Market Profiles

Effective Sep 2024, RBC IS operates a segregated account structure in this market.

Whilst no documents are required in this market, it is prudent to hold on record client documents to show the legal existence of the client in case the agent or the country regulator requests it.

For further information or support around accessing this market, please contact your RBC IS representative.

Casablanca Stock Exchange (CSE) 
The sole exchange in Morocco, CSE is based upon the new law of Société Anonyme. It is privately owned and managed by the limited liability company Bourse de Valeurs de Casablanca (BVC). 

The status of the Casablanca Stock Exchange management company will be transformed into a holding company. Following the demutualisation of Casablanca Stock Exchange, the new shareholders of the managing entity of the Casablanca Stock Exchange consists of the following shareholders:

• Banks - 39%
• CDG - 25%
• Brokerage firms - 20%
• Insurance companies - 11%
• Casablanca Finance City - 5%
  
  

The CSE operates the following markets:

• The Central Trade Market: the regular trading market. The new market structure adopted by the Casablanca Stock Exchange gives a pivotal role to the central market. All trades (other than block trades) in securities listed on the Casablanca Stock Exchange must pass through the central market.
• The Block Trade Market used for strategic deals between institutional investors. When institutional investors submit large orders, it may not always be possible to execute the order in full because of a lack of counterparts on the market order book. As a result, the Casablanca Stock Exchange has set up a block trade market.
  
  

There are three listing markets:

• three equity markets. The listing requirements differ from one market to the other
• one bonds market
• one funds market (not yet operational).

Trading is via an electronic trading system based upon simultaneous DVP transactions. CSE has moved on from the old market structure (Kerb sales and open outcry) and the markets now operate under the rules set out in the "General Regulations" as issued by the Casablanca Stock Exchange and published by order of the AMMC.

On January 12, 2015, the electronic trading activity of treasury bonds was launched via E-bond Maroc Bloomberg platform.

Monday to Friday: (regular season)

* T0, T1, T2 and T3 are random durations ≤ 60 seconds. They are determined automatically by the system for each instrument.

Monday to Friday: (Ramadan hours)

* T0, T1, T2 and T3 are random durations ≤ 60 seconds. They are determined automatically by the system for each instrument.

ISIN (International Securities Identification Numbering): All securities listed on the Casablanca Stock Exchange have an ISIN number, as do all dematerialised securities deposited at Maroclear. There are also corporate bonds listed that have ISINs.

In addition to the International Securities Identification Number (ISIN) codification, effective August 1, 2017, Maroclear adopted the Classification of Financial Instruments (CFI) codification in order to comply with the requirements of ANNA (Association of National Numbering Agencies) and international standards.

Ministry of Economy and Finances-  - Ministry of Economy and Finances is the general supervisory body for financial markets and is a crucial body for regulations, prudential matters and monitoring in the field of investment services. It's main reviews are as follows:

• Trust through taking decisions related to the Moroccan investment industry that can boost the market efficiency and liquidity.
• Safety and soundness by controlling all capital/investment markets' participants.
• Compliance with prudential rules by imposing ratios and standards that should be respected by all financial institutions.
  
  

AMMC - The securities market authority, Autorité Marocaine du Marché des Capitaux (AMMC) (previously called Conseil Déontologique des Valeurs Mobilières (CDVM)) was created in 1993 by the promulgation of Dahir n° 1-93-212 of September 21, 1993. It is a Public institution with its own legal status and financial autonomy and it supervises the entire securities market including depositories, brokers, Maroclear and the exchange. The Ministry of Finance empowers the AMMC to properly carry out its tasks.

Maroclear - Maroclear is the Central Depository and operates a system for the central handling of securities or equivalent book-entries in Morocco. Eligible instruments include government securities, equities, corporate bonds, corporate money market instruments and mutual funds. The depository was established and became operational in July 1997.

Bank al Maghreb - is the Central Bank of Morocco and the central depository bank governing and controlling the whole banking sector. This governmental body ensures the stability, liquidity, and solvency of all participants of the money market. It monitors the financial soundness of financial institutions and makes sure that they abide by the appropriate laws and regulations in that matter. Bank Al Maghrib's role is to monitor the investment and banking companies' financial position. It controls the market through trust review, safety and soundness' review, Electronic Data Processing review, and the compliance with the prudential ratios.

