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CMC 2-1 Introduction

1. Article 54 of the Law provides that:

A person shall not, in the DIFC or elsewhere, by any means, directly or indirectly…..

engage or participate in any act, practice or course of conduct relating to Investments….

that the person knows or reasonably ought to know:
(a) results in or contributes to, or may result in or contribute to, a false or misleading impression as to the supply of, demand for or price of one or more Investments;
(b) creates or is likely to create an artificial price for one or more Investments; or
(c) perpetrates a fraud on any person.
2. Article 54 includes a specific requirement relating to knowledge. It requires that the person who engages or participates in the act, practice or course of conduct either knew (a subjective test) or reasonably ought to have known (an objective test) that the act, practice or course of conduct would have the effect described in paragraph (a), (b) or (c) of that Article.
3. In assessing whether a person reasonably ought to have known that an act, practice or course of conduct would have the effect described in Article 54 (a), (b) or (c) (i.e. the objective test), the DFSA will consider if a reasonable person in that position would have or should have known it would have such an effect.
4. The following sections of this chapter set out the DFSA's views on conduct that contravenes paragraph (a), (b) and (c) respectively of Article 54.
Derived from GM9/2014 (Made 1st January 2015). [VER1/01-15]