Dubai’s financial regulator has agreed to share data on centrally cleared transactions with European securities watchdog ESMA.
The deal, signed this week, paves the way for Dubai-based central counterparties (CCPs) to provide services to EU-based clearing members and trading venues.
Other markets, including South Korea, Mexico, Switzerland, Australia and the US, have signed similar deals with bureaucrats in Brussels.
European rules on derivatives, collectively known as EMIR, are forcing over-the-counter (OTC) contracts to be cleared through CCPs to mitigate risk.
Dubai Financial Market (DFM), the Gulf's only listed-stock exchange, already offers a CCP service for derivatives trading on its subsidiary Nasdaq Dubai.
It plans to introduce CCP clearing for equities in 2019 after signing a deal with Nasdaq recently to revamp its post-trade platforms.
Last September European officials decided that the Dubai's regulatory framework for CCPs should be deemed equivalent to that of the EU.
The framework, built by Dubai's regulator DFSA, is also compliant with the international standards set out by IOSCO.
Ian Johnston, DFSA's chief executive, said that the group will cooperate and to assist fellow regulators, “particularly where the DIFIC firms have strong links with the European Union market participants.”
US and Hong Kong securities regulators agreed to strengthen cross-border ties in January.
Both parties signed specific cooperation terms for supervising and sharing information on exchanges, brokers, investment funds and clearing agencies.
SFC already has similar accords in place with ESMA.