H.H. Sheikh Mohammed issues Decree on listing of joint stock companies

His Highness Sheikh Mohammed bin Rashid Al Maktoum Vice President and Prime Minister of the UAE and Ruler of Dubai, has issued a Decree on the listing of joint stock companies in securities exchanges.

All local public joint stock companies established in Dubai, including those set up in special economic zones or free zones such as the Dubai International Financial Centre (DIFC), should list their stocks in local securities exchanges like the Dubai Financial Market (DFM) and Nasdaq Dubai.

Licenced private joint stock companies can go public in local stock markets after ensuring compliance with local listing requirements and regulations.

Firms listed in local markets can also have secondary listings in other markets.

Foreign companies established and licenced outside the country with branches, assets and activities in Dubai can list their shares in local markets as either a primary or secondary listing, according to the rules and regulations of the local securities exchange.

According to the Decree, non-local companies should list their stocks in local markets when their annual profits or revenues generated from activities in Dubai reach 50 per cent or more of their total annual profits or revenues, or when their total assets owned in Dubai amount to 50 per cent or more of their entire assets. The listing should be completed within a year of the date of reaching this percentage.

Non-local companies whose profits or assets have not reached the required percentage can also list their shares in local markets, subject to compliance with local rules and regulations. Foreign companies can also list their shares in local stock markets either in the form of a primary or secondary listing.

The Decree also specifies the responsibilities of licencing authorities, which include Dubai Economy, authorities in charge of special economic zones or free zones including DIFC and local securities exchanges including DFM and Nasdaq Dubai.

Their responsibilities include monitoring the compliance of local and non-local companies with the bylaws of this Decree, taking action against violators that may include cancellation of registration and licensing until changes have been made to meet the requirements.

All companies that are subject to this Decree, should change their status within a year of its issuance.

Licencing authorities can extend the deadline by same period as required. The Decree is effective from the date of its publication in the Official Gazette.