The Capital Markets Authority (CMA) has issued guidance to support coffee players in a bid to facilitate transitional arrangements in the sector.
This follows the gazetting of the Capital Markets Regulations 2020 which brought the coffee exchange and its members under the regulatory oversight of CMA.
"The Nairobi Coffee Exchange is granted permission to operate as it works towards full compliance with the regulations and all the applicants intending to offer coffee brokerage services are allowed to continue performing the role," CMA Acting Chief Executive, Wyckliffe Shamiah said.
The regulations were gazetted by the cabinet secretary for the national Treasury and Planning on April 3 2020.
Following amendment of the Capital Markets Act the spot commodities market was brought under regulatory oversight of CMA to strengthen governance of players and provide protection to consumers.
According to The Capital Markets (Coffee Exchange) Regulations 2020 and the Crops (Coffee) General Regulations,2019 CMA was therefore mandated to license the coffee exchange and the coffee brokers since July 1 2020.
CMA directs that the existing payment mechanisms be utilized in the interim period as the DSS is being put in place while details of direct coffee sales will be reported to the Nairobi Coffee Exchange.
Shamiah also added that all disputes that may arise in relation to coffee sales should be forwarded to the Authority to ensure follow up and resolution for the benefit of the coffee growers.
The industry committee has also been constituted to address any gaps that exist and those that may emerge during the transition period.
The Coffee Exchange Regulations were harmonized with the Capital Markets (Commodity Markets) Regulations, 2020.
