BY-LAWS OF DUBAI DIAMOND EXCHANGE
ARTICLE (1): Name and Address
1.1 The name of the exchange shall be “Dubai Diamond Exchange”
and is referred to hereinafter as “DDE”.
1.2 The principal office of DDE shall be in Almas Tower at the Dubai
Multi Commodities Centre (hereafter referred to as “DMCC”) in the
Emirate of Dubai, U.A.E. It shall be permissible to open branches and
representative offices for DDE within the Emirate of Dubai, by a
decision of the Board of Directors, after obtaining the approval of the
competent authorities in the Emirate of Dubai.
ARTICLE (2): Objectives and Powers
2.1 The objectives of DDE shall be to:
(a) promote the interests and development of the diamond,
precious stone and related jewellery industries in the Middle
East and adjacent regions;
(b) encourage and maintain just and equitable principles of
trade in diamonds, precious stones and related jewellery
amongst its members;
(c) eliminate abuses and unfair trade practices in relation to
such trade;
(d) disseminate accurate and reliable information concerning
such trade;
(e) cooperate – at the request and with the consent of the DMCC
with governmental agencies and other relevant parties within
the United Arab Emirates and abroad in the establishment and
maintenance of institutional arrangements conducive to the
ethical and economic welfare of these industries;
(f) provide arbitration tribunals to settle differences and
controversies amongst its members, and between its members
and other parties, in relation to trading in diamonds, precious
stones and related jewellery;
(g) provide for disciplinary proceedings to be taken against
members for breach of trade ethics or of honourable conduct;
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(h) provide, regulate and maintain suitable premises in the
Emirate of Dubai for its activities.
2.2 DDE has all the powers required to achieve its objectives as set
out above, including without limitation the power to:
(a) acquire, own and possess and to sell, lease, mortgage or
otherwise dispose of all such properties both moveable and (to
the extent permitted by law) immovable as may be necessary or
conducive to the attainment of DDE’s objectives;
(b) open bank accounts, to obtain loans and financial facilities
necessary for achieving its objectives, and to provide its assets
as a security for the same;
(c) provide all kinds of services to its members and others, and
to impose and collect fees against the services provided thereby;
(d) invest its funds in the form, activities and/or projects as may
be deemed appropriate;
(e) join in association with any similar body, including the World
Federation of Diamond Bourses (hereinafter referred to as
“WFDB”), agreeing that its members shall be required hereby to
comply with the rules and regulations of such body
(f) carry out any other function as may be deemed necessary
and required for achieving its objectives. The aforesaid
objectives shall be carried out by DDE, in accordance with rules
and regulations issued by Dubai Multi Commodities Centre
Authority, and the laws and regulations of the United Arab
Emirates applicable in the Emirate of Dubai.
ARTICLE (3) : Membership
3.1 Classes of Membership:
3.1.1 There shall be one kind of membership of DDE: Individual
Membership which shall be available for natural persons satisfying
the qualifications specified in Clause (3.2.2) hereunder;
3.2 Admission to Membership:
3.2.1 Application for membership with DDE does not automatically
constitute acceptance, as such application shall be subject to the
requirements and qualifications determined by the Board of Directors
and shall bein accordance with the applicable DMCC policy, in respect
thereof.
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3.2.2 Individual Membership:
A natural person may be admitted to Individual Membership of DDE,
if he or she has:
(a) attained the age of 21 years at the time of submitting the
application for membership;
(b) been engaged in the diamond, precious stone or related
jewellery industry for a period of at least two years at the time of
submitting the application for membership;
(c) an unblemished trade reputation;
(d) submitted to the Secretariat of DDE a complete Application
Form along with all supporting documents and the Application
Fee;
(e) provided any documents and information required by the
Secretariat.
3.2.3 Admission to DDE membership shall be confirmed by the
Secretariat upon completion of all membership requirements.
3.2.4 The list of the names of all applicants for Individual
Memberships shall be posted at DDE head office for a period of ten
days. During the posting period and for a period of five days thereafter
any member may object in writing to the admission of the applicant
and the Board of Directors shall take into consideration such written
objection(s). The aforesaid provisions of this Clause (3.2.5) shall apply
in case of any change in the named representative.