All securities are dematerialised at the Central Securities Depository, Maroclear.

Board lots are only applicable to the block market

Equities:
Primary market : +/-10% for the first five trading days
Secondary market:+/- 10% for securities traded on a continuous mode basis and +/- 6% for securities traded on a fixing mode basis

Debt instruments:
Secondary market: +/- 6%

MAD

Yes, the market is only used for debt instruments (listed or non-listed), Repo where all terms are defined on a contractual basis.

Trading hours: Monday to Friday: 09:30 - 15:00

Book-Entry: The settlement process is as follows:

TD to TD +1 – Trade Date: SBVC sorts the daily transactions by broker, effectively engaging in a matching process.

TD+1: The brokers send TRTs (Tableau Recapitulatif des Transactions - summary of transactions sorted by custodian) and TRCs (Tableau Recapitulatif des Clients - summary of transactions sorted by client) to the custodians/agent bank for validation in accordance with client instructions (via Maroclear).

The TRT and TRC are sent via the CSD.

TD+2: Custodians must validate the TRTs/TRCs (or not where appropriate), and return them to the brokers via Maroclear before 13:00 on T+2. Unvalidated transactions will settle by default, and validation constitutes an irrevocable commitment to settle.
Upon receipt of the validated TRTs/TRCs, Stock Exchange members have until 12:00 to submit them to SBVC, who in turn initiates an additional matching process.

TD+3:
Securities Side (MAROCLEAR)
MAROCLEAR starts the settlement batch at 1.30pm by blocking the securities and instructing the Central Bank to settle the cash side of the transaction. Once the cash side has settled and is confirmed by the Central Bank, MAROCLEAR unblocks the securities and settles the securities side of the transaction. 

Cash Side (Bank Al Maghrib)
On T+3, upon successfully matching the validated TRTs/TRCs, Maroclear instructs the settlement of cash through the current accounts maintained by the custodian bank/agent banks at the Central Bank. Payments are final once executed, and cash settlement is on a net basis.

Short-selling position
In the event that a delivering custodian does not have sufficient securities in its MAROCLEAR account to complete a transaction. MAROCLEAR will mark the trade as pending, attach priority markings, and attempt to settle it at a later date. CSE will continue to send statements detailing all pending/non validated TRCs/TRTs to both MAROCLEAR and custodian banks on a daily basis until resolution.

Physical: Contractual. Depending on the security entitled, this kind of transaction can either pass through CSE's off market department or by a contractual agreement between the counterparts. No physical securities are settled via the stock exchange.

Short selling is not yet authorised in the Moroccan market. There are plans to have an operational derivatives market.

Turn around trades are possible, however not all local subcustodians support them.

Maroclear is the clearing agency for all depository-eligible securities. There is no separate clearing house in Morocco.

Maroclear is the sole depository in Morocco and is responsible for the holding and record keeping of securities. Maroclear also handles the custody of equities, corporate and government debt, bons du Tresor (T-bills) and Organismes de Placement Collectif en Valeurs Mobilieres (OPCVM), the mutual funds. Both bearer and registered securities are held within the Maroclear system.

BIS is an international organisation which fosters cooperation among central banks and other agencies in pursuit of monetary and financial stability. The Committee on Payments and Market Infrastructures (CPMI) uses three common structural approaches, or models, to categorise the links between delivery and payment in a securities settlement system.

Maroclear - Broker-to-broker: BIS Model 3 - a system in which securities transfers occur on a trade-for-trade (gross) basis throughout the processing cycle. However, fund transfers occur on a net basis at the end of the processing cycle. Security transfers are made via book entry and are final; fund transfers are irreversible, but not final. Therefore, final transfer of securities precedes final transfer of funds (i.e. delivery precedes payment).

Maroclear – Broker to custodian. BIS Model 1 – a system in which there is a simultaneous transfer of securities and associated funds from the buyer to the seller. All transfers occur on a trade-by-trade (gross) basis with all transfers made via book entry. All transfers are final.

Physical Settlement: Delivery of physical securities occurs on the OTC /off market.

Book-Entry: Most of the listed shares trade in the bearer form. For bearer shares, registration is only done if requested by a shareholder.

Only four stocks still trade in the registered form. Shares admitted to Maroclear must be registered on T+5. There is no central registrar for equities in Morocco. Registration of securities takes place at the issuing company. The issuing company is responsible for maintaining the records of the shareholders. Some companies have appointed external registrars.

