Market Operation

SBI Japannext Co. Ltd., (the "Company") is committed to the appropriate management of transactions conducted through its PTS venue from the perspective of "measures to suspend or limit transactions", "monitoring and prevention of unfair transactions", in order to ensure transaction security and to secure investor confidence.

Suspension or Limitation of Sales Transactions

The Company is entitled to suspend or limit transactions conducted through our PTS to ensure transaction security and fair dealing, or when it is found necessary by the Company that such measures are required from the risk management point of view.

  1. [During hours of daytime session and part of nighttime session: 08:20 - 17:30]
  2. Suspension of transactions in the case where the primary exchange or Japan Securities Dealers Association suspended transaction of a security:

    In the case where the primary exchange on which the target security is listed halted a transaction of such security or in the case where Japan Securities Dealers Association ("JSDA") halted a transaction of such security outside a Financial Instruments Exchange Market, the Company will suspend transaction of such security.

    As regards the resuming of transactions after the suspension during the trading hours of 1. of the day, our PTS venue will resume the transactions of such security if the relevant Financial Instruments Exchange or JSDA resumed the transactions (Provided, however, that transactions will be kept suspended during the trading hours of 2. if the transactions of the relevant security is suspended for all day. In addition, when JSDA suspended transaction of a security with its own decision independent from the primary exchange, the Company shall suspend transactions on the hours designated by JSDA notwithstanding the hours of 1. and 2.).

    If the suspension of a security (including not only the transactions of a security but also the transactions of the whole Financial Instruments Exchange) is triggered by the system disruption of primary exchange, the Company may not suspend the transactions with its own discretion.

  3. [During hours of nighttime session other than those above 1.: 17:30 - 23:59]
  4. Suspension of transactions of the concerned security due to the occurrence of material information:

    When the following information is publicized after 17:30, the Company will suspend transactions of such security:

    a) Information disclosed by an issuer via Timely Disclosure Network ("TDnet") operated by Tokyo Stock Exchange Inc.; b) information regarding the designation of securities under supervision or securities to be put on delisting by the primary exchange; or c) information among those regarding a security that is reported or publicized by the media or through other avenues which is considered "Material Information" by the Company.

    Transactions suspended during the nighttime session due to the publication of material information will not be resumed within the same day.

    The major contents of "Material information" are the "information regarding a company's business, operations or performance which will have a material effect on the judgment of securities investment" as follows (examples):

    • Acts of organizational restructuring such as mergers and acquisitions, TOB (tender offer to buy);
    • Equity financing such as third party allocation
    • Bankruptcy, petition of corporate reorganization procedure or civil rehabilitation procedure, dissolution; or
    • Information regarding the designation of securities under supervision or securities to be put on delisting by Financial Instruments Exchange etc.
  5. Suspension of transactions common to both 1. and 2. trading hours
  6. The Company may suspend or limit all or the part of a transaction if any of the following events arises, irrespective of whether it is during daytime session or nighttime session hours (trading hours of 1 and 2). After the transaction is suspended due to the event, in principle, the Company will promptly resume transaction or abolish limitation once it is confirmed that such event has become immaterial. Provided, however, that in the case where the Company finds it better to continue the suspension or limitation, the Company may continue the measures of suspension or limitation.

    1. The Company finds it inappropriate to allow the continuation of transaction activities due to an abnormality in our PTS operation.
    2. Delay or inability to place order or execute an order, or to give money or securities due to the occurrence of a force majeure event such as natural disasters, political turmoil, strike, sudden change in foreign currency circumstances, closure of foreign exchange market etc.
    3. Other events in which the Company finds it necessary to suspend or limit transactions to ensure fair dealing.

In addition to notifying all participating securities firms, information regarding suspension of transactions of certain securities at our PTS venue will be circulated to the information vendors (QUICK Corp. and Thomson Reuters Markets KK) and be disclosed on the Company's website.

Surveillance to Detect and Prevent Suspicious Transactions

In order to maintain a fair-trade environment, and to prevent market manipulation and insider trading, the trade surveillance team monitors real time market prices and transactions as well as conducts detailed analysis after market close.

During market hours, our surveillance department may ask trading participants for transaction details, end-client information, and other intelligence needed for the detailed analysis of trades. When a trade is determined as unfair after the investigation, the SBI Japannext market surveillance department will notify trading participants to pay close attention to the identified issue. If there are no improvements after the notification, the SBI Japannext market surveillance department will consider introducing certain limitations or suspension of business with the participants in question.

Furthermore, the Japannext PTS compliance department may provide detailed information of those suspicious transactions to institutions such as SESC (Securities and Exchange Surveillance Commission), JSDA, and exchange markets.

Termination of Connectivity

Japannext PTS reserves the right to forcibly terminate a member's connectivity in the following circumstances: