The Business Year

HE Abdullah Salem Al-Turifi

UAE, ABU DHABI - Finance

Money Man

CEO, Securities & Commodities Authority (SCA)

Bio

HE Abdullah Salem Al-Turifi is the CEO of SCA at the rank of Under-Secretary and an SCA Board Member as well. The securities markets continue to witness, under his tenure as CEO of SCA, remarkable development in the areas of legislation, supervision, and an investment-friendly environment, which enabled the securities sector to perform creditably in boosting national economic stability. He is also the First Secretary General, unanimously elected for three consecutive tenures, of the Union of Arab Securities Authorities based in the UAE. He has been the CEO of SCA since 2003.

What strategy is the Securities & Commodities Authority (SCA) employing to attract foreign investors to the exchanges? Cross-border investment into the UAE stock exchanges is based on trusting that they […]

What strategy is the Securities & Commodities Authority (SCA) employing to attract foreign investors to the exchanges?

Cross-border investment into the UAE stock exchanges is based on trusting that they are properly regulated and protected from market abuse, as well as on the free flow of capital. Gaining investor confidence takes years, especially when a significant amount of money is in the balance, and is a prerequisite, preceding the expectation of reaping profits. While stock market performances are left to investor expectations of listed companies’ profitability, the SCA has been working to provide a level playing field in line with international best practices. In this sense, the SCA has been active in reviewing several elements that can enhance market functioning: DvP settlement has been introduced for improved safety of execution, XBRL was introduced to enhance the transparency of disclosure, a new funds regime was introduced to enhance and encourage investment recipients that would lead to improved institutional investment presence in the Emirati capital markets, along with the market maker, short selling, securities lending, and borrowing regulations to improve market depth. All these new regulations constitute a regulatory framework that is welcoming of foreign investors, who mainly look for opportunities in local capital markets, considering too, the safety of their investments under the protection of a full regulatory framework. The successful passage and implementation of these regulations, coupled with the relentless efforts of the ESCA and its strategic partners, have led to the recent upgrade to “Emerging Market” status by the MSCI index, which will also lead to a greater attraction of foreign investors to the local exchanges.

How is the SCA currently working to boost the local securities markets?

The SCA has diligently overseen the UAE capital markets by employing best international practices. One of the key methods of boosting the local securities markets has been SCA’s adherence to global best practices in order to protect investors and improve the efficiency of the UAE’s capital markets through the development of the necessary supervisory regulations. Secondly, the SCA’s close relations with the industry, investors, and stakeholders has allowed for the quick identification, resolution, and issuance of regulatory requirements. As a regulator, the SCA has approved and guided 133 entities and companies to list on both the Dubai Financial Market (DFM) and Abu Dhabi Stock Market (ADX), as well as supervising and overseeing a substantial rise and subsequent consolidation of a significant number of brokerage houses. Other key milestones include the SCA’s contribution to the improvement of the educational awareness of both institutional and retail investors, including on-going training workshops regularly conducted by the SCA discussing the implementation of the SCA codes and laws with market participants.

How does the SCA regulate Islamic bonds, and what steps are being taken to safeguard against a quick sell off?

SCA regulations cover the listing of Islamic bonds and sukuks, and require that all issuances of such bonds through public subscription first be authorized by the SCA, and that such securities are approved by an SCA-regulated sharia committee. They are required to comply with the requirements of the central bank before being listed on any licensed stock exchange. The SCA is currently working on expanding and developing these regulations to cover all stages from issuance through to listing, trading, clearing, and settlement. This will ensure supporting an efficient trading infrastructure, which is key to the development of both the primary and secondary markets for sukuks in the UAE. The SCA is committed to providing a regulatory environment supportive of and conducive to innovation and growth of the Islamic capital markets in the UAE, while ensuring that the interests of both issuers and investors are protected.

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