Clause 26

No person shall enter into any agreement to acquire shares by virtue of which he would, if the agreement is carried out, acquire a substantial shareholding in a clearing house without first notifying the Authority of his intention to enter into the agreement and obtaining the approval of the Authority to his entering into the agreement.(2) The Authority may grant its approval referred to in subsection (1) subject to such conditions or restrictions as the Authority may think fit.(3) Without prejudice to subsection (7), the Authority may, for the purposes of securing compliance with subsection (1) or any condition or restriction imposed under subsection (2), by notice in writing direct the transfer or disposal of all or any of the shares of the clearing house in which the substantial shareholder has or has had an interest.(4) Until the person to whom a direction is issued under subsection (3) transfers or disposes of the shares which are the subject of the direction, and notwithstanding anything to the contrary in the Companies Act (Cap. 50) or the memorandum or articles of association of the clearing house —

no voting rights shall be exercisable in respect of the shares which are the subject of the direction;

the clearing house shall not offer or issue any shares (whether by way of rights, bonus, share dividend or otherwise) in respect of the shares which are the subject of the direction; and

except in a liquidation of the clearing house, the clearing house shall not make any payment (whether by way of cash dividend or dividend in kind or otherwise) in respect of the shares which are the subject of the direction.(5) Any issue of shares by the clearing house in contravention of subsection (4)(b) shall be deemed to be null and void and the person to whom a direction has been issued under subsection (3) shall immediately return those shares to the clearing house, upon which the clearing house shall return to the person any payment received from him in respect of those shares.(6) Any payment made by the clearing house in contravention of subsection (4)(c) shall be deemed to be null and void and the person to whom a direction has been issued under subsection (3) shall immediately return the payment he has received to the clearing house.(7) Any person who contravenes subsection (1) or any condition or restriction imposed by the Authority under subsection (2) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $250,000 and, in the case of a continuing offence, to a further fine not exceeding $25,000 for every day or part thereof during which the offence continues after conviction.(8) Any person who contravenes subsection (4)(b) or (c), (5) or (6) or any direction issued by the Authority under subsection (3) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $100,000 and, in the case of a continuing offence, to a further fine not exceeding $10,000 for every day or part thereof during which the offence continues after conviction.(9) For the avoidance of doubt, a direction issued under subsection (3) shall be deemed not to be subsidiary legislation.”.