3.2.5 Any person whose application is rejected may again apply for
membership after six months from the date of the Board of Directors
decision in respect thereof.
3.2.6 All new members shall be on probation for a period of two years
commencing from the date of issuing the acceptance thereof, and the
Board of Directors shall be entitled to terminate and/or cancel such
membership at any time within this period for any reason whatsoever.
3.2.7 Any member may resign from the membership with DDE by
sending a written notice of not less than 30 (thirty) days to the
Secretariat. Such member shall be responsible for all obligations and
duties of a member in good standing in connection with any
transaction or matter which arose or which was initiated, in part or in
whole, prior to such member’s suspension or termination, including
but not limited to arbitration.
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3.2.8 Should a member who is a representative of a partnership or
corporation withdraw from that entity, it shall be the obligation of the
withdrawing member as well as the entity itself to immediately notify
the Secretariat in writing of such withdrawal by hand against receipt,
or by certified mail, return receipt requested.
3.3 Individual Membership Rights:
Members of DDE in good standing shall be entitled to:
(a) represent themselves in their business dealings as a
“Member of the Dubai Diamond Exchange”;
(b) enter the trading floor of DDE for the purpose of dealing with
other members in diamonds, precious stones and/or related
jewellery;
(c) attend meetings of members convened in accordance with
these By-Laws;
(d) enjoy other benefits and privileges as shall be determined by
the Board of Directors from time to time, at its sole discretion.
3.4 Membership Obligations:
Members of DDE shall be obliged to:
(a) conduct their business dealings in diamonds, precious
stones and related jewellery in accordance with the laws of the
relevant jurisdictions and in accordance with high standards of
business ethics;
(b) comply with these By-Laws, in particular those relating to
arbitration, as duly amended from time to time;
(c) refrain from trading in, offering or promoting conflict
diamonds;
(d) pay to DDE such annual subscriptions and other financial
commitments set by DDE.
3.5 Disciplinary Action Against Members:
3.5.1 If the Board of Directors has reason to believe that a member
has committed any of the following:
(a) failure to pay on time all amounts due to his/her/its
creditors;
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(b) failure to pay on time the membership fee to DDE, fines
imposed by DDE, as well as, any other amounts due from such
member to DDE;
(c) breach of these By-Laws and/or the rules and regulations
issued by the Board of Directors from time to time;
(d) failure to meet his/her business obligations;
(e) receipt of a petition in bankruptcy or any involuntary petition
in bankruptcy, making an assignment for the benefit of
creditors;
(f) failure to comply with a decision or awards of the arbitration
tribunals;
(g) intentionally making an untrue claim;
(h) avoiding arbitration by going to court against another
member;
(i) Any member company or individual that conducts
himself/herself in a manner that jeopardizes the reputation of
the exchange;
the Board of Directors may conduct an investigation of that
member.
3.5.2 The Secretariat shall give written notice, by hand against
receipt, or by certified mail, return receipt requested, of the date, time
and place of such investigation to:
(a) the member who is the subject of the investigation;
(b) the complainant, if any
(c) any known witnesses.
3.5.3 The member shall have the opportunity to file a written answer
to the charges within five days after being served personally or by mail
and to present witnesses, documentation or other evidence in his
defence and cross-examine any witnesses that may testify against
him.
3.5.4 The member shall be entitled to request the recusal of any
member of the Board of Directors from the meeting or meetings
conducting the investigation, on grounds stated, and the Board of
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Directors (including the Director concerned) shall make a decision
thereon which shall be final and binding.
3.5.5 Should the Board of Directors find the member guilty of the
alleged misdemeanours the Board shall have the right to determine
such disciplinary action it deems fit in its absolute discretion,
including one or more of the following:
(a) specific performance, such as a letter of apology or return of
property;
(b) a fine payable to DDE;
(c) a compensatory fine, payable to an aggrieved party;
(d) suspension of membership for a specified period;
(e) expulsion.
