Instruction No. 6/97 on the Authorization of Business Brokers, Stock Investment Advisors, and Solicitors

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

INSTRUCTION NO. 6/97 RELATING TO THE AUTHORIZATION OF BUSINESS BROKERS, STOCK INVESTMENT ADVISORS AND SOLICITORS

Having regard to the Convention of 3 July 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 the aforementioned Convention;

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

Having regard to Articles 91, 95 and 102 of the aforementioned General Regulation;

Having regard to the decision of the Regional Council in its session of 29 November 1997;

THE REGIONAL COUNCIL DECIDES:

Article 1: Business Brokers are natural or legal persons who transmit their clients' orders to SGI and/or who put a client in contact with an SGI or an Asset Management Company for the opening of a securities account and for investment advice or managed portfolio management.

Business Brokers, whether natural or legal persons, are prohibited from accepting deposits of funds and securities from their clients.

Article 2: The following are considered as carrying out the activities of Stock Investment Advisors: natural or legal persons who guide the choice of their clients without substituting themselves for them regarding their final decisions.

Stock Investment Advisors, whether natural or legal persons, are prohibited from accepting deposits of funds or securities from their clients or from transmitting stock orders to SGI on behalf of the clients they advise.

Article 3: The following are considered as solicitation activities: all operations carried out by anyone who habitually visits the home or residence of persons, or their workplaces, or places open to the public and not reserved for such purposes, with a view to advising on the subscription, purchase, exchange, or sale of securities, or participation in operations involving these securities.

Offers of service made or advice given, in a habitual manner, with a view to the same purposes as those referred to in the first paragraph of this Article, at the home or residence of persons or at their workplaces by sending letters or circulars or by telephone communication, are also considered as solicitation activities.

All forms of hawking of securities are prohibited, which consist of going to the home or residence of persons or to their workplaces or to public places to offer or acquire securities with immediate delivery of securities and immediate total or partial payment in any form whatsoever.

Article 4: No one may, as a habitual profession, without prior authorization from the Regional Council, carry out the activities of Business Brokers, Stock Investment Advisors or Solicitors.

In addition to the natural or legal persons authorized for this purpose, banking establishments are authorized, after declaration to the Regional Council, to carry out Business Broker activities.

SGI and banking establishments are authorized, after declaration to the Regional Council, to carry out the activity of Stock Investment Advisor.

The following are admitted, after declaration to the Regional Council, to use solicitation:
banking establishments, Asset Management Companies and SGI.

Article 5: Persons applying for authorization as Business Brokers, Stock Investment Advisors or Solicitors must send to the Regional Council a file containing the following documents:

a) for legal persons: the articles of association, certified balance sheets and accounts, a statement of guarantees offered as well as the criminal record extract of the directors;

b) for natural persons: a criminal record extract, a curriculum vitae and a statement of guarantees provided.

In addition, natural persons must demonstrate sufficient experience in the field of activity concerned. Legal persons that employ or use the services of an agent must demonstrate the same professional experience conditions.

Article 6: Legal persons applying for authorization as Business Brokers, Stock Investment Advisors and Solicitors are required to provide a bank guarantee in an amount equal to:

• five million FCFA for Business Brokers,
• two million FCFA for Stock Investment Advisors,
• one million FCFA for Solicitors.

For natural persons, the amount of this bank guarantee is:

• two million FCFA for Business Brokers,
• one million FCFA for Stock Investment Advisors,
• five hundred thousand FCFA for Solicitors.

Article 7: The granting of authorization is subject to the payment of a sum whose amount is fixed by instruction of the Regional Council.

Article 8: The authorization of a Business Broker, a Stock Investment Advisor or a Solicitor shall be published in the official bulletin of the stock exchange.

Done in Ouagadougou, on 29 November 1997

For the Regional Council
The President
L. NAKA