Section 36C: Self­regulatory organizations. A person who wishes to carry on activities as self­

36C. Self­regulatory organizations. A person who wishes to carry on activities as self­ regulatory organization may apply to the Commission for registration and the Commission may, where it deems appropriate in the public interest or for the protection of investors, register any entity as a self­regulatory organization in such form and manner and subject to such terms and conditions as may be specified including but not limited to following, namely:— (a) it is a company licensed by the Commission under section 42 of the Ordinance; (b) it has specified in its memorandum of association as its main objects the discharging of functions of self­regulatory organization; (c) it has necessary infrastructure, adequate office space, equipment’s, experienced man power and technical aspects, financial resources, policies, procedures, systems and controls to effectively and efficiently discharge its functions and responsibilities; (d) its directors and senior management officials fulfill the fit and proper criteria as may be specified; (e) at­least one­half of the number of its directors are independent directors and in order to determine the independent status of a director, the requirements prescribed in the code of corporate governance as specified by the Commission from time to time shall be followed; (f) the chairman of the board of directors of that company shall always be an independent director; (g) it has paid up capital net of losses of not less than such amount as may be specified; and (h) any other conditions as may be specified. Explanation.— For the purpose of this section, senior management officials shall include, chief executive officer or managing director, deputy managing director or chief operating officer and chief regulatory officer or holder of such position by whatever name called.

Effective date: 1997-01-01

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