USAID gives substantial assistance to countries in Africa, and worldwide, to develop their securities markets. A significant part of this assistance concerns laws and regulations that govern the issuance of securities and their trading, particularly on stock exchanges. A perennial problem for this assistance is to identify the kind of laws that are most effective for securities markets in Africa. USAID and other donors continue to encounter this very basic question in many African countries. The laws of other countries, with more developed markets, serve as models—positive or negative—for emerging markets. This study identifies the major elements of law governing securities markets and the players in the markets, including stock exchanges. “Law” includes all types of substantive rules: legislation, regulations, decrees, and other promulgations or decisions by the executive, legislative, or judicial branch of a government. It includes the process of making, implementing, and enforcing the substantive rules. A “securities regime” is the law and institutions that govern securities markets and players. The study examines the basic options revealed in the models of more developed countries that are available to regulators of emerging markets. The audience for this study is, first, the USAID missions in the region, which can apply the findings in their policy dialogue with host governments. The primary audience consists, then, mainly of people who are not trained in law and may not be trained in finance. A broader audience for the findings is decision-makers elsewhere in the developing world, and their technical assistance providers, who could benefit from rationalization of the laws and regulations governing securities markets.
