Title
SEC Rules on Temporary Restraining Orders
Law
Sec
Decision Date
Mar 13, 1998
The Securities and Exchange Commission establishes rules for the issuance and handling of temporary restraining orders (TROs) to ensure prompt and fair resolution of urgent complaints, allowing for ex-parte issuance and summary hearings while prohibiting delays in the process.
A

Filing and Referral Procedure

  • Complaints with TRO prayers filed with the Securities Investigation and Clearing Department (SICD) are referred to the Office of the Chairman.
  • SICD forwards an original copy of such complaints to the Chairman.
  • Cases before SICD continue despite TRO application pendency unless dismissed, which renders the TRO application moot.

Ex-Parte Issuance of TRO

  • The Chairman or, in his absence, the most senior Associate Commissioner can issue a TRO ex-parte.
  • TRO issuance requires determination of extreme urgency to prevent grave injustice or irreparable injury.
  • TRO issued ex-parte is effective only for seventy-two (72) hours.

Summary Hearing on TRO Application

  • The application is referred to the Director of SICD within 24 hours for a summary hearing.
  • Purpose is to decide on granting or extending the TRO.
  • Maximum TRO duration is twenty (20) days inclusive of the initial 72 hours.

Conduct of the Summary Hearing

  • Hearing is considered conducted once the adverse party or counsel has opportunity to oppose orally or in writing.
  • Failure to oppose constitutes waiver, and the application is submitted for resolution.

Preliminary Injunction Procedures

  • Any application for preliminary injunction must be heard and decided within the TRO's effective period by the assigned Hearing Officer.
  • If hearings are incomplete within TRO validity, the Hearing Officer decides based on available evidence.

TRO Application Post-Commencement

  • Applications for TRO after case commencement but before judgment must be filed with the Office of the Chairman.
  • Applicable rules and procedures remain the same.

Prohibitions Regarding TRO Proceedings

  • Motions that delay TRO resolution are prohibited.
  • Petition for Certiorari contesting TRO issuance is disallowed.

Repealing Clause

  • Existing SEC rules inconsistent with these provisions are modified or repealed.

Effectivity

  • Rules take effect fifteen (15) days after publication in a newspaper of general circulation.

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