3.5.6 Any member whose membership is suspended or who is expelled
as a result of a failure on part of such member to pay his creditors
their respective dues on time, may be reinstated by the Board of
Directors upon the satisfaction of the Board of Directors that such
member has settled the due amounts or has reached a settlement
agreement in settlement of the same. Each case shall be handled
individually at the sole discretion of the Board of Directors.
3.5.7 The membership of any member who is suspended for nonpayment of his membership fees, fines or any other amounts due to
DDE shall be automatically terminated if such member fails to pay the
outstanding amounts within two months from the date of suspension.
3.5.8 Any member who was suspended or terminated for reasons
other than non-payment of dues and resignation may, after a period of
2 (two) years from his suspension or termination, apply for
membership in DDE in the same manner and under the procedure
applicable at the time of applying for the new membership.
3.5.9 Whenever any member is suspended or terminated, such
member shall be responsible to all obligations and duties of a member
in good standing in connection with any transaction or matter which
arose or which initiated, in part or in whole, prior to such member’s
suspension or termination, including but not limited to arbitration.
ARTICLE (4): Finances
4.1 The registration fees, the annual membership fees, as well as, all
applicable fines and all other financial obligations of members towards
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DDE shall be determined by the Secretariat, and be placed on the
advertisement board at DDE head office.
4.2 DDE shall operate an account or accounts with such bank(s) in
the Emirate of Dubai as the Board of Directors shall determine from
time to time and all funds of DDE shall be deposited in the name of
DDE in such accounts.
4.3 The Secretariat shall arrange for annual financial statements and
annual report to be prepared and shall appoint a certified auditor to
examine the books and accounts of DDE and issue an annual report
and balance sheet.
ARTICLE (5): The DDE Board of Directors:
5.1 Subject to Clause (5.5), DDE shall be advised by a Board of
Directors consisting of fifteen members appointed by Dubai Multi
Commodities Centre Authority.
5.2 Each Director shall serve on the Board of Directors for a period of
three years commencing from the date of appointment thereof with the
maximum of three consecutive terms. The members of the Board of
Directors shall assume office the following business day following their
appointment and shall continue in the office until their successors
shall be properly appointed and assume office. Any vacancy that may
occur among the Directors shall be filled for the remaining term
thereof by the remaining members of the Board of Directors
appointing any DDE member in good standing to the position.
5.3 Dubai Multi Commodities Centre Authority may appoint Alternate
Directors for Appointed Directors.
5.4 Dubai Multi Commodities Centre Authority shall be entitled to
replace any one or more of the Appointed Directors at any time by a
written notice to the Secretariat..
5.5 All resolutions of the Board of Directors shall require a quorum of
5 persons, Chariman included. All decisions adopted by the Board of
Directors shall be by an open ballot, unless any two members of the
Board of Directors call for a secret ballot.. The Chairman of the Board
of Directors shall be appointed by the DMCC. The Chairman shall
have the right to exercise a casting vote at meetings of the Board of
Directors.
5.6 Meetings of the Board of Directors shall be held at such a place
and hour as the Board of Directors may determine. Special meetings
of the Board may be called at any time by the Secretariat, Chairman of
the Board or upon written request by a majority of members of the
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Board of 15 Directors, upon 2 (two) business days’ written notice to
each member of the Board of Directors.
5.7 The Board shall be authorized to:
(a) hold meetings at such times and places as it may deem
proper;
(b) appoint committees, on particular subjects, from amongst its
members and other members of DDE;
(c) devise and carry into execution such other measures as it
may deem proper to promote the objectives of DDE and to best
protect the interest and welfare of the members;
(d) cooperate at the request and with the consent of the DMCC
with governmental agencies in all matters concerning the
diamond, precious stone and related jewellery industry;
(e) fine, suspend or terminate any member or group of members;
(f) adopt rules and regulations, consistent with these By-Laws,
for the management and conduct of DDE;
(g) delegate any of its powers to any member of the Board of
Directors or to any committee of such members.
5.8 Should any member of the Board of Directors fail to attend three
consecutive meetings of the Board, the Secretariat shall reserve the
right to send them written notification in respect thereof, and unless
the said member shall provide an excuse satisfactory to the Board of
Directors justifying his absence, the Board of Directors shall declare
his office vacant.
