ADDIS ABABA — The Ethiopian Capital Market Authority (ECMA) has released a comprehensive new supervision guideline, establishing a rigorous framework for oversight, compliance, and governance for all market participants. Dated October 2025, the directive introduces significant new requirements aimed at bolstering market integrity and protecting investors.
Key measures include mandating the creation of highly independent committees to oversee the regulatory functions of exchanges, barring Politically Exposed Persons (PEPs) from serving on these committees, and instituting strict new protocols for external auditor appointments, regulatory reporting, and the management of trade disruptions.
The guideline outlines a “hybrid approach” to supervision, blending “Compliance-Based Supervision,” which ensures adherence to rules, with a forward-looking “Risk-Based Supervision (RBS)” model. The RBS approach allows the ECMA to proactively identify emerging risks and focus its resources on entities deemed “high-risk.”
Here are the most significant changes detailed in the new framework:
Independent Committees to Govern Exchanges
To better manage conflicts of interest, the ECMA now requires all “trading venues”—including securities exchanges, derivatives exchanges, and over-the-counter markets—to establish a special committee responsible for overseeing the exchange’s regulatory and supervisory obligations.
No Comment Found.