Page 431 - Sustainable Cities and Communities Design Handbook
P. 431
Business Ventures and Financial Sector Chapter j 19 401
74
was established as a public institution with its
Dubai Financial Market
own independent corporate body 75 and started the operations in March 2000.
DFM is operating as a secondary market for the trading of:
l securities issued by public joint-stock companies,
l bonds issued by the Federal Government or any of the Local Governments
and public institutions in the country,
l units of investment funds;
l other financial instruments (local or foreign) that are accepted by the Market.
As decided by the Executive Council Decree in Dec. 2005, DFM is set up
as a public joint stock company in the UAE. 76 It operates on an automated
trading system (screen based) that offers a major advantage over traditional
floor trading in terms of transparency, efficiency, liquidity, and trading of
prices. The Market has collaborated with renowned international experts in
trading systems. Safeguarding the market efficiency and integrity of trading
requires DFM to conduct regular monitoring and controlling. The Market
Control Section monitors the compliance with the trading rules and regulations
of the ESCA. 77 Brokers Licensing and Inspection Section monitors brokers’
conduct to ensure integrity of the brokers’ activities and that the best service is
given to investors.
In 2010 DFM launched a global service with the iVESTOR card, a revo-
lutionary and innovative solution that enables retail investors to instantly
receive DFM dividends directly into their investor card. Investors no longer
have to wait for dividend checks or have the hassle of depositing checks into
their bank accounts. The card will enable DFM to credit any future dividends
directly into the cardholders’ balance. In addition, the cardholder can easily
withdraw cash from ATMs.
78
Finance Companies undertake one or more of the following major
financing activities:
l extending advances and/or personal loans for personal consumption
purposes,
l financing trade and business, opening credit and issuing guarantees in favor
of customers,
l subscribing to the capital of projects and/or issues of stocks, bonds, and/or
certificates of deposit.
Contribution of the financing company to the capital of projects, issues of
stocks and/or bonds, or certificates of deposit should not exceed 7% of its own
74. http://www.dfm.ae/Default.aspx.
75. Resolution from the Ministry of Economy in 2000.
76. http://www.dfm.ae/pages/default.aspx?c¼801.
77. ESCA - the UAE Securities and Commodities Authority.
78. Central Bank of the United Arab Emirates, Report 2011 at www.centralbank.ae.