Excerpt from the Rules of the Sarajevo Stock Exchange:
(1) The Stock Exchange monitors the security business at the Stock Exchange, and in the event of identified violations, i.e. irregularities, conducts measures according to its authorities in order to provide fair security trade. The Stock Exchange monitors the business of its members with the help of its extraordinary surveillance work-stations, and can review, monitor and confiscate all copied documentation related to the trade business at the Stock Exchange member's premises.
(2)Stock market surveillance is conducted within: − the regular surveillance − surveillance of the information system − part-time surveillance
(3) The Management shall task the Stock Exchange officials with the authorization for the Stock Exchange trade surveillance. The Stock Exchange members and its employees shall follow the instructions of these officials.
(4) For purpose of surveillance of the information system, the Stock Exchange Member is required to keep electronic records of events of computer communication equipment, audit records of electronic order book, keep up-to-date and synchronize the time of computer workstations, server equipment and phone and fax devices with the system of the Stock Exchange and submit them to authorized persons of the Stock Exchange in electronic form.
(1) The Regular surveillance consists of regular daily surveillance of trade and, if necessary, regular annual surveillance of the Stock Exchange members.
(2) Regular daily surveillance is performed by surveillance workstations at the premises of the Stock Exchange. Special attention is paid to entered orders and closed transactions in terms of their impact on market integrity. Detailed manner of conducting regular daily surveillance of trade is defined by procedures for supervision.
(3) Regular annual surveillance shall be conducted at the premises of the Stock Exchange members, in dynamics and frequency defined by the Stock Exchange Management. The Stock Exchange member is informed about the planned annual surveillance at least 14 days before the scheduled date of surveillance.
(1) Regular surveillance of the information system consists of regular daily surveillance of use of the BIS, BTS, and regular annual surveillance of the Stock Exchange Members.
(2) Regular surveillance of the information system is performed by surveillance workstations in the premises of the Stock Exchange. Special attention is paid to control audit trail of electronic order book. Detailed manner of conducting regular daily surveillance of trade in terms of control audit trail of electronic order book is defined by the procedures for the surveillance.
(3) Regular annual surveillance of information system is carried out in the premises of the Stock Exchange members, in dynamics and frequency defined by the Stock Exchange Management. A member of the Stock Exchange is informed about the planned annual surveillance at least 14 days before the scheduled date of the surveillance.
(1) The proposal for initiating of extraordinary surveillance may be submitted by: − employee responsible for performing regular daily surveillance of trade, if he finds that there are indications of a violation of rules or other regulations governing the capital market, − employee in charge of the analysis of data obtained from the system for surveillance information system, − member of the Stock Exchange, in case of reasonable doubt for violation of the Rules or other regulations governing the capital market and − Stock Exchange Commission, in the case of Article 151, paragraph
(2) of these Rules (2) In the proposal for initiating of extraordinary surveillance, the submitter describes the situation that caused the submission of requests to initiate extraordinary surveillance, and lists the members of the Rules or other acts that are suspected to have been violated in the present case.
(3) The Stock Exchange Management, based on a proposal to initiate extraordinary surveillance, determines whether the submission is justified, and if it determines that there are enough strong indications, it then orders an extraordinary surveillance in the present case.
(4) Extraordinary surveillance starts without determining the justification of the request in the case when the Stock Exchange receives order from Securities Commission or other competent state or entity authority. Management also does not determine justification of starting of surveillance when Stock Exchange Commission initiate appropriate proceedings by official duty, when determine or find out that, given the existing state of affairs in the proceedings in front of them, they should proceed according to the second article of the Stock Exchange.
(5) On the basis of an order of the Board on the initiation of extraordinary surveillance, authorized employee conducts all necessary actions to collect the facts in the present case, involving a detailed 51 analysis of available data in the BTS, departure and exclusion of the necessary documentation with the Member, taking statements from responsible persons, etc.
(6) While conducting activities associated with extraordinary surveillance, the accused member of the Stock Exchange is introduced to the subject of supervision, and if circumstances of supervision permit, he is introduced with the reasons of starting the extraordinary surveillance.
(7) After completing the supervision of the Stock Exchange Member, the authorized surveillance employee shall prepare a record, which shall be submitted to the Member to give objections or comments. The deadline for submission of comments on the record is seven (7) days.
(8) After the surveillance is done, and the deadline for objections on the record is passed, the authorized surveillance employee draws up an analysis in which he describes in details the facts established in the extraordinary surveillance, with an indication of whether in the present case was a violation of the Rules or other regulations governing the capital market. The present analysis is delivered and presented to the Management Board.
(1) The Stock Exchange Commission is comprised of the Chairman and two members, and three deputy members, appointed by the Stock Exchange Supervisory Board.
(2) One representative of the Stock Exchange Management Board and the Management as well as one representative of the Self-Regulated Organization of Professional Brokers in a Security Trade (SRO) are appointed as members and deputy members of the Stock Exchange Commission appointed for the period of four years, with the possibility of re-election.
(3) The mandate of the Stock Exchange Commission member and deputy member can stop even before the expiry of the mandate which he/she was appointed to, in the following situations: − upon recall by the Management Board; − by termination of a condition he/she was elected upon; − after the submission of a request for termination of membership in the Exchange Commission.
(4) In case that the members absent and/or exempted and that there is no quorum, the deputy member (members) can substitute for the regular member during the session.
(1) As the measure for violation of the Rules and other regulations governing the capital market, the Stock Exchange Commission can issue one of the following measures to the Stock Exchange member: - warning (non-public warning, warning with the notice within the Stock Exchange members, public warning) - a fine amounting to BAM 50.000,00, depending on the violation type, paid in the reserve Fund within the Stock Exchange - temporary or permanent exclusion from the Stock Exchange business.
(2) As single measures, warnings are passed only for the first time, the second and every next warning is passed only cumulatively with the penalty, unless more than two years have passed since the date of pronouncement of the last warning.
(3) The fine and the temporary or permanent exclusion from the Stock Exchange business can be passed conditionally for the period of 2 years at most. On that occasion, the implementation of the issued measure can be conditioned by the new violation of the Rules caused by the member in the above stated period.
(4) During the identification of the measure type that shall be passed to the member who violated regulations of the Rules, and during the identification of the amount of penalty, the Stock Exchange Commission shall take into the consideration all the circumstances concerning the violation of regulations of the Rules as well as some prior violations of regulations of the Stock Exchange by the member.
(5) The level of the violation of regulations of the Rules shall be estimated by the Stock Exchange Commission, regarding the intensity of violation of the principal's (client's) interests and/or the security market integrity, other members and the Stock Exchange itself.
(1) The Stock Exchange shall notify the Securities Commission about their findings and the measures regarding the surveillance of the Stock Exchange business.