ADVOKS GLOBAL · KENYA
The Capital Markets (Derivatives Markets) Regulations
34. Duties of Derivatives exchange
Edition: 2025-02-14 · In force
34. Duties of Derivatives exchange
(1)A derivatives exchange shall ensure—(a)a fair, efficient and transparent market in derivatives contracts that are traded on its derivatives market; and(b)that risks associated with the business and operations of that derivatives exchange are managed in a prudent manner.(2)A derivatives exchange, in discharging its duty under subregulation (1), shall—(a)act in the interest of the public; and(b)ensure that the interest of the public prevails where it conflicts with the interest of the derivatives exchange, derivatives brokers who are its members, shareholders or the management.(3)A derivatives exchange shall operate its facilities in accordance with the rules approved by the Authority.(4)A derivatives exchange shall regulate the operations, standards of practice and business conduct of derivatives brokers who are its members and representatives or other employees of those derivatives brokers in accordance with the rules, policies, procedures and practices of the derivatives exchange.(5)A derivatives exchange shall formulate and implement appropriate procedures for ensuring that the derivatives brokers who are its members and representatives or other employees of those derivatives brokers comply with the rules of the derivatives exchange.(6)A derivatives exchange shall preserve confidentiality with regard to all information in its possession concerning derivatives brokers who are its members and their clients, except that such information may be disclosed by the derivatives exchange when required in writing to do so by the Authority or if the derivatives exchange is ordered to do so by a court of law.(7)A derivatives exchange shall immediately notify the Authority, if the derivatives exchange becomes aware—(a)that any derivatives broker who is a member of the derivatives exchange is unable to comply with any rules of the derivatives exchange or any financial resources requirements; or(b)of a financial irregularity or other matter which, in the opinion of the derivatives exchange, may indicate that the financial standing or integrity of a derivatives broker, who is its member, is in question, or that a derivatives broker, who is its member, may not be able to meet its legal obligations.