Podcast
Questions and Answers
What is the initial capital requirement for a trading member who holds client margins?
What is the initial capital requirement for a trading member who holds client margins?
- R300 000
- R400 000 (correct)
- R200 000
- R150 000
What must a trading member do to terminate its membership?
What must a trading member do to terminate its membership?
- Pay a termination fee
- Provide 30 days written notice (correct)
- Submit a financial report
- Notify the JSE verbally
When a trading member undergoes a change in corporate structure, what is their obligation?
When a trading member undergoes a change in corporate structure, what is their obligation?
- Notify the JSE within 14 days
- Update the company registration only
- Notify the JSE immediately in writing (correct)
- No notification is required
Which of the following applies to a trading member that wishes to change its authorised user status?
Which of the following applies to a trading member that wishes to change its authorised user status?
Which action can the Membership Committee take regarding a termination request?
Which action can the Membership Committee take regarding a termination request?
What is the consequence for a trading member with capital adequacy deficiency?
What is the consequence for a trading member with capital adequacy deficiency?
What is required when a trading member's business structure is transferred to another entity?
What is required when a trading member's business structure is transferred to another entity?
What does the term 'mutatis mutandis' signify in the context of membership changes?
What does the term 'mutatis mutandis' signify in the context of membership changes?
How much initial capital is required for a trading member who does not hold client margins?
How much initial capital is required for a trading member who does not hold client margins?
What must accompany the notification of a change in membership to the JSE?
What must accompany the notification of a change in membership to the JSE?
Upon termination of membership, what action does the JSE take regarding notification?
Upon termination of membership, what action does the JSE take regarding notification?
Which of the following is NOT a reason the JSE may require a new application for membership?
Which of the following is NOT a reason the JSE may require a new application for membership?
What additional information might the JSE request when notified of a change in membership?
What additional information might the JSE request when notified of a change in membership?
What is the minimum notice period required for a trading member to inform the JSE about a transfer in business structure?
What is the minimum notice period required for a trading member to inform the JSE about a transfer in business structure?
Which of the following scenarios would require the JSE to determine a new membership application must be made?
Which of the following scenarios would require the JSE to determine a new membership application must be made?
What happens to the termination of membership upon notification by the JSE?
What happens to the termination of membership upon notification by the JSE?
What is a requirement for a trading member authorized as an inter-dealer broker (IDB)?
What is a requirement for a trading member authorized as an inter-dealer broker (IDB)?
Which statement best describes the clearing agreement requirements for a trading member?
Which statement best describes the clearing agreement requirements for a trading member?
What are the conditions under which the JSE may authorize an IRC trading member to provide services?
What are the conditions under which the JSE may authorize an IRC trading member to provide services?
What happens if an inter-dealer broker wants to trade on a matched principal basis?
What happens if an inter-dealer broker wants to trade on a matched principal basis?
Which of the following is NOT a requirement for IDBs to maintain their status?
Which of the following is NOT a requirement for IDBs to maintain their status?
What must a trading member demonstrate to the JSE as part of the membership application process?
What must a trading member demonstrate to the JSE as part of the membership application process?
Upon which basis must IDBs operate their business activities?
Upon which basis must IDBs operate their business activities?
What obligation does an IDB have when requested by any trading member regarding bond transactions?
What obligation does an IDB have when requested by any trading member regarding bond transactions?
Which of the following best describes the restriction placed on trading members regarding their client representations?
Which of the following best describes the restriction placed on trading members regarding their client representations?
Study Notes
Membership Change Notifications
- Trading members must inform the JSE at least one month prior to transferring IRC securities trading to another entity, accompanied by detailed information akin to a new membership application.
- In cases of mergers, take-overs, transfers, or corporate restructuring, the JSE may request additional particulars regarding reasons for changes.
Termination of Membership
- The JSE must notify trading members of any membership terminations or changes, effective immediately unless specified otherwise.
General Membership Requirements
- Applicants must meet specific criteria set by the JSE, including compliance with established requirements.
- The JSE maintains a register of trading members, detailing their respective categories and sub-categories of authorized user.
Categories of Membership
- Trading members can enter into clearing agreements with one clearing member for transaction settlement.
- Members can either be clearing members or trade on behalf of clients.
- Inter-dealer brokers (IDBs) are a sub-category of trading members, prohibited from being clearing members and subject to specific IDB rules.
Specific Requirements for Inter-Dealer Brokers (IDB)
- IDBs must limit activities in JSE-listed bonds to facilitating transactions between counterparties or matched principal trading.
- They are not allowed to take proprietary positions against clients when trading on a matched principal basis.
- Must provide a list of potential client counterparties upon request from other trading members.
Capital Requirements
- Trading members trading on behalf of clients without managing client margins must have a minimum initial capital of R200,000.
- Those holding client margins or other assets must maintain at least R400,000 in initial capital.
- The JSE can suspend members for capital adequacy deficiencies.
Membership Changes and Termination
- Members seeking to change their authorized user status or sub-category must submit an application with necessary modifications.
- Trading members can apply for membership termination by providing 30 days written notice to the JSE.
- Changes in name or corporate structure must be communicated immediately to the JSE.
- The Membership Committee has discretion over acceptance of termination applications based on fulfillment of obligations.
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Description
This quiz covers the necessary regulations and procedures for trading in IRC securities, including the protocol for name changes and the implications for trading members' businesses. Understanding these regulations is essential for compliance within the trading environment.
