Trends in International Regulation Regulation of the Dubai International Financial Centre Ian Johnston Deputy Chief Executive & Managing Director Dubai Financial Services Authority

The Global Drivers of Change? G-20 Financial Stability Board International Standard-Setting Bodies –Basel Committee on Banking Supervision –International Organization of Securities Commissions –International Association of Insurance Supervisors –Financial Action Task Force

National Regulation FinCo Sector-based Regulation Securities Regulator/s Banking Regulator/s Insurance Regulator/s Single Regulator Integrated Regulation Twin Prudential Conduct of Business Peaks

The Regulator is part of a larger Universe FinCo National Regulator/s ● Basel ● IOSCO ● IAIS ● FATF Supranational Standard Setting

Member Jurisdictions G20 Spain Hong Kong The Netherlands Singapore Switzerland International Organisations BIS ECB EC IMF OECD The World Bank International Standard- Setting Bodies & Other Groupings BCBS (banking) IAIS (insurance) IOSCO (securities) IASB (accounting) CPSS (payment & settlement) CGFS (market stability) Financial Stability Board Joint Forum

International Standard- Setting Bodies All standard-setters are revising their Core Principles and Standards, and specifically considering: -Independence of supervisors and other pre-conditions for financial stability -Macro-prudential supervision -Systemically important financial institutions -Corporate Governance and conduct of business -Causes of the crisis versus “fads” in regulation

Dubai International Financial Centre UAE DUBAI DIFC Common Law System Civil Commercial Laws of UAE Disapplied Regulated to International Standards 110 Acre Financial Free Zone

About the DIFC Onshore Capital Market / International Standards No Local Partner Requirements Foreign Currency Denominated / Zero Tax Rate* Designated as a Financial Free-Zone Tailor-made Laws for the DIFC * 50 Years and Renewable Civil and Commercial Laws of UAE Not Applied

The Structure of the DIFC Independent integrated regulatory authority with risk- based regulation on par with international standards Provide overall direction for the development and marketing of the DIFC Independent and final DIFC Court modeled on superior common law court

The DFSA’s regulatory mandate, as a unified regulator, covers asset management, banking and credit services, securities, collective investment funds, custody and trust services, Islamic finance, insurance, an equities exchange and a commodities derivatives exchange. The DFSA

Categories of Authorised Firms Category 1Category 2Category 3Category 4 Accepting deposits or providing credit Dealing in investments as principal Dealing in investments as agent or Managing Assets Arranging Credit or Deals in Investments or Arranging Custody Decreasing Capital Requirements and Prudential Risks Category 5 Islamic Financial Institution Capital Requirements may vary

Regulated Entities Authorised Financial Firms: 255 Representative Offices: 9 Ancillary Service Providers (Legal and Accounting): 52 Registered Auditors: 15 Exchanges: 2 Recognised Members (86) and Recognised Bodies (7) Branches: 86 Subsidiaries:98 Start-Ups: 71

Firms in the DIFC

Significant Participation with Key Standard Setters Basel Committee on Banking Supervision International Association of Insurance Supervisors (IAIS) International Organisation of Securities Commissioners (IOSCO) Financial Action Task Force (FATF) and the Wolfsberg Group Various International Accounting, Auditing and Islamic Finance Bodies

MoUs signed: 53 (bi-lateral) and 4 (multi- lateral) including ASIC US Federal and Banking Regulators Germany Switzerland UK FSA Netherlands China Hong Kong IOSCO IAIS Other Items of Interest

Key Issues for Region International Standards Corporate Governance Mutual Recognition Exchange Consolidation

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