Source: BIE

Addis Ababa, Ethiopia (15 February 2023)

The Ethiopia Capital Market Authority (ECMA) has taken a major step toward the development of its capital markets with the approval and release of three directives for public consultation. These directives are aimed at regulating and supervising the establishment and operation of securities exchanges, derivative exchanges, and other trading platforms and facilities, capital market service providers, and self-regulatory organizations (SROs).

The Directive on Licensing and Operating Securities Exchanges and Trading Platforms aims to ensure the protection of investors, market integrity, and the existence of fair, efficient, and transparent markets while promoting the development of Ethiopia’s capital markets. It outlines the regulatory requirements for the establishment and operation of securities exchanges and other trading platforms, ensuring that they adhere to the highest standards of governance, transparency, and accountability.

The Capital Market Service Providers Licensing Supervision Directive focuses on the licensing and supervision of capital market service providers (CMSPs), which includes individuals and entities providing capital market-related services such as underwriting, brokering, and asset management. It provides detailed rules and requirements for licensing, setting out the criteria for senior officials of capital market service providers, and establishing educational and practical qualifications for appointed representatives. It also specifies fines and sentences for individuals and entities violating the provisions of the directive.

Lastly, the Recognition of Self-Regulatory Organization Directive provides rules for the recognition of self-regulatory organizations (SROs), which are professional associations of capital market service providers that provide a self-regulatory framework for their members. This directive provides a framework for the recognition of SROs by the ECMA, ensuring that they meet the highest standards of governance, transparency, and accountability. It also indicates that the ECMA has power to regulate, sanction, and withdraw the recognition and license of an SRO and its personnel.

Recall that in 2021, Ethiopia gave the green light to a Capital Markets Establishment Proclamation that serves as a legal basis for the development of capital markets in the country.

Source: Ethiopia Capital Market Authority  


The opinions expresses here in the post "Ethiopia's Capital Market Authority Unveils Three New Directives for Regulatory Framework" are those of the individua's contributor(s) and do not necessarily reflect the views of Business Info Ethiopia , BIE Intelligence PLC, its publisher, editor, or any of its other contributors.


Hanna is an aspiring economist in her final year at Addis Ababa University. She has written hundreds of insightful daily stories, analyses, and features about the Ethiopian economy and beyond.

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