Licensing - REGULATION | Securities Commission Malaysia

Licensing

The Capital Markets and Services Act 2007 (CMSA) repeals the Securities Industry Act 1983 (SIA) and the Futures Industry Act 1993 (FIA). The CMSA, which took effect on 28 September 2007, introduces a single licensing regime for capital market intermediaries. Under this new regime, a capital market intermediary will only need one licence to carry on the business in any one or more of the following regulated activities:

Dealing in securities
Dealing in derivatives
Clearing for securities or derivatives
Fund management
Dealing in Private Retirement Scheme
Advising on corporate finance
Investment advice
Financial planning

Licensing ensures an adequate level of investor protection, including the provision of sufficient safeguards to protect investors from default by market intermediaries or problems arising from the insolvency of such intermediaries. More importantly, it instills confidence among investors that the organisations and people they deal with, will treat them fairly and are efficient, honest and financially sound.

Through its authority to issue licences, the SC regulates the market by ascertaining the fitness and propriety of companies and individuals applying for licences. In considering whether an applicant is fit and proper to hold a licence, the SC takes into account the following factors:

Probity
Ability to perform such functions efficiently, honestly and fairly
Financial status
Reputation, character, financial integrity and reliability

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