Securities and Exchange Commission (Sec) Zambia Becomes 116th IOSCO MMoU Signatory

The Securities and Exchange Commission (SEC) is one of the three financial sector regulators in Zambia with a core objective of regulating the capital markets sub-sector. The SEC is a statutory body established under the Securities Act, Cap. 354 of the Laws of Zambia and whose establishment is continued under the new Securities Act, No. 41 of 2016. The SEC has a primary mandate to protect investors and to develop the securities markets in Zambia.

The Board and Management of SEC are pleased to inform the public that on 15th January 2018, the SEC became the 116th of 117 signatories to the International Organization of Securities Commissions (IOSCO) Multilateral Memorandum of Understanding (MMoU) and only the 6th in the 15-member SADC grouping. The latest authority to sign the IOSCO MMoU is the Central Bank of Armenia. Founded in 1983, IOSCO is an association of organisations that regulate the world’s securities and futures markets and is an international standard setting body for securities regulators. The MMoU, which was established in 2002 and last revised in May 2012, is a document that facilitates the sharing and exchange of information among signatories when investigating securities fraud. The MMoU was established for the following reasons:
• Increased international activity in securities and derivatives markets and the corresponding need for mutual cooperation and consultation among IOSCO Members to ensure compliance with, and enforcement of their securities and derivatives laws and regulations;

• the events of September 11 2001 which underscored the importance of expanding cooperation among IOSCO Members; and

• the desire by IOSCO Members to provide one another with the fullest mutual assistance possible to facilitate their respective regulatory functions.

The MMoU has therefore provided securities regulators with the tools for combatting cross-border fraud and misconduct that can weaken global markets and undermine investor confidence. It is a benchmark for enforcement-related cooperation which will enable the Commission to obtain as well as share key investigative information with other global securities regulators.

By the Commission becoming a signatory to the MMoU, Zambia will obtain recognition from international bodies and regulators around the world as a jurisdiction committed to improving cross-border investor protection cooperation through seamless interaction with other regulators. Through the MMoU, Zambia is reinforcing its message to the markets that regulators are co-operating and watching out for potential securities and derivatives fraud. As a result of becoming an IOSCO MMoU signatory, Zambia’s capital markets are poised to become more credible and will compete more favourably in attracting foreign investments with other countries globally. In particular, the country should see increased capital inflows which will result in a lower cost of capital. Additionally, other international organisations including the International Monetary Fund (IMF), the World Bank (WB) and the Financial Action Task Force (FATF) use a country’s MMoU signatory status when conducting country compliance assessments for international standards and best practice.

Mr. Amos Siwila
Board Chairperson
Securities and Exchange Commission – Zambia