5.9 The DMCC shall provide a secretariat which shall have all the
authority required to manage and act on behalf of DDE as specified in
these By-Laws. The authority of the Secretariat shall include, but not
be limited to, the following:
(a) managing the day-to-day operations of DDE;
(b) opening, operating and closing all bank accounts in relation
to DDE and conducting all dealings with banks and financial
institutions and to sign all applications and documents for such
purposes and to obtain credit facilities and loans required for
DDE to achieve its objectives;
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(c) paying all costs, charges and expenses related to DDE and
giving receipts and discharges in respect of any amount paid to
DDE;
(d)record or cause to be recorded all votes and minutes of all
proceedings in books to be kept for that purpose.
(e) cause proper notice to be given of all the meetings of the
Board of Directors and committees.
(f) take charge of the general secretarial work of the various
committees and of the DDE.
5.10 DMCC retains the authority to appoint a Managing Director
should it recognize the need for such a function. At the discretion of
DMCC the Managing Director may be given the authority carry out the
following:
(a) negotiating and signing all types of contracts, transactions,
arrangements and dealings with third parties in the name of
and on the behalf of DDE;
(b) employing all persons as may be required by DDE and to
determine their salaries and benefits, as well as other terms and
conditions of such employment, and shall be entitled to
terminate such employment;
(c) determining the financial planning of DDE;
(d) pledging, mortgaging and otherwise charging the assets of
DDE for the purposes of raising and providing the financial
facilities deemed necessary;
(e) suing on behalf of DDE, attaching properties of debtors,
referring cases to arbitration, appointing lawyers and otherwise
taking all legal measures to protect the interests of the
Company whether as plaintiff, respondent, party to arbitration
or otherwise;
(f) representing DDE and signing on its behalf, without
limitation, before all governmental offices and departments;
(g) delegating all or part of his powers, as he shall deem fit.
The Managing Director shall exercise the powers and
authorities listed above in accordance with this By-Laws.
5.11 No official of DDE, in the due and correct performance of his/her
official duties, shall be held responsible in any manner whatsoever for
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any decisions or be subject to any legal actions for decisions or
actions taken on behalf of DDE.
5.12 The Board of Directors can establish standing committees to
assist in conducting its business. Initially DDE shall have the
following committees with members from the Board of Directors or
members in good standing of DDE, appointed from time to time by the
Board of Directors.
The Trading Committee shall consist of at least three Individual
Members of DDE and shall have the power and authority to
temporarily exclude a member from entering DDE trading room
and/or to recommend to the Board of Directors to institute
disciplinary proceedings against a member where a member
causes a disturbance or conducts himself/herself in DDE
trading room in a manner unbecoming of a member of DDE.”.
ARTICLE (6): Meetings of the Members
6.1 The Board of Directors at its discretion may convene a General
Meetings of the membership of DDE. General Meetings may be used to
communicate important changes affecting the membership or other
important matters regarding the operations of DDE.
6.2 Special general meetings of the membership may be called by:
(a) the Secretariat; or
(b) the Board of Directors, by resolution at a duly convened
meeting or upon the written request of a majority of the Board of
Directors; or
6.3 Special general meetings shall be called only to consider a specific
subject, which must be stated in the notice of the meeting.
6.4 Whenever notice is required to be given to any member, except as
provided for herein, such notice shall be deemed to have been given
from and at the time, when said notice, in writing, shall have been
sent to the member by hand against receipt, or by certified mail,
return receipt requested, addressed to the member at his/her latest
known place of business or residence, as the same shall appear upon
the books of DDE.
It shall be the responsibility of each member to report in writing any
change of address and phone number of his/her business and
residence to the Secretariat.
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6.5 At all meetings of the general membership, a quorum shall consist
of 51% of the individual membership of DDE. If there shall be no
quorum at a duly called meeting, then a second meeting shall be duly
called within ten days thereafter. At such second meeting, all business
may be transacted when there is a quorum of 25%. At general
meetings the Chairman shall not have the right to exercise a casting
vote.
