(MENAFN) The UAE's Securities and Commodities Authority Okayed new rules that are expected to improve the liquidity in stock markets, Reuters reported.
The much-awaited move will help maintain market balance and boost national economy, said the Minister of Economy Sultan bin Saeed al-Mansoori.
In November 2011, the regulator published draft rules on short selling and stock borrowing.
UAE's capital markets have failed to keep pace with the country's economic growth; moreover, they lack the regulatory developments seen in more developed economies.
Also, allowing market makers is expected to reduce transaction costs, which has hampered liquidity.
A number of brokerages in the UAE have been forced to shut as turnover on the Dubai Financial Market and the Abu Dhabi bourse slumped to seven-year lows in 2011.
In June, the regulator made changes to the stock ownership rules to boost transparency in the Gulf Arab state's two stock markets and lead to better disclosure during takeovers.
It also approved new regulations for the country's nascent fund management industry in August.