ID :
114959
Sun, 04/04/2010 - 14:53
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https://oananews.org//node/114959
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UAE proposes initiative for integration of GCC securities markets
Riyadh, April 4, 2010 (WAM)- The United Arab Emirates has floated a practical initiative aimed at integrating securities markets of all member states of the Gulf Cooperation Council (GCC). The initiative which will see the markets operating under the same policies and regulations was outlined in the statement of H.E. Sultan bin Saeed Al-Mansoori, Minister of Economy, during the 1st Meeting of the Ministerial Committee of Chairmen of GCC Regulators Board, which was held in Riyadh.
The meeting was held at the invitation of GCC Secretary General, H.E. Abdul Rahman Al-Atiyya, who, at the beginning of his inaugural address, expressed deep condolences to the UAE President H.H. Sheikh Khalifa bin Zayed Al Nahyan, the UAE government and people, on the death of Sheikh Ahmed bin Zayed Al Nahyan.
The UAE Minister, who is also the Board Chairman of the Emirates Securities and Commodities Authority (SCA), called for concerted and unified efforts and better coordination among the member states to overcome the repercussions of the global financial crisis.
"Undoubtedly, the global economic crisis has clearly taken its toll on a number of sectors in member states, notably among these sectors is the securities market sector, being the mirror of the economy, due to its high sensitivity in reacting to any change in the general situation, economic or political. In view of this, the current situation demands from us better coordination, uniting our front and launching innovative initiatives, at a time when many institutions and corporate entities worldwide are doubling their steps towards forming alliances and blocs, even merging together to defeat the difficulties facing them. This means, we are in a situation, today, in which we need more actions than our need for words," Al-Mansoori stated in his address, read on his behalf by H.E. Abdullah Al-Turifi, Chief Executive Officer of the SCA.
The initiative calls for a comprehensive strategy that would be implemented in stages, over a certain period of timeframe. The strategy must have a permanent committee consisting of CEOs of the regulatory bodies of member states or those in their equivalent status. The committee, which shall have to meet three times, at least, in a year, will deliberate over issues and proposals referred to it by member countries. It shall also, among other thing, come up with draft laws, policies and guidance regulations for the GCC securities markets and their regulators, look into technical proposals aimed at developing the securities markets in the region and refer its recommendations to the permanent ministerial committee for action.
Member countries at the meeting agreed on referring to the GCC Ministerial Council a recommendation for the setting up of the proposed permanent technical committee for consideration.
Highlighting the UAE strategy, Al-Turifi pointed out that the strategy will be presented later to the GCC Ministerial Committee (GCC Foreign Ministers Committee) for review and action. He said the strategy had attracted great applause from the GCC Secretariat and all member states, who saw the SCA initiative as a roadmap towards achieving integration of GCC securities markets, adding that members of the committee had suggested that a coordination meeting be held to further discuss this initiative.
The two-tier initiative consists of issues that need instant action and other issues which can be dealt with in stages according to certain timeframe, to be agreed on by members.
The issues which require instant action, include unification of licensing, subscription and listing procedures for public joint stock companies (PJSCs) of member states in a process to be known as the "Unified Gulf License" procedure. Whereby PJSC that will be set up in any member state shall acquire a Unified Gulf License (UGL) which takes into consideration requirements in all member states. Others are the issuing of unified Initial Public Offering (IPO) regulations and procedures, coordination of the timings of IPOs and their procedures in all GCC states and putting in place a common text for cooperation and partnership agreements between brokerage and financial services.
But the issues that can be dealt with in stages according to a timeframe and priority include updating of guidance regulations in various areas of the securities market like the components of the securities sector, the restructuring of the securities sectors of member states in a way that takes into consideration the transformation of GCC securities markets into listed holding companies, having common text for listing conditions and requirements, regulating the incorporation, management and supervision of investment funds, corporate governance of PJSCs, Market Makers and creating new investment tools and mechanisms, like derivatives and short selling.
The strategy also highlighted the need for the technical committee to study the possibility of having all member states to coordinate and cooperate among themselves to acquire the same technical systems when necessary, and to coordinate efforts in the areas of unified technical and professional training for staff of all securities markets and regulators of member states and establish a network of database of all GCC stock markets according to a system that would be agreed upon by all members.
The strategy also recommends the use of the criteria of the International Securities Identification Number (ISIN) to identify listed companies through the unifying of their numbering systems, developing the debt securities, including Islamic bonds (Sukuk) and by approving the legal and technical framework declaration and setting up institutions that regulate them, as well as by generalising the adoption of the Extensible Business Reporting Language (XBRL) system by PJSCs, securities markets and regulators.
Commenting on the meeting, Al-Turifi said the Riyadh meeting discussed integration of securities markets through the unifying of their policies and regulations, adding that the meeting reflects the priority attached to boosting of the integration of GCC securities markets in accordance with the economic agreements for the activating of GCC Common Market and maximising its benefits.
