The Commodity Exchange Regulations, 2016

This section says the Regulations may be cited as the Commodity Exchanges Regulations, 2016.

These Regulations apply to commodity exchanges and commodity market intermediaries.

This section defines key terms used in the Regulations.

Applicants must meet the Act’s criteria before the Authority can consider approving them as an exchange or market intermediary.

Applicants must complete and submit the prescribed forms to the Authority, include the requested supporting documents, and show proof of payment of the application fee. The Authority may also ask for more information while reviewing the application.

The Authority must review applications, decide within 45 days, may ask for more information if needed, and use verification results before deciding whether to grant a licence.

A commodity-related licence is granted only if the applicant meets the Authority’s minimum financial requirements for the relevant business category.

A representative's licence may be granted or renewed by the Authority only after it considers the application and is satisfied the applicant will perform the role efficiently, honestly, and fairly; the licence can be granted only to a natural person.

The Authority may refuse a licence application or renewal in specified cases, but it must first give the applicant or licence holder a chance to be heard.

The Authority must not grant or renew broker’s or dealer’s licences unless the required deposit, guarantee, or insurance has been lodged with it when the application is made.

A deposit made under Regulation 10 must be refunded to the applicant if the dealer’s licence application is refused.

The Authority may invest deposits made under Regulation 10, and must retain 55% of the investment income after taxes for a dealer.

A licence holder who applies for renewal on time may keep treating the licence as valid until the renewal is granted, refused, or withdrawn.

Licence holders must notify the Authority in writing of certain changes or cessation events within 14 days.

If the Authority suspends a licence, it must notify the defaulting licensee with reasons; the suspension takes effect immediately and may later be revoked under stated conditions.

If revocation grounds arise, the Authority must notify the defaulting licensee, prepare a report for Board approval, and the licensee has 14 days to respond.

The Hearing Officer(s) must prepare a report and recommendation to management based only on the testimony presented at the hearing.

Management must consider the Hearing Officer(s)’ report and may change the recommendations before sending them to the Board for a final decision.

The Authority must deliver its decision within 7 working days after the hearing and read it to the Licensee.

The Authority must give the Licensee a copy of its decision.

A person aggrieved by a final decision of the Authority may appeal to the Tribunal.

XY may trade commodity contracts for the Client’s account as instructed, may delegate execution/clearance/settlement in its discretion, and the Client must follow XY’s Electronic Access Policy when sending orders electronically.

All transactions in the Client’s Account must follow this Agreement, related agreements, and applicable laws.

Contract terms inconsistent with the listed law are treated as amended or replaced, and the agreement otherwise stays in force.

This text states that Client did not give instructions to effect the claimed indebtedness, and defines “Affiliates” as entities controlling, controlled by, or under common control with XY.

The Client must pay XY on demand for listed account-related charges, losses, balances, interest, costs, and other amounts owed, and must provide bank details needed to verify wire transfers when asked.

The client must acknowledge that trading in Financial Instruments is speculative and involves leverage and fast-changing markets.

Section heading: Risk of Loss; Limitation of Liability.

Client bears the risk of transactions and market price changes in the account, and XY disclaims responsibility for third-party performance and certain execution delays.

Client consents to XY using automated systems or service bureaus for the Client’s account, and XY disclaims warranties and representations about those systems.

The Client must indemnify, defend, and hold harmless XY and related persons for losses and liabilities arising from the Client’s breach, noncompliance, or false statements.

Client conversations about the account, orders, and financial instruments may be recorded by XY, and the Client consents to that recording and use. If a transaction is in a foreign-currency market, exchange-rate gains or losses stay with the Client, margin deposits must be in Tanzanian Shillings unless XY requests another required currency, and XY may convert account funds at its normal exchange rates.

The Clients must at all times maintain the stated margins and premiums.

The Client must deposit margin or premium when XY requests, within a reasonable time; XY can ask for shorter notice. XY generally does not have to pay interest on client account funds unless agreed in writing.

XY may require the Client to deliver collateral quickly, and the Client must pay interest and collection costs if delivery is late.

If specified events happen, XY may apply collateral, close out or liquidate client positions, and cancel or refuse orders.

The remedies mentioned are only for XY’s protection, and the Client stays bound by its contractual obligations even if those remedies are not used, or only partly used.

XY may sell collateral, trade or liquidate client positions, and set or enforce position limits; the client must not exceed those limits.

This section only identifies “Commodity Exchanges” in G.N. No. 146 (contd.).

The Client must give XY delivery or liquidation instructions, or provide funds/documents, at least 5 business days before the last trading day; otherwise XY may liquidate the position or handle delivery without notice.

