By Peter Alagos
Qatar Financial Centre (QFC) will pass a new law next year, simplifying procedures for foreign investors and giving them more access to the local market, CEO Yousuf Mohamed al-Jaida has said.
The revised QFC law, expected in 2016, will attract more Foreign Direct Investment (FDIs) to Qatar and allow international investors access to the local market.
Speaking to reporters on Wednesday, al-Jaida highlighted other regulatory reforms such as the plan for a combined regulatory framework between the QFC and the Qatar Financial Market Authority (QFMA) and Qatar Central Bank (QCB) to regulate asset management.
Aside from asset management, the regulatory reforms would also cover banking and insurance, he said.
According to al-Jaida, legal revisions are taking place within the QFC. “The QFC law allows more room for onshore access…There are certain efforts that cannot be done unless these laws are revised, including the listing of certain QFC funds that are not working unless this QFC law revision takes place,” he explained.
On listing QFC companies at the Qatar Stock Exchange (QSE), al-Jaida said: “We do not have any QFC companies that have listed at the QSE yet but we have companies for listing in the pipeline. However, that comes back to the QFC law revision; the law will allow access into the onshore environment, including the listing in the QSE.”
Al-Jaida noted that listing of QFC companies in the stock exchange was affected by the slump in oil prices.
“Listing follows market dynamics….some companies may have changed their decisions by now because of the oil prices. But what we want is to allow the mechanics and let the companies decide whether they want to list or not, depending on the market dynamics,” he said.
Al-Jaida noted that revising the QFC law will also help expand the centre’s judicial environment, allowing international companies in Qatar to use the QFC courts.
“For the next expansion phase, these issues have to be addressed in order to attract more companies. If you want a better market and better stability within the market, FDIs would have to be comfortable in a friendly business environment,” he said.
Al-Jaida said the QFC is also revisiting regulated entities in areas such as banking, insurance, and asset management.
“We are also looking into developing the regulatory framework with the government before we proceed with full force in attracting regulated companies. There are a lot of efforts on the ground with the QCB, QFMA, and QFC to enable a ‘best-in-class’ regulatory framework in Qatar to attract companies in those areas,” he said, referring to the banking, insurance, and asset management sectors.
He said there are plans to have only one regulator for asset management: “A lot of efforts are being put in place to have one regulator for that particular sector…What needs to be done is more regulatory reforms between the QFC and our counterparts.
“For asset managers, it is important to be able to set up products quickly, to be able to have access to the stock exchange in terms of listing new products, and to be able to raise capital either from the local market or from abroad,” he said.
He added: “Without a proper market, I don’t think there is any attractiveness for international asset managers to move into the Qatari market. One part of it is to introduce new products, other avenues of investments, and to be able to allow a viable and friendly regulatory environment around it as well."