This section addresses common inquiries.
The Proclamation and the Directive mandate two things from issuers:
The objective of registering securities and ongoing reporting is to solicit adequate and accurate disclosure of the material facts concerning the issuer, its business, financial position, securities it offers, and risks associated to enable potential investors to make informed investment decisions.
Yes, the requirement for registration applies to all companies, irrespective of the sector they are engaged in.
: Registration of Securities is mandated by Article 75(1) of the Capital Market Proclamation No. 1248/2021, and the detailed requirements for registration are provided for in the Public Offer and Trading of Securities Directive No. 1030/2024. An issuer is required to file a registration statement. The contents of the registration statement are detailed in Article 8 of the Directive, and these are:
The Directive requires all securities that are offered to the public to be registered. However, the process and timeline for registration vary depending on the offering type and timeline. Accordingly, securities that are covered under the transitional provision of the Directive (Art. 159) are required to register as stated under item (a) & (b) hereunder, and all other securities shall be required to be registered as stated under item (c) below:
a. Securities that were already sold before the coming into effect of the Directive need to be registered within 12 (twelve) months following the effective date of this Directive.
b. The Public Offering of Securities that started before the effective date of this Directive, and which has not been completed as of the effective date of this Directive, shall be required to register the securities within 12 (twelve) months following the effective date of this Directive, and
c. All securities the offering of which starts after the effective date of the Directive have to register with the authority under the relevant provisions of the Directive before the start of the offer.
All securities must be registered before a public offer.
a. If the issuing company is a company under formation, a public offering is deemed to have started when the issuer has incorporated all the necessary information in the prospectus as per Commercial Code Article 259, all promoters have signed, and a proposition for subscription has been made.
b. If the issuing company is an existing company, the company is considered to have made a public offer when it has prepared a prospectus that incorporates the methods of the offering, the price and size of the securities planned to be offered, and other relevant information as per the decision passed by the entity with authority over the company and when a proposition for subscription has been made
Thus, for existing companies that are increasing their capital through public offer of securities, an offer is considered to have commenced on the date when the company has forwarded a proposition for of securities of that offer, as laid down in Article 455 of the Commercial Code, along with the decision made at the EGM.
No, your response to the public notice does not constitute a registration of securities as required by the Capital Market Proclamation (Proclamation No. 1248/2021) and the Public Offer and Trading of Securities Directive (Directive No. 1030/2024).
Thus, the purpose of the notice is to gather information that will assist the ECMA in determining which securities the transitional provision applies.
Issuers of securities that are the subject of public offer or which are publicly held are required to file ongoing reports.
The ongoing disclosure is required to be filed semi-annually. However, issuers are required to file material information that will have an impact on the price of the securities within 24 hours.
Address
Minaye Corporate Building 15th Floor
Flamingo Area, Kirkos
Addis Ababa, Ethiopia
This public notice is directed at publicly held companies established or raising capital through public subscription under the Commercial Code of Ethiopia. Specifically, it concerns companies with more than fifty (50) shareholders, regardless of the sector or industry in which they operate.
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