The Securities Exchange Law ( 2013, Law No. 20 of Pyidaungsu Hluttaw ) 9th waning of  Waso 1375 M.E 31st July, 2013 Hereby enacts the following Law : Chapter I Title and Definition 1. This Law shall be called the Securities  Exchange Law . The following expression contained in this Law shall have  the meanings given 2. hereunder: (a) The  expression "Securities"  includes the followings: (i)  treasury bills, treasury bonds, bonds and debentures issued or arranged to issue by the Government or any Governmental organization; (ii) treasury  bills,  treasury  bonds,  bonds  and  debentures  issued  by  the international organizations, foreign governments and their institutions; (iii)shares, stocks, bonds and debentures issued   or arranged to issue by the public companies and rights, options and warrants relating to such shares, stocks, bonds, debentures; (iv) other  securities and instruments prescribed by notification as securities by the Securities and Exchange Commission; (b)  Securities Business means the business of carrying out any of the followings: (i)   Securities Dealing; (ii)   Securities Brokerage; (iii)   Securities Underwriting; (iv)   Securities Investment Advisory; (v)   Securities Depository and Clearing; (vi)the business prescribed by notification as securities business by the Securities and Exchange Commission. (c) Securities Dealing means an engagement of securities company in buying and selling securities for its own account; (d) Securities Brokerage means an operation of a securities company acting as an intermediary  to carry  out securities buying or selling orders on behalf of the customers in consideration of a commission, fee or other remuneration therefrom; (e)  Securities Underwriting  means a function of underwriting of all or part of the securities from a company for sale to the public or to assist the issuer in distribution of securities to the public; (f)   Securities Investment Advisory means a function of providing investment advice in securities for a fee; (g) Securities Depository and Clearing means a function of receiving securities deposited by customers, safe keeping of customers' securities, delivery of securities to customers, giving assistance to customers to exercise the rights regarding their ownership of securities and the functions for the settlement  and delivery of  traded  securities including related services provided; (h) Securities Market means a market or a place where the securities business is carried out regularly. In such expression, it also includes a  system that carries out the securities business regularly; (i) Securities Company means a company limited, formed in accordance with the existing Law to carry out securities business; (j) Stock Exchange means an organized market for trading of  eligible securities to be listed in the Stock Exchange  providing the system and method of  trading securities; (k)  Over-the-Counter Market means an organized market for trading of unlisted securities; (l) Share means share in the share capital of the public company. In such  expression it also includes stock except when a distinction between stock and share is expressed; (m) Warrant means a security entitling the holder to buy the underlying stock at some specified date at a specified price; (n) Contract note means the explanation which includes details about the confirmation of the trading of securities sent to the customer and issuing companies by the securities company which carries out as broker or agent in respect of trading securities; (o) Listed Securities mean securities registered or authorized for trading in the Stock Exchange; (p) Licence  means   the  securities business licence issued by the Commission under this Law; (q)   Commission means the Securities and Exchange Commission formed under this Law; (r) Ministry means the Ministry of Finance, the Union Government.
Chapter II
Objectives
3. The objectives of this Law are as follows: (a) to enable to support the development of the market-oriented economic system effectively; (b) to emerge the securities market systematically that may be able to collect and obtain capitals which are necessary for long term for the development of the national economy; (c) to develop economic sectors by promoting the efficiency of State and private financial enterprises; (d) to supervise the securities business in order to be operated smoothly and properly; (e) to enable to protect the persons who participate  in the securities market in accordance with the law; (f) to assist the  national financial policies by encouraging so as to promote financial investments of the general public.
