Publication date: 08.07.2024
Legal regulation of the stock market in Ukraine
The stock market is an important element of Ukraine's economic system, which mobilizes capital to finance investment projects and provides tools for the efficient allocation of financial resources. The legal regulation of this market aims to ensure transparency, fairness and efficiency of its functioning, as well as to protect the rights of investors. In this article, we will consider the main aspects of legal regulation of the stock market in Ukraine.
Key laws and regulations
The main laws and regulations governing the stock market in Ukraine include:
- TheLaw of Ukraine "On Securities and Stock Market " - defines the general principles of the stock market, rules for issuing and circulating securities and activities of market participants.
- TheLaw of Ukraine "On State Regulation of the Securities Market in Ukraine " - establishes the powers of state authorities in the field of securities market regulation, in particular the National Securities and Stock Market Commission (NSSMC).
- TheLaw of Ukraine "On Joint Stock Companies " - regulates the activities of joint stock companies, the procedure for issuing shares and shareholders' rights.
- TheLaw of Ukraine "On the Depository System of Ukraine " - regulates the activities of depositories, accounting and storage of securities.
State regulatory authorities
The following authorities regulate the stock market in Ukraine:
- TheNational Securities and Stock Market Commission ( NSSMC) is the central executive body that regulates, supervises and controls the securities market.
- National Bank of Ukraine (NBU ) - regulates the activities of banks in the stock market and ensures the stability of the financial system.
- TheAntimonopoly Committee of Ukraine (AMCU ) - controls compliance with antitrust laws in the stock market.
Licensing of activities in the stock market
Licensing of professional stock market participants is an important element of its legal regulation. The NSSMC licenses the following types of activities:
- Brokerage activities - mediation in securities transactions on behalf of clients.
- Dealer activities - purchase and sale of securities on their own behalf for their own funds.
- Depositary activities - storage and accounting of securities.
- Asset management - management of securities and other assets of investors.
Issuance and circulation of securities
The issue of securities in Ukraine is regulated by the Law "On Securities and Stock Market". Issuers must comply with disclosure requirements, issue registration and publication of the prospectus. Securities are traded through stock exchanges and over-the-counter trading systems.
Protection of investors' rights
Protection of investors' rights is a key aspect of legal regulation of the stock market. The legislation provides for the following protection mechanisms:
- Information disclosure - issuers are required to disclose information about their financial activities, ownership structure and other material facts that may affect the value of securities.
- Control over compliance with the law - the NSSMC supervises the activities of market participants and imposes sanctions for violations of the law.
- Handlingcomplaints and disputes - investors have the right to go to court or the NSSMC to protect their rights and interests.
Transparency and prevention of manipulation
Ensuring transparency and preventing manipulation in the stock market are important aspects of its regulation. The legislation provides for:
- Prohibition of market manipulation - actions aimed at artificially increasing or decreasing the value of securities are illegal and punishable by fines.
- Preventing the use of insider information - it is prohibited to use confidential information to conduct transactions with securities.
International cooperation
Ukraine actively cooperates with international organizations and institutions in the field of stock market regulation, which contributes to the integration of the Ukrainian market into the global financial system. This includes cooperation with the International Organization of Securities Commissions (IOSCO) and the European Securities Association (ESA).
The role of stock exchanges
Stock exchanges play a key role in the functioning of the stock market. They provide an organized market for the purchase and sale of securities, facilitate the establishment of market values for securities, and ensure transparency of transactions. There are several stock exchanges in Ukraine, the largest of which are PJSC Ukrainian Exchange and PJSC PFTS Stock Exchange.
Depository accounting systems
Securities depository systems are an important component of the stock market infrastructure. They ensure storage and accounting of securities, as well as settlement of securities transactions. Ukraine has a Central Securities Depository, which provides centralized storage of securities and records of securities ownership.
Implementation of new technologies
The development of digital technologies has a significant impact on the functioning of the stock market. The introduction of blockchain technologies, smart contracts, and other innovations contributes to the market's efficiency, transparency, and security. Ukrainian legislation is gradually adapting to new technological realities, creating legal conditions for their implementation and development.
Development of the securities market
The stock market in Ukraine continues to develop, introducing new instruments and mechanisms to attract investment. Promising areas of development include:
- Institutional development - increasing the role of institutional investors, such as pension funds, insurance companies and investment funds.
- Expanding the range of financial instruments - introducing new types of securities, such as derivatives, to help manage risks more effectively.
- Increasing financial literacy of the population - educational programs and initiatives aimed at improving the knowledge and skills of investors.
Conclusions.
The legal regulation of the stock market in Ukraine is aimed at ensuring stability, transparency and protection of investors' rights. The main instruments of regulation are licensing of market participants, control over compliance with the law, ensuring information disclosure and preventing manipulation. International cooperation facilitates the integration of the Ukrainian market into the global financial system, and the introduction of new technologies creates new opportunities for its development. The further development of the securities market requires both institutional changes and increased financial literacy of the population.
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