Directive No. 2 — Remisiers Working in Teams
3 April 2008.
Please contact Member Supervision:—
Facsimile No : 6538 8273
E-Mail Address: firstname.lastname@example.org
1 We are pleased to inform Trading Members that following consultation with the Monetary Authority of Singapore, Remisiers can now operate in teams and enter orders for each other's customers. Trading Members and their Remisiers who wish to engage in such arrangements must observe the following:—
(1) Prior to commencement of any team arrangements, Trading Members must approve the teams and furnish SGX-ST with the names of Remisiers who operate in teams and any subsequent updates.
(2) If a customer's order is passed along a chain of Remisiers, each Remisier must record from and to whom he receives and transmits the order, and the time of such receipt and transmission. Trading Members must ensure that the team Remisiers do not trade ahead of their customers.
(3) Trading Members must keep customers informed of the team arrangements, and give them the option not to be serviced by Remisiers working in teams. Trading Members should also keep their customers informed of any changes to team compositions.
(4) Remisiers must be jointly and severally liable if customers' losses are not recovered.
(5) Trading Members must establish in writing the terms and conditions of each team arrangement with its Remisiers. The terms and conditions must include how possible disputes amongst remisiers working in teams are resolved. Possible disputes that may arise from team arrangements include those in respect of commission allocation, trading errors, and overtrading.
(6) Trading Members must ensure that their Banker's Guarantees are enforceable.
(7) Trading Members must ensure that Remisiers working in teams will not compromise their compliance with all relevant legislation and regulations.
2 Team arrangements increase the risk of a single customer or the team trading beyond the trading limit imposed. In this respect, Trading Members should closely monitor the team to ensure that customers' and Remisiers' trading limits are not exceeded, especially in the case of trades not executed on the Trading System which are not captured real time in the Trading System. Trading Members should also conduct frequent reviews of team operations to ensure that trading irregularities do not occur.