Law Regulating Dealings in Foreign Stock Markets No. 1 of 2017
The Law Regulating Dealings in Foreign Stock Markets has now been issued, replacing the temporary law No. 50 of 2008. The law is comprised of eight Articles, and mainly states the following:
Article 3 of the law stipulates that engaging in the business of dealing in foreign stock markets and brokering for the account of others are activities solely reserved to be undertaken by Banks (the company licensed to practise banking activities pursuant to the provisions of the Banking Law) and Financial Services Companies (any legal person engaged in the business of performing services as a Financial Broker, Dealer, Investment Trustee, Investment Manager, Financial Adviser, Underwriter, or any combination of these functions, or any other service specified by the Commission pursuant to this Law and the regulations, instructions and decisions issued pursuant thereto)- and that it is prohibited for any person other than a Bank or Financial Services Company to undertake, for the account of others or on behalf of another, any activity directly or indirectly connected to dealing in any foreign stock market or brokering therein. It further prohibits any person from promoting or advertising by any means that the person engages in dealing and brokering for the account of others in a foreign stock market, whether directly or indirectly.
Article 4 of the law outlines the punishments imposed on any person who violates the provisions of Article 3 of this law (namely, imprisonment for a period not less than one year and a fine of not less than JOD5,000 and not exceeding JOD100,000). It further states that any contracts and agreements executed by any person contrary to the provisions of Article 3 of this law shall not be considered valid, and the violator shall be obliged to return any monies received from a third party. The Article then highlights that, without prejudice to the liability of joint partners, if the violator is a company, then its chairman, and the members of its board of directors or management committee or general manager, as the case may be, shall be jointly and severally liable to return the received monies to third parties.
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