Abu Dhabi Securities Exchange: A catalyst in the evolution of UAE's capital markets

The year 2000 was a watershed year in the setting up of formal capital markets in the UAE with the establishment of Abu Dhabi Securities Exchange (ADX); formerly Abu Dhabi Securities Market (ADSM), Dubai Financial Market (DFM) and the introduction of a host of capital market regulations and reforms in line with international best practices.

ADX was established on November 15, 2000 by Local Law No. (3) Of 2000, the provisions of which vest the market with a legal entity of autonomous status, independent finance and management.

On March 17, 2020, ADX was converted from a public entity to a public joint stock company (PJSC). ADX is now a part of ADQ, one of the region’s largest holding companies with a broad portfolio of major enterprises spanning key sectors of Abu Dhabi’s diversified economy.

Abu Dhabi Securities Exchange is regulated by the Securities and Commodities Authority (SCA), a federal authority in the UAE mandated with the regulation of capital markets within the UAE. SCA was established by Federal Law No (4) of (2000) concerning the Emirates Securities and Commodities and Market.

ADX is a market place for trading securities; including shares issued by public joint stock companies, bonds issued by governments or corporations, exchange traded funds, and any other approved financial instrument.

ADX provides opportunities to invest savings and funds in securities in order to benefit the national economy. Ensure the soundness and accuracy of transactions and ensure free and fair price discovery based on demand and supply of securities traded on the market. As a modern market place driven by global regulatory standards, ADX protects investors through establishing fair and proper dealing principles between various investors.

ADX ensures the best policies, procedures, and technical infrastructure to help listed companies finance their growth through the issuance of securities and their inclusion on the exchange. This includes stocks, bonds, sukuk, investment funds and other securities.

As an advanced market place for securities, ADX plays a key role in ensuring the highest corporate governance standards by ensuring transparency and corporate disclosures in the interest of all market participants. To ensure sound functioning of the market ADX has stringent controls over securities transactions.

Going beyond its function as a transparent market place for financial securities, ADX is also instrumental in developing a healthy investment culture in the country by conducting studies in order to ensure that savings are invested in productive sectors.

ADX is one of the largest securities markets in the Arab region and its strategy of providing stable financial performance with diversified sources of incomes is aligned with the guiding principles of the UAE “Towards the next 50” agenda. The national plan charts out the UAE’s strategic development scheme which aims to build a sustainable, diversified and high-value added economy that positively contributes to transition to a new global sustainable development paradigm.