On 12 February 2013 a new resolution of the National Securities and Stock Market Commission (the "Commission") regulating associations of professional stock market participants (the "Regulation") became effective. It replaced the resolution of the Commission of 17 February 2009, which used to govern this question.

The Regulation stipulates that the association of professional stock market participants (the "APP") is established to protect interests of its members that perform various types of professional (i.e. licensed) stock market activities. This association acquires the status of the APP when the Commission adopts its resolution to register it.

Professional stock market players may simultaneously be members of several APPs. They must hold a license for the relevant professional activity, meet APP requirements for membership and agree to abide by APPs' bylaws.

To be registered APP must:

  • unite no less than 35 percent of professional stock market participants per each type of the relevant professional activity;
  • be a nonprofit organization;
  • have approved rules and standards for conduct in the particular segment of the stock market, which must be mandatory for its members;
  • own at least UAH 600,000 in assets.

Among the major powers and rights granted to APP are:

  • development and approval of methodological recommendations for respective type of professional activity on the stock market;
  • implementation of dispute resolution mechanisms relating to professional activity of its members;
  • participation in drafting regulations and state programs concerning development of and self-regulation on the stock market;
  • collection of information concerning APP's missions from state and municipal authorities;
  • challenging acts and inaction of state and municipal authorities violating APP's or its members' rights and interests.

APP can obtain the status of a self-governed organization concerning particular type(s) of professional activity (the "SGO"). The status is granted by Commission's resolution.
To obtain the SGO status, APP must comply with a number of requirements including:

  • unite at least 75 percent of stock market professional participants per each type of the relevant professional activity;
  • enact the rules (standards) for the activity of its type and have them approved by the Commission;
  • enact SGO bylaws and other internal documents and have them approved by the Commission;
  • own at least UAH 1,000,000 in assets.

Among the major authorities and rights granted to SGO are:

  • development and approval of the SGO rules (standards) for its respective type of professional stock market activity binding on its members, including requirements as to professional qualification of the SGO employees;
  • exercise of the powers delegated by the Commission;
  • exercise various functions also entrusted to the APPs, such as approval of methodological recommendations for its members, dispute resolution mechanisms, participation in drafting of regulations and state programs, collection of information from public authorities, protection of its members by challenging acts of public authorities violating SGO's or its members' rights and interests, etc.

The Commission supervises APPs and SGOs and maintains their registry.

Also, some other resolutions of the Commission became effective in February 2013, in particular, in relation to (i) procedure for foreclosure sale of securities on stock exchange, (ii) prudential standards of depository activity and requirements to risk management system, activities on trading in securities and management of institutional investors' assets, and (iii) changes to the rules for licensing stock market professional activities.


For further information please contact partner Vadym Samoilenko
and senior associate Oles Kvyat