What is the Capital Market Proclamation 1248/2021?

Proclamation No. 1248/2021 is the law that created Ethiopia's capital market. It was enacted to help mobilise capital for the national economy, promote financial innovation, and let investors share investment risk — and, just as importantly, to protect investors and keep the market fair, orderly and transparent.

It lays down the ground rules everything else is built on. It defines what counts as a “security” and a “capital market” (a market where shares, bonds, derivatives and related instruments are bought and sold), it establishes the Ethiopian Capital Market Authority (ECMA) as the regulator, and it sets uniform requirements for companies that want to raise money from the public.

Almost every other rule in this knowledge base — ECMA's directives, the ESX Rulebook, the rules on public offerings and on market abuse — flows from powers granted by this Proclamation.