Licensing, Authorisation and Market-Entry Requirements
This domain tests entry gateways: who must be licensed, what evidence is required, and what conditions continue after authorisation. The exam favours scenarios where a firm assumes its home licence or exchange membership is enough.
Common gateways
- Legal form and local presence; credible business plan; board and senior management fit and proper; approval of controllers and material shareholders; minimum capital; systems and controls; AML/CFT and data protection compliance; custody and client-money arrangements.
- CBK licenses banks, microfinance banks, forex bureaus, money remittance providers, payment service providers, credit reference bureaus and digital credit providers.
- CMA licenses stockbrokers/dealers, investment banks, investment advisers, fund managers, CIS, REITs and derivatives participants.
- Approval-in-principle may be followed by conditions; licences are not transferable; material change of control requires prior approval.
Cross-border entry
There is no single passport. A foreign firm must establish an approved branch or subsidiary and meet local capital, governance and conduct rules; home supervision is not a substitute.
Worked example
A foreign brokerage wants Kenyan clients. Its home licence does not permit dealing in Kenya. It incorporates a local company, applies to CMA for a dealer licence, demonstrates fit and proper directors and shareholders, capital, client-money segregation and AML controls; then it applies separately for NSE membership and CDSC participation. Only after licensing and admissions can it onboard clients.
Traps
Treating NSE membership as the regulatory licence; assuming capital alone is enough; ignoring controller approvals; launching before approval-in-principle conditions are met; omitting FRC and ODPC registrations where applicable.