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(1) The Commission may issue guidelines in respect of securities lending or borrowing for the purpose of trading on an exchange or approved trading system.

(2) Subject to this section and die guidelines issued by the Commission, a person shall not engage in securities lending or borrowing for the purpose of trading on an exchange or approved trading system unless that person enters into an agreement with an intermediary approved by the exchange or trading system to perform the function on behalf of that intermediary.

(3) An agreement between a lender and an intermediary and a borrower and an intermediary shall provide for die following conditions:

(a) the period of depositing or lending of securities;

(b) charges or fees for depositing or lending and borrowing;

(c) collateral securities for borrowing;

(d) provisions for the return including the premature return of the securities deposited or lent; and

(e) the provision for die return of all benefits.

(4) A person shall not deposit a security with an intermediary for the purpose of lending unless that person is die bona fide owner of die security or is duly authorized by die person in whose name die security is registered.

(5) A person who contravenes a guideline in respect of securities lending and borrowing is liable to payment of penalties prescribed in the guidelines issued by die Commission.