It's worth mentioning here that the GCC Supreme Council, during its 30th meeting tasked its concerned ministerial committees to draw up the necessary mechanisms for activating Article 5 of the Economic Agreement concerning investment climate in the Gulf region. Article 3 of the agreement calls for integration of securities markets of member states and unifying their policies and regulations.
The meeting was held at the invitation of GCC Secretary General, H.E. Abdul Rahman Al-Atiyya, who, at the beginning of his inaugural address, expressed deep condolences to the UAE President H.H. Sheikh Khalifa bin Zayed Al Nahyan, the UAE government and people, on the death of Sheikh Ahmed bin Zayed Al Nahyan.
The UAE Minister, who is also the Board Chairman of the Emirates Securities and Commodities Authority (SCA), called for concerted and unified efforts and better coordination among the member states to overcome the repercussions of the global financial crisis.
"Undoubtedly, the global economic crisis has clearly taken its toll on a number of sectors in member states, notably among these sectors is the securities market sector, being the mirror of the economy, due to its high sensitivity in reacting to any change in the general situation, economic or political. In view of this, the current situation demands from us better coordination, uniting our front and launching innovative initiatives, at a time when many institutions and corporate entities worldwide are doubling their steps towards forming alliances and blocs, even merging together to defeat the difficulties facing them. This means, we are in a situation, today, in which we need more actions than our need for words," Al-Mansoori stated in his address, read on his behalf by H.E. Abdullah Al-Turifi, Chief Executive Officer of the SCA.
The initiative calls for a comprehensive strategy that would be implemented in stages, over a certain period of timeframe. The strategy must have a permanent committee consisting of CEOs of the regulatory bodies of member states or those in their equivalent status. The committee, which shall have to meet three times, at least, in a year, will deliberate over issues and proposals referred to it by member countries. It shall also, among other thing, come up with draft laws, policies and guidance regulations for the GCC securities markets and their regulators, look into technical proposals aimed at developing the securities markets in the region and refer its recommendations to the permanent ministerial committee for action.
Member countries at the meeting agreed on referring to the GCC Ministerial Council a recommendation for the setting up of the proposed permanent technical committee for consideration.
Highlighting the UAE strategy, Al-Turifi pointed out that the strategy will be presented later to the GCC Ministerial Committee (GCC Foreign Ministers Committee) for review and action. He said the strategy had attracted great applause from the GCC Secretariat and all member states, who saw the SCA initiative as a roadmap towards achieving integration of GCC securities markets, adding that members of the committee had suggested that a coordination meeting be held to further discuss this initiative.
The two-tier initiative consists of issues that need instant action and other issues which can be dealt with in stages according to certain timeframe, to be agreed on by members.
The issues which require instant action, include unification of licensing, subscription and listing procedures for public joint stock companies (PJSCs) of member states in a process to be known as the "Unified Gulf License" procedure. Whereby PJSC that will be set up in any member state shall acquire a Unified Gulf License (UGL) which takes into consideration requirements in all member states. Others are the issuing of unified Initial Public Offering (IPO) regulations and procedures, coordination of the timings of IPOs and their procedures in all GCC states and putting in place a common text for cooperation and partnership agreements between brokerage and financial services.
But the issues that can be dealt with in stages according to a timeframe and priority include updating of guidance regulations in various areas of the securities market like the components of the securities sector, the restructuring of the securities sectors of member states in a way that takes into consideration the transformation of GCC securities markets into listed holding companies, having common text for listing conditions and requirements, regulating the incorporation, management and supervision of investment funds, corporate governance of PJSCs, Market Makers and creating new investment tools and mechanisms, like derivatives and short selling.
The strategy also highlighted the need for the technical committee to study the possibility of having all member states to coordinate and cooperate among themselves to acquire the same technical systems when necessary, and to coordinate efforts in the areas of unified technical and professional training for staff of all securities markets and regulators of member states and establish a network of database of all GCC stock markets according to a system that would be agreed upon by all members.
The strategy also recommends the use of the criteria of the International Securities Identification Number (ISIN) to identify listed companies through the unifying of their numbering systems, developing the debt securities, including Islamic bonds (Sukuk) and by approving the legal and technical framework declaration and setting up institutions that regulate them, as well as by generalising the adoption of the Extensible Business Reporting Language (XBRL) system by PJSCs, securities markets and regulators.
Commenting on the meeting, Al-Turifi said the Riyadh meeting discussed integration of securities markets through the unifying of their policies and regulations, adding that the meeting reflects the priority attached to boosting of the integration of GCC securities markets in accordance with the economic agreements for the activating of GCC Common Market and maximising its benefits.
It's worth mentioning here that the GCC Supreme Council, during its 30th meeting tasked its concerned ministerial committees to draw up the necessary mechanisms for activating Article 5 of the Economic Agreement concerning investment climate in the Gulf region. Article 3 of the agreement calls for integration of securities markets of member states and unifying their policies and regulations.
