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Stock markets

Discussion in 'Other Governmental Matters' started by Terry Thompkins, Sep 16, 2020.

  1. Terry Thompkins

    Terry Thompkins Law Topic Starter New Member

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    What laws stop someone from starting their own stock market?
    For example: if someone wanted to create a market for individual products instead of companies and broker said market, is there any laws stopping them from doing this?
     
  2. adjusterjack

    adjusterjack Super Moderator

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    What do you mean by "products"? Unless you are talking about cows, stocks are pieces of ownership of publicly trading corporations that are bought and sold and regulated by the Securities and Exchange Commission.

    The oldest example of a stock market (securities) in the US is the NY Stock Exchange founded in 1792.

    The newest is BATS Global Markets launched as a subscriber exchange in 2005 and converted to a formal stock exchange in 2008.

    There is no law stopping you from creating a stock exchange for the trading of shares of company stock. But there are plenty of laws regulating how you do it. Considering the competition it would probably require millions of dollars in start-up capital.

    If by "products" you mean something different, you'll have to explain what you mean.
     
  3. army judge

    army judge Super Moderator

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    Probably, because THEY control the stocks and the markets in which people gamble.
     
  4. Tax Counsel

    Tax Counsel Well-Known Member

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    No laws stop you from doing that. But you would have to ensure that your stock market conforms to the applicable federal and state securities laws. There are a number of requirements a stock market will need to meet. As a starter, your market would generally either need to register with the SEC (and the requirements to qualify for registration are pretty extensive) or file with the SEC for exemption from registration.

    So if you want to do this, you need to consult a securities lawyer to make sure you do it correctly. If you don't do that, you might find yourself owing a huge amount of money in fines to the government and/or judgments to disgruntled investors.
     

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