Issued in compliance with provisions of Article (67/c) of the Securities Law No. (76) for 2002, and amended upon a resolution by the Board of Commissioners of the Securities Commission No. (159/2009) of 16.3.2009
These directives will be called “Directives of Trading with Securities at the Amman Stock Exchange for 2004” and shall enter into force as from 1.6.2004.
The following words and expressions herein shall have the meanings designated hereunder unless otherwise connoted by the Context:
The Securities Law in force.
Jordan Securities Commission.
Amman Stock Exchange.
Board of Directors
The Board of Directors of the ASE.
The Chief Executive Officer of the ASE.
The electronic trading system.
Transaction of buying and selling securities at the ASE.
A juristic person licensed by the Jordan Securities Commission engaged in the usiness of buying and selling securities for the account of others or for its own account.
A natural person authorized by the JSC to do financial Brokerage work.
A natural person who is a member of the Board of Directors, the Board of executives, a director, a manager or an employee of a financial services company, or any person occupying a similar status or performing similar functions at a financial broker, Dealer, Investment Trustee, Investment Manager, Financial Advisor, Underwriter or financial services company, the term does not include any person whose functions are solely clerical, supporting services or unrelated to the conduct of any business in securities.
Authorization to buy/sell
A request presented by the client to the Broker, requesting and authorizing it to execute a buying /selling transaction of a security, according to specific conditions laid down by the client in accordance with these Directives .
Order sent to the ETS to buy a certain security.
Order sent to the ETS to sell a certain security.
Trading between two Brokers or through one Broker to buy and sell a security in one lot, upon the written authorization of the client, provided that the market value of the single contract does not fall short of the minimum set by the Board of directors for such security and the price of the block trade falls within the allowed minimum and maximum thresholds which are set by the Board of directors for such security.
The price of the last trading transaction in a trading session, executed on a specific security while observing the provisions of article(18) of these directives.
The price upon which the minimum and maximum price thresholds allowed during the trading session are determined and it is equal to the closing price, except the case of security reservation or the case when calculating a new reference price for the security.
The number that the Broker assigns to the client for the purposes of trading, and it shall be previously identified at the Securities Depository Center.
Persons associated with the Broker
Members of the Board of Directors and staff of the Broker.
a.Trading with securities at the ASE will take place through trading contracts between brokers for their own account or for the account of their clients. It will be prohibited to agree on a price that violates what is stipulated in the Contract.
b.Trading transactions will be documented in records by the ASE either manually or electronically.
a.A Broker must not dispose of funds, nor trade in securities of any of its clients unless in compliance with the provisions of the law, bylaws, directives and resolutions issued according to that Law in addition to the provisions of the written agreement concluded therewith.
b.The Broker shall use the client’s funds to execute transactions to the account of the same client; such funds cannot be used to execute transactions to the account of the Broker or to the account of third parties.
a.The Broker must incorporate in the agreement concluded with it’s client any information or terms required by the valid bylaws and directives especially following:
1.Name and address of both the Broker and the client.
2.Illustration of the services to be delivered by the Broker to it’s client.
3.Illustrate commissions that the Broker will charge for it’s services or refer to a separate document illustrating these commissions. However, such commissions must be within the permitted range.
4.Types of authorizations upon which the Broker can enter the client’s orders.
•B. No matter what agreement is concluded, the Broker cannot restrict or get an exemption of the responsibilities imposed by the valid legislation.
•C. The agreement referred to in Paragraph (a) in this Article will be subjected to the ASE control.
1.the Broker must obtain written or over the phone authorizations from its clients to empower it to dispose of their securities on their behalf. These authorizations will be mandatory to the Broker.
2.The client can authorize the Broker to buy or sell a security upon an e-mail as connoted in the valid Law of Electronic Transactions .
3.At any time, the Broker must prove that it has an authorization shows the name of client, name of the issuer, type of transaction (buy or sell), number of securities, price, date and time and validity of the authorization.
1.The Broker must confirm date and time when receiving authorization to observe sequence when entering orders into the ETS including authorizations of it’s own portfolio.
2.The Broker must document, in written, the authorization over the phone using the form approved thereby for a written authorization before entering the order into the ETS. The Broker will be held responsible for the result of such an entry.
The authorization must determine the price which the Client wishes to execute according to the types of orders permitted by the ASE .
