GCC moves toward market integration

Abu Dhabi: Participants in the first meeting of the committee looking at integrating Gulf securities markets adopted most of the components of an initiative presented by Emirates Securities and Commodities Authority (ESCA) chief executive Abdullah Al Turaifi, according to a statement released yesterday.

Al Turaifi presented several proposals to the GCC Committee of Heads of Arab Securities Regulators at the General Secretariat of the Gulf Cooperation Council (GCC) in Riyadh.

The meeting was part of the efforts aimed at achieving better integration of the GCC securities markets, unified market policies and regulations in implementation of the GCC ministerial resolution issued during the recent GCC foreign ministers council meeting which was held in Jeddah last May.

In a statement at the end of the meeting, Al Turaifi said the committee had discussed and adopted most of the articles of the SCA-initiative, which calls for the integration of GCC securities markets according to the timetable referred to the committee by the ministerial committee.

Common policies

The SCA initiative touched on a number of issues dealing with the adoption of common securities market policies and regulations, studying the possibility of issuing unified licence, subscriptions and listing for public joint stock companies, innovating common regulations for securities market-related issues in member states and expanding the investor base on the markets by encouraging the setting up of public joint stock companies, boosting GCC securities markets elements and factors, activating corporate governance regulations and setting up for these purposes working groups which will make recommendations in this regard to the committee.

The meeting followed an agreement reached by the ministerial committee of the board chairpersons of market regulators of GCC states during its first meeting held last May, during which the meeting deliberated on the SCA's proposal on the integration of securities markets of member states.

The meeting urged member states to refer their proposals in this regard to the GCC Securities Regulators Board Chairpersons' Committee for review and recommendations, which would subsequently be referred to the GCC ministerial committee for action.

The committee also reviewed proposals by the Kuwait Securities Market and by the GCC General Secretariat on mechanisms for achieving integration among GCC securities markets.

The committee agreed to set up six working groups, including a registration, listing and disclosure rules working group, initial offerings and subscriptions working group, networking and clearance working group, financial tools working group, market supervision and monitoring working group and market institutions working group.

The tasks of each working group were clearly defined to make each group work within the areas of its jurisdiction and specialisation. All the groups shall refer their recommendations to the GCC Securities Regulators Board Chairpersons' Committee, which would deliberate on them before referring them to the Ministerial Committee of Board Chairpersons of Securities Regulators of Members States for final approval.

The meeting agreed that the registration, listing and disclosure rules working group and the initial offerings and subscriptions working group should be summoned first to hold two separate meetings each before October to propose their plan of action and timetable for executing their tasks.