Instruction No. 53/2017 on the Authorization of Business Introducers, Stock Investment Advisors and Sales Agents on the UMOA Regional Financial Market

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Avenue Joseph ANOMA 01 presidence@crepmf.org
P.: 1878 Abidjan 01/Côte d'Ivoire TEL.: (225) 20215742/20215179 Fax: 202216 www.crepmf.org 1/10 West African Monetary Union REGIONAL COUNCIL FOR PUBLIC SAVINGS AND FINANCIAL MARKETS INSTRUCTION No. 53/2017 ON THE AUTHORIZATION OF BUSINESS INTRODUCERS, STOCK INVESTMENT ADVISORS AND SALES AGENTS ON THE UMOA REGIONAL FINANCIAL MARKET

The Regional Council for Public Savings and Financial Markets, Having regard to the Convention of 3 July 1996 establishing the Regional Council for Public Savings and Financial Markets, particularly its Annex on the composition, organization, functioning, and powers of the Regional Council; Having regard to General Regulation No. 001/97 of 28 November 1997 on the organization, functioning, and control of the Regional Financial Market, particularly Articles 91, 90, 95, and 102; Having regard to Decision No. CM/DAC/04/04/2017 of 14 April 2017 by the UMOA Council of Ministers appointing the President of the Regional Council; Having regard to the favorable opinion of Council Members following the home consultation on 10 July 2017; HEREBY ADOPTS THIS INSTRUCTION.

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Avenue Joseph ANOMA 01 B.P.: 1878 Abidjan 01/Côte d'Ivoire TEL.: (225) 20215742/20215179 Fax: 20221657 presidence@crepmf.org Instruction No. 53/2017 TITRE 1: GENERAL PROVISIONS
Article 1: Definitions
1.1 Business Introducers are natural or legal persons who transmit their clients' orders to Management and Intermediation Companies (SGI) and/or connect a client with an SGI, Wealth Management Company (SGP), or Collective Investment Scheme Management Company (SG d'OPC) for opening a securities account, subscribing to CIS shares, and providing investment advice or discretionary portfolio management.
1.2 Stock Investment Advisors are natural or legal persons who guide their clients' choices without substituting themselves for them regarding final decisions. They may also provide issuers with advice on debt and capital structuring, industrial strategy, mergers and acquisitions, as well as handle subscription forms by agreement specifying the obligations of participatory investment advisors and the fees charged.
1.3 Sales Agency (Démarchage) consists of all operations conducted by those who usually visit individuals' homes or residences, workplaces, or public places not reserved for such purposes to advise on subscribing to, purchasing, exchanging, or selling securities or participating in transactions involving these securities.
1.4 Sales Agency activities also include service offers or advice given habitually, to the same ends, at homes/residences or workplaces via letters/circulars or telephone communication.

Article 2: Conditions of Exercise
2.1 Natural or legal persons wishing to exercise one or more of the activities defined in Article 1 must first obtain authorization from the Regional Council after submitting an accreditation application file.
2.2 The authorization number issued by the Regional Council must appear on all publications and all documents required of the Business Introducer, Stock Investment Advisor, or Sales Agent.

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Avenue Joseph ANOMA 01 B.P.: 1878 Abidjan 01/Côte d'Ivoire TEL.: (225) 20215742/20215179 Fax: 20221657 www.crepmf.org Instruction No. 53/2017
Article 3: Accreditation
Persons applying for authorization as Business Introducers, Stock Investment Advisors, or Sales Agents must submit to the Regional Council a file containing:
i. For legal persons:
a) statutes; b) Notarized Declaration of Subscription and Payment (DNSV); c) copy of the Trade and Movable Credit Register (RCCM) extract; d) minutes of the Constituent General Meeting, if applicable; e) audited balance sheet and accounts for the last financial year for existing companies; f) opening balance sheet for companies less than one year old; g) detailed five (05)-year business plan; h) presentation of human and material resources to be deployed; i) criminal record extract less than three (03) months old for directors and client relations staff; j) CVs demonstrating satisfactory professional experience of directors and appointed representatives; k) CVs for all personnel dedicated to the activity; l) bank guarantee of five (5) million FCFA, two (2) million FCFA, and one (1) million FCFA, respectively for Business Introducers, Stock Investment Advisors, and Sales Agents:

