The Ethiopian Capital Market Authority (ECMA) has published a directive that permits the issuance of a license for the operation of exchanges and over-the-counter markets.
According to ECMA’s statement released today, the first securities exchange license in Ethiopia will be made possible by the landmark directive.
According to ECMA, the Ministry of Justice authorized and it is now in force, “Directive on Licensing, Operation, and Supervision of Securities Exchanges, Derivatives Exchanges, and the Over-The-Counter Market No. 1009/2024.”
“This comprehensive directive sets forth the documentation, related terms, and requirements necessary to obtain a license for operating exchanges and over-the-counter markets. It outlines the supervisory framework for exchanges, the need for internal regulations approved by the authority, reporting obligations to the authority, and various standards governing the process,” it added.
For the first time in Ethiopia, this directive facilitates the licensing of securities and over-the-counter markets.
“It enables both government and private companies to utilize the market for selling shares and bonds, thereby creating a conducive environment for raising capital and undertaking significant projects,” ECMA says by adding “it establishes a transparent and controlled trading system for service providers with market licenses to buy and sell securities.”
This directive consolidates the previously fragmented securities trading in Ethiopia into a single, licensed, and regulated market, enhancing the sector’s contribution to stakeholders and the national economy.
“It also paves the way for the Ethiopian Securities Exchange S.C. to commence operations by granting an exchange license,” the regulatory body said in its statement.
Source: Capital Ethiopia
