UAE: SCA extends decision to exempt registration fees for green or sustainability-linked bonds or sukuk

The decision, issued by Mohamed Ali Al Shorafa, Chairman of the SCA Board of Directors, stipulates that the exemption from the registration fees prescribed by the Authority under a previous decision of the Chairman of the Authority's BoD will be extended for registration applications submitted during the current year, without violating the provisions of Decision No. 5 of 2023 regarding the registration of securities for listing purposes.

This decision supports the Authority's efforts to encourage companies to issue green bonds and sustainability-linked sukuk to finance sustainable projects related to the environment and climate, and also encourages investors and companies to adopt environmentally friendly investment opportunities.

Last June, the BoD of SCA approved a proposal under which the Authority exempts companies wishing to list their green bonds or sustainability-linked sukuk in one of the local markets from registration fees for the year 2023.

The decision aims to highlight the state's efforts in accordance with a clear agenda to achieve sustainable development goals on multiple levels, especially regarding sustainable economic growth.

The registration fee for bonds and sukuk for the purpose of listing which the Board agreed yesterday to temporarily exempt from - is determined by the Chairman of the Authority's Board of Directors Decision No. (32 / R.M) of 2018 regarding the due technical service fees at a rate of (0.01 per cent) of the value of the issue subject to a maximum of AED 30,000.

The SCA issued its Decision No. (21 / R.M) for the year 2023 AD regarding the regulation of green bonds and sukuk related to sustainability, as this decision allowed public shareholding companies to issue "green" bonds and sukuk whose entire subscription proceeds are used to finance or refinance environmentally friendly sustainable projects (such as renewable energy projects, energy efficiency projects, pollution prevention and control projects, environmentally sustainable management projects for natural resources and land use, projects for preserving terrestrial and aquatic environmental diversity, clean transport projects, and sustainable management of water and wastewater projects), as well as companies' issuance of bonds and sukuk related to sustainability, through which the sustainability goals specified by the issuing company are achieved within a predetermined period to contribute to the achievement of key performance indicators, and to bear structural and/or financial features and characteristics depending on the issuing company's achievement of sustainability goals. (ANI/WAM)