• intended to cover risks related to their activities,
• valid for one year, renewable and submitted annually to the Regional Council,
• issued in favor of clients of Commercial Intermediaries,
• initiated by the Regional Council for Public Savings and Financial Markets,
• must bear, under penalty of nullity, the signature of the applicant and their bank, with the maximum guaranteed amount written in full by hand in letters and figures.
  ii. For natural persons:
  a) criminal record extract less than three (03) months old; b) CV demonstrating satisfactory professional experience; 3/10 Instruction No. 53/2017 c) detailed five (05)-year business plan; d) presentation of human and material resources to be deployed; e) bank guarantee of two (2) million FCFA, one (1) million FCFA, and five hundred thousand (500,000) FCFA, respectively for Business Introducers, Stock Investment Advisors, and Sales Agents:
• intended to cover risks related to their activities,
• valid for one year, renewable and submitted annually to the Regional Council,
• issued in favor of clients of Commercial Intermediaries,
• initiated by the Regional Council for Public Savings and Financial Markets,
• must bear, under penalty of nullity, the signature of the applicant and their bank, with the maximum guaranteed amount written in full by hand in letters and figures.
  f) Professional civil liability insurance policy.
  The Regional Council may request any additional information during file processing.
  Authorization of a Business Introducer, Stock Investment Advisor, or Sales Agent is published in the Official Gazette of Côte d'Ivoire.
  iii. Granting authorization is subject to payment of a sum fixed by Decision of the UMOA Council of Ministers, Instruction, or Regional Council.

TITRE 2: OPERATION AND MANAGEMENT
Article 4: Rules and Principles of Conduct
4.1 Business Introducers, Stock Investment Advisors, or Sales Agents must:
i. act in the exercise of their activity with loyalty and fairness, as well as with the competence, care, and diligence required to best serve their clients' interests and the integrity of the Regional Financial Market;
ii. efficiently and professionally use resources and procedures necessary to successfully carry out their activities;
iii. ascertain the financial situation of their clients, their investment experience, and their objectives regarding requested services;
iv. ensure they provide clients with sincere and accurate information on transactions conducted on their behalf, ensuring clients are aware of risks inherent to the nature of operations they consider;
v. comply with all applicable regulatory provisions governing their activity;
vi. retain for at least ten (10) years copies of written documents or other records related to their activity;
vii. demonstrate that each order transmitted by them was duly given under a mandate, and be able to prove the time of receipt and transmission;
viii. inform the Regional Council of any legal proceedings brought against them;
ix. provide services adapted to client needs and respect an absolute obligation of confidentiality regarding non-public facts, acts, and information known during or in connection with their professional activities;
x. prior to commencing operations, define in writing with clients the investment objectives;
xi. be subject to an obligation of means;
xii. determine their remuneration with clients connected to Commercial Intermediaries. However, this remuneration must in no way consist of brokerage or commission retrocession;
xiii. mandatorily sign a contract before any client relationship begins.
4.2 Exercising Business Introducer, Stock Investment Advisor, or Sales Agent activities requires holding a professional card. The professional card must be renewed before January 31 of each year.
Business Introducers, Stock Investment Advisors, or Sales Agents must pay any fees and commissions charged at the Regional Financial Market within fixed deadlines.
4.3 Business Introducers, Stock Investment Advisors, or Sales Agents are prohibited from receiving deposits of funds and securities from their clients.
4.4 Any form of door-to-door sales (colportage) of securities is prohibited, consisting of visiting homes/residences or workplaces or public places to offer or acquire securities with immediate delivery of titles and immediate total or partial payment in any form.

Avenue Joseph ANOMA 01 B.P.: 1878 Abidjan 01/Côte d'Ivoire TEL.: (225) 20215742/20215179 Fax: 20221657 presidence@crepmf.org www.crepmf.org 5/10

