The Legal Regulation of the Intermediaries in the Stock Market, and Their Civil and Criminal Liability

This research deals with the study and analysis the legal regulation for the financial intermediation companies in the stock market, and their legal liability during of carrying out their duties and obligations in accordance with the provisions of the applicable legislations in Palestine, especially the Stock Exchange Law No. (12) of 2012 and the instructions deriving from it, and the applicable civil legal rules in Palestine, due to the importance of the role played by the financial intermediation companies in the commercial transactions that conducted in the stock market as a main player in this market. This research focused on defining the stock market intermediary and clarifying his obligations, and the civil liability, specifically the contractual liability, and his criminal liability in accordance with the applicable legislations in Palestine. This research has dealt with the contractual civil liability that arises on an intermediary under the financial mediation contract, which occurs when an intermediary does not carry out his obligations according the contract that is concluded between him and the client, or between him and the Securities Market Authority. It means he commits a mistake that leads to causing damage and therefore he is obliged in a compensation. In addition, the criminal liability, as the legislator considered that there are many actions practiced by an intermediary during of carrying out his duties, constitute a crime and arises his criminal liability and punished him with a stipulated penalty, whether these actions are related to practicing of the financial intermediary profession without license or failure in fulfillment his obligations. It was concluded that the legislator imposed heavy liability on this intermediary to maintain confidence in the stock market and the trading operations in it, and to protect the rights of dealers.