Chapter III
Formation of the Commission and
Duties and Powers of the Commission 4. The Union Government: (a) (b) (c) shall form the Commission comprising a minimum of five suitable persons; shall select and appoint  Chairman and  Secretary  out of the Commission members simultaneously in forming the Commission; may determine and allow remuneration to the Commission members who are not services personnel. 5. (a) Relating to the tenure of office of the members of the Commission, each two Commission members shall  resign in turn once in two years in accord with the stipulations. (b) The Union Government may substitute the suitable person for the vacant Commission member or may reappoint any member of the Commission whose tenure of office has expired. (c) The member of the Commission shall continue to carry out his functions and duties although his  tenure  of office has expired before the Union Government substitutes and appoints a new member of the Commission. The Chairman of the Commission shall act as the head of the management of the 6. Commission. 7. The Commission: may issue or refuse to issue licence after scrutinizing the application to issue (a) securities business licence; (b) may  suspend the licence subject to a time limit or revoke the licence if the licence-holder violates any duty and term and condition; (c) may extend the  term of licence after scrutinizing the application for renewal; (d) shall collect licence  fees and fine in accord with the stipulations. 8. The Commission may: issue permit or refuse to issue permit after scrutinizing the application to (a) establish Stock Exchange; (b) suspend the permit subject to a time limit or revoke the permit if the Stock Exchange violates any of the duties and terms and conditions to be complied with; (c) revoke the permit issued to the Stock Exchange if any of the following conditions  arises: (i) termination of the business of the Stock Exchange due to any cause; (ii)  dissolution of the Stock Exchange; (iii) decreasing the number of member securities company below the fixed minimum number which shall be included in Stock Exchange; (iv) carrying out business that is distinctly detrimental to the interests of the general public and to the protection of investors in the manner of prohibited acts referred to the Chapter IX. 9. The Commission may: give permission after scrutinizing the submission for appointing auditor of (a) the securities company and of the Stock Exchange; (b) and the give permission to the constitution of the Stock Exchange amendment  of  such constitution in accord with the stipulations. 10. The Commission may grant a  permit if  the securities companies apply collectively to establish the Over-the-Counter Market for trading  unlisted securities together with the constitution in accord with the stipulations.
11.
The Commission: (a) may submit necessary advice in respect of matters relating to the securities business to the Union Government; (b) may form necessary working committees, bodies and determine the functions and duties; (c) may issue directives to the securities company or the Over-the-Counter Market or the Stock Exchange as may be necessary; (d) shall supervise the securities business and shall carry out the inquiries and inspections from time to time; (e) shall carry out other functions and duties  assigned by the Union Government. The Commission shall supervise the following organizations and persons so as to 12. keep the accounts relating to their business in accord with the relevant Myanmar accounting  standards  and may call for and obtain necessary accounts, documents, statements, other references and information from them; Public company; (a) Securities company; (b) Over-the-Counter Market; (c) Stock Exchange; (d) Persons who are carrying out or had carried out as responsible person, member, staff and agent of any public company, securities company, Over- the-Counter Market and Stock Exchange; (e) licence -holder or lawyer, auditor and agent of such licence-holder. (f) The Commission may carry out research and development for securities business 13. and  communicate with the organizations of other countries that supervise the securities business and businesses, departments, organizations related to such organizations to make securities business compatible to international standard. 14. The Commission has the right to summon and examine any relevant person and take the evidence if there is cause to believe that persons who carry out securities business violate this law and any prohibition contained in the rules, regulations, by-laws, notifications, orders, directives and procedures issued under this law or fail to comply with any responsibility to be obeyed and if there is cause to believe that they commit cheating or immoral act relating to securities business. 15. Any member or staff of the Commission shall, with the exception of  revealing, displaying or declaring under any existing law, keep information obtained in performing the  functions and duties of the Commission confidential without revealing, displaying or declaring.
Chapter IV
Securities Company
16. A person desirous to establish a securities company and carry out the securities business shall form and register the company in accord with the existing law relevant with the Myanmar companies. 17. In forming  the securities company: (a) (b) (c) (d) It shall include the expression "Securities" in the name of the company; it shall be formed as a limited company whose liability is limited by shares; it shall have authorized capital and a minimum of paid-up capital in accord with the stipulations; it shall  be in comformity with rules, regulations, by-laws, notifications, orders, directives and procedures  issued under this Law. 18. The securities company has the right to carry out the securities business permitted according to licence category if it obtains any category of licence issued by the Commission. 19. The responsible persons and staff of the securities company shall not only have capability, and fairness in dealing with the customers but also provide service in good faith. 20. The securities company shall: (a) compile and maintain accounts and records relating to the securities business of the company in accord with the stipulations; (b) (c) (d) obtain permission of the Commission before appointing an auditor in accord with the existing laws  relevant with the Myanmar Companies; submit the audit report to the Commission in accord with the stipulations; not  reduce the authorized capital without prior permission of the Commission; (e) submit the business  report in accord with the stipulations to the Commission; (f) send a contract note in respect of a transaction of sale or purchase of securities, in accord with the stipulations, to the person or organization for whom the securities company executed the transaction. 21. The securities company shall  refrain from the prohibited acts contained in Chapter  IX, which affect the interests of the general public and the protection of investors in carrying out the securities business.
22.
