Instruction No. 4/97 on the Approval of Management and Intermediation Companies (SGI)

WEST AFRICAN MONETARY UNION
REGIONAL COUNCIL FOR PUBLIC SAVINGS AND FINANCIAL MARKETS

INSTRUCTION NO. 4/97 RELATING TO THE APPROVAL OF MANAGEMENT AND INTERMEDIATION COMPANIES (SGI)

Having regard to the Convention of July 3, 1996 establishing the Regional Council for Public Savings and Financial Markets, hereinafter referred to as the Regional Council,

Having regard to Article 21 of the annex to said Convention,

Having regard to Decision No. 001/97 of the Council of Ministers of the West African Monetary Union at its session of November 28, 1997 adopting the General Regulation relating to the Organization, Operation and Control of the UMOA regional financial market, hereinafter referred to as the General Regulation,

Having regard to Articles 26 to 35 of said General Regulation,

Having regard to the decision of the Regional Council at its session of November 29, 1997,

The Regional Council adopts

Article 1: Management and Intermediation Companies (SGI) are authorized, upon their approval by the Regional Council, to exercise, on an exclusive basis, the activities of negotiator-clearer for listed securities on behalf of third parties.

Article 2: The application file for the approval of a Management and Intermediation Company is submitted to the Regional Council. It must include the following documents:

a) the articles of association of the company, which must be constituted in the legal form of a public limited company (société anonyme) and have its registered office in one of the States of the West African Monetary Union,

b) the amount, distribution of capital, as well as the identity and activity of shareholders holding more than 10% of the capital,

c) own funds, defined as follows:
. paid-up social capital,
. + reserves,
. + provisions with reserve character,

• credit balance brought forward,
• shares of the Regional Securities Exchange and the Central Depository/Settlement Bank,
• first-demand guarantees and within the limit of the amount of social capital,

• debit balance brought forward,
• projected result for the current period, if it is negative.

d) the composition of the corporate bodies, e) the list of senior executives and their criminal records, f) the description of the technical means equipped by the company, g) for pre-existing companies, the certified accounts and balance sheets of the last three financial years by an auditor approved by the Regional Council, h) the commitment to transmit to the Regional Council a copy of the Internal Regulations, i) the identity and extract of the criminal record of the person or persons designated to perform the functions of internal controller. j) the nature of the envisaged activities, k) the guarantees offered, l) the written commitment to acquire shares in the capital of the Regional Securities Exchange and the Central Depository/Settlement Bank upon grant of approval, in amounts of forty million and twenty million respectively at least, m) the written commitment by the company whereby it undertakes to know the expectations of its clients, to provide them with clear, rapid and complete information on operations to be processed or processed on their behalf, and to adhere to the Market Guarantee Fund. n) the commitment to request membership in the Professional Association of SGIs, o) any other document that the Regional Council deems necessary.

Article 3: The minimum capital of SGIs is fixed at 150 million FCFA. Cash contributions made towards the SGI capital must be fully paid up upon issuance of the corresponding shares.
The provisions of the preceding paragraph also apply to share issuances resulting from a capital increase.

Own funds of SGIs cannot be less than 150 million FCFA during their existence.

Article 4: Management and Intermediation Companies (SGI) must inform the Regional Council for Public Savings and Financial Markets of modifications affecting the characteristic elements of their situation included in the initial approval application.

Article 5: Granting of approval is subject to payment of a sum whose amount is fixed by instruction of the Regional Council.

Article 6: The approval of an SGI is the subject of an notice published in the official bulletin of the stock exchange.

Done in Ouagadougou, on November 29, 1997
For the Regional Council
The President
L. NAKA