Blog - HOW TO LIST YOUR COMPANY SHARES IN DUBAI-PRECAUTIONS FOR INVESTORS

How to List Your Company Shares in Dubai: Precautions for Investors
Listing a company’s shares on a stock exchange is a pivotal moment that can shape the
future of a business. It unlocks new avenues for raising capital, boosts public visibility, and
creates growth opportunities. For businesses aiming to engage with Dubai's dynamic
financial market, it's crucial to understand the step-by-step process, applicable regulations,
and necessary precautions for investors. This comprehensive guide delves into the legal
framework, regulatory requirements, and vital steps involved in listing shares in Dubai.
1. Detailed Regulatory Landscape
I. Securities and Commodities Authority (SCA)
The SCA plays a central role as the regulatory body overseeing the capital markets in the
UAE. It enforces securities laws and ensures that market activities adhere to legal
standards. Under Federal Law No. 4 of 2000, the SCA monitors and prevents fraudulent
practices, issues licenses to brokers and investment managers, and enforces rules to protect
investors. Companies listed on exchanges must comply with SCA regulations, which include
transparency in their financial disclosures and adherence to corporate governance
guidelines, such as those outlined in Circular No. (3) of 2016 on Disclosure and
Transparency and Circular No. (1) of 2020 on Corporate Governance.
II. Dubai Financial Market (DFM)
As one of Dubai's major stock exchanges, the DFM provides a platform for the trading of
securities and shares. The DFM imposes minimum requirements regarding capital,
profitability, and operational history for companies seeking to list. A thorough application
process is involved, which includes submitting a prospectus and financial statements to meet
the DFM's listing standards. The DFM also mandates a governance structure that aligns with
its governance code, ensuring that the board of directors and committees such as the audit
and risk management committees are properly structured and effective.
III. Nasdaq Dubai

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Nasdaq Dubai is another prominent exchange in the region, catering to both local and
international investors. Companies aiming to list here must meet specific financial criteria,
including minimum capital thresholds and a required number of shareholders. Beyond the
initial listing requirements, companies must also comply with ongoing disclosure obligations,
regular financial reporting, and corporate governance requirements. This includes adopting a
code of conduct that promotes ethical business practices and transparency.
2. Regulatory Compliance and Reporting
 Financial Reporting Requirements
Companies listing in Dubai are required to prepare their financial statements in accordance
with International Financial Reporting Standards (IFRS). This ensures that financial
information is consistent and comparable across different markets. These financial
statements must be audited by accredited firms, and the audit report must be included in the
prospectus submitted to the SCA and the exchange. Additionally, companies are required to
submit annual reports that provide a comprehensive review of corporate governance
practices, financial health, and operational activities.
 Disclosure of Material Events
Listed companies are obligated to promptly disclose material events that could impact their
stock prices. These disclosures must be made through official channels, such as the
exchange’s website and press releases, ensuring that all investors have equal access to the
information. Additionally, companies must disclose key risk factors, covering operational,
financial, and market risks that could influence their performance.
3. The Listing Process in Detail
 Initial Preparation and Structuring
Before listing, companies must ensure that their corporate structure aligns with regulatory
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requirements. This may involve converting from a private entity to a public joint-stock
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company (PJSC), which requires amending the company’s Articles of Association to comply
with Federal Law No. 32 of 2021 on Commercial Companies. Implementing a strong
governance framework is crucial at this stage. The board of directors must formally approve
the decision to list shares, and the company should engage legal, financial, and marketing
advisors to navigate the complex process of listing.
 Meeting Listing Requirements
The preparation of a prospectus is a critical part of the listing process. The document must
provide detailed information about the company’s business, financial performance,
management, and risk factors. The prospectus must be approved by the SCA before the IPO
can proceed. Following this, the company launches its Initial Public Offering (IPO), pricing
the shares based on market conditions, valuation, and investor demand.
 Post-Listing Compliance
After the IPO, companies are required to maintain ongoing compliance with regulatory
requirements. This includes submitting quarterly and annual financial reports, conducting
regular board meetings, and ensuring the audit committee functions effectively. Compliance
with these ongoing obligations is essential to maintain investor confidence and market
integrity.
4. Investor Precautions
 Conducting Due Diligence
Investors should conduct thorough due diligence before investing in a listed company. This
involves analyzing the company’s financial health, business model, and management team.
Investors should examine the company’s financial statements for transparency and
consistency and assess the sustainability of the business model. Additionally, evaluating the
experience and track record of the company’s leadership team is crucial to understanding
how well the company is positioned to handle market challenges.
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 Assessing Market Conditions

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Market conditions, including economic indicators such as interest rates and inflation, play a
significant role in a company’s financial performance and stock value. Investors should also
consider geopolitical risks and sector-specific trends that could impact the company’s
operations and stock performance.
 Risk Management
Diversifying investments across different sectors and asset classes is a key strategy for
mitigating risks. Investors should seek professional advice from financial advisors to tailor
investment strategies to their individual goals and risk tolerance. Legal advice is also crucial
for ensuring compliance with regulations and addressing potential legal issues related to
investments.
5. Conclusion
Listing a company’s shares in Dubai is a complex process that requires careful preparation,
adherence to regulatory standards, and ongoing compliance. Companies must engage with
experienced advisors to navigate the legal and financial intricacies of the listing process. For
investors, conducting thorough research and adopting a cautious approach is key to making
informed decisions. By understanding the regulatory landscape and staying informed about
market conditions, both companies and investors can effectively leverage Dubai’s financial
markets to achieve their strategic and financial objectives.
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How to List Your Company Shares in Dubai: Precautions for Investors

1. Detailed Regulatory Landscape

I. Securities and Commodities Authority (SCA)

II. Dubai Financial Market (DFM)

III. Nasdaq Dubai

2. Regulatory Compliance and Reporting

 Financial Reporting Requirements

 Disclosure of Material Events

3. The Listing Process in Detail

 Initial Preparation and Structuring

 Meeting Listing Requirements

 Conducting Due Diligence

 Assessing Market Conditions

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