Union News

Issue No. 17 (April - Mai - June)

April - June 2017

Members News Details

The Securities & Commodities Authority approves the first Clearing Member

The Securities & Commodities Authority (SCA) issued to Emirates NBD the approval required to pursue the clearing activity and act as a “General Clearing Member" in the local financial markets. Emirates NBD is the first entity to receive this approval in the financial markets in the United Arab Emirates after meeting the conditions and requirements set by the SCA.


Such approval was granted in line with the SCA's relentless efforts to enhance the performance of the financial markets in the UAE and its ongoing initiatives under its plans which target advancing the rating of the UAE financial markets to the degree of the developed markets on the major international indexes and satisfying the need of its strategic partners and all the customers.


The approval enables the clearing member to perform clearing and settlement for the brokerage firms (clearing member) and their clients, after concluding a bilateral agreement to settle the accounts of the brokerage firm's clients or the accounts of the firm. This agreement would regulate the business relation between both parties and the rights and liabilities of each party, as well as how to distribute the commission on them.


The Authority's Board Of Directors' Decision No. (2/R) Of 2001 Concerning The Regulations As To Trading, Clearing, Settlement, Transfer Of Ownership And Custody Of Securities stipulates that the clearing member should be a local bank or a branch of a foreign bank licensed to operate in the UAE and approved by the SCA to perform the clearing business. Except for the local banks or the branches of foreign banks licensed to pursue the custody of the securities, the clearing activity may not be practiced unless after obtaining the SCA's approval which shall be renewable annually upon meeting the necessary requirements and payment of the prescribed fee.


Issuance of the approval to the Emirates NBD is expected to contribute to fulfilling the goals desired from the classifying of the firms according to the applicable regulation of brokerage in securities. Further, it will enable the brokerage firms desiring to be converted from a trading and clearing member to a trading member to start submitting the required applications.