Issued by virtue of the provisions of Article (67/C) of the Securities Law No. 76 for the year 2002 and article (24/B/1) of the Internal By-Law of Amman Stock Exchange for the year 2004
These Directives shall be called the ” Directives for Internet Trading on the Amman Stock Exchange for the year 2009″ They shall enter into effect as of 3/8/2009.
A. The following words and expressions in these directives shall have the meanings assigned to them hereunder, unless otherwise indicated by context.
Jordan Securities Commission.
Amman Stock Exchange
Chief Executive Officer of the ASE
The ASE electronic trading system
Internet Trading Service, which is provided by the Broker to its client, in order to allow him to enter buying and selling orders and follow them by himself through the Internet by using a special program
The special program, which is approved by the ASE, for the Internet trading purposes.
A legal person licensed by the JSC to do the work of a financial Broker and authorized to offer the ITS.
A natural person certified by the JSC to perform financial brokerage work.
The process by which a trading contract is completed with the final, unconditional transfer of securities from the seller to the buyer and the final settlement of price payments in their respect.
B. The words and expressions not construed in these directives shall have the meanings assigned to them in the “Directives of Trading with Securities at the Amman Stock Exchange”, unless otherwise indicated by context.
No Broker shall offer the ITS before obtaining the ASE’s written approval and the JSC’s authentication in accordance with the specific mechanism in these directives.
A. Trading in securities on the ASE shall take place through trading contracts between Brokers either for their own accounts or their clients’ accounts.
B. For purposes of implementing these directives, entering buying and selling orders to the ETS shall be restricted to clients who use the ITS via the program.
The Broker must provide sufficient funds necessary to confront and meet its financial obligations arising from dealings in securities in accordance with the provisions of these directives.
A. The Broker wishing to offer the ITS must submit an application to the ASE, together with all required documents – which are certified by the ASE- as per the standard form made for this purpose, the documents should include the following:
1. A draft form of Broker – Client Contract to regulate offering the ITS in accordance with the requirements of article (10/C).
2. A written Contingency Plan describing the Broker’s strategy and available resources to enter buying and selling orders for the clients on behalf of them when the trading via the Internet becomes unavailable to the clients for any reason.
3. A Risk Disclosure Statement, which shall prominently and explicitly state all risks related to buying and selling securities through the ITS.
4. Fees to be charged by the Broker for offering the ITS.
5. A statement of minimum qualifications required in the client who wishes to use the ITS.
B. The ASE may request any additional requirements to consider the application of the Broker who wishes to provide the ITS.
The ASE shall review and submit a certificate to the JSC that:
A. All documents and information attached with the application are accurate, complete and in compliance with these directives.
B. The program which is used by the broker meets the ITS requirements.
C. The broker’s IT infrastructure is suitable to carry out the Internet trading operations in a correct and uninterrupted manner.
D. Installation of the program and communication systems with the ETS meets the ASE technical and operational requirements.
A- After approving the Broker’s application by the ASE in accordance with these directives, the ASE forwards the application with all supporting documentation to the JSC to obtain its authentication.
B- The JSC may request additional requirements before the authentication of the application.
A- The Broker, who obtained the ASE’s approval and the JSC’s authentication to provide the ITS, shall publish the Risk Disclosure Statement indicated in article (6/A-3) of these directives on its website before proceeding to provide the ITS.
B- The Broker shall at all times keep the Risk Disclosure Statement, and any information related to the ITS requested by the ASE and/or the JSC on its website.
A. Subject to qualifications required by the ASE and/or the JSC, the Broker, as it deems appropriate, may require qualifications in the client who use the ITS.
B. The Broker shall take all necessary procedures to verify the identity of the client who requests opening an Internet trading account and shall retain copies of all documents used to verify the identity of the client.
C. No Broker shall offer the ITS before signing a contract with its client consistent with the contract draft, which includes particularly;
1. A Risk Disclosure Statement, and acknowledgment that the client has received and read the statement.
2. A Statement of Fees to be charged by the Broker for offering the ITS
3. A detailed statement of both the Broker’s and the client’s rights and obligations.
4. Emphasis on the client responsibility to maintain his username and password.
5. The client approval to receive the documents and correspondences electronically.
6. Emphasis that the client understands the nature of the risks that may occur to his investments in securities as a result of Internet trading, particularly those arising from the possible delay in the arrival of orders sent to the ETS.
