in respect of the matter to which the reference relates; or
(g) where the other person has entered into, or proposes to enter into, a transaction, or has done, or proposes to do, any other act or thing, with a view to becoming associated with a person as mentioned in paragraph (a), (b), (c), (d), (e), or (f).
(2) Where, in proceedings under this Act, it is alleged that a person referred to in subsection (1)(d)(i) and (ii) was associated with another person at a particular time, that person shall be deemed not to have been associated in relation to a matter to which the proceedings relate unless the person alleging the association proves that the first mentioned person at that time knew or ought reasonably to have known the material particulars of that matter.
(3) A person shall not be taken to be associated with another person by virtue of paragraph (b), (c), (e) or (f) of subsection (1) by reason only that one of those persons furnished advice to, or acts on behalf of, the other person in the proper performance of functions that relate to his professional capacity or to his business relationship with the other person.
(1) Where any property held in trust consists of or includes securities in which a person knows or has reasonable grounds for believing that he has an interest, that person shall be deemed to have an interest in those securities.
(2) A person shall be deemed to have an interest in a security where a body corporate has an interest in a security and–
(a) the body corporate is, or its directors are, accustomed or under an obligation, whether formal or informal, to act in accordance with the directions, instructions or wishes of that person in relation to that security;
(b) that person has a controlling interest in the body corporate; or
(c) that person is, or the associates of that person or that person and his associates are, entitled to exercise or control the exercise of not less than 30% of the votes attached to the voting shares in the body corporate.
(3) A person shall be deemed to have an interest in a security in any one or more of the following circumstances–
(a) where he has entered into a contract to purchase a security;
(b) where he has a right, otherwise than by reason of having an interest under a trust, to have a security transferred to himself or to his order, whether the right is exercisable presently or in future and whether on the fulfilment of a condition or not;
(c) where he has the right to acquire a security or an interest in a security, under an option, whether the right is exercisable presently or in the future and whether on the fulfilment of a condition or not; or
(d) where he is entitled, otherwise than by reason of his having been appointed a proxy or representative to vote at a meeting of members of a body corporate or of a class of its members, to exercise or control the exercise of a right attached to a security, not being a security of which he is the registered holder.
(4) A person shall be deemed to have an interest in a security if that security is held jointly with another person.
(5) For the purpose of determining whether a person has an interest in a security, it is immaterial that the interest cannot be related to a particular security.
(6) There shall be disregarded–
(a) an interest in a security if the interest is that of a person who holds the security as bare trustee;
(b) an interest in a security of a person whose ordinary business includes the lending of money if he holds the interest only by way of security for the purpose of a transaction entered into in the ordinary course of business in connection with the lending of money;
(c) an interest of a person in a security being an interest held by him by reason of his holding a prescribed office; and
(d) a prescribed interest in a security being an interest of such person, or of the person included in such class of persons, as may be prescribed.
(7) An interest in a security shall not be disregarded by reason only of–
(a) its remoteness;
(b) the manner in which it arose; or
(c) the fact that the exercise of a right conferred by the interest is, or is capable of being made subject to restraint or restriction.
THE CAPITAL MARKETS AND SECURITIES AUTHORITY (ss 6-24)
(1) There is hereby established an authority to be known as the Capital Markets and Securities Authority.
(2) The Authority shall be a body corporate with perpetual succession and a common seal and shall be capable in its corporate name of–
(a) suing and being sued;
(b) taking, purchasing or otherwise acquiring, holding, charging and disposing of both movable and immovable property;
(c) borrowing and lending money;
(d) entering into contracts; and
(e) doing or performing all such other things or acts necessary for the proper performance of its functions under this Act which may lawfully be done by a body corporate.
(3) The Authority shall consist of–
(a) a Chairman to be appointed by the President on the recommendation of the Minister;
four other members who have experience and expertise in either legal, financial, business o administrative matters to be appointed by the Minister; (b) one representative from the Ministry responsible for finance in the Government of United republic;
(c) the Principal Secretary to the Treasury or an officer of the Treasury nominated by him in writing for that purpose;
(d) the Governor of the Bank of Tanzania or an officer of the Bank of Tanzania nominated by him in writing for that purpose;
(e) the Registrar of Companies or an officer in the office of the Registrar of Companies nominated by him in writing for that purpose; and
(f) the Attorney-General or an officer in the office of the Attorney General nominated by him in writing for that purpose;
(g) the Chief Executive of the Authority.
(4) The Chairman and every member appointed under paragraph (b) of subsection (3) shall hold office for a period of three years and shall be eligible for re-appointment.
