CDA Requirements

Rules & Requirements relating to appointment of Central Depository Agents

Only persons prescribed under section 9 of the Act and rule 10 of the CMA rules shall be eligible for appointment as CDA.

Procedure

All appointments of CDAs shall be made by the Central Depository in writing under the hand of the chief executive for the time being of the Central Depository.

Application

An application for appointment to operate as a CDA shall be submitted to the chief executive of the Central Depository in Form 1 set out in the First Schedule under the Procedures Manual and shall be accompanied by -

  1.  Memorandum and Articles of Association or any other document that defines the constitution of the applicant;
  2. A letter of no objection from the industry regulator (where applicable) including, if the applicant is a member of a securities exchange, a letter of no objection from the relevant securities exchange;
  3. A firm profile including experience and expertise;
  4. A current license of operation (where applicable);
  5. Statement by directors of the applicant of ability to provide the required services including financial resources to meet its obligations pursuant to the Act, the CMA rules, these rules and the Agency Agreement;
  6. Details of key personnel, their training experience and skill;
  7. The appointment fee as prescribed by the Authority.

Every applicant shall make appropriate arrangements with the settlement bank to effect payment in accordance with these rules and the procedures set out in the Procedures Manual and authorize the settlement bank to effect settlement in accordance with instructions received from the Central Depository, and to disclose to the Central Depository information regarding the availability of funds to satisfy the CDA's settlement obligations.

Conditions

  • The appointment as CDA of a non-member of a securities exchange shall exclude the power to operate the accounts for trading activities and shall be limited to non-trading activities including custody and mortgaging.
  • The Central Depository may, in appointing any CDA to perform any of the approved functions as set out in Rule 9, impose such requirements or conditions, as it considers necessary to ensure orderly deposits, withdrawals, transfers of book-entry securities, payment of cash and dealings in securities.

Appointment   

Upon finding an applicant fit for appointment as CDA and the applicant satisfying the requirements above, the Central Depository shall appoint the applicant as a CDA. The CDA shall upon executing the Agency Agreement be duly appointed and entitled to commence operations as such agent on the terms set out in the Agency Agreement.

Fees   

Every CDA shall pay an annual subscription fee prescribed by the Authority which shall be payable at the commencement of every calendar year following the year of appointment. The fees are stipulated below
   
Central Depository Agents

Appointment Fee for CDAs who are members of a Securities Exchange

Kshs. 20,000

Appointment fee for CDAs who are not members of a Securities Exchange

Kshs. 75,000

Annual Subscription Fee for CDAs

Kshs.  2,500

 Additional information can be found in the documents below;

Last modified on Tuesday, 01 November 2016 19:16