DECISION No. CM/07/09/2021 ADOPTING THE UNIFORM LAW ON STOCK MARKET OFFENCES ON THE REGIONAL FINANCIAL MARKET

UNION MONETAIRE OUEST AFRICAINE
CONSEIL DES MINISTRES
LE PRESIDENT
DECISION No. CM/07/09/2021 ADOPTING THE UNIFORM LAW ON STOCK MARKET OFFENCES ON THE REGIONAL FINANCIAL MARKET

The Council of Ministers of the West African Monetary Union, Having regard to the Treaty of the West African Monetary Union (UMOA) of 20 January 2007; Having regard to the Convention establishing the Regional Council for Public Savings and Financial Markets (CREPMF) of 3 July 1996 and its Annex on the composition, organization, functioning and powers of the Regional Council for Public Savings and Financial Markets; Having regard to the Uniform Act relating to commercial companies and economic interest groups, revised on 30 January 2014, of the Organization for the Harmonization of Business Law in Africa (OHADA) created by the Treaty on the Harmonization of Business Law in Africa of 17 October 1993; Having regard to the Note from the Regional Council for Public Savings and Financial Markets on the draft uniform law on stock market offences on the UMOA regional financial market, presented to the Council of Ministers at its ordinary session on 23 September 2021; Having regard to the Deliberations of the Council of Ministers at its ordinary session on 23 September 2021; DECIDES

Article 1
The uniform law on stock market offences on the financial market of the West African Monetary Union, annexed to this Decision and forming an integral part thereof, is hereby adopted.

Article 2
Within six (6) months from the signature of this Decision, the Member States of the UMOA shall take the necessary measures to incorporate the law referred to in Article 1 into their internal legal order.

Article 3
The President of the Regional Council for Public Savings and Financial Markets is tasked with monitoring the implementation of this Decision.

Article 4
This Decision repeals and replaces all prior provisions contrary to it dealing with the same subject matter. It shall enter into force as of the date of its signature and shall be published wherever necessary.

Done at Lomé, on 23 September 2021
For the Council of Ministers of the UMOA,
The President
Sani YA A

