The Exchange's enforcement of this Rules is critical to the health of the Markets. This Chapter sets out the various powers available to the Exchange in connection with its obligation to operate a fair, orderly and transparent market. The Exchange's powers range from temporarily restricting Members' activities to referring the matter to the Disciplinary Committee. The Exchange may exercise various powers as set forth below under two (2) main scenarios — (a) upon the occurrence of an Adverse Event; or (b) where there is a Rule Violation by a Member, Approved Trader or Registered Representative. The powers exercisable by the Exchange upon the occurrence of an Adverse Event are designed to deal swiftly with an unforeseen event. Having exercised such powers as set forth in Rule 7.3, the Exchange may thereafter refer the matter to a Disciplinary Committee if it deems fit. In the event of a Rule Violation, the Exchange's powers are limited to the exercise of certain summary powers prior to the matter being referred to the Disciplinary Committee. In proceedings before the Disciplinary Committee, the Exchange lays a charge against the Member, Approved Trader or Registered Representative concerned, and acts as a prosecutor. To assist in determining if any Rule Violation has occurred, the Exchange also conducts inspections and investigations.
7.1.1 Adverse Events
The Exchange may exercise any of the powers set forth in Rule 7.3 if any of the following events occur, which adversely impacts on a Member, Approved Trader or Registered Representative's ability to meet its obligations under this Rules (collectively, "Adverse Events"):
Amended on 7 August 20127 August 2012 and 29 July 2022.
7.1.2 Rule Violations
All Rule Violations are chargeable before the Disciplinary Committee in accordance with the procedures set forth in this Rules. Rule Violations may also result in the exercise of various powers of the Exchange as set forth in Rule 7.2.
7.1.4 Rule Violation by Approved Trader or Registered Representative to be deemed Rule Violation by Sponsoring Corporate Member
Any Rule Violation by any Approved Trader or Registered Representative shall also be deemed to be a Rule Violation by the sponsoring corporate Member for the purpose of proceedings before the Disciplinary Committee. If an Approved Trader or a Registered Representative suffers an Adverse Event, the sponsoring corporate Member shall be deemed to have suffered an Adverse Event.
7.1.6 Notification of Exercise of Powers by the Exchange
Except as otherwise provided under this Rules, the Exchange shall:
7.1.7 Public Announcement by Exchange
The Exchange shall notify all Members, Approved Traders, Registered Representatives and the general public via Circulars of the outcome of any proceedings before the Disciplinary Committee or Appeals Committee.
7.2.1 Disciplinary Action
Amended on 16 May 201116 May 2011.
7.2.1A Composition by the Exchange.
For the purposes of determining whether a Rule Violation is classified as a first, second, third or subsequent offence under Schedule A, only previous violations under the same Rule will be taken into consideration.
Added on 16 May 201116 May 2011.
7.2.2 Investigative Powers
In determining whether to lay a charge before the Disciplinary Committee or to make an offer of composition, the Exchange may, without notification to any Member, Approved Trader or Registered Representative, commence investigations in accordance with Rule 7.4.
Amended on 16 May 201116 May 2011.
7.2.3 Restriction and Supervision of Member's Conduct of Business
Amended on 25 August 200925 August 2009.
7.2.4 Restriction of Activities of Members, Approved Traders or Registered Representatives
Amended on 25 August 200925 August 2009 and 1 April 20141 April 2014.
7.2.5 Referral to Disciplinary Committee
If the Exchange suspends the privileges of a Member, Approved Trader or Registered Representative as contemplated in Rules 2.13.7, 2.14.3 or 2.15.2, or exercises any of the powers set forth in Rules 7.2.3 and 7.2.4, the Exchange shall refer the matter to the Disciplinary Committee within fourteen (14) calendar days of such action (the "Summary Referral"). The Summary Referral shall contain an account of (a) the Exchange's exercise of the summary powers; and (b) the grounds for taking action against the Member, Approved Trader or Registered Representative. The Exchange shall provide the Member, Approved Trader or Registered Representative with a copy of the Summary Referral at the same time that such document is provided to the Disciplinary Committee. The Summary Referral shall constitute a notice of charge as contemplated under Rule 7.7.2.
