SCA Issues Al-Ramz Securities First License to Practice Financial Consultancy and Analysis Services

Published November 10th, 2010 - 10:43 GMT

The Emirates Securities and Commodities Authority (SCA) has issued a "Financial Consultancy and Analysis" license to Al-Ramz Securities, making the latter the first to be granted permission to practice and offer financial consultancy and financial analysis services.

The granting of the license is part of the SCA's efforts to further boost efficiency on the UAE securities markets, by probing for the best means to develop it, offering new financial services on securities markets in the country according to international best practices and meeting the needs of investors.

Al-Ramz was granted the license after meeting all the requirements outlined by SCA Board Decree No. (48/R) of 2008 concerning the regulating of financial consultancy and financial analysis services in the country. The Decree defines financial consultation as: "Opinions and recommendations based on economic and financial research, studies and analyses concerning the feasibility studies and determining the anticipated current or future values of the securities, commodities, commodity contracts and companies to be provided to clients or published to the public in any of the various means of publication and communication."

It also defines financial analysis as: "The scientific systematic processing of data in connection with the position and performance of the companies in the past and at present, and future forecasts of the results of their business, the securities, commodities, commodity contracts, price trends and the trading volumes for the purpose of obtaining information used to take decision at the time of providing a financial consultation."

The SCA board approved the 23-article decree, which consists of definition of terminologies used in the decree, prerequisites and procedures for acquiring license to practice such activities, the validity of the license, license renewal rules and the obligations of a company licensed to practice those activities. It also outlines conditions for accreditation of financial analysts and their obligations, violations and their penalties and the general rules governing the practicing of those activities. For more information about the rules, go to: www.sca.ae .

It's worth noting here that the regulation aims at protecting the integrity of analytical studies and assessment of companies and stocks to serve general interest on securities markets in the country, in a way investors – individuals and corporate – would be well-informed about the real value of stocks in order to make their final decision on buying or selling according to sound investment basis. It is also to enable them make logical assessment of the profit growth of companies in order to arrive at a fair value of a stock.

The decree also outlines the rules for the practicing of financial analysis profession to ensure credibility of comments that would be made in this regard via the media or advice that would be given to investors. 


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