ANNEX TO DECISION No. CM/07/09/2021 ADOPTING THE UNIFORM LAW ON STOCK MARKET OFFENCES ON THE REGIONAL FINANCIAL MARKET

UNIFORM LAW ON STOCK MARKET OFFENCES ON THE UMOA FINANCIAL MARKET

PRELIMINARY TITLE - TERMINOLOGY
Article 1: Definitions
1. For the purposes of this Law, the following shall mean: Regulated activity: an activity whose exercise is subject to prior authorization or is subject to exercise conditions established by the General Regulations of the CREPMF. This includes, in particular, market infrastructure activities such as the Regional Securities Exchange (BRVM), the Central Depository/Settlement Bank (DC/BR), commercial intermediaries such as management and intermediation companies (SGI), management companies, stock investment advisors, business introducers, canvassers, and OPC management companies on the financial market, as well as all other regulated activities;
2. Annex: The Annex to the Convention establishing the Regional Council for Public Savings and Financial Markets of 3 July 1996, on the composition, organization, functioning and powers of the Regional Council for Public Savings and Financial Markets;
3. Public offering: a public offering as defined by the texts in force on the regional financial market of the Union;
4. BRVM: Regional Securities Exchange;
5. Communication: the act, by any insider and by any means, of bringing privileged information to the knowledge of any third party outside the normal framework of their profession or functions;
6. Regional Council: Regional Council for Public Savings and Financial Markets (CREPMF);
7. CREPMF: Regional Council for Public Savings and Financial Markets (CREPMF);
8. FCP: Collective Investment Fund;
9. Reference index: any tool - rate, instrument, number - available to the public, calculated regularly or periodically from a weighted average, allowing the performance of an actor or a financial instrument to be measured and its value determined;
10. Information: any information easily understood by the public;
11. Non-public information: any information that has not been made accessible to the public by a means guaranteeing equal access to information;
12. Particular information: any information relating to the prospects or situation of an entity making a public offering or an asset or product issued by that entity and traded on a financial market;
13. Precise information: any information relating to an event whose occurrence or non-occurrence is foreseeable, it being specified that the precise nature of information does not require certainty thereof;
14. Privileged information: Information as defined in the Annex to the Convention on the composition, organization, functioning and powers of the Regional Council for Public Savings and Financial Markets;
15. Misleading information: any information likely to mislead the public, in particular by its ambiguous, imprecise or incomplete nature;
16. Insider: any person who has knowledge of one or more privileged information, it being specified that any Chief Executive Officer, Chairman of the Board of Directors, General Manager, General Administrator, Deputy General Manager, any natural or legal person exercising at the entity making a public offering the functions of administrator, as well as any permanent representative of a legal person exercising these functions, as well as any other person who has, on the one hand, within the aforementioned entity, the power to take management decisions concerning its development and strategy and/or on the other hand, regular access to privileged information concerning directly or indirectly this entity, is presumed to know the privileged information by reason of the functions they exercise within the entity;
17. Trading day: day of opening of the BRVM;
18. Market manipulation: market manipulation is the offence provided for in Article 27 of this Law, notably characterized when the act has as its object or result any of the following:
1. Carrying out a fictitious transaction;
2. Giving or accepting an order whose execution brings no real change of owner;
3. Creating a false or misleading appearance of activity or an artificial price on a security;
4. Carrying out series of purchases or series of sales on the same security with the aim of unduly or abusively influencing the price of the security;
5. Carrying out alone or in concert with one or more persons, a series of transactions on a security in order to create real or apparent activity or to raise or lower its price.
19. Maneuver: set of fraudulent means, artifices, schemes, not falling under the normal functioning of the market, but employed to obtain a result;
20. Financial market: the UMOA regional financial market as well as any new financial market;
21. OPC: Collective Investment Scheme
22. OPCVM: Collective Investment Scheme in Securities;
23. Off-market transaction: transaction carried out outside a regulated market;
24. General Regulations: General Regulations relating to the organization, functioning and control of the regional financial market;
25. SGI: Management and Intermediation Company;
26. SICAV: Variable Capital Investment Company;
27. Wealth Management Company: portfolio management company;
28. UMOA: West African Monetary Union.

TITLE I - GENERAL PROVISIONS
Article 2: Purpose
This law aims to:

1. define the rules and practices likely to guarantee the transparency and security of transactions on the regional financial market;
2. criminalize fraudulent actions and practices that compromise the transparency and security of transactions on the regional financial market;
3. set the penalties applicable to the perpetrators and accomplices of the offences thus defined;
4. address cooperation between the Regional Council and judicial authorities within the framework of criminal proceedings for the repression of stock market offences.

Article 3: Scope of Application
This law applies to:

1. transactions taking place on the regional financial market regardless of their place of trading;
2. behaviors related to reference indices.
   However, it does not apply to:
   a) transactions on own shares carried out within the framework of buyback programs; b) stabilization measures for a financial instrument; c) transactions, orders or behaviors that intervene in the framework of the implementation of monetary, exchange or public debt management policy emanating from a public Administration of a Member State of the UMOA, an agency or an ad hoc entity of one or more Member States or a person, acting on behalf and in the interest of the same.

Article 4: Attempt, Association and Conspiracy
In the cases of offences provided for in this law, the attempt is punishable as the completed offence. The same applies to a conspiracy or association formed with a view to committing one of these offences.

Article 5: Complicity
Complicity by knowingly providing means, advice, or by assistance or aid for the commission of one of the offences provided for in this law is punishable by the same penalties as the commission of the offence.

TITLE II - PREVENTION OF OFFENCES AGAINST MARKET TRANSPARENCY
Chapter I: Suspicious Operations
Article 6: Declaration of Suspicious Operations
Any market participant or market management structure approved or authorized in accordance with the Annex is required to declare without delay to the Regional Council, in writing and according to the forms provided by the regulations, any operation carried out for its own account or on behalf of a third party, on an asset or product traded on a financial market, of which it has reason to suspect that it could constitute an offence within the meaning of this law.

Article 7: Means for Detecting Suspicious Operations
Any person subject to the declaration provided for in Article 6 shall put in place internal procedures whose purpose is, in particular, to establish and update a typology of operations in order to detect those to be declared. It shall also put in place, for its staff, a training and awareness program on the detection and declaration of suspicious operations.

Chapter II: Privileged Information
Article 8: Declaration of Privileged Information
Any entity making a public offering is required, without delay, to bring to the knowledge of the Regional Council and the public any privileged information concerning it directly.

