128Prohibition of dealings in securities by insiders

##### 128 Prohibition of dealings in securities by insiders (1) A person who is, or at any time in the preceding 6 months has been, connected with a body corporate shall not deal in any securities of that body corporate if by reason of his so being, or having been, connected with that body corporate he is in possession of information that is not generally available but, if it were, would be likely materially to affect the price of those securities. (2) A person who is, or at any time in the preceding 6 months has been, connected with a body corporate shall not deal in any securities of any body corporate if by reason of his so being, or having been, connected with the first‑mentioned body corporate he is in possession of information that: (a) is not generally available but, if it were, would be likely materially to affect the price of those securities; and (b) relates to any transaction (actual or expected) involving both those bodies corporate or involving one of them and securities of the other. (3) Where a person is in possession of any such information as is mentioned in subsection (1) or (2) that if generally available would be likely materially to affect the price of securities but is not precluded by either of those subsections from dealing in those securities, he shall not deal in those securities if: (a) he has obtained the information, directly or indirectly, from another person and is aware, or ought reasonably to be aware, of facts or circumstances by virtue of which that other person is then himself precluded by subsection (1) or (2) from dealing in those securities; and (b) when the information was so obtained, he was associated with that other person or had with him an arrangement for the communication of information of a kind to which those subsections apply with a view to dealing in securities by himself and that other person or either of them. (4) A person shall not, at any time when he is precluded by subsection (1), (2) or (3) from dealing in any securities, cause or procure any other person to deal in those securities. (5) A person shall not, at any time when he is precluded by subsection (1), (2) or (3) from dealing in any securities by reason of his being in possession of any information, communicate that information to any other person if: (a) trading in those securities is permitted on a stock market, whether within or outside the Territory; and (b) he knows, or ought reasonably to know, that the other person will make use of the information for the purpose of dealing, or causing or procuring another person to deal, in those securities. (6) Without prejudice to subsection (3) but subject to subsections (7) and (7A), a body corporate shall not deal in any securities at a time when any officer of that body corporate is precluded by subsection (1), (2) or (3) from dealing in those securities. (7) A body corporate is not precluded by subsection (6) from entering into a transaction at any time by reason only of information in the possession of an officer of that body corporate if: (a) the decision to enter into the transaction was taken on its behalf by a person other than the officer; (b) it had in operation at that time arrangements to ensure that the information was not communicated to that person and that no advice with respect to the transaction was given to him by a person in possession of the information; and (c) the information was not so communicated and such advice was not so given. (7A) A body corporate is not precluded by subsection (6) from dealing in securities of another body corporate at any time by reason only of information in the possession of an officer of that first‑mentioned body corporate, being information that was obtained by the officer in the course of the performance of his duties as an officer of that first‑mentioned body corporate and that relates only to proposed dealings by that first‑mentioned body corporate in securities of that other body corporate. (8) For the purposes of this section, a person is connected with a body corporate if, being a natural person: (a) he is an officer of that body corporate or of a related body corporate; (b) he is a substantial shareholder within the meaning of Division 4 of Part IV of the Companies Act 1981 in that body corporate or in a related body corporate; or (c) he occupies a position that may reasonably be expected to give him access to information of a kind to which subsections (1) and (2) apply by virtue of: (i) any professional or business relationship existing between himself (or his employer or a body corporate of which he is an officer) and that body corporate or a related body corporate; or (ii) his being an officer of a substantial shareholder within the meaning of Division 4 of Part IV of the Companies Act 1981 in that body corporate or in a related body corporate. (9) This section does not preclude the holder of a dealers licence from dealing in securities, or rights or interests in securities, of a body corporate, being securities or rights or interests that are permitted by a securities exchange to be traded on the stock market of that securities exchange, if: (a) the holder of the licence enters into the transaction concerned as agent for another person pursuant to a specific instruction by that other person to effect that transaction; (b) the holder of the licence has not given any advice to the other person in relation to dealing in securities, or rights or interests in securities, of that body corporate that are included in the same class as the first‑mentioned securities; and (c) the other person is not associated with the holder of the licence. (10) Where a prosecution is instituted against a person for an offence by reason that the person was in possession of certain information and entered into a transaction in contravention of this section, it is a defence if the person satisfies the court that the other party to the transaction knew, or ought reasonably to have known, of the information before entering into the transaction. (11) For the purposes of subsection (8), officer, in relation to a body corporate, includes: (a) a director, secretary, executive officer or employee of the body corporate; (b) a receiver, or a receiver or manager, of property of the body corporate; (c) an official manager or a deputy official manager of the body corporate; (d) a liquidator of the body corporate; and (e) a trustee or other person administering a compromise or arrangement made between the body corporate and another person or other persons.