The Broker must keep all authorizations in a sequential order according to the time of receipt; such authorizations will be subjected to the ASE control.
1.The Broker must keep authorizations for a period set by the Board of Directors.
2.Telephone recordings kept with the Broker will be approved as a reference in case a dispute erupts between the Broker and the Client.
The Broker licensed to act as investment manager must trade to the account of his Client in conformity with the Investment management agreement signed by them and stipulates the investment policy of the Client in line with the provisions of the law, bylaws, and directives in force.
1.The Broker must inform the Client of the following:
a.Executed transactions for the client’s benefit immediately upon execution or as per the Agreement concluded between them .
b.Unexecuted transactions for the client’s benefit once the authorizations given to the Broker expire.
c.That the Broker or any of the persons associated with it was a party to the executed transaction to the account of the Client unless otherwise stipulated in the Agreement.
2.The Broker licensed as a investment manager must serve a statement to the Client whose investments are managed by the broker. showing all executed transactions on the Client’s account, the account balance of securities at least once per month unless the agreement stipulates otherwise.
If the Broker and/or the Certified has (have) an interest in the transaction to be executed for the client’s account or if any is related to the transaction that can result in an interest conflict, they shall be prohibited to execute such a transaction unless they take relevant procedures to guarantee the Client’s interest and fair treatment.
1.The Broker shall be prohibited to execute any transaction on a certain security for its own benefit or for the benefit of clients whom it manages their investments, in case the Broker has already attempted a financial consultancy related to the same security. This shall apply until the financial consultancy is published to the public excluding the two following cases:
a.If the financial consultancy is meant for the Broker’s own purposes and will not be published to the public.
b.Executing orders given by clients whose investments are not managed by the Broker .
2.The Broker shall ensure confidentiality of information contained in the financial consultancy set for publication and that such information will not be disclosed to any of the non-concerned employees before it’s publication.
3.Unless one business day passes after publishing a financial consultancy related to a certain security, the Broker cannot execute any transaction related to that security whether to it’s own account or to the account of the clients whose investments are managed by the broker.
a.The Broker shall be prohibited to do any action aims to give a misleading status of any security’s price, volume or activity in a manner that influences supply and demand.
b.The Broker shall not execute any transaction to the account of any of its clients if such a transaction breaches provisions of Paragraph (a) of this Article.
1.The Broker shall be prohibited to execute any transaction on any security to his account or to the account of any of it’s clients based on insider information related to the same security or to any other related security.
2.For the purposes of these diectives and without breaching definitions of insider information given in the Law , the following information will be considered as insider information :-
a.Information related to the intention of any person to execute, or actually executing, selling or buying transaction in large quantities on a given security
b.The financial consultancy prepared by the Broker prior to its publication .
3.The Broker shall be prohibited to provide financial consultancy to any person based on insider information.
4.The Broker shall be prohibited toexecute any order for the benefit of any of its clients if the broker knows that this order is based on any insider information.
The ASE officers responsible for surveillance shall have the right to cancel buy and sell orders entered into the ETS on a certain security if the prices or volumes of such orders are meant to hamper trading on that security.
The CEO or this who he/she shall authorize in written from among the ASE employees, may adjust the closing price if discovering that the price of the last transaction on a certain security was meant to affect the closing price of that security. Accordingly, the closing price will be the price of the last transaction in a manner that does not breach the valid legislation provisions.
In order to execute block trades excluded from the minimum and the maximum price thresholds , the ASE may upon the broker’s written authorization enter buy and sell orders into the ETS on behalf of the Broker who will be entirely responsible for such entry.
1.The CEO or this who he shall authorize in written from among the ASE employees may cancel any transaction executed during the trading session in any of the following cases:-
a.A mistake has occurred while sending the order, provided that the involved Broker requests the cancellation within (10) minutes of execution, upon approval of the other party and before the market is closed.
b.As a result of a technical failure and the involved brokers shall be immediately notified thereof.
2.When requesting the cancellation of a transaction, the involved brokers shall fill in a form prepared for this purpose and send it to the ASE.
a.The Broker and Persons associated with it including the Certified brokers shall be prohibited from trading with securities unless through the Broker itself.
b.Prohibition stipulated in Paragraph (a) of this Article related to persons associated to the Broker shall not apply to the legal persons but to their representatives.
c.No Certified persons or employee at a financial service firm can be authorized to trade for any account at the firm or any other firm.