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Avenue Joseph ANOMA 01 B.P.: 1878 Abidjan 01/Côte d'Ivoire TEL.: (225) 20215742/20215179 Fax: 20221657 www.crepmf.org 6/10 Instruction No. 53/2017
Article 5: Information and Reporting Documents to CREPMF
5.1 Business Introducers, Stock Investment Advisors, or Sales Agents must transmit to the Regional Council a copy of each contract signed with each Commercial Intermediary in the exercise of their activities, no later than thirty (30) days from the signing date.
5.2 Quarterly Information: Business Introducers, Stock Investment Advisors, or Sales Agents must transmit to the Regional Council, no later than thirty (30) days following the end of each quarter:
i. an exhaustive list of Commercial Intermediaries (SGI, SGP, SG d'OPC) with whom they have contracted as well as clients brought to them during the past quarter;
ii. a detailed declaration of revenues received during the past quarter.
5.3 Annual Information: Business Introducers, Stock Investment Advisors, or Sales Agents must transmit to the Regional Council, no later than thirty (30) days following the end of each year:
i. information on the location of their place of activity;
ii. an update on their human and material resources;
iii. a professional civil liability insurance policy equivalent to the previous year's turnover.
iv. for legal persons:
a) provisional financial statements comprising Balance Sheet, Income Statement, and annexes of the closed year; b) audited definitive financial statements comprising Balance Sheet, Income Statement, TAFIRE (Tax on Turnover and Professional Profits), and annexes must be submitted no later than July 31 of each year; c) criminal records of company directors, less than three (3) months old; d) annual bank guarantee of five (5) million FCFA, two (2) million FCFA, and one (1) million FCFA, respectively for Business Introducers, Stock Investment Advisors, and Sales Agents.

presidence@crepmf.org
Instruction No. 53/2017
v. for natural persons:
a) a report assessing the evolution of their activities, containing products received and charges borne during the past year following the attached table; b) criminal record less than three (3) months old; c) annual bank guarantee of two (2) million FCFA, one (1) million FCFA, and five hundred thousand (500,000) FCFA, respectively for Business Introducers, Stock Investment Advisors, and Sales Agents.

TITRE 3: TRANSITIONAL AND FINAL PROVISIONS
Article 6: Transitional Provisions
Accredited Business Introducers, Stock Investment Advisors, or Sales Agents prior to the effective date of this Instruction have a maximum period of one (01) year from its signing date to comply with its provisions.

Article 7: Publication and Entry into Force
This Instruction, to be published where necessary, repeals Instruction 06/97 on the authorization of Business Introducers, Stock Investment Advisors and Sales Agents, as well as all contrary provisions, and takes effect from January 1, 2018.

Signed in Abidjan, December 18, 2017
The President

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Avenue Joseph ANOMA 01 B.P.: 1878 Abidjan 01/Côte d'Ivoire TEL.: (225) 20215742/20215179 Fax: 20221657 www.crepmf.org 7/10

REPORTING TO CREPMF FOR THE PERIOD FROM... TO...

1. General Information: First Name, Location of Place of Activity, Accreditation Date, Accreditation Number, Post Office Box, Telephone, Email Address, WEB Site.
2. Contracts or Conventions Concluded During the Period: NATURE OF SERVICE, TOTAL AMOUNT OF COMMISSIONS RECEIVED, TOTAL AMOUNT OF OPERATIONS CARRIED OUT, NUMBER OF CONTRACTS, CONTACTS, NAME OF ACTOR (SGI, SGP, SGO).
   Instruction No. 53/2017
3. Activity Evolution: Exercice N-1 (Year N-1), Exercice N (Year N).
   Labels: Nombre de clients (Number of clients), Commissions perçues directement des clients (FCFA) (Commissions received directly from clients (FCFA)), Commissions rétrocédées par les acteurs agréés (FCFA) (Commissions retroceded by accredited actors (FCFA)), Commissions rétrocédées à des tiers (FCFA) (Commissions retroceded to third parties (FCFA)), Volume des ordres transmis aux SGI (Volume of orders transmitted to SGI), Volume des ordres transmis aux SGI exécutés (Volume of orders transmitted to executed SGI), Valeur des ordres transmis aux SGI exécutés (Value of orders transmitted to executed SGI), Revenu global lié à l'activité (FCFA) (Global income related to activity (FCFA)), dont: - Conseil (- Advice), - Transmission d'ordres (- Order transmission), - Démarchage (- Sales agency), - Autres revenus liés à l'agrément2 (Other income related to accreditation). Charges liées à l'activité (FCFA) (Charges related to activity (FCFA)), dont: - Frais généraux (téléphones, revues spécialisés, etc.) (- General expenses (telephones, specialized journals, etc.)), - Commissions payées au CREPMF (- Commissions paid to CREPMF). ---