Securities Act, 1993
- Commenced on 8 August 1993
- [This is the version of this document at 31 December 1996.]
Part I – Preliminary
1. Short titleThis Act may be cited as the Securities Act.**Date of commencement 17th December, 1993.
Part II – Securities and Exchange Commission
3. The Commission
4. Functions of the CommissionThe Commission shall have the following functions:
5. Delegation of functionsThe Commission may delegate to its officers and employees such of its powers and functions as the Commission considers necessary or expedient to delegate.
6. Rules relating to exchangesThe Commission may by statutory instrument make rules in respect of the following:
Part III – Securities exchanges
7. Unlawful securities market
8. Application for securities exchange licence
9. Lusaka Stock Exchange
10. Power of Commission to give directions to securities exchange
11. Appeal against direction of Commission
12. Power of Minister to close securities exchange
13. Management of securities exchange
14. Rules of securities exchangeSubject to the approval of the Commission, a securities exchange may make such rules as it considers necessary or disirable for the proper and efficient regulation, operation, management and control of the exchange and the securities market operated by the exchange.
15. Securities exchange to assist CommissionA securities exchange shall provide such assistance to the Commission as the Commission may reasonably require for the performance of its functions and duties, including the furnishing of such returns and information relating to its business or in respect of dealings in securities or any other specified information as the Commission may require for the proper administration of this Act.
16. Amendments to rules of securities exchange
17. Use of certain titles
Part IV – Licensing of dealers, investment advisers and representatives
18. Dealers to be licensedAn individual, or any company which is not the holder of a dealer's licence, that—
19. Investment advisers to be licensedA person who is not the holder of an investment adviser's licence and who—
20. Representatives to be licensed
21. Applications for licences
22. Refusal of licence or renewal
23. Terms and conditions of licences
24. Revocation or suspension of licences
25. Rights of applicant
27. Register of licences
28. Records to be kept by licensees
29. Information to be supplied by licensees
30. Fraudulent applicationsAny person who for the purpose of obtaining a licence or the renewal of a licence under this Part, whether for himself or for any other person, makes any representation, whether in writing, orally, or otherwise, which he knows to be false or misleading as to a material particular shall be guilty of an offence, and shall be liable on conviction to a fine not exceeding sixty thousand penalty units or to imprisonment for a term not exceeding three years or to both.[As amended by Act No. 13 of 1994]
31. Deposits by dealers and investment advisers
Part V – Registration of securities
32. Securities to be registered
33. ProspectusA prospectus prepared for the purposes of any public offer to be made in relation to any securities that are registerable under section thirty-two—
34. Dealers not to deal in securities market not operated by securities exchangeA dealer that transacts a dealing in securities at or through a securities market which it knows or could reasonably be expected to know is not a market operated by a securities exchange shall be guilty of an offence and shall be liable on conviction to a fine not exceeding one hundred thousand penalty units.[As amended by Act No. 13 of 1994]
35. Trading of listed securitiesA person who deals in any listed, registered securities otherwise than through a securities exchange shall be guilty of an offence and shall be liable on conviction to a fine not exceeding one hundred thousand penalty units or to imprisonment for a term not exceeding five years or to both.[As amended by Act No. 13 of 1994]
36. Registered securities to be traded through licensed dealers
37. Registered securities to be traded through licensed dealers
38. Continuing obligations in relation to registered securities
Part VI – Conduct of securities business
39. Takeovers and substantial acquisitions
40. Code of conduct with respect to conduct of securities business
41. Contract notes
42. Terms of settlement of bargains in securities, etc.The Commission may by statutory instrument make rules for the regulation of the terms upon which bargains in securities are settled and may thereby prohibit or restrict forward transactions or option contracts.
43. Short selling
44. Safeguarding of investors' property
45. Accounts to be kept by licensees
46. Financial resources rulesThe Commission may, with the approval of the Minister, make rules requiring licensed dealers and licensed investment advisers to have and maintain, in respect of the business in relation to which they are licensed, such financial resources as are required by the rules made under this Act.
47. Investment advisory contracts
Part VII – Improper trading practices
48. False trading and manipulation of the market
49. Use of deceptive statements, etc. as inducementsA person who induces or attempts to induce another person to deal in securities—
50. Fraudulent transactionsA person who, directly or indirectly, in connection with any transaction with any other person involving the purchase, sale or exchange or securities—
51. False or misleading statement in connection with sale of securitiesA person who, directly or indirectly, for the purpose of inducing the sale or purchase of the securities of any company, makes with respect to those securities, or with respect to the operations or the past or future performance of the company—
52. Insider dealing
53. Powers of inspection
54. Damages for loss sustained through contravention of this Part
Part VIII – Powers of intervention
55. Scope of powers under this Part
56. Restriction of business
57. Restriction on dealing with assetsThe Commission may, as regards any assets whether in Zambia or elsewhere and whether they are the assets of a person licensed under Part IV or not, by notice in writing—
58. Maintenance of assets
59. Rescission or variation of prohibition or requirementThe Commission may, either of its own motion or on the application of a licensed person on whom a prohibition or requirement has been imposed under this Part, rescind or vary the prohibition or requirement if it appears to the Commission that it is no longer necessary for the prohibition or requirement to take effect or continue in force or, as the case may be, that it should take effect or continue in force in a different form.