XY is described as a separate, independent corporate entity, and the commodity contracts and collateral it handles are not bank deposits and are not insured or guaranteed by an affiliated bank.

The Client must make payments and send notices and other communications to XY’s offices, except for wire transfers discussed in Section 10.

A margin call is treated as correct unless the Client sends written notice to XY objecting within 24 hours of delivery. XY may also correct any error or omission after discovering it.

If an error occurs, XY must correct it, adjust the client account accordingly, and notify the Client in writing; XY also limits liability for certain damages and may use alternative communication methods if fax or email is disrupted.

The Client must keep XY informed of material changes, and either party may end the agreement by written notice. After termination notice, the Client must close out or transfer open positions, and XY must transfer assets once the Client’s liabilities are satisfied.

The Client makes several ongoing representations about legal capacity, authorization, registration compliance, transaction purpose, and account ownership, and XY may rely on apparent authority instructions.

21.0 Special Provisions for Managed Accounts

If a third party manages the Client’s account, the Client must provide XY with the third party’s written trading authorization or the Client’s acknowledgment of it, in a form acceptable to XY.

The Client must provide requested financial information to XY and must notify XY immediately, and no later than one business day, if its financial condition materially worsens. XY may make inquiries to verify the information.

Section title: Compliance with Anti-Money Laundering Law.

Before opening an account, XY must obtain, verify, and record information that identifies the Client.

Commodity Exchanges must provide identifying information, including name, address, and tax identification number, to help XY identify and verify clients.

XY may put inactive accounts on inactive status, and the Client must provide requested information and extra documentation if asking to reactivate the account.

Client may assign the agreement only with XY’s prior written consent. XY may transfer or assign the agreement, including the account, after notifying Client and getting Client’s consent.

Changes or waivers to the agreement are not binding unless they are in writing, dated later, and signed by the party to be bound; other agreements or understandings are also not binding unless written and signed by authorized officers.

The agreement is to be governed by and interpreted under the laws of Tanzania.

Disputes connected to the agreement must be settled amicably by the parties, and if that fails they go to courts or other dispute forums in Tanzania.

The client acknowledges receiving and understanding the risk disclosure statements required by regulation 32.

This section is an application form asking the applicant to provide identity details and supporting information.

The form asks for correspondence and permanent address details, and says the proof of address must be different from the proof of identity submitted.

This form section asks the person completing it to provide income, occupation, PEP status, and landline details if applicable.

Provide bank account details and attach supporting bank proof documents.

This section asks for depository account details, if available, including the depository participant name, depository name, and beneficiary name, and asks for a recent holding statement copy.

The Member must list the exchanges where it has membership, and if a client is later allowed to trade on another exchange, the Member must get a separate client consent letter and keep it with the document.

This section asks for investment/trading experience, including prior experience and years in commodities and other investment-related fields.

This section is a VAT details form asking for the VAT registration number, validity date, and place name, as applicable by state.

Provide details of any regulatory actions or proceedings against the client during the last 3 years.

If a client deals through another Member, the client must provide the listed details.

This section is an optional form asking for introducer details such as name, status, address, phone number, and signature.

This section asks whether you want communications from the Member in electronic form to your email address.

This section is a nomination form asking whether the account holder wishes to nominate a nominee and, if so, to provide nominee, guardian, witness, and declaration details.

The signer declares the information is true and correct and must tell you immediately if anything changes.

The signer confirms reading the listed documents and agrees to be bound by them.

All clients must provide a certified copy of their personal identification card.

The applicant must submit the original document.

The applicant’s submitted document copies should be properly attested by entities.

If an original document is not provided, copies must be attested by authorized entities. Identity or address proof in a language other than English or Kiswahili must be translated into English.

The applicant’s name and address on the KYC form should match the referenced item, but the source text is incomplete.

If correspondence and permanent address are different, proofs for both must be submitted.

A sole proprietor must make the application in his individual name and capacity.

Non-residents and foreign nationals may trade only subject to applicable law, guidelines, and statutory approvals, and they must provide a passport copy and proof of overseas address.

Foreign entities should provide the director’s passport copies.

This section defines Politically Exposed Persons (PEP) as individuals who are or have been entrusted with prominent public roles.

This section lists documents that may be accepted as proof of identity and proof of address, and says expired documents must be valid on the date they are submitted.

Clients are warned about commodity-trading risks and must accept those risks and seek professional advice if unsure.

The Authority must hold a hearing and issue its decision within 14 days from the hearing date. If it decides the defaulting licensee’s reasons are not reasonable, it must notify the licensee of the revocation decision.