ARTCLE (7): ARBITRATION
PROCEDURES
COMMITTEE
and
ARBITRATION
7.1 Arbitration Committee
An Arbitration Committee shall be established consisting of seven
Individual Members of DDE in good standing who shall be appointed
by the Board of Directors. The Board of Directors shall appoint the
Chairman of the Arbitration Committee.
7.2 Arbitration Proceedings
7.2.1 The function of the Arbitration Committee shall be to act as
arbitrators for the purpose of determining disputes as more fully set
out hereunder.
7.2.2 Any member who alleges a dispute with another member may
request arbitration by lodging in writing with the Secretariat details of
such dispute and the relief sought against the other member. The
Secretariat shall notify the dispute to the Chairman of the Arbitration
Committee who shall convene a meeting of the Committee, where at
least 3 (three) members shall be present to consider the matter.
Should any non-member of DDE allege a dispute with a member the
Secretariat shall refer the matter to the Board of Directors in
accordance with sub-clause (7.3.4) below.
7.2.3 At the said meeting of the Arbitration Committee, the Committee
shall decide whether a prima facie case exists, and if not, the
Secretariat shall in writing advise the member who may not proceed
with his dispute. If the Committee decides that a prima facie case
exists it shall then decide whether or not to refer the dispute to be
heard in accordance with DDE’s arbitration procedures. If it decides
not to so refer, the Secretariat shall in writing inform both the
complainant member, who may thereafter take such legal action as he
wishes, and the defendant member. Such decision by the Committee
shall be binding.
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7.2.4 Should the Committee decide to refer the dispute to arbitration:(a) A date for the hearing may be fixed (or subsequently fixed by
the Committee Chairman if not then convenient).
(b) An arbitration panel of 3 (three) Committee members may be
fixed (or subsequently fixed by the Committee Chairman if not
then convenient).
(c) A referee shall be selected unless the Committee instructs
the Committee Chairman to select a Referee.
7.2.5 The Secretariat shall in writing inform the complainant member
of the decision of the Committee and shall further inform him:(a) of his right to submit to a Referee in accordance with DDE
By- Laws in an endeavour to settle the dispute;
(b) of the date of the hearing and the names of the proposed
arbitrators in respect of whom he shall have the right to object
without cause to the appointment of any one such arbitrator
which right may be exercised only once;
(c) of his right to request the recusal of any one arbitrator on
good cause shown to the Committee whose decision thereon
shall be final and binding;
(d) of any defence or counterclaim lodged by the defendant
member when same is received.
7.2.6 The Secretariat shall in writing inform the defendant member:(a) of the dispute and the relief sought;
(b) of the Committee’s decision to refer the dispute to
arbitration; (c) of his right to submit to a Referee in accordance
with DDE By-Laws in an endeavour to settle the dispute;
(c) of his duty to lodge in writing his defence in the dispute and
details of any counter claim that he may have;
(d) of the date of the hearing and the names of the proposed
arbitrators, in respect of whom he shall have the right to object
without cause to the appointment of any one such arbitrator
which right may be exercised only once;
(e) of his right to request the recusal of any arbitrator on good
cause shown to the Committee whose decision thereon shall be
final and binding.
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7.2.7 In cases of urgency the Committee or the Arbitration Panel shall
be entitled to dispense with the above procedures provided that no
parties are prejudiced in the conduct of the arbitration.
7.2.8 In the temporary absence of a member of the Committee the
Board of Directors shall be entitled to appoint one of its members to
fill such position temporarily.
7.2.9 Any member, including the arbitrators, who participates in an
arbitration hearing in any capacity, shall be required and undertakes
to keep all the proceedings secret.
7.2.10 No legal representation at an arbitration hearing shall be
allowed to any party unless:
(a) he shall have applied timeously for the right to have such
representation; and
(b) The Arbitration Committee considers in its sole and absolute
discretion that the nature or complexity of the matter in dispute
warrants such representation, in which event all parties shall be
entitled to such representation.