The securities company shall: (a) keep a reserve fund out of the net profit in accord with the stipulations after the end of each financial year; (b) utilize reserve fund only for the matter to compensate any damage relating to carry out securities business. It shall obtain prior permission of the Commission if it is required to expend for other matters. Chapter V Licence 23. The categories of the licence are as follows: (a) securities dealing business licence; (b) securities brokerage business licence; (c) securities underwriting business licence; (d) securities investment advisory business licence; (e) securities company's representative business licence; securities business licence prescribed by notification issued by the (f) Commission. 24. The Commission shall determine the necessary qualifications and terms and conditions according to the categories of the licence. The securities company only may apply to the Commission in accord with the 25. stipulations to obtain one or more of the following  categories of licence: (a) securities dealing business licence; (b) securities brokerage business licence; (c) securities underwriting business licence. 26. (a) (b) The securities company which has obtained any category of the  licence contained in section 25 may carry out the securities investment advisory business without obtaining separate business licence. Any person who is in conformity with stipulated qualifications and terms and conditions may apply to the Commission to obtain a securities investment advisory business licence in accord with the stipulations. 27. may A person desirous of carrying out as the representative of a securities company apply in accord with the stipulations to the Commission attached with recommendation of such company to obtain the representative business licence of the securities company.
28.
The Commission:
(a) may allow or refuse to issue the licence on receiving the application for licence under section 25, sub-section (b) of section 26 and section 27 after scuritinizing whether or not it is in conformity with the qualifications and terms and conditions prescribed according to categories of licence. (b) shall issue the licence prescribing terms and conditions  if it is granted under sub-section (a). 29. The licence holder shall apply to the Commission a minimum of 30 days prior to the expiry of the term of licence if he is desirous to continue to carry out the permitted securities business when the term of licence is expired. 30. The Commission may allow or refuse to extend the term of licence after scrutinizing the application to extend the term of licence under section 29. 31. The Commission shall determine the licence fee, licence renewal fees, fine and the term of licence. 32. The licence-holder: (a) Shall abide by the rules, regulations, by-laws, notifications, orders, directives and procedures issued under this Law; (b) Shall abide by the terms and conditions of the licence. 33. The licence-holder shall: (a) surrender the licence to the Commission within 30 days from the expiry date of the licence if the term of licence was expired and the securities business is discontinued; (b) if the securities business is suspended during the term of licence, inform such suspension within seven days and surrender the licence to the Commission; (c) carry out the securities business after obtaining the prior permission of the Commission if it is desirous to merge with other business organization or to liquidate securities company voluntarily; (d) suspend the business during the period of attachment of warrant on the assets of the said company or sequestration by appointment of a receiver by the Court. 34. The Commission may suspend the licence subject to a time limit or revoke the licence when any of the following conditions  is caused by the licence-holder: (a) (b) violating  any of the terms and conditions of the licence or failing to perform any function and duty to be complied by the licence - holder; sub-leasing the licence or transferring the licence by any means; (c) (d) violating any of the prohibitions contained in this Law or the rules, orders, directives and procedures issued under this Law or failing to perform the functions and duties under such provisions by the licence- holder; death, lunacy or being declared as a bankrupt; (e) causing detriment  to the interests of the general public and to the protection of investors in the manner of prohibited acts referred to the Chapter  IX; (f) (g) compiling and submitting the financial and business account falsely; being convicted under an offence of cheating, misappropriation, theft, breach of trust or offence relating to morality;

35.
A public company shall: (a) submit to the Commission the procedure of a public offering  before public offering of its securities and obtain the approval of the Commission. The Commission shall decide within 60 days; (b) when offering to the public, publish the prospectus containing the material particulars of the company together with its memorandum and articles of the association. The Commission may prescribe the terms and conditions relating to the issue of 36. new securities by the public companies. 37. The public company shall, on request by the purchaser after the transaction of the securities in the securities market has been executed, change and register the ownership of  its securities when it  receives a contract note sent by the relevant  securities company.
Chapter VII
Stock Exchange
38.