A notice of revocation must be prepared in the form set out in the Fifth Schedule.

The Authority must not revisit a decision unless the Tribunal directs it to do so.

A licensee must check new clients for anti-money-laundering compliance and assess their background, genuineness, financial soundness, and investment objectives. For corporate clients, the licensee must also get an approved board resolution, and for unincorporated bodies, relevant authorization from that body.

A licensee must disclose key liability, risk, and trading information to clients, provide the required risk disclosure document, and ensure the client acknowledges receipt.

Licensees and their associates must not guarantee clients against loss, give unsuitable commodity-contract recommendations, or provide false or misleading information to induce business.

A licensee must explain the trading system to the client before taking orders, follow client instructions, give trade confirmations, and collect required margin money.

A licensee must settle clients’ accounts every quarter and send each client a statement of accounts when settling.

An exchange must send clients daily trade details, and member licensees must keep client mobile numbers and email addresses verified and updated.

Licensees must follow the law, supervise staff and transactions, avoid misuse of client assets, and keep client information confidential unless a court order or listed recipients apply.

A licensee must not trade contracts fraudulently or engage in unfair trading or market manipulation.

This provision applies the regulation to commodity dealers, their trading advisers, commodity brokers, commodity representatives, and a financial journalist.

An applicant for approval of a commodity contract must use the prescribed form and include the required fee and a standardized contract.

The Authority may approve a commodity contract for trading if the application meets the requirements, and it may require corrections, more information, or changes before approval. An application cannot be approved without compliance with a direction from the Authority unless that direction has been withdrawn, and an application or registration cannot be declined or revoked without hearing the applicant.

The Authority must keep a register of approved commodity contracts.

The Authority may suspend trading of a commodity contract for up to 60 days if it considers that this is in the market’s or public interest, and may extend the suspension for further periods of up to 60 days.

Every licensee must comply with relevant laws, including the Act, these Regulations, and applicable guidelines or directives on accounts and records.

Each licensee must prepare annual accounts, keep the balance sheet true and fair, and send audited financial statements to the Authority within three months after year-end; the Authority may extend the filing time.

Market intermediaries must prepare and submit an Annual Report to the Authority.

Licensees must keep detailed business records, safeguard client money in trust or clients accounts, send clients periodic account statements, and clients must report statement errors within 14 days.

Trading licensees must keep a separate ledger account for each client.

Licensees must keep and preserve specified business records, and trading members must keep certain commodity and contract-note records.

The 1997 Conduct of Business Regulations apply to all licensees under the Act or these Regulations, and references to dealers or investment advisers are read as commodity broker, dealers, or commodity trading advisers.

Licensees must issue clients a contract note for services performed, and the note must contain relevant details, be signed, numbered, and time stamped.

Commodity brokers, commodity dealers, and licensees must keep commissions separate from prices and show them separately in the contract note.

A licensee must not run operations from any office or premises whose full address has not been intimated to the Authority.

A licensee must make an agreement with each client before taking or placing orders for that client, and the agreement must include the Sixth Schedule provisions.

The Authority may inspect a licensee’s accounts and documents, and the licensee and its personnel must help the inspection.

The inspector must send an inspection report to the Authority quickly and keep the investigation confidential, and the Authority must share findings with the licensee before acting, unless it decides a hearing is not needed in certain circumstances.

The Authority may require a licensee to provide information or explanations, must keep client details confidential, and may disclose information to regulators or the public at its discretion.

A licensee or a person aggrieved by a decision of the Authority or a commodity exchange may appeal to the Tribunal within 14 days after the decision is communicated, subject to section 84.

The Authority may use several enforcement tools for commodity exchanges matters, including demanding fines, starting proceedings, imposing settlement penalties and bans, and freezing assets.

The Authority may investigate certain commodity-contract transactions and require a licensee to provide detailed information in writing; failure to comply or giving false information can lead to licence revocation or refusal of an application.

The Authority may grant or renew licences with conditions, change those conditions by written notice, and restrict how a licence holder may contact residences for commodity dealing. Licence holders who break licence conditions commit an offence.

This section states the company’s name and that it is a limited company.

Section 2 is an address field.

This section labels the date of incorporation field and leaves space for an entry.

An applicant seeking approval to establish a commodity exchange must provide the requested company, office, capital, and director details.

This fragment appears to refer to the name and address of the Chief Executive for Commodity Exchanges.

The applicant must enclose two copies of each listed document with the application.

This provision says an application or renewal fee in TZS is enclosed.

