1. Legal Foundations of the Armenian Securities Market
At the heart of Armenian stock exchange regulation lies the Law of the Republic of Armenia “On Securities Market”, adopted in 2007 and amended over time to reflect modern market practices. This law provides the foundational framework for the organization, supervision, and operation of securities markets in Armenia — including stock exchanges — with an emphasis on protecting investors, fostering transparency, and ensuring orderly market functioning.
Key objectives of the law include:
- Protection of investors’ rights and interests.
- Ensuring transparency and efficiency in price formation.
- Reducing systemic risk in the securities market.
- Establishing regulatory oversight mechanisms.
Under this legal regime, securities include a range of instruments such as stocks, bonds, depository receipts, and units of investment funds.
2. The Role of the Central Bank of Armenia
In Armenia, the Central Bank (CBA) serves as the primary regulator and supervisor of the securities market. The CBA’s role includes:
- Licensing and oversight of market participants, such as brokers, dealers, and investment service providers.
- Approving and registering changes to the stock exchange’s internal rules and governance structure.
- Monitoring compliance with market conduct and disclosure requirements.
The legal basis for CBA oversight is articulated in both the Securities Market Law and the Law on the Central Bank, empowering the regulator to issue warnings, impose sanctions, and enforce regulatory requirements designed to maintain market integrity and protect investors.
3. Defining the Stock Exchange Under Law
Under Armenian law, a stock exchange is defined as a regulated market that operates in compliance with minimum requirements set forth by law and subordinate regulatory acts.
The Stock Exchange’s operator — often the Armenia Securities Exchange (AMX) — must:
- Obtain and maintain a valid license to operate as a regulated market.
- Adhere to market rules approved by the CBA.
- Ensure orderly trading and transparent price formation.
A stock exchange may organize trading in multiple asset classes, including equity, debt, and potentially foreign exchange or derivatives as permitted within the broader regulatory framework.
4. Market Participants and Membership
Members of the stock exchange are typically licensed investment service providers, including brokerage firms and dealers. Only entities licensed to provide investment services — such as brokerage, dealing, or portfolio management — are eligible for direct access to exchange trading.
Exchange membership criteria and obligations are further established under the exchange’s internal rules, subject to CBA approval.
5. Trading, Listing, and Market Rules
Stock exchange regulation encompasses both listing requirements and trading rules:
Listing Requirements:
Securities must satisfy specific criteria related to:
- Financial disclosure
- Corporate governance
- Eligibility for trading
These criteria are codified in the Securities Market Law, CBA regulations, and the stock exchange’s own listing rules.
Trading Rules:
The exchange’s market rules govern market conduct, transaction reporting, trading interruptions, suspension and delisting procedures, and disciplinary actions against members.
Importantly, the operator may suspend trading in specific securities if issuers or participants violate regulatory requirements, or if such actions threaten investor interests or market order.
6. Investor Protection and Market Integrity
Armenian securities regulation includes provisions to combat market abuse, including insider dealing and price manipulation. These provisions, embedded in law and reinforced through CBA supervision, aim to preserve fair and transparent market conditions for both domestic and international investors.
Additionally, disclosure obligations require issuers and certain intermediaries to provide transparent and timely information to the market, enhancing investor confidence and supporting efficient price discovery.
7. Evolving Regulatory Landscape
The regulatory framework for Armenia’s stock exchange continues to evolve. In recent years, legislative updates and regulatory reforms have:
- Streamlined listing and disclosure requirements.
- Strengthened investor protections.
- Enhanced corporate governance standards.
- Aligned local practices with international norms to attract broader participation — including foreign institutional investors.
Though listing volumes remain modest compared to more developed markets, these regulatory reforms are intended to support deeper capital market development and greater liquidity over time.
8. Outlook and Opportunities
For investors and corporate issuers, understanding Armenia’s stock exchange regulations is critical for navigating market entry, raising capital through public offerings, or engaging in cross-border investment strategies. As the regulatory environment aligns increasingly with global standards and the CBA continues to refine market oversight, Armenia’s securities market presents niche opportunities for institutional and strategic investors seeking exposure to the Caucasus region.