The Stock Exchange
(a) (b) (c) is a legal entity which is formed as the limited liability company or joint- venture under the existing laws relevant with the Myanmar Companies after being granted permission by the Commission; shall have the duty to organize and supervise the trading of its listed securities; shall carry out the functions in accord with the provisions contained in this Law; (d) shall be under the management and supervision of the Commission. (a) 39. A board of directors of the Stock Exchange, comprising not more than five persons appointed by the Commission and not more than five persons elected by member securities companies to serve as directors, shall be formed  in accordance with the constitution of the Stock Exchange. (b) The Commission, when appointing the board of directors of the Stock Exchange, shall select the persons who have an excellent knowledge of, and experience in, the operations of the Stock Exchange, securities or financial businesses . (c) The board of directors of the Stock Exchange shall select a director to be the chairman. (d) The Chairman may  assign a director out of the board of directors as a secretary. (e) Necessary Committee and bodies may be formed in the Stock Exchange. (f) The  necessary staff shall be appointed for the board of directors of the Stock Exchange.
40.
The Stock  Exchange shall: (a) (b) carry out  the securities business only at the place  stipulated by the Commission; appoint the auditor with the prior permission of the Commission; (c) submit the audit report to the Commission annually; (d) abide by the rules, regulations, by-laws, notifications, orders,  directives and procedures issued under this Law. 41. The duties of the board of directors of the Stock Exchange are as follows: (a) administering the securities business; (b) determining the listing criteria for  securities to be traded on  its Stock Exchange; (c) registering the securities  which will be traded on its  Stock Exchange; (d) the records of securities transaction executed at  its Stock compiling Exchange; (e) compiling  the record of the relevant facts and data of the member securities companies; (f) determining the membership fees to be paid by member securities company, listing fees, reserve funds and other service fees  and maintaining and managing such funds systematically in accordance with the constitution and the business  rules; (g) (h) appointing  necessary staff and assigning duties thereof; inspecting and supervising whether the business operation of the member securities companies are  correct or not. 42. The powers of the board of directors of the Stock Exchange are as follows: granting or refusing the application of a securities company for membership (a) of  its Stock Exchange after scrutinizing it; (b) determining a minimum number of  member  securities company  for the Stock Exchange; (c) (d) (e) determining the rights and duties of member securities companies; suspending trading on  its Stock Exchange temporarily and prohibiting trading of securities of any member temporarily if there is  sufficient grounds; suspending or cancelling the membership of the securities company    which is not appropriate to continue to participate in the Stock Exchange; (f) settling and resolving disputes arising between the members or between any member and other persons relating to the securities trading. 43. If the Stock Exchange desires to amend its constitution or business  rules, or draft the new constitution, it shall execute them in accord with the stipulations after getting the prior permission of the Commission.
Chapter VIII
Over-the-Counter Market
44. The securities companies not less than three companies which are desirous to establish Over-the-Counter market, by applying collectively to the Commission, may establish Over-the-Counter market after obtaining permission. 45. At the establishment of the over-the-counter market with the permission of (a) the Commission under section 44, a board of directors comprising not more than 5 members elected by the member securities companies shall be formed. The board of directors of the over-the-counter market shall select a (b) chairman out of the board of directors. The Chairman of the over-the-counter  market may appoint a director out of (c) the board of directors as a secretary. 46. The Over-the-Counter market established in accordance with the permission of the Commission shall  have the right to operate perpetually and  right to sue and be sued in its  own name and seal. 47. The Over-the-Counter market shall abide by the rules, regulations, by-laws, notifications, orders,  directives and procedures issued under this Law. 48. The Commission may  suspend the permit  subject to a time limit or revoke the permit issued to the Over-the-Counter market  if the performance of the Over-the- Counter market  is distinctly detrimental to the interests of the general public and to the protection of investors in the manner of prohibited acts referred to the Chapter IX.
Chapter IX
Prohibited Acts
49. The prohibited acts detrimental to the interests of the general public and to the protection of investors are as follows: (a) involving directly or indirectly in any act, such as cheating, deceiving, making false statements or concealing important information, which seriously causes deception or influence on the activities of public offering of securities, listing, selling, buying, trading, investing and services in securities and securities market; (b) making disclosure of untruthful information in order to incite or entice other persons to buy or sell securities or making disclosure of insufficient or untimely information that seriously affects the price of the securities in the market; (c) or using internal information to buy or sell securities for its own account for other persons or disclosing or providing internal information or giving advice to other persons to buy or sell securities based on undisclosed internal information; (d) conspiring in buying or selling securities by creating false demand and supply, or buying or selling continuously or using trading methods by conspiring with others or by enticing others in order to manipulate the price of securities.
