From SCA to CMA: A New Era for UAE Capital Markets in 2026

1. Why Did the UAE Replace the SCA?

The SCA was established under Federal Law No. 4 at a time when the UAE’s capital markets were still developing and largely focused on traditional securities and commodity trading. Over time, financial products became more sophisticated, trading volumes increased, and market participants expanded beyond national borders. 

Despite regulatory updates, the legacy framework increasingly struggled to address modern market realities such as complex financial instruments, alternative investment structures, systemic risk, and enhanced expectations around transparency and governance. Federal Decree-Laws 32 and 33 were introduced to address these gaps and to create a regulator with broader powers, clearer mandates, and stronger enforcement tools. 

2. What Is the Capital Market Authority (CMA): FDL32 & FDL33? 

The amendment of FDL32 establishes the CMA as an independent federal public authority with separate legal personality, meaning the CMA is the independent successor to the SCA. This institutional independence is intended to strengthen supervisory effectiveness and regulatory credibility. 

The CMA’s objectives include regulating and developing the UAE capital markets, protecting investors, enhancing market integrity, supporting sustainable economic growth, and promoting innovation within a controlled regulatory environment. The CMA inherits all rights, obligations, assets, and liabilities of the former SCA, ensuring continuity while operating under a modernised legal framework. 

The CMA is granted extensive powers covering licensing, supervision, investigations, enforcement actions, rulemaking, and cooperation with foreign regulators. Governance requirements, confidentiality obligations, and accountability mechanisms are also reinforced under the new regime. 

The amendment of FDL33 clarifies and expands the substantive scope of securities market regulation in the UAE. The CMA’s jurisdiction now extends to a broad range of financial products and regulated activities, including issuance, brokerage, asset management, intermediation, valuation, and alternative finance. 

A notable development is the explicit extension of the CMA’s oversight to certain activities conducted outside the UAE where those activities have an impact on UAE markets. In addition, activities carried out abroad by UAE entities or nationals may fall within scope, depending on their nature and effect. 

This expanded perimeter significantly increases compliance expectations for firms with cross-border operations or international client bases. 

3. Licensing and Systemically Important Firms

Under the new framework, firms must hold specific licences for each regulated activity they conduct. Licences remain subject to ongoing compliance and may be amended, suspended, or revoked by the CMA. Existing licence holders may continue their activities, provided they remain within the scope of their current permissions. 

FDL 33 also introduces the concept of “Systemically Important Licensed Persons.” The CMA may designate firms based on factors such as size, complexity, interconnectedness, and market impact. These firms will be subject to enhanced capital, liquidity, governance, and risk management requirements, including recovery and resolution planning. 

This approach mirrors international standards applied in mature financial markets and represents a significant step forward from the previous regime. 

4. Market Conduct, Enforcement, and Investor Protection 

The CMA framework significantly strengthens market conduct rules and enforcement powers. The new laws expand and clarify provisions on market abuse, including insider dealing, market manipulation, and unlawful disclosure of information. 

The CMA is equipped with broad supervisory and investigatory powers, including on-site inspections, information requests, administrative sanctions, and criminal referrals. Financial penalties may reach up to AED 200 million or ten times the illicit gains derived from misconduct. 

Investor protection is further enhanced through the establishment of an Investor Protection Fund and a Settlement Guarantee Fund, offering safeguards in cases of firm insolvency or settlement failure. Disclosure obligations and takeover rules are also strengthened to improve transparency and shareholder protection. 

5. Funds, Virtual Assets, and Areas to Watch 

The funds framework has been updated to introduce differentiated regulatory treatment for retail investment funds, qualified investor funds and private funds, while explicitly recognising collective investment schemes and alternative fund structures. This bring the CMA’s framework closer to international standards, including those in the UK and EU.  

According to FDL33, the CMA now maintains an official list of virtual assets that may be traded in the UAE, granting it regulatory authority over virtual asset trading, transactions, and related activities. This is expected to have a significant impact on virtual asset service providers, particularly by limiting the types of virtual assets permitted for trading within the jurisdiction. 

However, existing Cabinet Decisions and sector-specific frameworks remain applicable during the transition period. The interaction between the CMA, VARA, and the Central Bank’s virtual asset and payment token regimes remains an area to monitor closely. 

6. How can SALVUS support your compliance with the CMA Framework? 

The transition from the SCA to the CMA marks a new era for UAE capital markets, bringing broader jurisdiction, enhanced enforcement powers, and heightened regulatory expectations. Navigating this modernised framework requires a clear understanding of licensing requirements, market conduct rules, investor protection obligations, and cross-border considerations. 

At SALVUS, we combine deep regulatory insight with practical experience to guide clients through the complexities of the new CMA regime. Our team can assist with: 

• Strategic assessment of your current activities and licences under the CMA framework. 

• Preparation and submission of regulatory documents, policies, and procedures. 

• Ongoing compliance support to ensure alignment with evolving CMA requirements. 

• Guidance on funds, virtual assets, and systemically important operations to mitigate risk and optimise business structure. 

With extensive knowledge of UAE capital market regulations, SALVUS is a trusted partner for firms seeking to operate efficiently and confidently under the new CMA. 

Contact us at compliance@salvusfunds.com if you would like more information about our UAE licensing services. We are always ready to answer your questions and support you in achieving regulatory compliance.

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The information provided in this article is for general information purposes only. You should always seek professional advice suitable to your needs.