The ASE shall have the right to request all documents required to ensure sound trading.
a.The CEO or this who he/she shall authorize in written from among the ASE employees, may adjust the reference number in the executed trades based on a justifiable request by the Broker and accepted by the ASE.
b.The ASE may take all the procedures and request all documents it deems necessary to do the adjustment.
The ETS shall be operated on a daily basis in order to trade securities at the ASE. except for holidays, official days, and the last working day in the calendar year.
The Board of Directors shall set the hours and phases of trading sessions at the ASE.
The ASE shall announce the Board of directors decisions on matters relating to trading sessions included in these directives .
The ASE shall immediately inform the brokers if any change has been introduced to the timetable of the trading sessions as a result of any contingency.
Trading on the ASE shall be through the various pricing groups, set by the Board of directors .
Trading on the ASE shall be on the basis of one security and its multiples unless the Board of directors shall decide otherwise .
The Board of Directors shall set the minimum quantity a Broker can display of the total quantity of securities entered in the buy and sell orders.
The Board of Directors shall set the period of time that must elapse after entering or modifying the order though the ETS so that the Broker can cancel it or modify it.
1.Securities can be priced either in Jordanian Dinar or in any other currency.
2.Securities issued in Jordanian Dinar shall be priced in multiples of ten fils; however, the Board of Directors shall determine the monetary multiples for securities issued in other currency.
The Board of Directors shall determine the permissible percentage of price increase and decrease for securities compared to the reference price. The Board of Directors shall also determine permissible percentage for the price to exceed that percentage during the trading session in case of reservation.
The ASE shall cancel buy and sell orders entered into the ETS and are still valid for a given security on the day following distribution of cash profits and in all cases in which the ASE calculates a new reference price excluding the case of reservation.
a.The Board of Directors may exclude some block trades from minimum and maximum price thresholds allowed for the block trade in any of the following cases:-
1.If the Government or any public institution is a party of such block trades.
2.If the market capitalization of the block trade is not less than the minimum limit set by the Board of Directors for this purpose.
3.Any other case approved by the Board of Directors if convinced that the transaction reflects the will of two parties to execute the block trade at the requested price.
•B. Trading commissions for block trades stipulated in Paragraph (a) of this Article shall be calculated at either the execution price or the closing price of the relevant security on the execution day, whichever is higher .
a.The ASE will undertake execution of transactions to sell securities required upon a court sentence or upon request by relevant official parties .
b.The Board of Directors shall organize the process of distributing transactions referred to in Paragraph (a) of this Article to the brokers operating at the ASE.
c.The Broker who executes the selling transaction will issue a check for the value of the sold securities after subtracting commissions due to the relevant party that decided to sell ; along with the invoice to be delivered to the ASE.
d.Brokers shall be committed to collect the minimal commission set in the valid legislation when executing transactions stated in Paragraph (a) of this Article.
a.Only the certified brokers can use the trading screens of the ASE to enter buy and sell orders into the ETS.
b.While observing provisions of Paragraph (c) of this Article, the number of trading screens for the broker shall not exceed the number of certified brokers.
c.The Board of Directors shall identify the maximum number of trading and inquiry screens given to each broker.
A Certified Broker must pass the examination required by the ASE.
If any broker could not have access to the ETS due to technical failure, the ASE shall assist and permit to use the backup systems available at the ASE to enter orders into the ETS. In case several brokers being unable to access to the System, the CEO will have the right to decide to resume or stop the trading session as per the market interest.
Phone calls taking place during the trading session between brokers and ASE officers in charge of surveillance shall be recorded and kept for the period set by the Board of Directors. These recordings shall be used as a reference for the purposes of implementing the provisions of law, bylaws, and directives issued in compliance therewith.
Brokers will be committed to all administrative, organizational and technical decisions issued by the Board of Directors and the CEO as needed to the effect of implementing the provisions herein.
The ASE shall impose penalties against those breaching these directives. Such penalties will be in accordance with the provisions of the Law; bylaws, directives and resolutions issued in compliance therewith including nullity of transactions that violate valid legislation.
All issues related to the internet trading service that a Broker delivers to it’s clients shall be governed through special directives () issued for this purpose.
The Board of Directors shall issue the trading system user manual.