Depository

Overview

Dubai Financial Market (DFM) is authorized by local securities law to operate a central securities depository for all securities listed on the DFM. DFM Depository operates a fully dematerialized scripless investor-level electronic securities registry system where legal ownership of listed securities is evidenced by the electronic records of DFM Depository. Ownership is transferred by book-entry and is protected by local securities laws from the insolvency of DFM Depository and DFM Depository Participants. DFM Depository also conducts securities settlement of trades cleared by DFM Clearing and serves the local market. There are no cross-border links. DFM Depository uses NASDAQ OMX’s Equator AS400 system for its depository functions. 

DFM Depository operates on a National Investor Number (NIN) system where each investor must have a NIN. An investor can only have one NIN with DFM Depository irrespective of the NIN type but may have more than one depository account under a NIN.

There are two types of NINs: 

1. Direct NIN
2. Custodian NIN

 There are three ways for an investor to apply for a NIN: 

1. DFM Depository directly at the client services counters located at the DFM premises; or
2. Trading Member Participants who will facilitate the application for an NIN for the Trading Member’s clients;
3. Custodian Participants if the investor is a client of the Custodian Participant.

Participants

There are two types of depository participants: 

1. Trading Member Participants
   All DFM Trading Members are automatically appointed as Trading Member Participants of DFM Depository. An investor with a Direct NIN which is a client of a Trading Member may submit depository transaction requests either directly to DFM Depository or through the Trading Member Participant. Before an investor can trade on the DFM, the investor must open a depository trading account with a Trading Member Participant. The depository trading account opened with the Trading Member Participant is also a securities inventory account and records all trade and non-trade related securities transactions which the investor transacted at the Trading Member.
   
   
2. Custodian Participants
   Local banks offering asset custody services may apply to the DFM to be a Custodian Participant. A Custodian Participant manages all depository transactions for its custody clients. DFM Depository only accepts depository transaction instructions from the Custodian Participant and not directly from the custody client. A custodian client must also open a depository trading account with a Trading Member Participant before the custodian client can trade on the DFM. The depository trading account opened with the Trading Member Participant is a non-securities inventory account and records only trade-related securities transactions executed with the Trading Member. This setup ensures confidentiality of custodian client asset information from Trading Participants.

Services

DFM Depository operates an investor service counter at the DFM premises where retail investors can request for depository services such as apply for an NIN. In addition, DFM Depository operates a customer service centre to assist investors. The following is a list of services offered by DFM Depository:

1. Dual-listed Companies Procedure
2. Obtaining Proof of Securities Ownership
3. Audit Confirmation Letter
4. External Transfers:

• Transfer from a Company to Employees
• Transfers between Board Members
• Reservation of Securities by Court Order
  
• Letters to Judicial Authorities

Operational Procedures

The following procedures apply to the operations of DFM Depository:

1. Custody of Shareholders’ Register for Private Shareholding Companies
2. Electronic Connection with AS400 for Issuers and Custodians
3. Change of Trading Symbol for a Company
4. Dual Listings Procedures
5. Obtaining Proof of Securities Ownership
6. Audit Confirmation Letter
7. External Transfers:
   1. Transfer From a Company to Employees
   2. Transfers Between Board Members
8. Annual Subscription in periodic reports for Issuers 
9. Reproduction of Reports for Issuers and Custodians Upon Request
10. Reproduction of Share Book for issuers 
11. Freezing & Un-freezing of Securities
12. Reservation of Securities by Court Order
13. Letters to Judicial Authorities
14. Custody Services
15. Corporate Action Procedures
16. Releasing Founder Shares
17. Merger of Companies
18. Multi NIN External Procedures- Issuers ^NEW
19. External Procedures - Multi NINs- Investors ^NEW

Operational Procedures

The following procedures swexwedxeapply to the operations of DFM Depository:

1. Custody of Shareholders’ Register  for Private Shareholding Companies
2. Electronic Connection with AS400 for Issuers and Custodians
3. Change of Trading Symbol for a Company
4. Procedures for Ownership Transfers from Certificates into Electronic Environment
5. Procedures for Registration of Share Certificates
6. Dual Listings Procedures
7. Obtaining Proof of Securities Ownership
8. Audit Confirmation Letter
9. Annual Subscription in Stock Balance Statement for Investors
10. External Transfers:
    1. Transfer From a Company to Employees
    2. Transfers Between Board Members
11. Annual Subscription in periodic reports for Issuers 
12. Reproduction of Reports for Issuers and Custodians Upon Request
13. Reproduction of Share Book for issuers 
14. Freezing & Un-freezing of Securities
15. Reservation of Securities by Court Order
16. Letters to Judicial Authorities
17. Custody Services
18. Corporate Action Procedures
19. Releasing Founder Shares
20. Merger of Companies