DFSA issues first ESG fee waiver to Emirates NBD

Dubai’s Emirates NBD has become the first financial institution to benefit from the Dubai Financial Services Authority’s (DFSA) sustainability-linked debt securities issuance fee waiver.

Last December, the DFSA announced the decision to waive all regulatory fees for issuers wishing to list sustainability-related debt securities in the Dubai International Financial Centre (DIFC) throughout 2024.

The fee waiver was adopted to support financial institutions that seek to list sustainability-related debt securities in the DIFC, and ultimately to accelerate the growth of sustainable capital markets in the center.

“The DFSA recognises the pivotal role that financial institutions play in promoting sustainability and addressing environmental and social challenges. By participating in the fee waiver, institutions are taking a proactive step towards adopting more sustainable financial practices,” said Ian Johnston, DFSA chief executive.

The DFSA is witnessing an increase in the number of firms that are submitting applications to become beneficiaries of the fee waiver and are processing pending applications. The waiver applies to all new and repeat issuers who make a relevant application to the DFSA.

DFSA promotes sustainable finance

 The fee waiver, which was announced at COP28, underscores the DFSA’s long-standing commitment to accelerating the growth of sustainable capital markets in the DIFC since the publication of its first set of guidelines for listing green bonds and sukuk in 2018.

To further mobilise and bolster the sources of financing for sustainable projects in the UAE and the wider region, the waiver applies to all ESG-related bonds and sukuk labelled as green, social, sustainable, sustainability-linked, climate, climate adaptation, climate transition, or similar.

Nasdaq Dubai, the DIFC’s exchange, has emerged as the world’s largest ESG sukuk market with more than 60 per cent of US-denominated ESG sukuk and close to 50 per cent of all-currencies ESG sukuk.

UAE authorities have been encouraging issuers to raise green debt as the country is hosting the COP28 climate conference, which kicked off on November 30.

The Securities and Commodities Authority said in June that companies would be exempted from listing fees on the local market this year for green or sustainability-linked bonds or sukuk.

Banks in the UAE pledged to mobilise around $270bn (Dhs1tn) in green finance by the end of the decade.

 Read: Mashreq to facilitate Dhs110bn in sustainable finance by 2030