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Securities and futures brokers are now able to refer their respective clients to one another following amendments made to the Securities Commission’s Licensing Handbook allowing for Referral Agent activities.
The amendments, initiated by Bursa Malaysia, will create a more facilitative trading environment and is expected to boost the number of participants in both the securities and derivatives markets.
Dato’ Tajuddin Atan, Chief Executive Officer of Bursa Malaysia and Chairman of Bursa Malaysia Derivatives said, “Through this initiative, securities brokers will be able to introduce clients to futures brokers and vice versa, thereby facilitating greater trading participation in both markets.”
“Market players can leverage on this commercial arrangement to encourage clients to trade both equities and derivatives products. This move is expected to benefit all brokers, in particular those which do not have securities and futures trading businesses under one roof.”
The amendments allow a Participating Organisation (PO), as a holder of the Capital Markets Services License (CMSL), to refer clients to a Trading Participant (TP) of Bursa Malaysia Derivatives, and vice versa.
Furthermore, Dealer’s Representatives (DR) who hold the Capital Markets Services Representative’s License (CMSRL) for dealing in securities may now refer their clients to a TP via their POs, and likewise, Registered Representatives (RR) holding the CMSRL for dealing in derivatives may refer their clients to a PO via their TPs. Referral agents must only undertake the regulated activities they are licensed for and not any other regulated activities.
For further information, please refer to Bursa Malaysia’s circular for POs and TPs.