7.3 Exchange's Powers upon Occurrence of Adverse Events
Unless otherwise specified in this Rules, upon the occurrence of any Adverse Event, the Exchange may exercise any of the following powers as it deems fit:
7.3.1 Liquidation of Positions
The Exchange may limit trading to liquidation of positions only or order liquidation of all or a portion of the positions in a Member's House Account or Customer Account or both.
7.3.2 Fix Settlement Price
The Exchange may fix a settlement price for the liquidation of positions in any Contract, including a Connect Contract.
Amended on 29 July 2022.
7.3.3 Call for Additional Margins
The Exchange may require additional margins to be deposited with the Clearing House for any Contract, including a Connect Contract.
Amended on 29 July 2022.
7.3.4 Confine or Limit Trading
The Exchange may confine trading of any Contract to a specific price range or modify Trading Days or hours.
7.3.5 Alter Delivery Conditions
The Exchange may defer delivery or designate alternative delivery points or procedures or alter conditions of delivery with respect to deliverable Futures Contracts.
7.3.6 Call on Trading Member's Letter of Credit
If a Trading Member's act or omission results in a Clearing Member defaulting under Rule 7A.01A.1 of the Clearing Rules, the Exchange or the Clearing House, as the case may be, reserves the right to call on any of the Qualifying Letters of Credit posted by the Trading Member to meet its financial requirements set forth in Rule 2.5, and apply the proceeds toward the discharge of liabilities incurred by the Clearing Member to the Clearing House.
Amended on 7 August 20127 August 2012 and 29 December 201429 December 2014.
7.3.7 Other Actions as Deemed Fit
The Exchange may take such other actions against any Member, Approved Trader or Registered Representative as it deems fit to discharge its regulatory obligations under the Act to maintain a fair, orderly and transparent market.
7.3.8 No Liability
Without prejudice to the generality of Chapter 1, the Exchange, its related corporations, SGX RegCo, any person or entity referred to under Rule 1.7.4, and their respective directors, officers, employees, representatives and agents shall not be liable to any Trading Member or any other Person in respect of any damage, loss, cost or expense of whatsoever nature (whether direct, indirect, special or consequential, including without limitation any loss of business, revenue, goodwill, bargain or profit), suffered or incurred by such Trading Member or other Person, arising out of or in connection with, or arising out of or in connection with any thing done or not done as a direct or indirect consequence of, the exercise or non-exercise of the powers under Rule 7.3 or the determination of the satisfaction or non-satisfaction of any condition for the exercise of such powers.
Amended on 26 April 201326 April 2013, 15 September 201715 September 2017 and 3 June 20193 June 2019.
7.4.1 Commencement of Investigations
The Exchange may conduct an investigation if:
Amended on 1 April 20141 April 2014.
7.4.2 Direction to Commence Investigation by MAS
The Exchange shall conduct an investigation if MAS so directs.
7.4.3 Requirement to Cooperate with Investigations
The Exchange may direct a Member, Approved Trader, Registered Representative or any Member's director, officer, employee or agent to:
and that Person shall comply with the Exchange's direction.
7.4.4 Prohibition Against the Furnishing of False Statements or Information to the Exchange
A Member, Approved Trader, Registered Representative, or any Member's director, officer, employee or agent shall not wilfully make, furnish or permit the making or furnishing of any false or misleading information, statement or report to the Exchange.
7.4.5 Appointment of Exchange Examiners
The Exchange may appoint any Person or Persons to assist in its investigation (the "Exchange Examiners"). The Exchange may delegate all or any of its powers under this Rule 7.4.5 to the Exchange Examiners. The Exchange Examiners shall report the results of their investigations to the Exchange.
