East African Community Cross-Border Bond Offerings
 REGIONAL FIXED INCOME SECURITIES REQUIREMENTSÂ
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Requirement |
Description |
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Definition |
A fixed income security approved for issue in more than one East African Community Partner State jurisdiction. Issuer elects a PRIMARY jurisdiction for lodging prospectus. |
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Eligible Issuers |
Entity incorporated or registered as a foreign entity in ALL jurisdictions where offer is to be made. Includes sovereign borrowers, quasi-sovereign borrowers, and treaty organizations. |
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Minimum Share Capital |
Local currency equivalent of USD 850,000 (applies to companies; exempt for sovereigns/quasi-sovereigns/treaty organizations) |
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Minimum Net Assets |
Local currency equivalent of USD 1,700,000 (exempt for sovereigns/quasi-sovereigns/treaty organizations) |
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Profitability Requirement |
Profits in at least 2 of previous 3 years (except SPVs and with regulator discretion for justifiable declines) |
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Minimum Issue Size |
Local currency equivalent of USD 850,000 |
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Credit Enhancement |
Issuer may secure credit enhancement. Guarantor must be a licensed bank, non-bank financial institution, or recognized international financial institution. Letter of no-objection required from credit enhancers primary regulator. |
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Credit Rating |
MANDATORY: Valid credit rating for entire life of issue from recognized agency. Rating not a recommendation; cautionary statement required. |
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Currency and Denomination |
Determined by issuer, subject to prevailing policy. Funds may be raised in any jurisdiction without restriction on where proceeds are used. |
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Financial Disclosure |
IFRS audited accounts for last 3 years (not more than 6 months old at offer); supported by management accounts if older. Cashflow projections covering at least 3 years from issue date. |
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Professional Parties |
Must appoint: Transaction Adviser/Sponsoring Stockbroker/Placing Agent licensed in at least one EAC Partner State with affiliates in all regional jurisdictions; Reporting Accountant; Legal Adviser. (May be exempted for offers to institutional/sophisticated/professional investors only) |
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Listing |
Mandatory for all regional offers to the public or a section of the public |
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Deposits |
All regional fixed income securities must be deposited at a central depository established under written law in any Partner State |
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Continuing Obligations |
Comply with disclosure obligations in ALL jurisdictions where capital raised. Updates on rating reports, interim financial reporting, audited financial reports must be provided simultaneously to all investors. |