(5) Any member appointed under paragraph (b) of subsection (3) shall cease to hold office if–
(a) he delivers to the Minister a written resignation of his appointment;
(b) on the advice of the Authority, the Minister removes him from office on the grounds that he is incapacitated by mental or physical illness or is otherwise unable or unfit to discharge the functions of a member or is unable to continue as a member;
(c) he has been absent from three consecutive meetings of the Authority without leave or good cause;
(d) he is adjudged bankrupt or enters into a composition scheme or arrangement with his creditors;
(e) he is sentenced by a court to imprisonment for a term of six months or more without the option of a fine;
(f) he is convicted of an offence involving dishonesty, fraud or moral turpitude; or
(g) in the case of a person in possession of a professional qualification, he is disqualified or suspended, otherwise than at his own request, from practicing his profession in Tanzania or in any other country by an order of any competent authority made in respect of him personally.
(6) In the event of vacation of officer by any member appointed under paragraph (b) of subsection (3), the Minister may appoint another person to hold office for the unexpired period of the term of office of the member in whose place he is appointed.
(7) If any member of the Authority appointed under paragraph (b) of subsection (3) is temporarily unable to perform his duties, the Minister may appoint another person to act in his place during the period of his absence.
(8) The members of the Authority other than public officers in receipt of a salary, shall be paid such remuneration and allowances out of the general fund of the Authority as may be determined by the Minister.
(1) The Chairman of the Authority shall convene meetings at least once each month to carry on the business of the Authority and whenever he receives a written request signed by at least two members; and in the absence of the Chairman, meetings shall be convened by the Chief Executive and the members present shall elect one of their number to preside as Chairman.
(2) The quorum for any meeting of the Authority shall be five, and the Authority may, subject to the requirement for a quorum, regulate the procedure in regard to meetings of the Authority and the transaction of business at such meetings.
(3) All questions for decisions at any meeting of the Authority shall be decided by the vote of the majority of the members present and, in case of an equality of votes, the Chairman of the meeting shall have a casting vote.
(4) If the Chairman of the Authority, by reason of extended illness or absence is temporarily unable to perform the duties of his office, the President, on the recommendation of the Minister, shall appoint another member of the Authority to act in his place during the period of absence.
(5) The Chairman may at any time resign by a letter addressed to the President and the resignation shall take effect upon being accepted by the President.
(6) Any member who has a direct or indirect interest in any decision that is to be taken on any specific matter by the Authority, shall disclose the nature of such interest at the meeting of the Authority where such decision is being taken and the disclosure shall be recorded in the minutes of the meeting and, if either the member or the majority of the members of the Authority believe that such member's interest in the matter is such as to influence his judgment, he shall not participate in the deliberation or the decision of the Authority on such matter:
Provided that if a majority of the members in attendance at a meeting where such matter is considered determine that the experience or expertise of the interested member is necessary for the deliberation on the matter, they may permit such member to participate as they deem appropriate.
(7) The common seal of the Authority shall be kept in the custody of the Authority and shall not be affixed to any instrument or document except as authorised by the Authority.
(8) All documents, other than those required by law to be under seal, made by, and all decisions of, the Authority may be signified under the hand of the Chairman, or, in the case of a decision taken at a meeting at which the Chairman is not present, under the hand of the person presiding at such meeting.
(1) The Minister shall, after consultation with the Authority, appoint a Chief Executive of the Authority on such terms and conditions as he may determine.
(2) The Chief Executive shall, subject to the general direction and control of the Authority, be charged with the direction of the affairs and transactions of the Authority, the exercise, discharge and performance of its objectives, functions and duties including the administration and control of the officers and other employees of the Authority.
(3) The Minister may remove from office the Chief Executive appointed under subsection (1).
(4) The Authority may employ such other officers and employees as it considers necessary for the efficient discharge of its responsibilities and functions.
(5) The officers and other employees employed under subsection (4) shall be remunerated in such manner and at such rates, and shall be subject to such conditions of service, as may be determined by the Authority.
(6) Every officer or other employee of the Authority shall, subject to this Act, exercise such powers and functions and perform the duties assigned to him from time to time by the Chief Executive.
(1) There is hereby established a fund of the Authority to be known as the General Fund.
(2) There shall be paid into the General Fund–
(a) all such sums of money as may be paid as fees under this Act;
(b) all such sums of money as may be received by the Authority for its operations from any other source;
(3) There shall be paid out of the General Fund all such sums of money required to defray the expenditure incurred by the Authority in the exercise, discharge and performance of its objectives, functions and duties.
(4) The financial year of the Authority shall be the period of twelve months commencing on the first day of July in each year.
(5) The Authority shall cause proper books of accounts to be kept of its income and expenditures, assets and liabilities and all other transactions of the Authority.
The Minister shall determine in respect of the Authority, the amount of money which shall remain the property of the Authority for its budgetary purposes and the amount of money which shall be treated as public funds to be credited to the Consolidated Fund.
(1) Subject to the provisions of this Act, the Authority shall have the duty to–
(a) regulate the securities market;
(b) protect the interests of investors in securities;
(c) promote and facilitate the development of securities market; and
(d) conduct public education programmes.
