A Recognised Body may only permit a Member to provide its Clients Direct Electronic Access to the Recognised Body's facilities where:(a) the Clients meet the suitability criteria established by the Member in order to meet the requirements in Rule 2.8.8;(b) the Member retains responsibility for the orders and trades executed by the Clients who are using Direct Electronic Access; and(c) the Member has adequate mechanisms to prevent the Clients placing or executing orders using Direct Electronic Access in a manner that would result in the Member exceeding its position or margin limits.
A Recognised Body which permits its Members to allow their Clients to have Direct Electronic Access to its trading facilities must:(a) set appropriate standards regarding risk controls and thresholds on trading through Direct Electronic Access;(b) be able to identify orders and trades made through Direct Electronic Access; and(c) if necessary, be able to stop orders or trades made by a Client using Direct Electronic Access provided by the Member without affecting the other orders or trades made or executed by that Member.
MIR 2.8.9 [Deleted]
"Direct Electronic Access" means any arrangement, such as the use of the Member's trading code, through which a Member or the clients of that Member are able to transmit orders relating to investments directly to the facility provided by the Recognised Body.
A Person who is permitted to have Direct Electronic Access to a Recognised Body's facilities through a Member is not, by virtue of such permission, a Member of the Recognised Body.
The Regulator may have regard to the arrangements made to permit Direct Electronic Access to the Recognised Body's facilities and to prevent and resolve problems likely to arise from the use of electronic systems to provide indirect access to its facilities by Persons other than its Members, including:(a) the rules and guidance governing Members' procedures, controls and security arrangements for inputting instructions into the system;(b) the rules and guidance governing the facilities Members provide to Clients to input instructions into the system and the restrictions placed on the use of those systems;(c) the rules and practices to detect, identify, and halt or remove instructions breaching any relevant restrictions;(d) the quality and completeness of the audit trail of any transaction processed through an electronic connection system; and(e) procedures to determine whether to suspend trading by those systems or access to them by or through individual Members.