Regulator proposes bourses merger

The Emirates Securities and Commodities Authority (SCA) has recommended merger of UAE bourses in order to boost liquidity in the stock market, the regulator said in a statement on its website.

SCA Advisory Board recommended that "the markets would witness significant growth if merged into one.” 

A statement issued on Tuesday by SCA said that the board approved amendments to a number of rules concerning securities brokers and margin trading and Article 36 of the Disclosure and Transparency Regulation.

During the meeting, which was presided over by its chairman, Engineer Sultan bin Saeed Al-Mansoori, Minister of Economy, the board also approved a request by securities markets in the country to charge listing fees from public joint stock companies (PJSCs). It also approved the setting up of a program for training of UAE nationals working in brokerage companies and those interested in working in that sector.

Arabic daily Al Khaleej said on Tuesday that SCA, under new regulations, can now seize bank guarantees of the UAE brokerages if they delay meeting investor obligations or fail to comply with regulator’s instructions.

Under new amendment in Article 23, SCA or the Board of Director can seize the bank guarantees - in whole or in part – of brokers to fulfill their obligations owed to investors or to implement decision of SCA in this regard, it said in a report.

The broker, however, can challenge the SCA or the Board of Director’s decision before the competent court within 30 days.

The board also approved an amendment on the current text of Article (9) of the Margin Trading Regulation. The amendment now allows margin trading without necessarily identifying the securities being traded.

To eliminate insider trading and rumors on the market, the board amended the text of Article (36) of the Disclosure and Transparency Regulation concerning initial reports. The board, therefore, approved the amendment of the aforementioned article to make it compulsory upon all companies which have listed their securities on UAE securities markets to furnish the SCA and the securities markets with their initial reports.

The Advisory Board also recommended the encouraging of family and private companies to list on the market.

The board also approved a suggestion which calls for setting up of a special training programme for UAE nationals working in the securities sector and those interested in working in that sector. The suggestion calls for challenging the SCA Training Centre to come up with special training programs that would train and qualify UAE nationals working in the securities sector and those interested in working in the sector to pass the CISI exams. The cost for both the training programmes and the CISI examinations fees for UAE nationals will be borne by the SCA.

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