Number 1288 14 February 2012

Client Alert

Latham & Watkins Corporate Department

NASDAQ Consults on New Admission and Disclosure Standards

On 6 February 2012, the NASDAQ The ADSs and the DFSA’s Dubai securities exchange, which Markets Rules is based in the Dubai International Financial Centre (the DIFC), opened It is proposed that the ADSs will its proposed new Admission and form part of the NASDAQ Dubai Disclosure Standards (the ADSs) for Business Rules and will replace public consultation. the existing Issuers and Securities Rules. Separately, the DFSA has Reform of the DIFC’s Listing been consulting on its proposed new Markets Rules, which will Regime include the DFSA’s listing rules. The The proposed ADSs form part of Markets Rules will be promulgated “The proposed significant ongoing reform of the by the DFSA pursuant to a power to be conferred on it by a new DIFC ADSs form part regulatory architecture governing NASDAQ Dubai and other securities Markets Law, which is currently in of significant exchanges in the DIFC. On 1 October the final stages of being passed, and ongoing reform 2011, responsibility for maintaining which will replace the existing DIFC Markets Law of 2004. It is intended of the regulatory an Official List and listing authority functions in the DIFC was transferred that the new NASDAQ Dubai Business architecture from NASDAQ Dubai to the DIFC’s Rules incorporating the ADSs and the governing regulator, the Dubai Financial Services DFSA Markets Rules will come into force at the same time. NASDAQ Authority (the DFSA). Responsibility for admission of securities to trading Dubai and on NASDAQ Dubai remains with the NASDAQ Dubai’s other securities exchange. This approach mirrors the Objectives exchanges in the position in the UK, where there is a similar split in functions between the The ADSs begin with an introduction DIFC.” Financial Services Authority (in its setting out the stated objectives of role as the UK Listing Authority) and the rules, which include (i) ensuring the London Exchange, which an internationally competitive and regulates admission to trading on its accessible market; (ii) maintaining markets for listed securities. fairness, transparency and an orderly market; (iii) ensuring liquidity and (iv) following international standards for trading securities. NASDAQ Dubai reiterates the importance of its relationships with issuers.

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Ensuring Liquidity on This provision is likely to prove NASDAQ Dubai controversial with market participants, who will be concerned at the practicality One of the key issues for consideration of such prescriptive measures. For as part of the public consultation process example, US$2,000 may be seen as too is NASDAQ Dubai’s proposals that high an amount to allow local retail seek to ensure adequate liquidity on investors, who should be encouraged the exchange. The trading liquidity to participate in local IPOs, to count of