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Title: Regulation of Initial Public Offering of Shares in Ethiopia: Critical Issues and Challenges
Authors: Tikikile, Kumulachew
Advisors: Tadesse Lencho (LL.B, LL.M, PhD candidate)
Keywords: Regulation
Public Offering of shares
issuers liabilities
self regulation
Copyright: Jan-2011
Date Added: 16-May-2012
Publisher: AAU
Abstract: An IPO (Initial Public Offering of Shares) is offering stock to the public on an open market for the first time. The IPO is the process in which a company first offers its shares to the public and becomes a publicly traded company. The reason for the regulation of public offering is that members of the public who are subscribed shares in a company are entitled to full disclosure to the nature of what is on that offer before they make a financial commitment, and to provide them with effective remedies to redress any loss incurred as a result of failure on the part of the company to make complete or accurate disclosure. The paper investigates the issues and challenges in relation to the regulation of initial public offering of shares in Ethiopia. Issues like approval of public offering; regulation of prospectus content, form and distribution; the publication and advertisements of the offer; the market conducts of the participants and their civil and criminal liability as well as the issues associated with the regulatory framework of the securities market are analysed. The findings of the research show that there are inadequate legal and institutional frameworks to regulate the public offering of shares in Ethiopia. Poor approval of public offering, prospectus regulation, and insufficient registration of intermediaries and regulation of their market conducts and lack of public and self regulatory institutions characterize the process of public offering. Laws governing civil liabilities for misconducts in public offering of shares are flawed in multifarious ways with weaknesses such as ambiguities and short comings in proscribing acts and omissions which entail liability, identifying potentially liable persons, high burden of proof, and problems in enforcement.
URI: http://hdl.handle.net/123456789/3068
Appears in:Thesis - Law

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