Nasdaq Dubai welcomes EU recognition of its central counterparty framework
Nasdaq Dubai has welcomed a ruling by the European Union that grants recognition to the exchange’s clearing infrastructure. The decision opens the door for overseas banks and investors to play a larger role in Nasdaq Dubai’s rapidly growing equity futures market. The ruling by the European Securities and Markets Authority, ESMA, recognises Nasdaq Dubai as a third-country central counterparty, CCP, under EU regulations. This enables banks based in the EU to apply to become Clearing Members on the exchange.
ESMA’s ruling also applies to Nasdaq Dubai’s CCP infrastructure regarding equities and other securities. The UAE is the only country in the Middle East to which the ruling applies.
Hamed Ali, Chief Executive of Nasdaq Dubai, said, "Building on our existing international connectivity, this recognition by ESMA further enhances our links with European market participants. We are in discussions with a number of European banks that wish to become General Clearing Members, GCMs, on our equity futures market. Acquiring overseas Clearing Members will facilitate more trading by investors based around the world, adding new impetus to the market, which is currently dominated by regional investors."
The ruling follows ESMA’s decision in January 2017 to classify the framework for central counterparties of Dubai Financial Services Authority, DFSA, Nasdaq Dubai’s regulator, as equivalent to that of the EU.
