The Ethiopian Securities Exchange (ESX), a share company, is Ethiopia’s primary securities exchange platform that facilitate the trading of stocks, bonds, and other financial instruments. The Capital Market Authority (ECMA) ECMA has licensed ESX according to the Capital Market Proclamation No 1248/2021. The exchange market was officially launched on January 10^th 2025 and is now open to list companies.

The ESX Rulebook, 2024 is a comprehensive document that outlines the rules, procedures, and governance mechanisms governing securities trading, membership requirements, listings and disciplinary actions on the exchange. The detailed rules, procedures and requirements of listing are provided in the rule book.

According to the rule book there are two types of listings in the ESX, Main market listing and Growth market listing. The first one is for established companies that can meet the financial and operational requirements while the latter is for companies that are small and don’t meet the requirements but have high potential.

To be listed, Companies must have a structure of a share company and their shares need to be free from any restrictions of transfer, fully paid and registered by ECMA. The minimum capital required is 500,000,000.00 birr (five hundred million birr) for main market listing and 100,000,000 birr (one hundred million birr) for growth market listing. The company must have been in operation for at least three years for the main listing and two years in case of growth market listing.

The company shall also show it has declared profit after tax credited to shareholders in at least one of the last financial years. Financial statements provided by the companies must be according to the International Financial Reporting Standards (IFRS) or the relevant Ethiopian accounting standards along with directives issued by the ECMA.

From the total shares sought to be listed 15% of the total shares to shall be held minimum of 300 public shareholders in case of main market listing and 10% of at least 50 public shareholders for growth market listings.

Governance and management requirements are related with the company’s board of directors, Management team, auditor and legal advisors. The board of directors and management should be experienced and competent. And the company should appoint an independent auditor and legal advisors to ensure transparency and compliance with regulatory standards.

The listing process begins with preparation where the companies interested in listing must prepare necessary documentation, including financial statements, governance reports, and a detailed business plan. The next step is to submit the application to the ECX, along with all required documents. ESX then reviews and evaluates checking if the company meets all the listing criteria. Once approved, the company is officially listed on the ESX, and trading of its shares begins.