Commonwealth Numbered Acts

CORPORATIONS ACT 1989 No. 109 of 1989 - SECT 1266

1266. (1) In this section, a reference to the transmission by an eligible
futures broker of instructions to deal in a class of futures contracts is a
reference:

   (a)  where the broker has direct access to the futures market on which the
        instructions are to be executed-to the transmission of the
        instructions to that futures market; or

   (b)  where the broker has access to the futures market on which the
        instructions are to be executed only through another futures broker-to
        the transmission of the instructions to that other futures broker.

(2) Subject to subsection (3), an eligible futures broker shall transmit in
the sequence in which they are received by the broker all instructions to deal
in a class of futures contracts at or near the market price for a futures
contract of that class prevailing immediately before execution of the
instructions.

(3) Where an eligible futures broker proposes to deal in a class of futures
contracts on the broker's own account and the person by whom or on whose
instructions the instructions for the dealing are to be transmitted is aware
of instructions of a client of the broker to deal in that class of futures
contracts at or near the market price for a futures contract of that class
prevailing at that time (being instructions that have not been transmitted),
that person shall not transmit, and shall not give instructions to any other
person to transmit, the instructions to give effect to the proposal of the
broker to deal in that class of futures contracts before the instructions of
the client are transmitted.

(4) An eligible futures broker, or a director, partner, officer or employee of
an eligible futures broker, shall not, except:

   (a)  to the extent necessary to execute the instructions concerned;

   (b)  as required by this Act or any other law; or

   (c)  as required by the business rules of a futures organisation of which
        the broker is a member; disclose to any other futures broker, or to a
        person engaged or employed in the business of the first-mentioned
        broker or of any other futures broker, instructions of a client to
        deal in a class of futures contracts.

(5) A member of a futures exchange who is concerned in the execution, on a
trading floor of the futures exchange, of instructions to deal in futures
contracts shall execute in the order in which they are received by the member
all instructions to deal in a class of futures contracts at or near the market
price for a futures contract of that class prevailing immediately before
execution of the instructions.

(6) Where:

   (a)  during a particular period, an eligible futures broker transmits
        instructions (whether or not those instructions consist of, or
        include, instructions giving effect to a proposal of the broker to
        deal in the class of contracts concerned on the broker's own account)
        to deal in a class of futures contracts at or near the market price
        for a futures contract of that class prevailing immediately before
        execution of the instructions; and

   (b)  dealings in that class of futures contracts are effected pursuant to
        those instructions; the broker shall, except so far as the business
        rules of a futures organisation of which the broker is a member
        otherwise provide, allocate the dealings to those instructions:

   (c)  in the sequence in which the dealings were effected; and

   (d)  in the sequence in which the broker transmitted those instructions.

(7) An eligible futures broker shall maintain, in accordance with the
regulations, records that set out the prescribed particulars of:

   (a)  instructions by a client to deal in futures contracts;

   (b)  the date and time of receipt, transmission and execution of those
        instructions;

   (c)  the person by whom those instructions are received, the person by whom
        they are transmitted and the person by whom they are executed;

   (d)  the date and time of receipt, transmission and execution of
        instructions to deal in futures contracts on the broker's own account;
        and

   (e)  the person by whom instructions of the kind referred to in paragraph
        (d) are received, the person by whom they are transmitted and the
        person by whom they are executed; and shall retain those records for
        the prescribed period.

(8) Where:

   (a)  an eligible futures broker transmits for execution on a futures market
        outside Australia and the external Territories instructions to deal in
        futures contracts; and

   (b)  it is not reasonably practicable for the broker to set out in the
        records maintained by the broker pursuant to subsection (7) the
        prescribed particulars of the date and time of execution of those
        instructions; the broker shall so set out those particulars as
        precisely as is reasonably practicable.