Legal Aspect of the Development of Stock Exchange in Ethiopia

Abstract

An organized stock exchange mandatorily requires the existence of a law that recognizes the market as an entity, regulate the issuance of securities, the subsequent transactions of securities, rules of listing, rules regulating disclosure of information, rules regulating axillaries like stock brokers, rules regulating insider trading, rules establishing and authorizing supervisory authority, and rules for settlement of disputes arising out of securities transaction. This article examines the legal aspect of the development of an organized stock exchange in Ethiopia from a historical perspective. It finds out that there has not been any sufficient legislative framework for regulating stock exchange in the country though there were signs of an organized stoke exchange in the 1960s.

Keywords: Stock exchange, Legal aspect, Development.