Chapter X
Depository and Clearing of the Securities
50. (a) (b) The securities company shall, if it is desirous to carry out the depository and clearing business of the securities, apply to the Commission in accord with the stipulations in order to obtain permit; The Commission may issue the permit or refuse to issue the permit, by specifying terms and conditions, after scrutinizing the application under sub- section (a). 51 . The Stock Exchange may, if it is desirous to carry out the depository and clearing business of the securities, carry out without obtaining permit of the Commission. But it shall inform to the Commission on doing so. The Ministry may, if necessary, assign any suitable governmental department or 52. organization to  carry  out the depository and clearing business of the securities by prescribing terms and conditions.
Chapter XI
Appeal
53. (a) (b) The person,who is not satisfied with decision  passed by the power of the board of directors of the Stock Exchange under section 42, may appeal to the Commission within 30 days from the date of such decision is  passed. The Commission may confirm or amend the decision of the board of directors of the Stock Exchange or may pass other suitable decision  after scrutinizing the appeal under sub-section (a).
Chapter XII
Prohibitions and Penalties
Any person shall not  act by violating the prohibited acts under Chapter  IX, which 54. are detrimental to the interests of the general public and to the protection of investors.
55.
Any person shall not: (a) carry out any securities business without licence; (b) establish a Stock Exchange or an Over-the-Counter Market without the permit of the Commission or carry out the  functions of such Stock Exchange or Over-the-Counter Market or carry out the similar  functions of such Stock Exchange or Over-the-Counter Market; (c) use the title of the authorised Stock Exchange or Over-the-Counter Market without permission of the Commission or impersonate as a member of such Stock Exchange or Over-the-Counter Market. 56. Any licence-holder shall not sub-lease  or transfer the licence in any manner. 57. Any responsible person of the securities company shall not allow any person or organization other than its  licensed representative to operate the securities business in the name of its company. 58.    Any member or staff of the Commission shall, with the exception of  revealing, displaying or declaring the information obtained in performing the  functions and duties of the Commission under any existing law, not reveal, display or declare the information to the person who is not concerned. 59.    Any responsible person or staff of the securities company shall not  participate in other securities company, other company or other economic  enterprise without permission of the Commission. 60.  Any person who  violates  prohibition contained  in section 54 shall, on conviction, be punished with imprisonment for a term not exceeding 10 years and may also be liable to fine. 61.  Any person who  violates  any  prohibition contained in section 55  shall,on conviction, be punished with imprisonment for a term not exceeding five years or with fine or with both. 62.   Any licence-holder who  violates  prohibition contained  in section 56  shall,on conviction, be punished with imprisonment for a term not exceeding five years or with fine or with both. 63.     Any responsible person of securities company who  violates  prohibition  contained in section 57 shall, on conviction, be punished with imprisonment for a term not exceeding five years or with fine or with both. 64. Any member or staff of the Commission who  violates  prohibition  contained in section 58 shall, on conviction, be punished with imprisonment for a term not exceeding three years or with fine or with both. 65.    Any responsible person or staff of securities company who  violates  prohibition contained  in section 59 shall, on conviction, be punished with imprisonment for a term not exceeding three years or with fine or with both. Any person who  violates  any prohibition contained in rules, regulations, by-laws, 66. notifications, orders, directives and procedures issued under this Law shall, on conviction, be punished with imprisonment for a term not exceeding one year or with fine or with both.
Chapter XIII
Miscellaneous.
During the transitional period before the securities market can be  distinctively 67. established and systematically operated in accordance with this law in Myanmar: (a) The Union Government shall determine a transitional period. If it is necessary, such transitional period may be extended; (b) (c) The Union Government shall assign the Ministry to supervise the Commission and the securities business during the transitional period; The Ministry may issue necessary notifications, orders, directives in the supervision of the securities business during the transitional period; (d) Notwithstanding anything contained in the provisions of the Financial Institutions of Myanmar Law, the Ministry may allow the Myanma Economic Bank to form a joint venture company with a non-financial institution, and the said joint venture company to operate the functions of a Stock Exchange and an Over-the Counter Market. 68. The expenses of the Commission and the office of the Commission shall be born by the fund allocated to the Union Government. 69. The offences contained in this Law are  determined as cognizable offences. 70. No court shall have jurisdiction on any offence under this Law without prior permission of the Commission. 71. In implementing the provisions contained in this Law : (a) The Ministry may, with the approval of the Union Government, issue necessary  rules, regulations, by-laws after  coordination with the Commission; (b) The Ministry and the Commission may issue necessary notifications, orders, directives and procedures .