Legal Mechanisms in the Implementation of Stock Exchange Transactions, Current Problems and Proposals for Improvement

Legal regulation of stock exchange transactions is one of the most important mechanisms ensuring the sustainable development of the economy and the free and safe movement of capital. The presented research work is devoted to a comprehensive analysis of the existing legal mechanisms regulating the implementation of stock exchange transactions in the Republic of Azerbaijan. The article examines the national legislative framework, including the Civil Code and the application aspects of the Law "On Securities Market". At the same time, the activity of institutional mechanisms (clearing, settlement, brokerage, and listing) in the stock exchange trading process is analyzed. As a result of the research, a number of conceptual problems were identified, such as gaps in the legal regulation of derivative financial instruments, incomplete formation of the central counterpart (CCP) institution, ineffectiveness of legislation against insider trading, and violation of the rights of minority investors. In order to solve the problems, specific proposals for the modernization of legislation and ways to improve legal mechanisms were submitted, taking into account international experience, in particular the MiFID II directive of the European Union and the practice of advanced developed countries.