Dubai hosts eigth Gulf cooperation council regulators' summit

Thomson Reuters, the world's leading source of intelligent information for businesses and professionals, inaugurated the 8th Gulf Cooperation Council (GCC) Regulators' Summit in Dubai. The event is organized in collaboration with the Dubai International Financial Centre. A keynote speech was delivered by Abdul Aziz Al Ghurair, Chairman, UAE Banks Federation, at the opening session. He pointed out that a consultative approach between regulators and banks would lead to a balance between sustainable economic growth and protecting the system. "Collaboration and inclusion are key elements of the consultative approach which, in my view, will protect the interest of all stakeholders. The UAE Banks Federation has seen the UAE Central Bank playing a positive role in this regard, taking a balanced approach on regulations, while encouraging growth and protecting the financial system. They have been pro-active in conducting regular dialogue with the industry to ensure that regulations not only secure the long-term health of the banking system, but also protects consumers and help the economic growth of the country," he said. Mr. Al Ghurair added: "We all know that the financial services industry is the backbone of any economy. This sector not only impacts the economic growth of the country but also influences the daily lives of its people. Therefore, regulators in each country have a challenging task of enforcing regulations which ensure that banks and financial service companies remain healthy and also contribute to the economic growth in different economic cycles. He noted that highly restrictive regulations may keep the system intact but would choke the economy and will not be beneficial in the long run. Similarly, the absence of effective regulations may lead to the collapse of the banking system affecting the economy and hurting the consumers. Mr. Al Ghurair concluded: "In recent years with the tightening of regulations, particularly, in the AML and sanctions area, its criticality has increased manifold. Banks in many jurisdictions have paid heavy penalties for not complying to regulatory provisions. We believe two-way communication is the way forward and would encourage all banks and regulators to work together closely in the best overall interests of their consumers, their economies, and their countries." Nadim Najjar, Managing Director, Middle East, Africa and Russia / CIS, said: "In 2011, Thomson Reuters polled more than two thousand senior governance professionals, compliance officers and legal counsels. The results of our survey showed that the increase in regulation over the past several years has significantly impacted the performance of compliance professionals, the companies that they work for, and the broader economy as a whole. And around 71 percent - of those surveyed said that the global economy is now being negatively impacted by the burden of excessive regulation." Although we still see regulatory issues that deter foreign investment in the region, there are also limitless possibilities especially as we move to clarify our regulations. The GCC regulatory landscape has been experiencing ongoing significant change during the past few years. In response to the global financial crisis in 2008, GCC regulators have embarked on a wide-ranging reform agenda," he added. Mr. Najjar pointed out that the top themes in 2013 remained money laundering, risk management, terrorism finance, data security, global sanctions enforcement, and the new international core principles such as Basil III and the International Organization of Securities Commissions (IOSCO). "We have also seen development and further regulation in the field of Islamic Finance, especially in terms of Shariah standardization and compliance," he noted. Many speakers focused on the ongoing effort to attract institutional investors and to limit the scale and impact of speculative investing. Additionally, regulatory representatives stressed the importance of expanding co-operation and communication, not only among authorities within countries, but also between countries in the region. Panelists spoke about supporting and expanding the SME sector by facilitating freer and more robust access to capital markets, as well as more proactive help from lenders. They highlighted some of the challenges facing the broader regional co-operation and pointed out that GCC jurisdictions are still in the process of developing and implementing new regulatory and legislative frameworks. Speakers at the first session recognized that the GCC is and can continue to be a coherent player on the global market and that greater co-operation will help both to promote and protect the region's long-term economic interests. The summit will also address issues related to dealing with regulatory change and the impacts of EU and US regulatory reforms in the Middle East, the local regulatory drivers, the impact of EMIR '&' Dodd Frank compliance, and the role of self-assessment in regulatory monitoring. Corporate governance will be a key highlight at the summit specifically governance of state-owned entities (SOEs) and government-related entities (GREs).