Conduct of Business (Part I) Flashcards
Define “foreign client”
A client who does not reside in the Republic.
Define “foreign investment”
“Foreign investment” means the following JSE authorised investments:
1. securities listed on an external exchange;
2. units or any other form of participation in a foreign collective investment scheme approved by the Registrar of Collective Investment Schemes in terms of section 65 of the Collective Investment Schemes Control Act, 2002;
3. units or any other form of participation in a collective investment scheme licensed or registered in a foreign country; and
4. foreign funds intended for the purchase of such securities, units or participation.
What type of advice is included in the definition of “advice”?
Any recommendation, guidance or proposal of a financial nature furnished, by any means or medium, to a client or group of clients:
1. in respect of the buying and selling of securities; or
2. on any corporate action or other event affecting the rights or benefits in respect of securities; or
3. on the exercise or lapse of any right in respect of any JSE securities; irrespective of whether or not such advice results in any transaction being effected.
What type of factual advice is not included in the definition of “advice”?
Factual advice given merely :
1. on the procedure for entering into a transaction in respect of securities;
2. on the procedure relating to a corporate action or other event affecting the rights or benefits in respect of securities;
3. in relation to the description of securities;
4. in answer to routine administrative queries;
5. in the form of objective information about securities; or
6. by the display or distribution of promotional material.
In order for the content of an analysis or a report on a JSE authorised investment not to constitute “ advice”, what must the analysis or report not contain?
Any express or implied recommendation, guidance or proposal that any particular transaction in respect of the securities is appropriate to the particular investment objectives, financial situation or particular needs of a client.
Define “investment services”
The services provided by an investment services provider to its clients, and includes:
1. exercising discretion in the management of JSE authorised investments on behalf of clients;
2. providing advice to a client in respect of JSE authorised investments;
3. executing transactions in JSE authorised investments other than equity securities; and
4. safeguarding JSE authorised investments other than uncertificated equity securities and funds intended for the purchase of equity securities.
Define “investment services provider”
A member which has been authorised by the JSE to perform investment services in terms of the rules.
Define “manage” in relation to JSE authorised investments.
Any arrangement entered into between a client and a member which authorises such member to buy or sell JSE authorised investments on behalf of such client, either with full discretion or with prior reference to the client or exercise any rights attached to those investments.
