A recognised market is essentially an alternative trading venue, marketplace or facility that brings together purchasers and sellers of capital market products under the purview of the SC. These recognised markets are operated by recognised market operators (“RMO(s)”) who are registered pursuant to Section 34 of the Capital Markets and Services Act 2007 (“CMSA”).
In comparison with approved markets such as the Main Market, ACE Market and LEAP Market of Bursa Malaysia Securities Berhad, which are approved pursuant to Section 8 of the CMSA and subject to stringent requirements under securities laws, the regulations for recognised markets are designed and promulgated to commensurate with the risk profile, nature and scope of the recognised market operations.
Pursuant to the responses received on its Public Consultation Paper No. 2/2014 titled “Proposed Regulatory Framework for Equity Crowdfunding” which sought feedback from the public in respect of the proposed regulatory framework for ECF activities in Malaysia, the SC had on 10 February 2015 issued the Guidelines on Regulation of Markets under Section 34 of CMSA. This was subsequently replaced by the Guidelines on Recognized Markets (“RM Guidelines”) issued on 11 December 2015 which introduced the terms “recognised market” and “RMO(s)”.
Today, save for IEO which is specifically regulated under the Guidelines on Digital Assets (“DA Guidelines”), all recognised markets in Malaysia including a digital asset exchange (“DAX”), ECF and P2P Financing are regulated under the RM Guidelines. An IEO operator which is registered under the DA Guidelines shall, however, be deemed to be registered as a RMO for the purposes of section 34 of the CMSA.