Article 9: Conditions for Postponing the Declaration of Privileged Information
The entity making a public offering may defer the publication of a privileged information in order not to harm its legitimate interests, provided that the failure to publish does not mislead the public and that the entity is able to ensure its confidentiality by controlling access, in particular by:

1. putting in place effective internal procedures preventing access to this information by persons other than those who need it in the framework of their functions within the entity making a public offering;
2. taking the necessary measures to ensure that any person having access to this information is aware of the obligations linked to such access and is warned of the sanctions provided for in case of undue use or dissemination of this information;
3. putting in place provisions allowing for the immediate publication of the privileged information in the event that it was unable to ensure its confidentiality.

Article 10: Legitimate Interests
The legitimate interests mentioned in Article 9 may in particular concern the following situations:

1. when making the privileged information public would risk affecting the outcome or the normal course of ongoing negotiations, in particular in case of serious and imminent danger threatening the financial viability of the entity making a public offering;
2. when the information relates to a decision taken or a contract concluded by the management body of the entity making a public offering, requiring, if necessary, the approval of another body of this entity to become effective, if the publication of the information, combined with the simultaneous announcement that this approval has not yet been given, is likely to distort their correct assessment by the public.

Article 11: Dissemination of Privileged Information
When an entity making a public offering or a person acting on its behalf and for its account communicates a privileged information to a third party in the normal exercise of its activities, profession or functions, it shall ensure its dissemination according to the modalities fixed in Article 8, either simultaneously in case of intentional communication, or in the shortest possible time in case of unintentional communication. The provisions of the preceding paragraph do not apply when the person receiving the information is subject to a confidentiality obligation, whether its basis is legislative, regulatory, statutory or contractual.

Article 12: Integrity of Privileged Information
The entity making a public offering shall refrain from combining, in a manner likely to mislead the public, the provision of privileged information and advertising or commercial elements relating to its activities.

Article 13: Disclosure of Changes Relating to Privileged Information
Any significant change concerning privileged information already made public shall be disclosed according to the same modalities as those used during its initial dissemination.

Chapter III: Communication of Stock Market Operations
Article 14: Obligation to Declare Stock Market Operations
The following information shall be communicated to the Regional Council, within five trading days following the completion of the operation concerned, all information relating to any acquisition, disposal, subscription or exchange of an asset or product issued by an entity making a public offering, traded on a financial market, when such an operation is carried out by:

1. the Chief Executive Officer, Chairman of the Board of Directors, General Manager, General Administrator, Administrator, Deputy General Manager or any other Legal Representative;
2. any other person who has, on the one hand, within the entity mentioned in the present article, the power to take management decisions concerning its development and strategy and, on the other hand, regular access to privileged information concerning directly or indirectly this entity;
3. any person having, with any person mentioned in points 1 and 2, close personal ties of spouse not legally separated, kinship or alliance resulting in common residence for at least one year as of the date of the transaction concerned;
4. any legal person or entity whose direction, administration or management is ensured by one of the persons mentioned in points 1 and 2 or by one of the persons mentioned in point 3 acting in the interest of one or more persons mentioned in points 1 and 2;
5. any legal person or entity controlled, directly or indirectly, by one of the persons mentioned in points 1, 2 and 3;
6. any legal person or entity constituted for the benefit of one of the persons mentioned in points 1, 2 and 3;
7. any legal person or entity for which one of the persons mentioned in points 1, 2 or 3 benefits from at least the majority of the economic advantages.

Article 15: Obligation to Provide Copy of the Communication
The declaration obligation provided for in Article 14 applies to the persons mentioned in points 1 to 6 of said article, who are required, when communicating to the Regional Council, to provide a copy of this communication to the entity making a public offering, referred to in the same article.

Article 16: Persons with Access to Privileged Information
Any entity making a public offering that has issued assets or products traded on a financial market, or for which an application for admission to trading on such a market has been submitted, is required to establish, update, and communicate to the Regional Council, upon its request and without delay, a list of persons working within it and having access to privileged information concerning this entity directly. The entity shall establish, update and communicate to the Regional Council, under the same conditions, the list of third parties acting on its behalf or for its account having access to privileged information in the framework of their professional relations with it. Under the same conditions, any third party acting on behalf and for the account of any entity making a public offering is required to establish, update and, upon request, communicate to the Regional Council a list of persons working within it and having access to privileged information concerning directly or indirectly the entity making a public offering mentioned in the first paragraph, as well as a list of persons acting on its behalf or for its account, having access to the same information in the framework of their professional relations with it.

