DFSA Issues Consultation Paper for SME Listings

Press release
Published November 14th, 2019 - 05:54 GMT
Dubai Financial Services Authority
Dubai Financial Services Authority
SMEs play an important role in the economic development of any country.

The Dubai Financial Services Authority (DFSA) has issued a consultation paper that outlines the DFSA’s proposals for a regulatory regime that permits Small and Medium Sized Enterprises (SMEs) to list their shares on an Authorised Market Institution (AMI) in the Dubai International Financial Centre (DIFC).

SMEs play an important role in the economic development of any country. The UAE Ministry of Economy has stressed that SMEs are a key pillar in the country’s economic vision. More than 94% of the companies operating in the UAE are SMEs, and the SME sector provides jobs for more than 86% of the private sector's workforce. Despite this, SMEs are known to experience difficulties accessing funding. Given the importance of SMEs to the economy, the DFSA wishes to facilitate financing solutions that might bridge the funding gap and ease cash flow issues.

Through this proposal, the DFSA seeks to enable SMEs to access equity capital markets in or from the DIFC by providing appropriate and proportionate regulatory standards, while at the same time providing adequate levels of investor protection. The proposed regime is intended to simplify and streamline the approval process for SMEs to access equity markets.

Eric Salomons, Head of Markets at the DFSA said: “The DFSA recognises that SMEs form a vital part of the UAE’s economy.  Protecting investors properly, while enabling easier access to equity financing for SMEs, is a way in which the DFSA can contribute to the further economic development of Dubai and the UAE. These proposals set out our plans to deliver this.”

The DFSA’s proposals align with government initiatives, including the Dubai Plan 2021 to support and grow the SME sector.

The DFSA invites comments from potential SME applicants, operators of AMIs and those providing legal, accounting, audit, or compliance services to SMEs in the DIFC, as well as from potential investors in listed SMEs. Comments must be provided by 12 January 2020.

Background Information

Dubai Financial Services Authority

The Dubai Financial Services Authority (DFSA) is the sole independent regulator of all financial and ancillary services conducted through the Dubai International Financial Centre (DIFC), a purpose-built free zone in Dubai.

The DFSA's regulatory mandate covers asset management, banking and credit services, securities, collective investment funds, custody and trust services, commodities futures trading, Islamic finance, insurance, an international equities exchange and an international commodities derivatives exchange.

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