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Capital markets industry commits to closer engagement with the CMA in strengthening the legal and regulatory framework for sustainable market development

Nairobi December 16, 2014…..The capital markets industry committed to work in tandem with the Authority to continue the significant progress made to date in ensuring the legal and regulatory framework is more responsive and facilitative to the emergence of Kenya as the heart of capital markets investment on the continent. These resolutions were reached at a stakeholders’ forum on the findings of a recent Regulatory Impact Assessment of the capital markets laws on market development.

The concerted efforts between the Authority and the industry participant including issuers, investors and professional advisors will focus on among other areas: more effective ways of communication and access to the regulatory framework, particularly through leverage of ICT; more effective identification of the spectrum of activities which should fall within the Authority’s regulatory ambit; support for the harmonization of regulatory and operation costs of listing and issuance in the region, streamlining of trading and settling of cross listed securities; accelerated enactment of pending capital markets laws; and building awareness of the opportunities from issuing in the public markets through improved corporate governance compliance. Stakeholders reiterated their willingness to identify more effective options of engagements to better incorporate their views and enhance awareness of newly enacted laws.

Speaking during the forum, the Capital Markets Authority (CMA) Acting Chief Executive, Mr. Paul Muthaura, emphasized that the Capital Markets 10 Year Master Plan has devoted a Pillar specifically aligned to articulating the critical importance of a sound, responsive legal and regulatory framework that inspires confidence by strengthening and streamlining regulation as well as ensuring coherence in regulation as the best means to promote market development. In this context, the industry Master Plan affirms the need for continuous review and strengthening of corporate governance and financial reporting standards and frameworks. “The Pillar identifies the challenge of regulators globally of having the dual role of development and regulation, and re-enforces that the responsibility for innovation and development of products and markets must lie with market participants themselves, being those best equipped to identify viable opportunities for new products, based on demand, in collaboration with other market participants”, Mr. Muthaura noted.

Mr. Muthaura added “the Authority, in its endeavour to balance its regulatory and developmental mandate supports a regulatory framework based on the core objectives of protecting investors, maintaining orderly markets and supporting financial stability. This spirit has informed the introduction of an in-principle approval framework and informed a raft of new provisions in the Capital Markets Amendment Act, 2013 to facilitate greater regulatory flexibility for the introduction of appropriate products to fund the Vision 2030.

Mr. Muthaura observed that for the effective attainment of this approach to innovation, there is need to relook at some existing primary legislations that may hinder the introduction of a responsive legal and regulatory environment notably the Statutory Instruments Act.



The Capital Markets Authority (CMA) was set up in 1989 as a statutory agency under the Capital Markets Act Cap 485A. It is charged with the prime responsibility of both regulating and developing an orderly, fair and efficient capital markets in Kenya with the view to promoting market integrity and investor confidence. The regulatory functions of the Authority as provided by the Act and the regulations include; Licensing and supervising all the capital market intermediaries; Ensuring compliance with the legal and regulatory framework by all market participants; Regulating public offers of securities, such as equities and bonds & the issuance of other capital market products such as collective investment schemes; Promoting market development through research on new products and services; Reviewing the legal framework to respond to market dynamics; Promoting investor education and public awareness; and Protecting investors’ interest. For more information, contact Antony Mwangi on This email address is being protected from spambots. You need JavaScript enabled to view it. or 0722825227.

Kind Regards,

Leah Muli|Corporate Communications Officer | Capital Markets Authority