The Dubai Financial Services Authority (DFSA), the independent regulator of financial and ancillary services conducted in the emirate, said it has inked a major agreement with Europe’s Securities and Markets Authority (ESMA).

Esma was established on January 1, 2011 to enhance the protection of investors and promote stable and well-functioning financial markets in the European Union (EU). One of its responsibilities is the supervision of Credit Ratings Agencies (CRAs).  

The signing took place during a meeting between Ian Johnston, the chief executive of the DFSA, and Dr Steven Maijoor, the chairman of Esma, an independent EU authority. Esma's executive director Verena Ross, was also present.

In 2011, the DFSA had extended its regulatory reach to require CRAs in the Dubai International Financial Centre (DIFC) to be licensed and supervised by the DFSA. Three of these CRAs are also supervised by Esma, which prompted this MoU.

Commenting on the deal, Johnston said, "This MoU with Esma recognises the importance of on-going supervisory and enforcement-related co-operation in light of the cross-border activities of credit rating agencies and the global nature of ratings generally.”

“Since 2005, the DFSA has placed a high priority on building its information network, and reflecting the home jurisdiction of financial firms in the Centre, our links with Europe have been significant," stated Johnson.

"The DFSA already has MoUs with many of our counterparts in Europe including France, Germany and the UK. Through these arrangements we demonstrate our commitment to the operation of internationally accepted practices within the DIFC," he added.-TradeArabia News Service