61. Winding up ordersIf, in the case of a company licensed under Part IV, it appears to the Commission that it is desirable for the protection of investors that the company should be wound up under the Companies Act, the Commission may present a petition for it to be wound up under that Act on the ground that it is just and equitable that it should be wound up.[Cap. 388]
62. Receiving ordersIf it appears to the Commission that it is desirable for the protection of investors to do so, the Commission may present a petition for a receiving order in accordance with the Bankruptcy Act against a person licensed under Part IV if the person has committed an act of bankruptcy within the meaning of that Act, and that Act shall, with any necessary modifications, apply in relation to any such petition as it applies in relation to a petition presented by a creditor.[Cap. 82]
63. Orders of the Court
Part IX – Compensation fund
64. Compensation fundThe Minister shall establish and maintain a compensation fund for the purposes of this Part.
65. Compensation Fund Committee
66. Constitution of fundThe compensation fund shall consist of—
67. Purpose of fundThe compensation fund shall be held and applied on such terms and conditions as the Minister may be regulation determine, for the purpose of compensating persons who suffer pecuniary loss occasioned by any default of a licensed dealer or licensed investment adviser, or any employee of such a dealer or adviser, in the course of or in connection with any dealing in securities, being a loss in relation to any money, securities or other property which, in the course of or in connection with the business of any such licensee, was entrusted to or received by the licensee or any such employee for and on the person's behalf.
68. Disbursements from the fundSubject to this Part, there shall be paid out of the compensation fund as and when required and in such order as the Compensation Fund Committee considers proper—
69. Management of fundThe Minister may make regulations prescribing all such matters and things as are necessary or expedient to be prescribed for or with respect to the administration, management and application of any compensation fund established under this Part.
70. Liability of fund to be limitedPayment from the compensation fund shall be limited, in respect of each licensee in default, to such amount as the Minister may be regulation provide.
71. Recovery of disbursements from defaultersAny disbursement from the compensation fund that is accountable to the default of any licensed person is a debt due to the fund and is recoverable at the suit of the Commission in any court of competent jurisdiction.
Part X – Collective investment schemes
72. DefinitionsIn this Part—"collective investment scheme" means any arrangements with respect to money or other property of any description, under which—(a)provision is made for persons taking part in the arrangements 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;(b)property the subject of the arrangements—(i)is owned or held in trust by; or(ii)is managed by or on behalf of,a body corporate (in this Part referred to as the "operator" of the scheme); and(c)the interests of persons participating in the arrangements is represented by shares or other securities of the body corporate or, in the case of a unit trust, by units;(d)funds invested in accordance with the arrangements purporting to be invested with the aim of spreading investment risk."investment company" means a company that is the owner of property the subject of a collective investment scheme;"open-ended investment company" means an investment company whose collective investment scheme makes provision for—(a)redemption or repurchase, by (or out of funds provided by) the company, of shares, securities or units representing the interests of participants in the scheme; or(b)the sale of such shares, securities or units by the participants on a securities exchange at a price related to the value of the property the subject of the scheme;"unit trust" means a collective investment scheme in which:(a)property the subject of which the scheme is held on trust for the participants of the scheme by a person other than the operator of the scheme; and(b)the interests of participants in the scheme is represented by what are commonly known as units in the trust or by a mode of representation, by whatever name described, that the Commission considers equivalent.
73. Authorisation and regulation of schemes
74. Restriction on promotionsA person who—
Part XI – Miscellaneous
75. Immunity of Commission, etc.No person shall be liable to any action in damages for anything done or omitted in the exercise or performance of any power or function conferred or imposed on him by or under this Act unless the act or omission is shown to have been in bad faith.
76. ObstructionA person who obstructs the Commission or any public officer or any person in the exercise or performance of any power, authority, duty, or function under this Act shall be guilty of an offence and shall be liable on conviction to a fine not exceeding twenty thousand penalty units or to imprisonment for one year or to both.[As amended by Act No. 13 of 1994]
77. Offences by bodies corporateIf a body corporate is convicted of an offence against this Act or the rules or regulations made under this Act, every person:
79. Guidance notes, etc.The Commission may issue such guidance notes, bulletins or other regulatory statements as the Commission may consider necessary or desirable for the administration of this Act.
80. Repeal of Act No. 43, 1990 and savings
History of this document
31 December 1996 this version
08 August 1993
|Securities (Licensing, Fees and Levies) (Amendment) Rules, 1998||Statutory Instrument 19 of 1998|
|Securities (Licensing, Fees and Levies) (Amendment) Rules, 2001||Statutory Instrument 31 of 2001|
|Securities (Licensing, Fees and Levies) (Amendment) Rules, 2005||Statutory Instrument 20 of 2005|