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CONTENT
Table of Contents
- Introduction to Law
- Nature, purpose and classification of law
- Sources of law
- The court system; establishment, composition and jurisdiction;
- Fundamentals of the law of contract: definition; classification; formation; terms of a contract; vitiating factors; illegal contracts; discharge of contracts; remedies for breach of contracts; limitations of actions
- Fundamentals of the law of agency: nature of agency; formation of agency; authority of agents; duties and rights of principals and agents; personal liability of agents; termination of agents
2. Financial markets regulatory institutions
- Historical development of the law and regulations governing financial markets
- Objectives of regulation; need for regulation of financial markets
- Regulatory strategies in financial services
- Financial market regulators (as applicable in Kenya or other jurisdictions where relevant): central banks; capital market authorities; deposit insurance corporations and deposit insurance funds; insurance regulatory authorities; retirement benefit authorities; sacco societies regulatory authorities; unclaimed financial assets authorities; competition authorities or equivalent bodies
- Professional bodies in financial services- Institute of Certified Investment and Financial Analysts (ICIFA)
- Regulations in the international financial markets
3. Regulations of Capital Markets
- The Capital Markets Authority (CMA) – Powers, functions and roles
- Investor Compensation Fund (ICF)
- The Capital Markets Tribunal: Powers, functions and roles
- The Capital Markets Fraud Investigations Unit
- The International Organisation of Securities Commissions principles relating to the regulator
4. Financial market intermediaries
- Requirements for licensing of market intermediaries
- Market intermediaries:
- Investment Banks, Stock Brokers and Dealers
- Fund Managers and Investment Advisers
- Credit Rating Agencies
- Collective Investments Schemes (Unit Trusts and Mutual Funds)
4.2.4 Custodians/ Authorized Depositories
- Online Foreign Exchange Brokers and Money Managers
- REIT Managers and REIT Trustees
- Foreign Exchange Bureaus
- Private Equity and venture capital Firms
- Savings and Credit Cooperative Societies
- Obligations of licensed intermediaries: conduct obligations; client accounts; record keeping and reporting obligations
- Roles of an authorised depository and when the appointment of a custodian is required
5. Central Securities Depository
- The Central Depository Settlement Corporation
- Establishment of the Central Depository
- Role and duties of a Central Depository
- Central Depository agents
- Rules relating to Appointment of Central Depository Agents
- Rules of a Central Depository
- Structure of Central Depository Accounts; settlement of trades
- Insurance of a Central Depository
- The Business Conduct Committee of the Central Depository Corporation
- Establishment and Management of the Central Depository Guarantee Fund
6. Securities Exchanges and Clearing Agencies
- Establishment of Securities Exchanges
- Role of the Securities Exchange
- Membership of the Securities Exchange
- The Board and committees of the Securities Exchange
- Securities Exchange listing rules; listing process; role of advisers; eligibility and disclosure requirement; continuing obligations
- Takeover and Merger Regulations
- Foreign Investor Regulations
- Derivatives Exchange Regulations: Requirements for Derivative Exchanges
- Raising capital in the securities market: Initial Public offering, introductions, offers for sale of issued securities, Additional new listing of securities
- Market Segments and Eligibility requirements: Main Investment Market Segment (MIMS), Alternative Investment Market Segment (AIMS), Fixed Income Securities Market Segment (FISMS) and Growth Enterprises Market Segment (GEMS)
- Appointment and Responsibilities of nominated advisors, sponsoring stockbrokers and lead transaction advisor
- Procedure for admission to listing of REITS securities
- Suspension and delisting of securities listing and post listing requirements
- Demutualization and Self-Listing of the Exchange
- Cross border listing
- Over the counter (OTC) markets and other multilateral trading facilities (MTF)
- Clearing Agencies
- The International Organisation of Securities Commissions (IOSCO) principles for self-regulation and enforcement of securities regulation
7. Investment Funds
- Collective Investment Schemes (CISs): types of CIS; requirements for authorisation of a fund and the restrictions on advertising content; purpose and main contents of the information memorandum; role of the main participants in a collective investment scheme; rules surrounding the valuation and pricing of a fund and investor dealing
- Exchange-Traded Funds (ETFs): characteristics of exchange-traded funds; Listing ETFs; Trading and Settlement
- Real Estate Investment Trusts (REITs): Types of REITs; characteristics of REITS; Regulatory Requirement of REITS; Role of the REIT Manager; Role of the Trustee
- Venture Capital Companies: characteristics of Venture Capital Companies; Eligibility Requirements for a Registered Venture Capital Company
- Employee Share Ownership Plans (ESOPs): Creation of an ESOP; Scheme Requirements
- Special Interest Schemes: characteristics; requirements for special interest schemes
8. Corporate Governance and Conduct of Business of Market Intermediaries
- The concept of corporate governance
- Objective of the corporate governance Regulations
- Role of the Board, its committees and the Board Charter
- Responsibilities of shareholders
- Employees and prescribed Code of Conduct
- Management of a market intermediary
- Internal controls and risk management
- Capital Markets Authority Audit
- Conduct of business of market intermediaries
- Principles when conducting business with the public
- Know your client procedures
- Client rights, contract notes, confidentiality, funds and complaints handling procedures
- Purpose of the fair and clear communications rule
- Rules surrounding cold calling
- Rules surrounding the disclosure of charges
- Required content of a client agreement
- The concept of fiduciary duty
- Rules around client confidentiality and access to client information
- Conflict of Interest
- Suitability of advice; investment advise process
- Client Money: segregation of client money bank accounts; Operating Client Money Accounts; Reconciliation and Accounting Record; Registration of Asset
- Unacceptable trading practices: front running; churning; insider dealing; market abuse; penalties for unacceptable trading practices
9. Anti-Money Laundering and Combating the Financing of Terrorism
- Money laundering, the process and related offences; suspicious transactions reporting
- Financial Reporting Centre-objectives, functions and powers
- The Anti-Money Laundering Advisory Board; Anti-Money Laundering obligations of a Reporting Institution
- Money laundering checks: best execution rule; timely execution rule; timely and fair execution rule; contract notes rule; off-market transactions
- Assets Recovery Agency (ARA)- functions, powers and funds
- Criminal Assets Recovery Fund – functions, powers and funds
- Role of the financial Action Task Force
- Role of Egmont Group of Financial Intelligence Units
- Role of Eastern and Southern Africa Anti Money Laundering Group (ESAAMLG)
- Role of United Nations Office on Drugs and Crimes (UNODC)
- Customer Due Diligence requirements for natural persons, legal persons, partnerships and trusts
- Counter Financing of Terrorism: Inter-Ministerial Committee – Functions and powers of the Committee; mechanism for coordinating counter – terrorism measures
- Enhanced due diligence measures
- Establishment of ultimate beneficiaries
- Politically exposed persons
- Correspondent relationships
- Wire transfers
- Legitimacy of source of funds
