Law:

Section:

Securities and Exchange Commission of Pakistan Act (XLII of 1997)------- --------Ss. 20(6)(b)(g) & 33-------Securities and Exchange Ordinance (XVII of 1969), S.7-------Deposit of amount for purchase of shares-------Complaint against-------Failure to deliver shares-------Jurisdiction of Securities and Exchange Commission-------Complaint was lodged against Ex member of Stock Exchange, to the effect that, said member of Stock Exchange, despite repeated reminders, could not deliver shares, despite complainant had deposited amount of said shares-------Stock Exchange confirmed that there were seventy-five claims against said member, out of which twenty-two were settled; that amount received from the sale of membership seat of said member was distributed on pro rata basis among the claimants-------Director (SMD) of the Commission, held that Stock Exchange did not take all necessary steps to protect the small investor and failed to declare its member as a defaulter for failing to pay to the complainant-------Director (S.M.D.) of the Commission, directed the Stock Exchange, to either return shares as claimed by the complainant, or give the amount deposited by the complainant to said member-------Stock Exchange, filed appeal against impugned order contending that, Commission had failed to establish that under which provision of law it had assumed jurisdiction in the matter between two private parties-------Validity-------Stock Exchange, was a front line regulator for capital market, and one of its main functions, was to provide adequate protection to investors-------Commission, being the apex regulator, would provide framework within which the Stock Exchange, the capital market intermediaries and investors, could operate; and had to keep check on the omissions and commissions of the Stock Exchange-------Section 20(6)(b)(g) of the Securities and Exchange Commission of Pakistan Act, 1997, had given power to the Commission to look into the matter where there was regulatory non-compliances on part of the Stock Exchange, and to take necessary action in order to maintain confidence of investors in the securities market-------Contention of Stock Exchange, held, was baseless…

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