The securities and financial regulators of Australia and Dubai respectively have entered a mutually beneficial agreement to cooperate on and promote financial technologies (FinTech) in each other’s markets.
Inking the terms yesterday, the Dubai Financial Services Authority (DFSA) and the Australian Securities and Investment Commission (ASIC) will jointly work on a collaborative framework toward FinTech innovation. Notably, the regulatory framework will lower the burden for industry startups and businesses to enter each other’s markets, aided by the authorities for regulatory compliance. ‘It provides Australian fintech businesses wishing to operate in the DIFC with a simple pathway for engaging with DFSA, and vice versa,’ reads an excerpt from the ASIC’s announcement.
DFSA chief executive Ian Johnston added:
[The] agreement underscores our commitment to maintaining strong channels of communication with our regulatory peers and creates a regulatory framework that supports the latest developments in FinTech innovation.
The terms of the agreement also mandate the two authorities to share information on innovative FinTech developments in each other’s markets. A particular area of focus, the ASIC revealed, is regulatory technology (RegTech) with trials expected to occur between the regulators.
“Regtech is becoming more and more important – this is a new frontier in our bilateral cooperation that will benefit both regulators and businesses,” ASIC Commissioner John Price said upon signing the agreement.
The DFSA regulates the Dubai International Financial Centre (DIFC), a sprawling financial free-zone district that allows foreign companies to hold 100% ownership in Dubai, without the need of a local partner. Earlier this year, the authority outlined its approach to embrace the FinTech sector stating it will not regulate industry startups and companies unless needed. To that end, the authority lowered its scrutiny of the sector with a special new FinTech license that allows the testing of innovative products and services between a 6 to 12-month period.
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