7. Emphasis that the client bears responsibility for his mistakes during orders entry, modification or cancelation.
8. A provision confirming the client’s commitment to the Securities Law provisions, regulations, directives, and decisions issued pursuant thereto, and his full liability for the violations committed by him.
9. Technical support and the necessary technical assistance provided by the Broker to its clients.
D. No Broker may shift legal responsibility to any client for losses arising from third party misuse of, or technical failures in, the Broker’s program authentication or security mechanisms.
The ASE Board of Directors may set up:
A. The minimum balance required, in cash or equivalent securities; for opening an Internet trading account
B. The types of buying and selling orders- and the duration of their validity – which the client is permitted to enter through the ITS.
A. The program verifies the sufficiency of the client’s cash or securities balances, before any order entry, or modification of an existing order into the ETS.
B. If the client issues an order to the Broker according to article (13/B) of these directives, the Broker must verify the sufficiency of the client’s cash or securities balances as the case may require before any order entry or modification of an existing order into the ETS.
A. Except scheduled maintenance times, the client may at all times enter new buying and selling orders, modify and cancel non-executed and partially executed existing orders, through the program which sends them to the ETS during the trading hours in the ASE.
B. The client may issue to the Broker new buying and selling orders or request modifying or canceling non-executed and partially executed existing orders in behalf of him, during the Broker’s regular business hours, if the ITS is not available to the client for any reason.
The program shall electronically do the following:
A. When a buying order is sent to the ETS, the cost of the securities to be bought, together with the value of trading commissions and due charges, shall be seized from the client’s cash account available for trading.
B. When a selling order is sent to the ETS, the amount of securities to be sold shall be seized from the client’s securities account available for trading.
C. When a buying order is totally or partially executed, the cost of the bought securities, together with the value of trading commissions and due charges, shall be deducted out of the seized cash balance, and the client’s securities account balance shall be increased by the quantity of bought securities.
D. When a selling order is totally or partially executed, the quantity of sold securities shall be deducted out of the seized securities balance, and the client’s cash account balance shall be increased by an amount equal to the selling amount, minus the value of trading commissions and due charges.
E. In case an order is rejected by the ETS, or modified or canceled by the client, the client’s cash and securities account balances shall be readjusted accordingly.
It is prohibited to use the ITS for executing Block Trades.
The Broker must immediately inform the ASE and the JSC in writing of prohibited acts committed in violation of the provisions of the Securities Law, regulations, directives, and decisions issued pursuant thereto by its clients who use the ITS.
The Broker must guarantee providing its clients who use the ITS with the following live trading information:
A. Live Market Watch.
B. A “Market Depth” function reflecting at least the best five bid/ask prices and quantities for the selected security. as supported by the ASE.
C. The client’s cash and securities balances (stamped with time and date ).
D. An immediate assessment for the client’s portfolio.
E. Status of all the client’s entered orders.
F. A statement shows the client’s transactions (stamped with time and date ).
G. Any additional information, required by the ASE and/or the JSC.
Any Broker wishes to offer the ITS to its clients shall sign a data distribution agreement with the ASE.
A. The ASE shall maintain an electronic performance log for all the brokers which offer the ITS – in accordance with a form approved by the JSC- includes the following data and information for each Broker;
1. The date, time and duration the ITS is unavailable for its clients for any reason.
2. A description of the ITS outage.
3. A description of the procedures taken to correct the ITS outage.
4. Clarification of the ITS outage causes.
B. The ASE shall submit the log and its updates to the JSC on a monthly basis.
The ASE Board of Directors shall determine the charge which the ASE collects for activating the ITS.
After obtaining the JSC’s approval, the ASE may carry out one or more of the following actions:
1. Restrict, suspend or forbid the offering of the ITS.
2. Restrict, suspend or forbid the activity of any Broker regarding offering the ITS.
3. Restrict, suspend or forbid the offering of the ITS to any specific client.
4. Reorganize the ITS.
The Broker shall abide by the decisions issued by the ASE and the JSC that are necessary to implement the provisions of these Directives.
Provisions stated in the valid “Directives of Trading with Securities at the Amman Stock Exchange” shall apply to the Internet trading, unless an express provision is provided for in these Directives.
The CEO shall take all the necessary decisions to implement the provisions of these Directives, unless otherwise stipulated for.
If the ASE finds any violation of the provisions of these directives, the ASE shall submit a report to the JSC which includes the facts and violations to take the appropriate actions.
According to these directives, dealings between the Broker and its clients shall be carried out in accordance with the method of dealing on a cash basis or margin funding basis.