East Africa regulators seek more trades in cross-listed shares

Regulators in East Africa are seeking to boost liquidity by encouraging more trading in the dual-listed shares. The regional forum, the East African Securities Regulatory Authorities (EASRA), is to talk to stakeholders. It will also focus on developing East African Community (EAC) Council Directives to support convergence in the legal frameworks and in harmonization in the region. They also backed joint action, including inspections and investigations, according to a press release.
The decisions came in the 36th Consultative Committee meeting held on Friday 19 October, 2012, in Dar es Salaam, Tanzania. EASRA members agreed to amend their Memorandum of Understanding (MoU) to allow for the creation of “supervisory colleges” that would administer joint inspection programmes and investigations within regional operators, as well as coordinated surveillance for cross-listed companies. The regulators agreed to continue implementing common standards on corporate governance for market intermediaries as well as work on the development of common standards on corporate governance for listed companies.
The meeting also considered and agreed on a harmonised capital adequacy framework for capital-market participants who will be operating in the regional market. Each regulator was called upon to seek stakeholder views in their jurisdictions on the agreed harmonized framework before a final position is taken by EASRA.
Japheth Katto, the Chairman of EASRA and Chief Executive Officer of the Capital Markets Authority-Uganda, said that there was increased capital markets action in the region. He cautioned: “Due to the lack of a common trading, clearing, settlement and depository infrastructure, there has been minimal trading in cross listed securities. We need to address this matter urgently if investors have to benefit from a regional market”.
Also in attendance were representatives of the Financial Sector Development and Regionalization Project-1 (FSDRP-1) and Efficient Securities Markets Institutional Development (ESMID), underlining EASRA’s commitment to advancing the regionalization and development of EAC capital markets by partnering with other likeminded organizations.
As one of the growing EAC markets, members further agreed to support Burundi in its efforts to develop capital markets by providing technical assistance, including seminars, workshops and training, and by hosting study tours and work-experience attachments for Burundi officials.

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