The European Securities and Markets Authority (ESMA) has withdrawn third-country recognition from three UAE-based central counterparties.
This follows the decision by the European Commission to place the United Arab Emirates on its list of high-risk countries regarding its compliance with anti-money laundering standards.
As a result, the Dubai Commodities Clearing Corporation, Dubai Clear LLC and Nasdaq Dubai Ltd are no longer included in ESMA’s list of recognised third-country central counterparties.
To be recognised by ESMA, a third-country CCP must meet all cumulative conditions specified under Article 25(2) of the European Market Infrastructure Regulation (EMIR), including the requirement that it does not appear in the AML blacklist drawn up in accordance with the AML Directive.
The European Commission has highlighted “strategic deficiencies” in the UAE’s anti-money laundering and counter financing of terrorism (AML/CFT) regime and added the jurisdiction to its list of high-risk countries on 16 March 2023.
ESMA has given the three CCPs three months to adapt to its judgement, dictating that these clearing houses will no longer be authorised to provide clearing services to clearing members or trading venues established in the EU from 25 October.
