Ethiopia’s Collective Investment Schemes Framework Now Fully Operational
The Ethiopian Capital Market Authority (ECMA) has announced a significant milestone in the development of Ethiopia’s capital markets. As of September 23, 2026, the Collective Investment Schemes Operation Directive No. 1150/2026 has been officially registered and approved by the FDRE Ministry of Justice.
Issued under the Capital Market Proclamation No. 1248/2021, this Directive establishes the first comprehensive legal framework governing the establishment, registration, operation, and administration of Collective Investment Schemes (CIS) in Ethiopia.
The Directive formally recognizes six distinct types of schemes: Money Market Funds, Mutual Funds, Real Estate Investment Funds, Exchange Traded Funds (ETFs), Alternative Investment Funds, and Special Designation Funds. No scheme may be offered to the public without prior registration with the Authority.
Importantly, the Directive places a strong emphasis on investor protection. Scheme assets must be held by an independent Custodian, separate from the Operator, ensuring proper asset segregation and reducing conflicts of interest. Operators and Custodians will be licensed under the Capital Market Service Providers Licensing and Supervision Directive No. 980/2024, and ongoing disclosure obligations will apply.
According to ECMA Director General Hana Tehelku, the Directive “is a significant step in channeling the savings of Ethiopians into productive investment through professional management and strong investor protection. It broadens access to the capital market and opens the way for the wider public to share in the country’s economic growth.”
The introduction of this Directive represents a substantial regulatory development. Financial institutions, fund managers, and promoters seeking to establish Collective Investment Schemes must now navigate complex registration, custodianship, and disclosure requirements. Our team is available to provide legal guidance on compliance, fund structuring, and regulatory engagement with the ECMA.