The Effect of Legal and Regulatory Framework on the Performance of Financial Markets in Rwanda: A Case Study of Capital Market Authority

The purpose of this research is to explore the effect of legal and regulatory framework on the performance of financial markets in Rwanda with reference to capital market authority Rwanda as the case study with the following objectives; to assess the effect of CMA license and approval on performance of finance markets, and to identify the contribution of CMA regulations on financial markets performance. The researcher reviewed literature related to legal and regulatory framework and its effect on performance of capital markets. The research design to be used is descriptive while the population is 12 employees of Rwanda Capital authority and since the population is very small all respondents were contacted and census were used. Data collection tools were questionnaires and interviews. The collected data were presented using tables and analysed based on percentages and frequencies as well as SPSS program. The researcher found out that complying with legal requuiremmts lead to improvments in devlopmment since commpanies get an opportunity of establishing and maintain standards for the conduct of marketing, complying with legal requuiremmts lead to improvments in devlopmment. The researcher concluded that contribution of CMA regulations on financial markets operations is establishing an environment that encourages local companies to going public, local companies will secure a chance of being listed in foreign stock market, boost its efficiency in operation and Guarding against manipulation of share prices and insider trading. The researcher recommended that the government of the Republic of Rwanda should help companies in Rwanda to understand financial markets through capacity building trainings.