7.3 Jurisdiction
7.3.1 Every member of DDE shall be deemed by virtue of his being
such to have submitted himself to the reference to and decision by the
Arbitration Committee of any dispute as if he had signed a Deed of
Submission to the arbitration and decision by the Committee. He shall
be deemed to have consented to the arbitration being held in the
Emirate of Dubai.
7.3.2 A member of DDE who institutes legal proceedings against any
other member of DDE concerning a dispute that should have properly
been referred to DDE for arbitration and which legal proceedings have
not been authorized as contemplated by Clause (7.2.3) above shall
himself be guilty of a breach of these By-Laws and shall be liable to
disciplinary action. A member against whom such legal proceedings
have been instituted shall have and retain all his rights to have the
dispute dealt with as contemplated by these By-Laws.
7.3.3 The nature of any dispute which shall be submitted to
arbitration shall be any dispute between members (defined as in subclause (7.3.2) above) arising from or forming part of any transaction or
negotiation or act or omission howsoever connected directly or
indirectly with or relating to the diamond of precious stones or related
jewellery industry, trade or undertakings.
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7.3.4 Notwithstanding anything hereinbefore contained the Board of
Directors shall be entitled in its discretion to apply the provisions of
these By-Laws to a dispute alleged and relief sought by a non-member
of DDE against a member who has consented in writing for such
dispute and relief sought being referred to DDE.
(a) This provision shall be deemed to be a stipulation for the
benefit of such non-member and in the event of this provision
being applied, such non-member shall acknowledge in writing
that he agrees to be bound by the terms of these By-Laws and
the Arbitration proceedings.
(b) The Board of Directors or the Committee or the Arbitration
Panel may levy such charges against such non-member as it
deems fit and may require any or all of such charges to be
deposited in advance.
7.3.5 The Arbitrators may make use of legal or other expert assistance
in the discharge of their duties, provided always that having obtained
such assistance they exercise their own independent judgement on all
matters including that in respect of which they sought assistance, and
insofar as costs are incurred in seeking such assistance, they may
make a suitable award to cover such costs.
7.3.6 Save as herein provided, Arbitration proceedings are subject to
the relevant laws of the United Arab Emirates.
7.3.7 The Arbitrators shall determine the process to be followed in the
presentation and adjudication of any dispute provided always that the
process to be followed is fair and affords each party an adequate
opportunity to state his case.
7.3.8 The decision of the arbitrators shall in any dispute be final and
binding upon the parties thereto. Neither they, DDE or any of its
officials shall be liable to any party for any act or omission relating to
an arbitration proceeding or the performance of any functions or
duties thereunder.
7.3.9 Each member shall be bound by the arbitration rules of the
WFDB and in particular Article (4) of its Inner Rules, and where
required by local laws, subject to the mutual binding of a member of
another bourse likewise being so bound.
ARTICLE (8): By-Laws
8.1 These By-Laws may be amended only by proposals submitted to
the Board of Directors, and recommended by the Board of Directors to
a general meeting of members. In order for such an amendment to
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take effect it must be approved at such general meeting by not less
than two-thirds of the members present and entitled to vote. A
quorum at any meeting called for such purpose shall be 25% of the
membership. If such Quorum is not present, then another meeting
shall be called as herein provided. At such second meeting, any
amendment may be passed by a two-thirds vote of the members
present and entitled to vote.
8.2 Any proposed amendment of these By-Laws, must be posted on
the DDE notice board for a period of 14 (fourteen) days prior to the
meeting at which it is to be considered.
ARTICLE (9): Dissolution
DDE may be dissolved:
by a decision of the Board of Directors or equivalent body of
Dubai Multi Commodities Centre Authority
ARTICLE (10): Restraint of Trade
DDE shall not adopt any resolution, rule, regulation or By-Laws,
which illegally attempts to restrain trade or violate the law.
ARTICLE (11): Visiting Dealers
The Board of Directors may determine rules and procedures that shall
govern the conditions on which Visiting Dealers may be permitted to
enter the DDE trading floor.
ARTICLE (12): Other Issues
Issues not covered by the provisions of these By-Laws may be
addressed and regulated by regulations issued by the Board of
Directors to be published at the head office of DDE.
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