Having explained the new phase upon which the Buenos Ayres Bourse has entered, we must now consider its organisation and its usages, and the regulations under which it operates.
In the first place we must remark that the Bourse is not an official institution, but a private establishment, founded and supported by a limited liability company, the “Bolso de Comercio,” which is recognised as a judicial body.
In contrast to other Exchanges, and that of New York in particular, the number of shareholders is unlimited, and varies from time to time. In 1886 there were 2959; in 1891, 4901; in May 1905, 3709. To become a member of the Bourse one must be presented by two shareholders, admitted by the Council Chamber or Committee (Chambre Syndicate), and must pay a moderate entrance fee, as well as an annual subscription.
According to its rules, the object of the Bourse de Commerce is to “offer a place of meeting to these members, where they may discuss and effect all manner of lawful business; and to facilitate and negotiate all commercial operations by giving them security and legality.” It also undertakes to represent commerce and production in general before the authorities of the country, or before private undertakings; it supports petitions relative to their interests, in order that laws about to be proposed, or those which are being adopted, shall be equitable and shall favour the development of commercial transactions. Its object is both to ensure the unity of commercial usages, and in case of need to take the initiative in all questions of economics which may affect commerce in general.
The management of the Bourse is effected by the Council Chamber—the Chambre Syndical de la Bourse, which is entrusted with the general and official representation of the institution. It is this authority which permits or refuses the official quotation of all stocks, shares, loans, etc., issued according to the laws of the country of their origin and by legally constituted bodies.
The functions of the stockbroker can only be fulfilled by persons previously authorised by the Council Chamber, after they have accomplished certain formalities, and have proved whether they have attained their legal majority, have experience of business, and have enjoyed a good reputation, all of which must be guaranteed by three men of business of known responsibility. The number of such brokers is not limited, and may be increased or decreased according to circumstances. In 1905, for instance, their number was 385. They are not obliged to give security nor to make any deposit as guarantee before practising; they have merely to pay a small monthly subscription.
The regulations of the Bourse contain severe provisions against brokers who infringe any of the numerous prohibitions affecting them; such as accepting orders from clients whose identity has not been proved; from persons known to be insolvent, or from incapable persons; or acting as intermediary in negotiations where there is reason to suspect that the parties involved are not proceeding seriously. Brokers who infringe these rules or others—who do not, for example, meet their engagements—are suspended by the Council Chamber of the Exchange.
All operations must be declared in an audible voice by the stockbroker to the recorder (annotator), in order that the latter may inscribe them upon the blackboard. The vendor and the buyer must then exchange memoranda, in order that the transaction shall be definitely confirmed and made valid. All transactions effected on exchange[93] during official hours are copied, with the prices, from the blackboard into the Journal of Sales; these latter being also published in the Boletin de la Bolsa de Comercio; or, as we should say, the Stock Exchange Bulletin. The settlement of all transactions concluded is effected through the Council Chamber, with the aid of the Bureau de Liquidation, or Settlement Office, under the supervision of an official liquidator, appointed at a general meeting of the brokers, who charges a percentage on the settlements which he effects.[94]