UAE to get new transparency law for cos in 2010

A new corporate law intended to ensure that the UAE’s listed companies exercise full transparency might be introduced in April next year, according to a report.

The Emirates Business daily quoted Mariam Al Suwaidi, deputy CEO for Issuance, Research and Legal Affairs at the Emirates Securities and Commodities Authority (Esca), in its report on Thursday as saying: “The law is at the drafting stage and will replace current guidelines and rules and regulations”.

"We already have rules and regulations covering corporate governance. But this law will make it compulsory for listed companies to abide by all Esca rules and regulations.”

Al Suwaidi was speaking on the sidelines of the first Abu Dhabi Corporate Governance Conference, organised by the capital's Centre for Corporate Governance.

According to her, the new law would be more transparent and seek full clarity from listed companies. Al Suwaidi said that there are some ambiguities in the current rules and regulations, and also with regards to the interpretation of some articles.

The official told the Emirates Business daily: “However, we are still at the stage where these rules are voluntary. The current crisis has underlined the need to reinforce good governance in the country. We have seen lots of companies adopting improved standards of corporate governance and all this shows a new culture is being created in the country.”

The need for greater transparency laws for companies has been felt more acutely in recent times.

Last week the managing director and CEO of UAE jewellery retailer Damas International on Monday left the company after admitting to being responsible for unauthorised payments worth up to $165m, the company said in a statement.

Reactions from Arabian Business readers have highlighted that strengthening the corporate laws in the UAE and increasing accounting transparency would enhance the UAE’s reputation as a safe financial and business destination to entrust investors’ money.

Last month, the UAE's economy minister said that the country may introduce a law to better protect foreign investors, amid an increase in civil court cases in the wake of the global financial crisis.

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