Iran Capital Market

Iran’s move towards market-based economy with the growth of industrial activities followed by economic and social reforms of the 1962s was undoubtedly demanding new markets and instruments to finance, leaded to the birth of Iran Stock Exchange.            
By May 1966, the law-established of stock exchange was passed by the Parliament. Thereby, Tehran Stock Exchange was established based on Market system, aiming to encourage private sector of Iran economy.

 

 

Tehran Stock Exchange

 The TSE is Iran’s first and largest equity market. Initially launched in February 1967, the TSE listed six companies later on accompanied by other financial instruments such as treasury bonds and certain state-backed certificates.    
As of today, the TSE is the pioneer market in Iran with more than 318 well-established companies from 41 diverse industries listed on this exchange. The Act, ratified in November 2005, restructured Iran capital market resulting in the establishment of the SEO as the supervisory body and the TSE as an equity market. The TSE previously known as “Brokers Organization” used to be a non-governmental public organization whose board members were mainly appointed from brokerage firms but since 2006, it has turned into a self-regulatory public joint-stock corporation
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Iran Fara Bourse

One of the legal obligations of stock exchange rules is creation and organizing over the counter markets. The intended structure has been created for administrating and supervising capital market and also separating regulatory and operational affairs, so securities and exchange organization as a public organization established under the exchange council in 2007. As a public joint-stock company located in Tehran, the IFB commenced operation in November 2008. The IFB is Iran’s second equity market and functions as conventional OTC markets but with more features. The market is a self-regulatory entity while being supervised by the SEO. The IFB is a market for both listed and unlisted securities and also other financial instruments.

The IFB by nature tries to design innovative financial instruments in the capital market which helps to direct capital towards developmental plans and economic prosperity. The IFB comprises five markets, each of which serves a unique role in the capital market. Click here

How to invest on Iranian stock exchange as a foreign investor?

For applicants not living in Iran, the following is required:   
The investor sends the request
form for trade permission to the Securities and Exchange Organization of Iran (SEO) based on SEO’s criteria for granting permission through an eligible  Iranian broker (Mellat Bank Brokerage). Whenever the permission is issued, the broker sends it along with the request form for account creation to Central Securities Depository of Iran (CSDI) so that the trade account is issued.

Forms

         1.      Trading License Application for the Iranian Issuers' Securities (Institutional)

         2.      Trading License Application for the Iranian Issuers' Securities (Individual)

         3.      Trading License

         4.      Brokerage Firm

         5.      Letter of Commitment

         6.      Application Form for Resolving Blocked Trader S

Capital Market Regulations

              1. Iranian Securities Market Act

              2. Bylaw Governing Foreign Investment in the Exchanges and OTC Markets

              3. The Anti-Money Laundering Act

              4.The Law for Development of New Financial Instruments and Institutions

        5. Foreign Investment Promotion and Protection Act: FIPPA

        6. The Law on the Issue of Participation Certificates (Musharakah Sukuk)

The entire regulations, bylaws, and acts related to the Iranian capital market are available on Research, Development & Islamic Studies Department


For more information, please visit here.

 

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