Maroclear manages the flow of registration information between the custodians and the issuing companies. Custodians of the buyer and the seller are required to submit a referenced transfer order to Maroclear. This will transmit the information to the issuing company to cross off the name of the seller and register the securities in the name of the new buyer. Once the records of the registers are updated and the issuing company sends its confirmation to Maroclear, the final settlement book-entries are then executed at the sub custodian's accounts maintained with Maroclear. The process of registration is done at two levels at either the CSD or the issuer:

1-Securities held at Maroclear

• Registered securities received through the Cash-Securities settlement:

The Cash-Securities settlement is simultaneous and completed with the exchange of documents (Bordereau de Références Nominatives) needed for the registration of those securities. As a result any registered security received through the Cash-Securities settlement for the account of the client will be automatically registered in its name.

• Registered securities received through Franco:

When the counterparty delivers the registered securities through "franco de couverture", two options might be chosen by the counterpart:

• Delivery with change of the registered holder
• Delivery without change of the registered holder
  
  

2-Securities held in the books of the issuer
These securities are transferred through an "Order de Movement". Upon receipt of this document, the subcustodian can see whether or not the counterparty has indicated to the issuer the wish to register the shares in the name of the client.

• If yes, the subcustodian can immediately book the securities in the account of the client.
• If not, the subcustodian must go through the procedure of "Crossing transaction".
  
  

There is neither a street name nor nominee concept registration in Morocco. The stocks will be registered under the name of the investors. The cost is MAD 15 per registration. Stamp duties are not applicable in the market. Both counterparties (buyer and seller) pay the costs to Maroclear.

The new Maroclear settlement platform has led to the dematerialization of the registration process - effective from September 24, 2010, registration will take place directly on Maroclear's IT system rather than through the exchange of paper forms.

Physical: physical securities are not held at CSD. The issuer is in charge of the whole process of shareholders registration account. Registrar function is quasi-nul since most of the stocks are held in bearer form.

Issuing companies.

T+5

Share holdings may be required to be disclosed by the beneficial owner, particularly when holdings reach or exceed prescribed disclosure limits. Investors must ensure that they comply in full by reporting such holdings to the appropriate organisations for this market, within the timeframe required. If you have any questions regarding this issue we encourage you to consult your legal counsel.

Failure to comply with reporting requirements may lead to penalties and/or other sanctions.

In order to comply with the Reform Law dated January 16, 1997, any investor whose direct or indirect holdings with voting rights in a listed company either exceed or fall below the thresholds of 5%, 10%, 20%, 33.33%, 50% or 66.66%, must inform the company, the CSE and the AMMC, within five business days of the trade date. The AMMC then advises the market of this information via the daily stock exchange bulletin.

An investor whose holdings with voting rights in a bank either exceed or fall below, directly or indirectly, the thresholds of 5% must inform the Central bank.

In addition, investors must also inform the AMMC of their intentions for the next 12 months stating whether they will continue to increase their holdings of the security, intend to take control of the company, or will request an appointment to the Board of Directors.

Should an investor fail to comply with these ownership disclosure requirements, fines of between MAD 5,000 (approximately USD 495) and MAD 100,000 (approximately USD 9,850) can be imposed. In addition, the investor can also lose voting rights on the shares exceeding the specified limits for up to two years.

1. Resolution of securities lacks ( Buy-in ) :
Considering the provisions of the general rules of the stock exchange repurchase session within the framework of a securities default is
organized as follows :
If securities default is not solved on the sixth market day which follows the date of its theoretical completion ( SD +6) the CSE organises on the following day the first repurchase session of the missing securities, if by the end of the first repurchase session not all the securities have been repurchased one second and last repurchase session will be organised on the following day (SD +8)

First repurchase session :
Reference price (Settlement date + 7) plus the maximum rate of variation in force

Second repurchase session :
Reference price (Settlement date + 8) plus twice the maximum rate of variation in force

2. Resolution of cash lacks (Sell-out)
If the lack of cash is not resolved on the third market –day which follows the date of its theoretical completion (SD+3) the CSE organises the first resale session on the following day , if by the end of the first resale session all the securities could not be resold a second resale session is organised on the following day (SD +5)

First resale session :
Reference stock price ( SD+4) minus the maximum rate of the variation in force

Second resale session :
Reference stock price ( SD +5) minus twice the maximum rate of variation in force

3. Penalties
Damages within the guarantee system
In case of unsettled movement of Securities the defaulting firm must pay to its counterparty damages the amount of which calculated on the basis of twice the reverse repurchase rate applied by Bank Al Maghrib to the quantity of the securities unlisted movement plus the closing price of the day of the initial negotiation in proportion to time.

