To be admitted as a member and to remain a member, an applicant or a member, respectively,
- must be incorporated and registered as a domestic company under the Companies Act of Seychelles or the Company Law of a recognized jurisdiction (Per Schedule 2 of the Seychelles Securities Act, 2007 (“the Act”)),
- only appoint executive and non-executive directors who meet the fit and proper requirements of Rule 2.2(d) and are over 21 years of age,
- appoint a compliance officer in terms of rule 2.5 (a) who meet the fit and proper requirements set out in Directive 2,
- appoint a settlement officer in terms of rule 2.5 (b) who meet the fit and proper requirements set out in Directive 2, and
- appoint a trader or traders in terms of rule 2.5 (c) who meet the fit and proper requirements set out in Directive 2.
Specific Conditions of Membership
The specific conditions of membership represent the minimum conditions which an applicant and a member are required to satisfy:
- A member must employ adequate resources, procedures and systems necessary for the effective performance of the regulated services which the member provides and for ensuring compliance with the Act and the rules and directives that are relevant to the performance of such regulated services.
- A member must fulfill the requirements of the Anti-Money Laundering Act, 2006 (as amended).
- Members must comply with the Securities (Conduct of Business) Regulations.
- If providing custody services, a member must establish a wholly owned nominee company and be authorized by the Securities Authority to provide custody services in terms of Section 62(1) of the Act.
- A member must ensure that its employees are suitable, adequately trained and properly supervised.
- As a member of Trop-X the member must show that it performs as its regular business securities services.
- The member must remain in good standing in terms of its licensed status with the relevant regulatory authority.
- Overseas members must maintain their membership status of the recognized overseas securities exchange.
Fixed Expenditure Base Requirement
The higher of a base amount of USD 10, 000 (ten thousand US Dollars) or 12 (twelve) weeks operating capital. Trop-X however reserves the right to require members to provide such additional liquid capital as it may specify to cover high levels of operational or other risks to which the member is exposed.
Adjusted liquid capital
A member must on admittance and at all times thereafter hold adjusted liquid capital sufficient to meet its base requirement and its risk requirement which complies with the minimum requirements calculated in accordance with Directive 1.
Here are the minimum banking accounts that is required:
Client Cash Account
Used to segregate client funds
Business Cash Account
Used for funding all business expenses
Clearing Agency Participant Securities Account
Used to clear and settle transactions
- A member is required to appoint an independent auditor who is acceptable to the Securities Authority within 30 days of being licensed and must communicate this to the Securities Authority.
- A member is required to submit to the Securities Authority and Trop-X a copy of its audited financial statement within 4 months of the end of each financial year.
A member must hold, at a minimum, adequate Fidelity Insurance Cover for its clients’ benefit in respect of negligence, fraud and misappropriation by directors, officers, traders or employees involved in the performance of securities services.
Internal Controls and Risk Management
For membership purposes Trop-X requires all documentation and procedures of the member’s internal control and risk management procedures to be approved prior to commencement of operation.