The securities market in Tanzania emerged as a result of the structural transformation of the Tanzanian economy. The Capital Markets and Securities Authority (CMSA) was established in 1994 under the Capital Markets and Securities Act, 1994. It is a regulatory and supervisory body on the capital markets. It licenses and regulates investment intermediaries and deals with exchanges and deals with the issuance and trade in securities.

As a result of economic transformation and reforms, Dar es Salaam Stock Market (DSE) was incorporated in September 1996 and began trading operations in April 1998. DSE is the only formal trading place for securities. At present, only Tanzania citizens are allowed to buy shares in the primary stock market. All companies wishing to be listed at the DSE must be approved by CMSA.

Currently there are seven listed securities at the DSE including four ordinary shares companies: Tanzania Oxygen Limited (TOL), Tanzania Breweries Limited (TBL), Tanzania Cigarette Company (TCC), Tanzania Tea Packers Limited (TATEPA), Tanga Cement (SIMBA), Dar es Salaam Airport Handling and Clearing Company (DAHACO) and Kenya Airways (KA). Market capitalization for the quarter ending December 2001 rose to TShs 187bn from TShs 137bn. Two more scarcities (one equity and one corporate bond) are planned to be listed at DSE in the first half of 2002. Find latest results.

10.2 Listing Procedures for Equities
CMSA and the DSE council must approve all companies wishing to be listed at the DSE. A sponsoring broker has to be appointed to process an application through the DSE and CMSA.

The sponsoring broker will be responsible for coordinating contacts between DSE and the listed company and ensuring that the company complies with the listing conditions. To be listed, a company must meet the following conditions: -

• Duly incorporated as a public company with securities freely transferable;

• At least three consecutive years of audited accounts;

• The company must have a track record of profits and dividend payments over at least three years;

• The company must have a minimum of TShs 50mn of issued share capital and fully paid up;

• The public must hold at least 25% of the issued share capital. Shares held by employees are not to be counted as part of the 25%;

• The company must have a minimum of 1000 shareholders or the potential of achieving this requirement after a listing;

• The Company must submit a memorandum and articles of association;

• The company must demonstrate that it will have sufficient working capital;

• The company must show that it has a competent board of directors and senior management; and

• Prospectus for public offering.

10.3 Listing Procedures for Debt Securities
A company applying for a listing of debt (loan) securities must meet the following criteria:

• It must have already obtained a listing of its ordinary share capital;

• It should offer at least TShs 50mn of issued loan capital of the class to be listed. Further issues of shares of a class already listed are not subject to these limits;

• Its total loan capital should not exceed 100% of shareholders? funds less intangible assets; and

• It is required to enter into a contract with the Exchange on such terms as the Exchange may require for the protection of stockholders.

10.4 Procedures for Establishing A Collectives Investment Scheme
The establishment of any Collective Investment Schemes must be authorised by CMSA. Any such authorisation may be granted subject to terms and conditions, as Authority considers necessary or desirable for the protection of investors. CMSA not only monitors the establishment of CISs but also their operations, promotion, marketing and administration.

10.4.1 Unit Trust
The proposed Trustee and proposed Manager must request authorisation to act as Trustee and Manager respectively of the Unit Trust. The following documents will be required:

• Duly filled application form;

• Draft scheme particulars, which contains information on the scheme calculated to invite offers by the public for units in the scheme;

• Trustees latest audited reports;

• A letter from the trustee consenting to its appointment as trustee of the scheme;

• Draft trust deed;

• The memorandum and articles of association of the management company;

• Full particulars regarding the actual or proposed trustee and the actual proposed manager;

• Full particulars of the investment adviser (if any);

• Information on any other third part involved in the unit trust;

• Any other document which may be requested by the Authority.

10.4.2 Open Ended Investment Companies (OEICs)
The proposed Trustee and proposed Custodian must request authorisation to act as Trustee and Custodian respectively of the OEICs. The following documents will be required: -

• Duly filled application form;

• The draft memorandum and articles association of the OEIC;

• Draft scheme prospectus, which contains information on the scheme calculated to invite offers by the public for units in the scheme;

• The Custodian's latest audited report;

• A letter from the Custodian consenting to its appointment as Custodian of the scheme;

• The memorandum and articles of association of the management company;

• Full particulars regarding the actual proposed manager and Custodian;

• A copy of the Custodian agreement;

• Full particulars of the investment adviser (if any);

• Information on any other third part involved in the unit trust; and

• Any other document which may be requested by the Authority.

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