7.4.6 Supply of Information
The Exchange may direct a Member, Approved Trader or Registered Representative to provide specified information relating to Members' Affairs, transactions relating to Customers and former Customers, and matters pertaining to any contract. Such direction shall be in writing and the Member, Approved Trader or Registered Representative shall provide the information to the Exchange within such period as is specified by the Exchange, being a period of not less than two (2) Business Days after receipt of the Exchange's direction. Information provided to the Exchange under this Rule shall be treated as Confidential Information and subject to the safeguards set forth in Rule 1.4.
7.5.1 Composition of Disciplinary Committee
The Disciplinary Committee shall comprise persons appointed by the SGX RegCo Board and shall not have a member who is, or who within three years of the proposed appointment date was, a director, officer or employee of:
Amended on 15 September 201715 September 2017 and 3 June 20193 June 2019.
7.5.2 Chairman and Deputy Chairman of the Disciplinary Committee
The SGX RegCo Board shall appoint the chairman and deputy chairman of the Disciplinary Committee. In the absence of the chairman, the deputy chairman will have all the powers of the chairman.
Amended on 15 September 201715 September 2017 and 3 June 20193 June 2019.
7.6.1
The Exchange may initiate disciplinary proceedings and charge a Member, Approved Trader, or Registered Representative before the Disciplinary Committee if the Exchange is of the opinion that the Member, Approved Trader or Registered Representative has committed any of the following:
Amended on 1 April 20141 April 2014 and 3 June 20193 June 2019.
7.6.1A
The Disciplinary Committee shall, as a tribunal of first instance hear and determine charges brought by the Exchange against a Member, Approved Trader, or Registered Representative pursuant to Rule 7.6.1. The Disciplinary Committee may exercise its powers against a Member, Approved Trader, or Registered Representative if it is satisfied, on a balance of probabilities, that the Member, Approved Trader, or Registered Representative has committed any of the matters set out in Rule 7.6.1.
Added on 3 June 20193 June 2019.
7.6.2 Powers of the Disciplinary Committee
The Disciplinary Committee may impose one or more of the following Sanctions:
The Disciplinary Committee may order a stay of any Sanction imposed, pending an appeal to the Appeals Committee.
Amended on 25 August 200925 August 2009 and 3 June 20193 June 2019.
7.6.2A Mandatory Minimum Penalties to be Imposed by Disciplinary Committee for certain Rule Violations
Where a mandatory minimum penalty has been stipulated for a particular Rule Violation in the thirteenth column of Schedule A, the Disciplinary Committee:
Added on 16 May 201116 May 2011 and amended on 3 June 20193 June 2019.
7.6.2B
A failure to comply with any Sanction imposed by the Disciplinary Committee constitutes a breach of this Rules.
Added on 3 June 20193 June 2019.
7.6.3 Exercise of Power by Disciplinary Committee Due to Breach by Chief Executive Officer, Director or Key Personnel
The Disciplinary Committee may exercise its powers against a Member if that Member's chief executive officer, any director or key personnel who is suitably qualified and experienced to implement, oversee and maintain adequate internal procedures and risk management controls as contemplated under the Rules commits, or causes that Member to commit any of the acts described in Rule 7.6.1, whether or not such chief executive officer, director or key personnel is so authorised to act on behalf of the Member.
7.6.4 Former Member Bound by Rules for Acts or Omission Before Expulsion
A former Member, Approved Trader or Registered Representative is bound by this Rules in respect of acts or omissions occurring before expulsion. The Exchange and the Disciplinary Committee retain their respective powers notwithstanding expulsion.*
* Augments Rule 2.15.5 which refers to Members only.
7.7.1 Disciplinary Committee Procedures
Procedures may be issued in relation to Disciplinary Committee proceedings. The procedures are binding on all the parties to the proceedings and may be varied by the Disciplinary Committee as provided in the procedures or this Rules. Where any matter is not dealt with by the procedures or this Rules, the Disciplinary Committee may establish its own procedures.
Refer to the [Disciplinary Committee and Appeals Committee Handbook].
Amended on 3 June 20193 June 2019.
