According to a report issued on Saturday, the corporate watchdog reviews monthly accounts of brokerage companies to identify those who have flouted various rules and regulations.

“Following the review of the 2009 activities, the authority recorded 113 violations of the supervisory and monitoring rules of trading, in addition to 14 violations of information disclosure rules and 76 violations of financial information disclosure rules by public joint stock companies,” an annual performance report for the year issued by SCA said.

The authority also reviewed 83 complaints by investors and companies and suspended 11 investors, three brokerage companies and brokers’ representative, as well as seven non-brokers’ representatives. Also, 22 companies were cautioned for flouting the authority’s rules while another eight fined.

Supervision

The authority has temporarily suspended the licenses of two companies, International Shares and Bonds Centre and InvestOne Financial Brokers, for a period of one year, while the case of Golden Gate closed with a court judgment having been passed to liquidate the company.

It also cancelled the licence of two brokerage companies NPF Securities and EMCO Financial Services on their request.

Legislations

The Chief Executive Officer of SCA Abdullah Al Turifi said his authority was striving hard to further strengthen the legislative framework by making some necessary amendments, in line with international standards.

“The SCA continues to develop a number of rules and regulations to boost the legislative infrastructure of the UAE’s financial market, while, on the other hand, it continues to organise awareness campaigns to serve the interest of all stakeholders and concerned parties,” Al Turifi said.

Regarding the legislations issued in 2009, UAE Economy Minister Engr. Sultan bin Saeed Al Mansouri has issued Decree No. 518 of 2009 on rules and regulations of Corporate Governance and Institutional Code of Conduct, which will be compulsory from May 1, 2010.

The minister also issued other decrees, including a decree regulating the “Custodian” Stock Exchange which allows the regulating of new activities needed on stock markets in the country, based on the international best practices, and another decree regulating the work of record-keepers of public joint stock companies.

Other decrees include Resolution 30/R of 2009 amending the brokers’ bye-law, including Article 1 and 17 of the bye-law which allow a brokerage company to invest in shares.

The amendments include rules and regulations governing the practice of a brokerage company trading investing in securities, which must be done after getting approval from the Authority and in accordance with the rules indicated by the resolution.

haseebhaider@khaleejtimes.com