Stock Market in Ethiopia

Reference: Capital-Market-Proclamation of Ethiopia-No.1248-2021

What is Stock Market or Capital Market?

Capital Market is a market where securities such as shares or equities, bonds, derivatives, or other related securities are bought and sold.

Share is a portion of ownership interest in a share company, or an interest or stake in any collective investment scheme.

Securities are any instrument – in any legal form – that evidences ownership of a share in a financial transaction and that is negotiable pursuant to approval from the Authority, such as:

a) Shares issued or proposed to be issued in the capital of a company;

b) Any instrument that creates or acknowledges a debt issued or to be issued by a company;

c) Loans, bonds, and other instruments that can be converted to shares in the capital of a company;

1. d) All public debt instruments that are tradable and issued by the Government and other government entities;
2. e) Any right or derivative contracts relating to securities (such as options and futures);
3. f) Units in a collective investment scheme;
4. g) Any paper or instrument considered by the Authority as a security for the purposes of implementing this Proclamation

but does not include commercial papers such as cheque, promissory notes, bills of lading, letters of credit, cash transfers and instruments negotiated by banks exclusively between each other, insurance policies and rights arising from retirement funds established for the benefit of the beneficiaries therefrom.