In case of an unsettled movement of Cash the amount of damages is calculated on the basis of twice the reverse repurchase rate applied by bank al Maghrib to the amount of the cash unsettled movement in proportion to time.

The amount of damages cannot be inferior to MAD one hundred.

Fines within the grantee system
In the event of securities suspended movements the fine is calculated on a 0.2% basis applied to the quantity of securities with suspended movements increased by the closing price of the initial trading day.

In the event of cash suspended movements the fines is calculated on a 0.2% basis applied to the pending security and per trading date.

The fine cannot be less than MAD 2,000 exclusive of Tax and cannot exceed MAD 10,000 exclusive tax per pending securities and per trading trade. 

The lack of securities and cash are communicated to the AMMC. 

The managing firm may suspend momentarily the activity in the stock market for the defaulting brokerage company, pursuant to the provisions of Article 12a of the aforesaid Royal Edict as law Nr. 1-93­211 of rabia II 4, 1414 (September 21, 1993).

Securities lending and borrowing is allowed in Morocco: Law n°83-20 recognises and accepts the International and Global Master Agreements, the use of foreign securities for the collateral and arbitrage on corporate actions.

There are two funds operating in the Moroccan market:

• A guarantee fund whose role is to compensate clients in case of broker bankruptcy. This fund is managed by the AMMC and is only invested in government securities.
• A guarantee fund for the settlement of operations "garantie de bonne fin". This fund is used to settle trades when a broker fails to deliver or pay its counterparty. This fund is funded by brokers based on their semi annual activity report and is managed by the Sock Exchange.

The CSE is responsible for organising the cash payment, clearing and delivery of securities. Delivery is made at the same time and in return for payment on the settlement date. It guarantees that the brokerage firms deliver the securities and cash payment in the amounts due to them in respect of transactions involving transferable securities listed on the Securities Exchange and carried out on the central market.

For this purpose, each brokerage firm places guarantee deposits with the CSE to cover its unsettled net positions on the central market. If settlement does not take place on the theoretical settlement date, unsettled net positions are regarded as net fails. Net fails are subject to penalties. Guarantee deposits previously placed by a brokerage firm having a fail position shall, where appropriate, cover the cost of carrying out the buy-in or sell-out procedures.

CSE has a dedicated entity taking care of the good end operation " garantie de bonne fin d'opération" trough imposing a settlement guarantee fund and imposing a call margin. The total guarantee fund is MAD 34.6 million (October 2015).

Documentation required by Law for account opening:

• Articles of Incorporation
• Extract from Register of Commerce (or equivalent)
• Certificate of residency for tax purposes
• Minutes of AGM having nominated administrators
• List of Signatories
• ID document of authorised signatories (at least two)
• Power of attorney (notarised)
• Custody agreement duly signed stating a clear cut of responsibilities
• Fee schedule duly signed.
• FATCA documentation
  
  

New clients have to provide AML & KYC questionnaires.

A new draft circular has been issued by the AMMC regarding due diligence and internal monitoring that brokers, asset managers and custodians will have to comply with. This new circular has as its main objective to strengthen procedures against money laundering.

For clients serviced out of certain locations this is an FII market. Please refer to the Terms & Conditions for Global Custody or contact your RBC Investor Services' Client Manager before making portfolio investments.

The Moroccan economy is based upon the free economy concept except for natural Monopoly and Sensitive industries related to Army and Public Utility functions where prior approval shall be required.

Since January 8, 1990, the requirements for Moroccan national shareholdings have been waived. Therefore, the capital of a commercial enterprise can be either totally or partially held by foreign companies. In addition, the presidency and the majority of the board of directors no longer have to be held by nationals.

Foreign investors have free investment access opportunities to economic activities (Statutory framework, foreign investment code) as well as to agricultural land on long term leases.

No restrictions. These are not subject to any prior authorisation from the Control Exchange Office. Resident or non-resident foreign nationals are entitled to freely invest in Morocco.

