WAM Dubai, May 23th, 2012 (WAM) -- The Higher Committee overseeing the development of laws regulating the country's financial sector has instructed its technical team to complete the task of reviewing the draft laws in preparation for submitting it to the cabinet for passage.

The instruction was given at a meeting of the committee chaired by Deputy Ruler of Dubai and UAE Minister of Finance HH Sheikh Hamdan Bin Rashid Al Maktoum.

The sixth meeting of the committee was attended by Minister of State for Finance and the Committee's Vice Chairman Obaid Humaid Al Tayer, Minister of Economy, Chairman of Securities and Commodities Authority and the Insurance Commission Sultan Bin Saeed Al Mansouri, Chairman of the Board of Directors of the UAE Central Bank Khalil Mohammed Sharif Foulathi, Central Bank Governor Sultan Bin Nasser Al Suwaidi, Undersecretary of the Ministry of Finance Younis Haji Khouri, and the Director of Revenue Development Department at the Ministry of Finance Faisal Ali Al Mansouri.

The Committee discussed a number of topics on its agenda and reviewed previous resolutions issued by the federal government to address the effects and reduce the impacts of the global financial crisis by forming a temporary ministerial committee headed by Minister of State for Finance, Minister of Economy and the Governor of the UAE Central Bank.

A statement issued at the end of the meeting said: With the rapid developments in the financial sector and in the quest to avoid falling into any crises that might face the global financial sector, the thinking about creating an integrated financial system that contributes to the protection of the country's rights as well as the protection of consumers had become a matter of urgency. Accordingly, the Committee adopted several recommendations that were proposed for submitting to the cabinet , which in turn will contribute to the development of the country's financial sector through legislation with a view to become one of the best legal systems in the world.

Among these recommendations were the adoption of a binary system called "Twin Peaks", which is based on the establishment of a state control mechanism as precautionary measures and to avoid structural risks in the banking and financial system in the country.

The Committee also agreed to raise the proposal to the cabinet to form a permanent higher committee for continuous supervision of the financial sector in the country.

Such a committee will function as a safety valve protecting the sector from any financial risk that may threaten the country's banking and financial system, suggested the meeting.

The committee, within its powers as enshrined in the new law, will have a major role in making key decisions that control the financial sector in the country.

The committee will also work as a link between the cabinet and the two prime regulators of the financial sector in respect to the development of all laws regulating financial services, the meeting recommended.

The Committee also stressed the Central Bank's important role of issuing periodic reports on the state of the economy in the country and of taking all precautionary measures to prevent any financial risk in the banking and financial system.

WAM/AB