SEC: Ghanaian regulator restricts overseas exposure for Collective Investment Schemes

In a move aimed at safeguarding the Ghanaian economy and protecting local investors, the Securities and Exchange Commission (SEC) has imposed strict new limits on how Collective Investment Schemes (CIS) can invest in foreign stocks and bonds. 

The directive, issued on February 4, 2026, seeks to curb the potential outflow of capital and mitigate risks associated with overseas markets.

The regulatory action, detailed in the Directive to Market Operators on Investments in Foreign Securities for the Collective Investment Schemes (SEC/DIR/001/02/2026), comes in response to what the Commission describes as “a growing interest in and appetite for investing in foreign securities” by fund managers. 

The SEC expressed caution over the “potential effects this could have on the stability of the Ghanaian Cedi and the country’s macroeconomic indicators at large,” as well as risks to investor protection originating from other jurisdictions.

Under the new rules, the SEC “hereby directs all Fund Managers, Custodians, Directors of Mutual Funds and Trustees of Unit Trusts to ensure the strict adherence” to a set of clearly defined investment ceilings. The core restrictions create a two-tier system based on a fund’s licence. For funds primarily focused on the domestic market, “a Fund Manager… licensed to invest locally shall not invest more than 20% of its funds under management in foreign securities.”

More significantly, even funds specifically authorised to have major foreign exposure now face a mandatory local investment quota. The directive states that “a Fund Manager… licensed to invest 100% or to have substantial exposure to foreign securities is to limit their investment to 70% and retain 30% locally.” 

This 30 per cent local retention rule marks a substantial policy shift, compelling internationally-focused funds to maintain a significant anchor in the Ghanaian economy.

Further tightening the framework, the SEC has mandated that all foreign investments must comply with existing definitions of securities and can only be channelled into “approved eligible markets.” 

Crucially, the Commission has added a stringent regulatory cooperation requirement: investments are only permitted in foreign markets where the local regulator is a full signatory to the International Organization of Securities Commissions (IOSCO) memorandum of understanding, or has a separate information-sharing or capacity-building MoU with the SEC itself.

Fund managers and trustees have been ordered to “take the necessary steps to comply… to regularize or amend the scheme particulars” through investor meetings, while schemes currently outside the new limits have a 90-day grace period from the directive’s issuance to align their portfolios. The SEC warned that breaches could lead to enforcement actions under the Securities Industry Act.