7.7.8 Decision of Disciplinary Committee
Amended on 3 June 20193 June 2019.
7.7.9 Finality of Proceeding or Findings
No proceeding or determination in respect of a Rule Violation shall be annulled, avoided, called into question or set aside by reason of the fact that the matter under consideration may or should have been dealt with by another committee under the business rules of any other exchange or clearing house, or that the Person concerned was absent from the hearing after having been given notice thereof.
7.8.1 Right of Appeal
The Exchange or the Person charged may appeal to the Appeals Committee against the decision of the Disciplinary Committee.
Amended on 3 June 20193 June 2019.
7.9.1 Composition of Appeals Committee
The Appeals Committee shall comprise persons appointed by the SGX RegCo Board and approved by MAS provided that:
Amended on 5 December 20065 December 2006, 15 September 201715 September 2017 and 3 June 20193 June 2019.
7.9.2 Chairman and Deputy Chairman of the Appeals Committee
The SGX RegCo Board shall appoint the chairman and deputy chairman of the Appeals Committee. In the absence of the chairman, the deputy chairman will have all the powers of the chairman.
Amended on 5 December 20065 December 2006, 15 September 201715 September 2017 and 3 June 20193 June 2019.
7.9.5 Powers of the Appeals Committee
The powers of the Appeals Committee include:
Amended on 5 December 20065 December 2006, 15 September 201715 September 2017 and 3 June 20193 June 2019.
7.9.5A
A failure to comply with any Sanction imposed by the Appeals Committee constitutes a breach of these Rules.
Added on 3 June 20193 June 2019.
7.10.1 Appeals Committee Procedures
Procedures may be issued in relation to Appeals Committee proceedings. The procedures are binding on all the parties to the proceedings and may be varied by the Appeals Committee as provided in the procedures or this Rules. Where any matter is not dealt with by the procedures or this Rules, the Appeals Committee may establish its own procedures.
Refer to the [Disciplinary Committee and Appeals Committee Handbook].
Amended on 3 June 20193 June 2019.
7.10.4 Appeals by Rehearing
The Appeals Committee shall determine the appeal by way of rehearing. It shall only rehear that part of the decision of the Disciplinary Committee which is appealed against.
Amended on 3 June 20193 June 2019.
7.10.9 Decision of Appeals Committee
Amended on 3 June 20193 June 2019.
7.11.1 Award of Costs of Investigations by Disciplinary Committee or Appeals Committee
The Disciplinary Committee or Appeals Committee may require the Person charged to pay all or part of the costs of the investigation, inspection or hearing.
7.11.2 Duration for Payment of Costs
The Disciplinary Committee or Appeals Committee may order the costs awarded to be paid within fourteen (14) calendar days.
7.11.3 Consequence of Costs Not Paid Within the Stipulated Time
Where an order for costs of the proceedings has been imposed against a Person and the Person does not make payment within the specified period, the outstanding sum shall be a debt payable to the Exchange. The Exchange may commence legal action to recover that debt, subject to any subsequent payments made by the Person. The Exchange shall be entitled to claim reasonable interest, a month after the payment is due, based on the sum outstanding.
Added on 3 June 20193 June 2019.
7.12.1 Period for Payment of Penalty
A penalty imposed by the Disciplinary Committee or the Appeals Committee shall be paid within fourteen (14) calendar days from the date of notice, or such longer time as the chairman of the Disciplinary Committee or the Appeals Committee (as applicable) permits.
7.12.2 Consequence of Penalty Not Paid Within the Stipulated Time
Amended on 3 June 20193 June 2019.
7.13.1 Limitation of Liability
No liability (whether in contract, tort or otherwise) shall be incurred by the Disciplinary Committee, Appeals Committee, the Exchange, or a manager appointed under Rules 2.5.6A(4), 7.2.3(d) and 7.6.2(j) for anything done or omitted to be done with reasonable care and in good faith in the course of or in connection with:
Added on 3 June 20193 June 2019.