Article 17: Content of the List
The lists mentioned in Article 16 shall include:

1. the name or corporate name of the persons to be included;
2. the reason for the inclusion of the persons to be included;
3. the legal relationship between these persons and the entity making the declaration.

Article 18: Information of Persons on the List
Any person or entity required to establish the list provided for in Article 16 shall inform, in writing and in the shortest possible time, the persons appearing on that list. This information shall include mention of their inclusion on the list, a reminder of the rules applicable to the possession, communication and exploitation of privileged information, as well as the sanctions attached to their breach.

TITLE III - REPRESSSION OF OFFENCES AGAINST MARKET TRANSPARENCY
Chapter I: Repression of Stock Market Offences
Article 19: Violation of the Declaration Obligation
Any person who knowingly contravenes any declaration obligation incumbent upon them under the preceding chapter, of whatever nature it may be, shall be punishable by a fine of one million (1,000,000) to twenty million (20,000,000) CFA Francs.

Article 20: Failure to Declare Stock Market Operations
Any person referred to in Article 14 who knowingly contravenes the declaration obligation incumbent upon them under said article shall be punishable by a fine of one million (1,000,000) to twenty million (20,000,000) CFA Francs.

Article 21: Failure to Publish Privileged Information
Any entity making a public offering who knowingly contravenes the declaration obligation incumbent upon them under Article 8 of this law shall be punishable by a fine of one million (1,000,000) to twenty million (20,000,000) CFA Francs.

Article 22: Failure to Declare Threshold Crossing
Any natural or legal person who refrains from fulfilling the information obligations to which they are subject, under the provisions of the General Regulations relating to threshold crossing declarations, shall be punishable by a fine of one million (1,000,000) to twenty million (20,000,000) CFA Francs.

Article 23: Insider Dealing Offence
Any insider holding privileged information on the situation of an issuer or the development prospects of the issuer's securities, who knowingly carries out or allows to be carried out, directly or indirectly, one or more operations on a financial market before the information is accessible to the public, shall be punishable by imprisonment of one (01) to five (05) years and a fine of five million (5,000,000) to fifty million (50,000,000) CFA Francs, this amount being able to be raised up to ten times the amount of the advantage derived from the offence, without the fine being able to be less than this advantage. In case of recidivism, the maximum fine shall be imposed, regardless of whether the perpetrator profited from the offence or not. Legal persons declared criminally responsible for the insider dealing offence shall be punishable by a fine of twenty-five million (25,000,000) to two hundred fifty million (250,000,000) CFA Francs, this amount being able to be raised up to ten times the amount of the advantage derived from the offence, without the fine being able to be less than this advantage. By way of derogation, the Regional Council may, periodically and specifically, authorize the following practices, at the request of the entity making a public offering that has issued the assets or products traded on a financial market to which the privileged information relates:

1. the purchases and sales of securities within the framework of the operation of a liquidity contract;
2. the purchases and sales carried out within the framework of a program accompanied by a precise calendar.

Article 24: Incitement or Recommendation of Privileged Information
Any insider holding privileged information who intentionally recommends to a third party to acquire or dispose of, or to have acquired or disposed of by another person, the asset or products traded on a financial market to which this information relates, or incites the carrying out of such operations on the basis of this privileged information, shall be punishable by imprisonment of one (01) to five (05) years and a fine of five million (5,000,000) to fifty million (50,000,000) CFA Francs, this amount being able to be raised up to ten times the amount of the advantage derived from the offence, without the fine being able to be less than this advantage. Legal persons declared criminally responsible for the offence of incitement or recommendation to a third party of privileged information, shall be punishable by a fine of twenty-five million (25,000,000) to two hundred fifty million (250,000,000) CFA Francs, this amount being able to be raised up to ten times the amount of the advantage derived from the offence, without the fine being able to be less than this advantage. In case of recidivism, the maximum fine shall be imposed, regardless of whether the perpetrator profited from the offence or not.

Article 25: Communication of Privileged Information
Any person who knowingly communicates privileged information to a third party, in violation of the obligations incumbent upon them, shall be punishable by imprisonment of