The Stock Exchange of Thailand (SET) is a center that provide trading services of listed securities which include the system and method for trading services as well as related business services such as clearing house, securities depository centre, securities registrar, and rendering services on securities data.

The SET was established in 1975 under the Securities Exchange of Thailand Act B.E. 2517. Since the Securities and Exchange Act B.E. 2535 (the SEA) had been effective, the Stock Exchange of Thailand became a regulated entity under the SEA.

The SEA prescribed the qualifications of associated persons as follows:

  A board of directors of the Securities Exchange comprises of no more than five persons appointed by the SEC and no more than five persons elected by members to serve as directors. The manager of the Securities Exchange is also director of the Securities Exchange as the position entails. (Section 159)

  Directors and the manager of the Securities Exchange shall be subject to statutory qualification and disqualification requirements prescribed in the SEA. (Section 160 and Section 165)

  Directors of the Securities Exchange shall hold office for two-year term. The directors who have completed the term of office may be re-appointed but shall not hold office for more than two consecutive terms. (Section 161)

  The board of directors of the Securities Exchange shall appoint the manager of the Securities Exchange. The manager shall hold office for a term of not exceeding four years and may be re-appointed. (Section 164)

1. Rules and regulations of the Stock Exchange of Thailand

The issuance and amendments of rules or regulations of the Stock Exchange of Thailand shall receive advice and consent from membership meeting. In some cases, approval of the board of SEC is required. For instances, rules regarding the acceptance and withdrawal of listed securities, rates for fees charged by brokers in trading listed securities, membership supervision and control of the Securities Exchange, and rates for the admission fees for membership. (Section 170)

2. Reporting requirement

The board of directors of the Securities Exchange shall submit financial statement and reports to the SEC within 14 days from the day the board of directors proposed the reports to the meeting of the members of the Securities Exchange. (Section 181)

(1) Audited financial statement, balance sheet and income statement

(2) Statement of the chairman of the Securities Exchange

(3) Annual report

(4) Budget and strategic plan of the following year

(5) Any other reports as prescribed by the SEC

(Notification : Thor Dor. 79/2552)

3. Anti-abnormality in the securities trading

  The SET, as a preliminary regulator, has duty to monitor malpractice of securities trading.In cases where further legal actions or further investigation are needed, the SET shall submit the case to the SEC for further proceeding.

  In case where there has been a breakdown in the equipment used in the trading system, which prevents the normal trading of listed securities in the Securities Exchange, the manager of the Securities Exchange shall have the power to order a temporary suspension of trading, and shall submit a report to the SEC immediately.

  In case where there have been any events, which prevents the normal trading of listed securities in the Securities Exchange, the board of directors shall have the power to order a suspension of trading, and shall submit a report to the SEC immediately.

  In order to safeguard against the damage which may be harmed to the public or the economy of the country, the SEC shall have power to

      (1) temporarily suspend the trading of all listed securities in the Securities Exchange for a specified period deemed to be reasonable;

      (2) instruct the board of directors or the manager of the Securities Exchange to act or omit to act as the SEC deemed appropriate.

4. Inspection of the Stock Exchange of Thailand

To ensure that the SET operation is efficient, integrity, and in accordance with the international standard, the SEC has adopted IOSCO principles. The principles work as a guideline for setting the scope of examination and expectation of SET operations. In 2004, the SEC had conducted an examination of the SET operation which had the scope of an examination covered many important areas. The inspection report stated that the SET operation achieved the expectation of the SEC. Nevertheless, the SEC had some suggestions on important issues including measures to prevent circulation of rumors, better adherence to the updating REHABCO companies’ information, and measures to improve listed companies’ free float proportion.