Shareholders must receive approval from the Central Bank if they are to cross upward/downward, directly or indirectly, 10%, 20% or 30% of a bank's capital.

To freely repatriate investment proceeds the inward remittance must originally be in foreign currency.

The Foreign Exchange Office is the regulatory body that regulates FX.

The foreign exchange control presently in force in Morocco does not restrict an investor's ability to convert its cash or cash equivalents into USD or other currencies.

Regulatory approval is not required for the repatriation of sale proceeds or cash dividends.

In general, overdrafts on dirham cash accounts are prohibited in Morocco. However, technical overdraft can incur while funds are in transit. The funds in transit should be justified by SWIFT message. The technical overdraft will allow Global Custodians to make cash payments while waiting for the funds of a foreign exchange transaction to be transferred.

FX arbitrage is not permitted.

RTGS (Real Time Gross Settlement System) is the only payment system that guarantees same day value on the day of the execution. All payments over MAD 10 million must be processed through the RTGS system.

SIMT (Systeme Interbancaire Marocain de Télécompensation), which is the interbank clearing system that connects all agent banks with the central cash depository, does not guarantee same day value. SIMT operates on a netting basis. SIMT can only be used for payments up to MAD 10 million.

Not permitted.

Record date for all events is the previous business day prior to the ex-date. The issuing companies determine dates. Record date occurs on the last business day of entitlement.

Entitlement is protected in Morocco by the concept of "droits constatés". On trade date, the entitlement is passed legally from the seller to the buyer. The stock exchange guarantees that the entitlements will pass on trade date.

The claim process of entitlements that are not received include follow up in writing and telephone calls initiated to the relevant counterpart to lodge the claim for the entitlement with several escalation points (counterpart staff, counterpart middle management, counterpart senior official, regulatory authorities) until receipt of full entitlement.

Currently, each company in Morocco has its own paying agent to run the distribution of dividends, while banks can manage their own distributions. Fixed income interests (for government securities) are settled by the central bank further to Maroclear instructions.

Securities (either bearer or registered) booked at Maroclear: Maroclear opens a coupon account on its books and then issues a statement of holding and coupons to each custodian on the record date, showing the credit of coupons. Maroclear then issues a statement of coupons to each participant. Custodians transfer the coupons from their account to the centralising paying agent, which in return credits the custodian's accounts at the central bank for the related income. In the target scheme, Maroclear will be responsible to debit the coupons from the custodian's account and credit the centralising paying agent, which will be responsible for settling the income with the various participants.

Annual, usually between April and September.

Dividends are announced at or immediately after the annual general meeting. The payment period is between five days to one month after ex-date. Dividend payments are announced by the stock exchange on behalf of the company at least ten days before ex-date. Issuers are required to pay their dividend within nine months of the close of the fiscal year.

Interest on government bonds is paid annually by the central bank, Bank al Maghrib, on payment date. Bank Al-Maghrib directly credits the cash accounts of the banks and financial institutions holding the government bonds.

For the calculation of entitlement, beneficial ownership is recognised on settlement date for T-bills and government bonds.

Not applicable.

N/A

All the entitlements are based upon the concept of " Droit Constaté" In other words, onExD+1, the shares will be recorded at CSD as being the ownership of the receiving counterpart.
RD = ex-date -1 (receiving party is entitled of the shares)
ExD = ex-date (receiving party is not entitled of the shares)

No restriction.

Shares are blocked five days prior to meeting date. May vary depending on the issuer's articles of incorporation.

Agendas and meeting notices are published either by the official bulletin at CSE or by the company itself in the local newspapers.

May be published in the official bulletin or local newspaper, however this is not yet required by the market.

Issued within the ADM notice (French version only).

Required. PoA must be issued by the beneficial owner and is only valid for one AGM per annum according to Law 17-95 on Corporations.

N/A

Resident - 13.75%
Non-resident - 13.75%
Corporate Bond - 10%
Government Bond - 0%

Exempted if listed at CSE, 10% if listed at auction.

Exempted

There is no stamp duty.

VAT is charged at 10%.

Morocco Holiday Calendar

• Casablanca Stock Exchange (CSE): www.casablanca-bourse.com
• Maroclear: www.maroclear.com
• Ministry of Finance: www.finances.gov.ma
• Bank Al-Maghrib: www.bkam.ma