Weekly Spotlight: The DIFC Announces the DEWS Nomination Deadline

The DIFC has issued a reminder that the deadline for appointing an employee and/or employer to the DEWS Supervisory Board is 15 January 2020.

Nominations should be accompanied with a valid DIFC employee card and the entity should be registered in the DIFC. The nominees should also have the appropriate qualified and experience.

The DEWS Supervisory Board will be made up of DIFC Authority representatives, employer and employee representatives and independent members. The Board will oversee the continuing governance and commercial aspects of the scheme which are not subject to regulatory supervision.

Weekly Spotlight: Dubai’s Multi Commodities Centre Announces New Rules and Regulations for 2020

Dubai’s Multi Commodities Centre has announced various new rules and regulations. They will come into force on 2 January 2020. The aim is to make it easier to do business and set-up in the Centre. The new regulations update the Centre’s existing company law framework to provide greater flexibility and make it easier to operate for businesses registered with the Centre. Key amendments include increased flexibility around a company’s Articles of Association; the introduction of different share types, allowing businesses to tailor their shareholding structures; a new dormant status and an increased ability to transfer company incorporation in the Centre.

Elsewhere, the Chairman of Ajman Free Zone has announced it has launched a new Business Hub. It will be available to freelancers, entrepreneurs and businesses who operate in the Zone. It has been specifically designed to provide investors in the Zone with a comprehensive range of services.

Weekly Spotlight: Social Media Law for Government Influencers in Sharjah

The Crown Prince of Sharjah, Deputy Ruler of Sharjah and Chairman of the Sharjah Executive Committee has issued Sharjah Executive Decree No. 39/2019 which makes it mandatory for all government departments in Sharjah to first get approval from the Sharjah Media Office prior to using services offered by social media influencers.

According to the resolution, all government and semi-government entities, independent government agencies, companies that the government contributes to or fully owns and private contracting companies affiliated to the government within the scope of the contract, must obtain the approval of the Sharjah Media Office prior to using services provided by social media influencers.

Whether the services are for promoting activities, services or products for government entities, or are paid for or not paid for, the Sharjah Media Office must issue the necessary administrative decision prior to implementing the contracts signed with social media influencers.

The decree came into the effect from 4 December 2019.

Weekly Spotlight: New Decree Amending the UAE Federal Labour Law

The UAE’s President has issued a Decree amending the Federal Labour Law. Federal Law No. 8/1980 has been amended by Federal Decree-Law No. 6/2019. It was issued on 29 August and came into force one month after its publication in the Official Gazette.

Under the amendments, it will be illegal to dismiss pregnant women. If they do, the employee will be considered to have been arbitrarily dismissed under Article 122 of Federal Law No. 8/1980. The amendments also ban discrimination in jobs with the same functions or discriminate between people.

The Human Resources and Emiratisation Minister will issue decisions regulating work where men and women cannot both be employed.

Weekly Spotlight: New Consultation by the Dubai Financial Services Authority on a Proposed Listing Regime for SMEs

The Dubai Financial Services Authority has launched a consultation on a proposed listing regime for SMEs. The consultation ends on 12 January 2020. If approved it will allow SMEs to list their shares on an Authorised Market Institution in the DIFC by providing appropriate and proportionate regulatory standards and adequate levels of investor protection. The proposals will be of interest to potential SME applicants, people who operate or intend to operate an Authorised Market Institution or ATS which facilitates trading in the shares of an SME, people providing legal, accounting, audit, or compliance services to SMEs in the DIFC or those who wish to provide these services and potential investors in listed SMEs.

It will allow SME companies to obtain equity financing through the capital markets, bridging a funding gap and compared to the established equity listing regime, to list with less than three years’ track record and benefit from lower fees when filing a Prospectus for approval and appoint a compliance adviser, rather than a sponsor, to assist it in complying with Authority requirements at application and on an ongoing basis. An SME applicant will have to produce a prospectus which complies with the Markets Law 2012 and Markets Rules, to be approved by the Authority, unless there is an exemption from the obligation to do so. Disclosure requirements will not apply to an SME applicant because of, among other things, its size and nature or limited years in operation.

SMEs will be able to list using their existing audited historical financial statements, prepared in line with their national audit and accounting standards, on the basis those standards are acceptable to the Authority. SMEs will have to produce audited accounts prepared in line with IFRS (or other standards acceptable to the Authority) and auditing standards of the IAASB (or other standards acceptable to them) for the next and subsequent financial years. Listed SMEs will have to comply with the existing requirements under the Markets Law and Markets Rules in respect of inside information and disclosure, including disclosure of interests by Connected Persons and of Directors’ material interests.

A listed SME, like any other Reporting Entity, should have a corporate governance framework in place at the time of listing. The Authority’s ‘comply-or-explain’ corporate governance regime is already designed to provide a degree of flexibility and it is expected it will permit a SME to achieve the outcomes intended while considering the nature, scale and complexity of their business. To accommodate the change, a definition of an SME will be introduced as will minimum market capitalisation requirements for regular listings. They will also need to have a trading record. In addition, there will be a lock-in arrangements, prohibitions on share repurchases, website disclosures and the appropriate fees. Finally, they will have to have a compliance advisor.

Weekly Spotlight: The UAE’s Central Bank has Announced it will Establish a FinTech Office

The UAE’s Central Bank has announced it will establish a FinTech Office. The Office will help draft regulations for this sector and encourage it to grow. It will also examine assets like cryptocurrencies. It will not compete with other initiatives like the sandboxes in the financial free zones.

The Governor of the Central Bank made the announcement at the Middle East Banking Forum in Abu Dhabi. He added ‘the aim of the office will be to position the Central Bank as the coordinating authority, as an author of prudential and market conduct regulatory requirements and as an enabler and facilitator of fintech activities in the UAE. It will ensure financial innovation continues in the banking sector with the support and facilitation of the national authorities’.