An applicant must include the last audited financial statement with the application and the signer must declare they have read and will follow the Act and the exchange rules.

This form requires an applicant for a dealer’s licence to provide detailed company, ownership, management, business, and control information.

This section asks whether a person or business has been licensed, registered, or otherwise authorized to deal in securities or to carry on a trade, business, or profession.

The form asks whether any director or secretary of the applicant has had certain problems or history within the past ten years.

The applicant must provide detailed employment and business history for each director and secretary, give relevant extra information, list character referees, and declare the application information true and correct.

If there is not enough space for required details, annexures should be attached, identified as annexures, and signed by the signatory to the application.

An applicant’s application must include the applicant’s last audited financial statements.

This application section asks the applicant to provide company and officer details.

An applicant for a Commodity Trading Adviser’s licence must describe its business, customers, and internal controls.

The applicant must list people who control the applicant’s management and policies (other than directors) and answer questions about recent licensing, registration, authorisation, or refusals involving the applicant, directors, or secretaries.

The application asks whether any director or secretary of the applicant has, within the past ten years, had certain exchange, criminal, financial, bonding, or company-management issues.

The applicant must provide details of each director’s and secretary’s employment and business activities for the previous ten years.

The applicant declares that the information in the application and any attached annexure is true and correct.

This form is for applying to renew a commodity broker, commodity dealer, or commodity trading advisor licence.

This section is a form asking for the applicant’s name, licence expiry date, and licence number.

An applicant that is a company must give the listed particulars, and an individual applicant must complete the listed questions.

An applicant for a representative licence must declare that the application information and any attached annexure are true and correct.

The applicant must answer a series of Yes/No questions about licensing, trading authorization, disciplinary history, convictions, civil fraud findings, bond refusals, bankruptcy, and director disqualification.

The applicant must answer whether they have experience as a representative or investment representative, and if yes, attach annexures with relevant details.

The applicant must provide details of two suitable persons, and the Authority may ask them about the applicant’s character and reputation.

The applicant must answer whether they have a qualifying interest in listed commodity contracts and must declare that the application information is true and correct.

A certificate must accompany the application, and it must be signed by the relevant licensee; if the applicant will work for a licensee, a director or secretary of that licensee must sign it.

This is an application form section that asks the applicant to supply personal and licensing details and to declare that the information is true and correct.

An application must be accompanied by a certificate, and the relevant licensee(s) must sign it.

This form is used to notify a change of business address or a change in the place where the register is kept.

This section provides forms for notifying changes in a licensee’s business details and for notifying cessation of business.

The provision lists educational qualifications the CMSA considers when evaluating certain commodity market licence applications and sets out the form and one-year term of a licence.

This text refers to a company being issued a licence by the Authority under the Commodity Exchanges Act, with a note about possible revocation.

This provision fragment refers to an entity that commenced its licensed operations on or before a specified date.

The provision appears to say that someone has, despite numerous reminders by letter, failed to do something and is in breach.

This section says site visits were made to the premises at the stated plot and the team’s findings are to be summarized.

Failure to indicate the offence without a reasonable explanation is treated as a material breach of the licence conditions.

Licensees must pay licence fees set by the Authority.

CMSA has determined licence fees payable by the named company for an unspecified matter.

A company is given 30 days to pay its licence fees, start operations, or show cause, or its licence may be revoked.

The Licensee must appear personally, may be represented by counsel, and is to be given an opportunity to be heard.

Everyone present must be identified.

Testimony must be recorded in writing, and it may also be recorded on tape.

The hearing officer must choose the language for the hearing by considering the language the parties can comfortably use, and must admit all relevant materials or evidence.

Objections to admitting or excluding evidence must be brief and state the grounds for the objection.

If a party makes an offer of proof after an objection to evidence, it must be a statement explaining the factual evidence or expert opinion relied on.

After a witness’s initial testimony, any party of record or the party’s counsel may examine that witness.

The applicant must testify and must answer cross-examination by the Hearing Officers.

The Licensee is entitled to receive the record of the proceedings in written form and on tape.

Commodity derivatives trading involves leverage, daily settlement, margin calls, and trading risks; you must ask your Exchange member for full contract details before trading.

A member should inform the client about any additional provisions on the features, risks, responsibilities, obligations, and liabilities of commodities trading through wireless or other technology.

Form 1 must be submitted to the Chief Executive Officer of the Capital Markets and Securities Authority, and applications are subject to the Disclosure Standards.

This provision is a label for the exchange name where the contract will be traded.

The exchange applies for approval of named contracts to be traded on the exchange and confirms the application complies with relevant laws and regulations.