(2) Without prejudice to the provisions of subsection (1), the Authority shall have powers to–
(a) advise the Minister on all matters relating to the securities industry;
(b) maintain surveillance over securities business;
(c) ensure orderly, fair and equitable dealings in securities;
(d) register, authorise, approve and regulate in accordance with this Act, stock exchanges, dealers, dealers' representatives, investment advisors, investment advisors' representatives, collective investment schemes and other market intermediaries;
(e) regulate and supervise the activities of dealers, dealers' representatives, investments advisors, investment advisors' representatives and other market intermediaries with a view to maintaining proper standards of conduct and professionalism in the securities business;
(f) formulate principles for the guidance of the industry;
(g) determine licensing criteria, conditions and the minimum capital requirements for a licensed, approved, registered, authorized or regulated persons depending on the size of operations and risk;
(h) monitor the solvency of licence holders and take measures to protect the interest of customers where the solvency of any such licence holder is in doubt;
(i) inquire into the affairs of, or conduct routine or ad hoc inspections of the books and records of any licensed, authorized, registered, approved or regulated person and any public company or issuer of the securities;
(j) adopt measures to minimize and supervise any conflict of interest that may arise;
(k) review, approve and regulate takeovers, mergers, acquisitions and all forms of business combination in accordance with any existing rules of practice authorizing or requiring the Authority to do so;
(l) create the necessary environment for the orderly growth and development of the capital market;
(m) perform the functions required to be performed by the Authority under the Companies Act *;
(n) conduct investigations where the Authority has reasons to believe that–
(i) transaction in securities is dealt with in a market in a manner which is detrimental to the investors or securities markets; or
(ii) a market intermediary which violated this Act or the directions issued by the Authority;
(o) call for information from any person and undertake, inspect, conduct inquiries and audits of any market intermediaries including a stock exchange, collective investment scheme or a public company;
(p) call for or furnish any agency such information as may be considered necessary by it for the efficient discharge of its functions;
(q) levy fees or other charges on any person for carrying out securities business in Tanzania;
(r) conduct research into all aspects of securities industry;
(s) disqualify unfit individuals from being employed anywhere in the securities industry;
(t) liaise effectively with the regulators and supervisors of other financial institutions locally and overseas;
(u) do anything which is calculated to facilitate the discharge of its functions, or is incidental or conducive to its discharge, under this Act;
(v) issue notices, circulars, conditions and guidelines as the Authority considers necessary for effective administration of the provisions of this Act; and
(w) undertake such other activities as are necessary or expedient for giving full effect to the provisions of this Act
(1) The Authority may by notice in writing, at any time, where it considers that there is sufficient cause to do so, give a direction to–
(a) a stock exchange;
(b) a member of the council of a stock exchange;
(c) a person who is or has been, either alone or together with another person, a dealer or an investment adviser or is or has been a dealer's representative or an investment representative;
(d) a nominee controlled by a person referred to in paragraph (c) or jointly controlled by two or more persons at least one of whom is a person referred to in that paragraph.
(2) A reference in subsection (1) to a dealing in securities or to a business carried on by a person includes a reference to a dealing in securities by a person as a trustee.
(3) For the purposes of subsection (1), books in respect of which a request to produce may be made shall relate to–
(a) the business or affairs of a stock exchange;
(b) any dealing in securities;
(c) any advice concerning securities or the issuing or publication of a report or analysis concerning securities;
(d) the character or financial position of, or any business carried on by a person referred to in paragraph (c) or (d) of subsection (1); or
(e) an audit of, or any report of an auditor concerning a dealing in securities or any accounts or records of a dealer or of an investment adviser.
(4) No direction to produce shall be made to any person pursuant to paragraph (g) of subsection (1) of this section–
(a) unless the Authority has reason to believe that the person has in his custody or under his control books relating to a matter specified under subsection (2) of this section;
(b) at a time or place that may unduly interfere with the proper conduct of the normal daily business of that person.
(5) The Authority may in writing authorise any person to exercise the power to request for the production of books conferred on it under this section.
(6) An authorisation from the Authority to any person under subsection (5) may be of general application or may be limited to making requirements of a particular stock exchange or other person.
(7) Where the Authority, or a person authorised by the Authority, requires the production of any books under this section and a person has a lien on the books, the production of the books does no prejudice the lien.
(8) An authorised officer shall where required to do so produce evidence of his authorisation.
(9) No action shall lie against any person for complying with a direction or requirement made or given under this section to produce books.
(10) A power conferred by this section to give a direction to a person extends, if the person is a body corporate, to giving that direction to any person who is or has been an officer of the body corporate whether that body corporate is in the course of being wound up or has been dissolved.
(1) Where the required books are produced under section 11, the person to whom they are produced–
(a) may take possession of them, make copies or take extracts from them;
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