Compliance with the Capital Markets Coffee Exchange Regulations 2020
The Capital Markets (Coffee Exchange) Regulations, 2020 granted the Capital Markets Authority (the Authority) the
mandate to licence Coff ee Exchange(s) and Coffee Brokers. Consequently, the Authority has so far licensed twelve coffee
brokers. The list of the licensed coffee brokers is published on the Capital Markets Authority website www.cma.or.ke
The Nairobi Coffee Exchange (NCE) was on 1 May 2023 granted a three (3) months extension of its in-principle approval to
continue operating as a Coffee Exchange until 31 July 2023. This extension is meant to give the NCE time to work towards
full compliance with The Capital Markets (Coffee Exchange) Regulations, 2020 including but not limited to onboarding a
Direct Settlement System (DSS) provider.
In line with the Authority’s mandate, of not only regulating but also facilitating the development of orderly, fair, and
efficient capital and commodities markets in Kenya, the Authority supports smooth transition of the Coffee Subsector
reforms and hereby:
1. Invites Growers across the country to note the two sets of Regulations governing the Coffee Sub-sector that is; The
Capital Markets (Coffee Exchange) Regulations,2020 and The Crops (Coffee) (General) Regulations, 2019 and to only
contract coffee brokers who are duly licensed by the Authority.
2. Advises any person already contracted to sell coffee on behalf of Growers without a coffee broker licence shall not
enter into new contractual arrangements since only duly licensed coffee brokers by the Authority are authorized
to conduct such business. However, such persons have a viable option of selling stocks currently held through the
licensed coffee brokers.
3. Notifies the public that, trading at the NCE shall be under new Trading Rules aligned to The Capital Markets (Coffee
Exchange) Regulations,2020 and that settlement shall be conducted through a Direct Settlement System (DSS) for
transparent and efficient settlement of coffee sales proceeds.
In the interim, any person desirous of obtaining a coffee broker licence should fully comply with the provisions of The Capital
Markets (Coffee Exchange) Regulations,2020 and The Crops (Coffee) (General) Regulations, 2019.
Compliance with the Capital Markets Coffee Exchange Regulations 2020
Public Notice About Recent Developments at Transcentury Plc and East African Cables Limited, Companies Listed at Nairobi Securities Exchange
The Capital Markets Authority (CMA) is aware that on 16 June 2023, TransCentury PLC and East African Cables Ltd, both being listed companies on the Nairobi Securities Exchange (NSE) were served with statutory administration notices. However, it has been established that both orders have since been suspended by the courts, pending the full hearing of the subject matters.
CMA is following these developments and if need be will communicate further any decision that may be deemed appropriate.
Stakeholder and Public Feeback on Draft Regulations
The Capital Markets Authority (CMA/The Authority) is charged with the mandate of regulating and developing Kenya’s capital markets. In line with the Statutory Instruments Act, the Capital Market Master Plan 2014 – 2023 and the Strategic Plan, the Authority is undertaking review and overhaul of various regulations. The regulatory review exercise is aimed at enhancing regulatory responsiveness to changing dynamics and market developments, technological advancements and emerging supply and demand side stakeholder needs.
In this regard, the Authority has reviewed and overhauled the below regulations in a bid to make them
responsive to market needs and emerging issues: –
- Capital Markets (Licensing Requirements) (General) Regulations, 2023
- Capital Markets (Take-overs and Mergers) Regulations, 2023
In accordance with Section 12A (3) of the of the Capital Markets Act the Authority now invites stakeholders
and the general public to submit comments on the draft Regulations, available on www.cma.or.ke.
CMA cautions investors against investing in unregulated products offered or promoted by unlicensed firms or unapproved entities
Nairobi, 17 June 2021…In line with its investor protection mandate, the Capital Markets Authority (CMA) has cautioned investors against investing through unlicensed and unapproved entities.
The CMA Chief Executive, Mr. Wyckliffe Shamiah, advised investors to only invest through licensed and approved entities who offer and promote regulated products, to enable them get protection offered by the Authority through the capital markets legal and regulatory framework. Investors who invest in unregulated products offered or promoted by unlicensed and unapproved entities risk loss of their investments with no recourse afforded to them under the capital markets regulatory framework.
Following numerous enquiries regarding the licensing status of the Cytonn Investment Group, Mr. Shamiah said, “the Authority confirms that Cytonn Investments is not a licensed and approved entity.” He further stated that, “investors who are affected by investing in unregulated products should report to the Capital Markets Fraud Investigation Unit
(CMFIU), which is the Police Unit attached to the Capital Markets Authority. CMFIU is currently investigating the issue for criminal violations for investors in the Cytonn High Yield Solutions (CHYS). He reiterated the Authority on 20 April 2020 communicated this same information to the public’’.
CMA has licensed Cytonn Asset Management Limited, which is licensed as a Fund Manager managing the following regulated funds: Cytonn Money Market Fund; Cytonn Balanced Fund; Cytonn Equity Fund; Cytonn Africa Financial Services Fund; Cytonn Money Market Fund (USD); and Cytonn High Yield Fund. So far CMA has not received any complaints on these regulated products.
Investors are advised to confirm the names of the licensed and approved entities offering services in the capital markets industry from the CMA website www.cma.or.ke. Members of the public who have been affected or have come to be aware of such illegal entities are advised to report to the Authority or to the Capital Markets Fraud Investigation Unit.
ENDS
BACKGROUND INFORMATION ON THE CAPITAL MARKETS AUTHORITY
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, please contact: Antony Mwangi, Manager, Corporate Affairs and International Relations, on amwangi@cma.or.ke