The application asks for the type of contract being applied for, with examples such as a spot commodity contract or a futures contract.

This section asks for a full description of the commodity contract used in the application.

This section is about the terms and conditions of a commodity and gives examples of characteristics that may be described.

Attach the commodity exchange certification showing the contract complies with the Commodity Exchange Act and related regulations.

The provision refers to contract design and risk management needs for prospective users, and asks for a market research report supporting the contract terms and conditions set by the Exchange.

It refers to market users’ views and opinions during contract design, and asks for a consultation report to be attached.

The applicant must attach a statement explaining what steps were taken to make the contract useful, or will be useful.

Provide a description of the local market relevant to the underlying commodity, where available data allows.

Provide data on estimated deliverable supply, including at least three full years of relevant cash-market and commodity information.

Depending on the contract, provide details of the underlying cash settlement index for the most recent three full calendar years and for any current-year months with available data.

For cash-settled index contracts, provide information showing the index reflects the underlying cash market and is not readily subject to manipulation or distortion.

An applicant who ticks the box is confirming that the market’s criteria and requirements are met.

This section asks whether the commodity contracts in the application are identical, identical to an existing contract, and freely transferable.

This section asks for information about the commodity’s country of origin, any foreign regulator approval lodged with CMSA, and trading/supply details including currency.

A form field asks for any ISIN number and whether settlement is yes or no.

This provision asks whether the contract is eligible for electronic settlement and refers to the default place of settlement.

The provision lists applicant details to be provided, including website address, contact name, job title, and telephone number.

This provision lists contact details and related roles to be provided for a lead adviser, sponsoring broker, and confirmed market makers.

This section states the address where the admission document will be available.

A date must be available no later than the first day of trading.

The applicant must complete the form, make required declarations, pay applicable approval and annual fees when due, provide accurate information, and follow the relevant standards.

For commodity contracts settled by physical delivery, the contract terms should include specified standards and delivery details such as quality, delivery points, delivery period, contract size, price fluctuation limits, and trading hours.

This section concerns the terms and conditions for settlement by cash.

Cash settlement means settling certain contracts with a cash payment instead of delivering the underlying commodity or instrument when the contract expires.

Contracts must describe key economic features of the commodity and explain how the final settlement price is calculated; cash-settled contracts need procedures and supporting documentation to reduce manipulation risk.

This provision defines “deliverable supply” and sets rules for estimating it, including what to count, what to exclude, and that estimates should be done monthly for the most recent three years of available data.

This section lists example details for describing an underlying commodity, such as type, where produced, maximum packages, storage conditions, flavor, odors, moisture content, and grade.

This provision states a minimum daily price in Tanzanian shillings per net kilogram, with a separate reference to one bag and fluctuation.

This section refers to contract size in terms of the number of bags and the unit measurements for each bag.

Buyer and seller settlement is due on the third business day after the trading day.

This section is titled “Cash settlement of day trading (item 10) and daily of settlement accounts (item 11).”

For physical delivery, the seller must tender the necessary documents and the commodity transfer is tied to the buyer. Grading is requested through a licensed warehouse using the Exchange form, and the grading certificate is issued within five business days after samples are received if the samples were delivered at least five business days before the trading day.

This section is titled Day trading and mentions long and short positions, gains and losses from transactions, and the settlement procedure and settlement date.

This section refers to daily settlement of accounts, including the invoice, settlement price determination, differences between the last price and the price traded during a trading session, and other adjustments.

The seller must tender the required documents on time, and the buyer must submit an invoice to the warehouse operator by the trading day.

This section is about specifying the commodity that is affected or damaged.

Section title fragment about maximum moisture, mud, and beans that taste strangely, are wormy, or bored.

This section sets delivery standards for coffee lots, including color, composition, storage, warehouse handling, and when lots may be transferred, repacked, or rejected.

This section sets how physical delivery settlement value is calculated, lets the buyer request weighing on delivery, and requires invoice adjustments and certain tax deductions/additions.

This section sets the settlement steps for a commodity trade, including payment timing, document approval, verification of storage conditions, replacement of nonconforming lots, and registration of discounts.

The provision states a basic commission rate for trading: 0.50% for regular trading and 0.10% for day trading, applied to trading value and subject to a minimum value set by the Exchange.

Common members must pay no more than 75% of the basic commission rate and 75% of the Exchange fee, and warehouse operators must have insurance cover as part of licensing requirements.

Section 19 is titled “Warehouse operator’s guarantee system.”

This section is a miscellaneous schedule that lists headings for a register of commodity contracts.