Institutional Mandate and Legal Basis
The Securities and Commodities Authority (SCA) was established in 2000 under Federal Law No. 4 of 2000 Concerning the Emirates Securities and Commodities Authority and Market, subsequently amended and supplemented by additional legislation. The SCA’s mandate covers the regulation, supervision, and development of securities and commodities markets in the UAE. The authority is responsible for licensing market participants, approving securities issuances, enforcing market conduct rules, and protecting investors. Its jurisdiction covers all capital market activities in the UAE outside the financial free zones of ADGM and DIFC.
Role Within UAE Governance Structure
The SCA functions as an independent federal regulatory body reporting to the Minister of Economy. It oversees the Abu Dhabi Securities Exchange and the Dubai Financial Market, as well as licensed brokerage firms, investment funds, and other market intermediaries. The SCA coordinates with the Central Bank on matters where banking and securities regulation overlap, and engages with international securities regulators through membership in the International Organization of Securities Commissions. The authority’s regulatory framework complements the separate regulatory regimes maintained by ADGM and DIFC within their respective free zones.
Key Functions and Activities
The SCA’s regulatory functions include licensing and supervising securities exchanges, brokerage firms, investment managers, custodians, and financial advisers. The authority reviews and approves initial public offerings, bond issuances, and fund registrations. It conducts market surveillance to detect insider trading, market manipulation, and other violations of securities law. The SCA administers corporate governance standards for listed companies and enforces disclosure requirements to ensure transparency. The authority also promotes investor education and financial literacy as part of its mandate to develop the capital markets ecosystem.
Relationship to We the UAE 2031 Vision
The SCA supports the We the UAE 2031 vision by building deep, liquid, and well-regulated capital markets that channel domestic and international capital into the UAE economy. Effective securities regulation attracts foreign portfolio investment, supports the listing of government-linked enterprises, and provides financing alternatives for the private sector. The SCA’s work on corporate governance and market transparency contributes to the institutional quality that underpins investor confidence and the vision’s goal of positioning the UAE as a global financial center.
Recent Developments and Strategic Initiatives
The SCA has modernized its regulatory framework to accommodate new financial products and market structures, including exchange-traded funds, real estate investment trusts, and derivatives trading. The authority has introduced regulations for crowdfunding and digital asset activities to keep pace with financial innovation. The SCA has strengthened its enforcement capabilities, including enhanced market surveillance technology and cooperation agreements with international regulators. Reforms to streamline listing requirements and improve corporate governance standards for public companies have been implemented to enhance the competitiveness of UAE exchanges.
Leadership and Governance
The SCA is governed by a Board of Directors chaired by the Minister of Economy or a designee, with members drawn from government and the private sector. The authority’s chief executive officer manages day-to-day operations and regulatory activities. The SCA’s organizational structure includes divisions for market regulation, issuance and disclosure, licensing, enforcement, and investor protection. The governance framework emphasizes regulatory independence, transparency, and alignment with international standards set by the International Organization of Securities Commissions.