Rulebooks: Contents

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Futures Trading Rules
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Section D — Regulatory Framework
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  • 13.8 Market Manipulation and False Market

    • 13.8.1

      A Trading Member or a Trading Representative must not engage in, or knowingly act with any other person in, any act or practice that will or is likely to:—

      (1) create a false or misleading appearance of active trading in any securities or futures contracts; or
      (2) lead to a false market in respect of any securities or futures contracts. For avoidance of doubt, a false market includes a market in which:—
      (a) information is false, exaggerated or tendentious;
      (b) contrived factors are in evidence, such as buyers and sellers acting in collaboration to bring about artificial market prices; or
      (c) manipulative or fictitious orders, transactions or other devices have been employed.

      Refer to Practice Note 13.8.1.

      Amended on 3 April 2008 and 8 October 2018.

    • 13.8.2

      The following factors are relevant when considering whether an act or practice may breach Rule 13.8.1:—

      (1) whether the proposed transaction will be inconsistent with the history of, or recent trading in, the security or futures contract;
      (2) whether the proposed transaction will or may cause or contribute to a material change in the market for or the price of the security or futures contract, and whether the person involved or another person with whom the first person is collaborating may directly or indirectly benefit from alterations in the market or price;
      (3) whether the proposed transaction involves the placing of multiple buy and sell orders at various prices higher or lower than the market price, or the placing of buy and sell orders which give the appearance of increased volume;
      (4) whether the proposed transaction will coincide with or is likely to influence the calculation of reference prices, settlement prices and valuations;
      (5) whether parties involved in the proposed transaction are connected;
      (6) whether the buy and sell orders are to be entered at about the same time, for about the same price and quantity (excluding Direct Business);
      (7) whether the proposed transaction will or may cause the price of the security or futures contract to increase or decrease, but following which the price is likely to immediately return to about its previous level;
      (8) whether a proposed bid (offer) is higher (lower) than the previous bid (offer) but is to be removed from the market before it is executed;
      (9) whether the volume or size of the proposed transaction is excessive relative to reasonable expectations of the depth and liquidity of the market at the time;
      (10) whether the proposed buy (sell) order is likely to trade with the entire best offer (bid) volume and part of the offer (bid) at the next price level;
      (11) whether the proposed buy (sell) order forms part of a series of orders that successively and consistently increase (decrease) the price of the security or futures contract; and
      (12) whether there appears to be a legitimate commercial reason for the proposed transaction.

      Refer to Practice Note 13.8.1.

      Amended on 3 April 2008 and 8 October 2018.

    • 13.8.3

      A Trading Member or a Trading Representative must not enter a buy order or a sell order on the Trading System if there is an existing opposite order from that same Trading Member or Trading Representative in the same security or futures contract for the same price. This Rule does not apply if:—

      (1) the Trading Member or Trading Representative knows or ought reasonably knows that the orders are for different beneficial owners;
      (2) the order is a type expressly permitted in a practice note published from time to time by SGX-ST as having a legitimate commercial reason and which is unlikely to create a false market; or
      (3) the Trading Member or Trading Representative can otherwise establish that the purpose for which the order was made was not to create a false market.

      Refer to Practice Note 13.8.1.

      Amended on 3 April 2008 and 8 October 2018.

    • 13.8.4

      A Trading Member or a Trading Representative must not directly or indirectly deal in securities which involve no change of beneficial ownership as defined in Section 197(5) of the Securities and Futures Act, or knowingly execute, or hold himself out as having executed, an order for the bona fide purchase or sale of futures contracts without having effected a bona fide purchase or sale of futures contracts as defined in Section 207(1) of the Securities and Futures Act. It is a defence if the Trading Member or Trading Representative can show that it, or he or she had no reason to suspect, or no reasonable Trading Member or Trading Representative ought to have suspected or known, that the transaction was a wash sale.

      Amended on 3 April 2008, 23 January 2009 and 8 October 2018.

    • 13.8.5

      A Trading Member or a Trading Representative must not deal in securities or trade in futures contracts in a manner that will or may affect or maintain the price of the securities, futures contract or their underlying, with intent to induce other persons to subscribe for, buy or sell the securities or futures contracts. This Rule does not apply to stabilising action carried out in accordance with Regulation 3 of the Securities and Futures (Market Conduct) (Exemptions) Regulations.

      Amended on 3 April 2008, 23 January 2009 and 8 October 2018.

    • 13.8.6

      A Trading Member or a Trading Representative must not disseminate information that is false or misleading if the Trading Member or Trading Representative:

      (1) knows or ought reasonably knows that the information was false or misleading; or
      (2) is reckless about the truth of the information.

    • 13.8.7

      A Trading Member or a Trading Representative must not participate in any prohibited market conduct in securities or futures contracts or in any insider trading, or knowingly assist a person in such conduct.

      Amended on 3 April 2008 and 8 October 2018.

    • 13.8.8

      A Trading Member or a Trading Representative must immediately inform SGX-ST if it or he or she reasonably suspects, or knows of, any attempted market manipulation, creation of a false market or insider trading.

    • 13.8.9

      A Trading Member must have in place processes to review orders and trades for the purpose of detecting suspicious trading behaviour.

      Refer to Practice Note 13.8.9.

      Added on 18 September 2012.