THE MEANING OF ARTIFICIAL PRICE: LESSONS FROM AUSTRALIAN CASE DIRECTOR OF PUBLIC PROSECUTIONS (CTH) V JM [2013] HCA 30

• Published date: 16 August 2019
• Date: 16 August 2019

THE MEANING OF ARTIFICIAL

PRICE: LESSONS FROM AUSTRALIAN

CASE DIRECTOR OF PUBLIC

PROSECUTIONS (CTH) V JM [2013]

HCA 30

TSHEGOFATSO KGARABJANG

Lecturer, School of Law, University of South Africa

Keywords: artificial price for company securities, Australian

Corporations Act 2001, Financial Markets Act 19 of 2012,

prohibited trading practices, market manipulation.

ABSTRACT

In recent times, South Africa and other jurisdictions with which it

shares corporate commercial legal traditions have upped the tempo

on tightening corporate commercial law policy and regulation.

One of the ways in which this is done is by introducing rules to

regulate conduct of players within the capital financial markets. In

South Africa, this is evidenced by the enactment of the Financial

Markets Act 19 of 2012. Central to the regulation of financial

markets is the prohibition of certain trading practices as clearly set

out in s 80 of the Act. One of such prohibited trading practices is

the direct or indirect use of or participation in any practice which

has created or is likely to have the effect of creating an artificial

price for the relevant securities of the company concerned. Since

there is no single case in South Africa dealing extensively with

the conduct of creating an artificial price for the securities of a

company, lessons can be derived from jurisdictions like Australia,

which shares corporate commercial legal traditions with South

Africa.

I INTRODUCTION AND BACKROUND

In Australia market manipulation is regulated by the Corporations Act

2001 (hereafter ‘Corporations Act’). Among others, the Corporations

Act prohibits a person from taking part in a transaction that has or is

likely to have the effect of creating or maintaining an artificial price

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(2015) 1(1) JCCL&P 93

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