35. The Schedule to the principal enactment is hereby Amendment amended in Part I of that Schedule, as follows ; "
| (1) by the substitution for item (g) of that Part of the following item :"
| | " (g) that the Board of Directors of the applicant company consists of nine members approved by the Commission, out of whom not more than five members shall be from among individual stock brokers or stock dealers elected by the general membership, and not less than four members shall be appointed by the Minister from among persons recommended by the Commission ;"; | | |
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| (2) by the substitution in item (i) for the words "is satisfactory ; and", of the words " is satisfactory ; " ; |
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| (3) by the substitution in item (j) (ii) for the words " of person who are ", of the words " of persons who are " ; |
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| (4) by the substitution in item (j) (viii), for the words "informed investment", of the words "informed investments " ; |
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| (5) by the substitution in item (j) (ix), for the words " and form the abuse of the words "and from abuse of" ; |
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| (6) by the substitution in item (j) (xi), for the words "stock dealers for conducting", of the words "stock dealers and for conducting" ; |
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| (7) by the substitution for items (j) (siii) and (xiv) of that Part, of the following items"
| | " (xiii) with respect to the conduct of securities trading of stock brokers and stock dealers and the manner in which information relating to Much transactions shall be maintained ; | | |
| | (xiv) for ensuring that the customers funds and securities are segregated from other business of brokers and. dealers ; and " ; | | |
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| (8) by the addition immediately after item (j) (xiv). of that Part of the following new item. : "
| | " (xv) for the appointment of a disciplinary committee a majority of the members of which are not associated with any licensed stock broker or licensed stock dealer.''; | | |
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| (9) by the addition immediately after item (j) of that Part of the following new item : "
| | " (k) that the articles of association of the applicant company provide procedure for removal of stock exchange management officials only by the vote of at least two-thirds of all the mem-broker or licensed stock dealer." ; | | |
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| (10) by the addition of the following Part at the end of that Schedule which shall have effect as Part IV of the Schedule :"
| | "PART IV Terms and conditions to be complied with for the purposes of the grant of a licence to operate unit trust are : | | |
| | (a) that the trustees and managing company of the unit trust in respect of which the application is made, be separate persons ; | | |
| | (b) that the trustee is not a connected person of the managing company ; | | |
| | (c) that the trust deed creating such trust or the agree- ment between the trustee and the management company"
| | | (i) sets out the restrictions on the investment of trust property ; |
| (ii) provides that unit holders shall not be required to make any further payment or assume any further liability, except in the circumstances, i! any, as are set out in such trust deed ; |
| (iii) sets out the method of calculating the offer and redemption prices of units ; |
| (iv) sets out the circumstances in which the redemption of units can be suspended ; |
| (v) provides for the maintenance of a register of unit holders ; |
| (vi) contains provisions requiring the trustee, the managing company and their connected persons to disclose their interest, whenever any business in which they have a material interest is being discussed at any meeting of the trust ; |
| (vii) provides for the appointment as auditors of the unit trust of persons having the qualifications specified by rules of the Commission and empowers the Commission to require the retirement of such auditors when they cease to possess such qualifications ; |
| (viii) empowers the trustee to dismiss the managing company on the managing company going into liquidation (other than voluntary liquidation) or on the appointment of a receiver in respect of any assets of the managing company or on the trustee being satisfied that a change of managing company is desirable in the interest of unit-holders or on the holders of at east seventy-five per centum of the units issued request the dismissal of the managing company ; |
| (ix) provides for the appointment by the trustee of a successor, immediately on the dismissal of the managing company ; |
| (x) prohibits the trustee from retiring until a new trustee is appointed ; |
| (xi) prohibits the managing company from entering into any under-writing or sub writing contract on behalf of the trust, except with the approval of the trustee and the Commission : |
| (xii) prohibits the making or granting of loans out of trust property, except with the consent of the trustee ; |
| (xiii) provides .for the approval in writing of the. trustee, for any transaction between the managing company or any connected person of the managing company and the trust; |
| (xiv) docs not exempt the managing company from any liability imposed on it by law nor indemnifies it against such liability at the. expense of the unit holders ; |
| (xv) provides that the consideration paid duly created units (less any charges that the managing company is entitled to retain) shall become subject to the trust immediately on receipt of such consideration by the trustee ; |
| (xvi) provides that a certificate in respect of units shall be delivered to a third party only on the trustee being satisfied that the consideration paid for such units (Jess any charges that may be retained by the managing company) has been or will be, vested in the trustee ; |
| (xvii) provides that where any trust property is registered in 'he name of a lender as security for a loan obtained by the trust the trustee shall be liable for any act or omission of the: kinder or his agent with respect to such property; |
| (xviii) prohibits the appointment of a new trustee except with the approval of the Commission; |
| (xix) specifics the minimum initial investment in units permitted ; |
| (xx) specifies the maximum initial charge which can be levied on the purchase of units ; |
| (xxi) provides for deposit of security by the trustee, guaranteeing against loss due to his misconduct or negligence, where required by the Commission. ", |
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Sri Lanka Consolidated Acts