ABU DHABI, May 1 (Reuters) - Abu Dhabi said its planned
financial free zone would offer a wide range of services, from
banking to fund management and commodities trading, and would
aim to fill a gap in financial markets' coverage of the global
In February, United Arab Emirates President Sheikh Khalifa
bin Zayed al-Nahayan passed a federal decree to create the zone
on Al Maryah island, close to Abu Dhabi's downtown area.
Announcing details of the plan on Wednesday, the emirate
left little doubt that its zone, to be called the Global
Marketplace Abu Dhabi, could become a competitor to Dubai,
currently the Gulf's premier financial centre.
Abu Dhabi's zone will have an independent regulator with its
own board, the Financial Services Regulations Bureau, as well as
two courts with a chief justice, the emirate's Office of
Government Communications said in its first public statement on
The zone, to be launched in the fourth quarter of 2013, will
offer benefits similar to the Dubai International Financial
Centre (DIFC), such as zero tax, easy repatriation of profits
and exemption from customs duties on imports.
"Under the law there will be independent authorities that
have their independent budgets and mandates under the
regulations of the Global Marketplace Abu Dhabi," the statement
Institutions operating in the zone will include various
types of bank, trading companies, foreign exchange and
commodity trading companies, prime brokerages, pension and
investment funds, Islamic financial firms, companies handling
stock trading, financial consultancies and others, it said.
"The free zone will bridge the gap in the global markets
between 7 a.m. and 11 a.m., between Asia and Europe, due to the
strategic location of the UAE," the statement said.
Neighbouring Dubai launched the DIFC in 2004 with its own
independent civil and commercial laws, its own courts and a
financial exchange, Nasdaq Dubai.
Abu Dhabi is keen to diversify its economy beyond oil and
although it is starting well behind Dubai as a financial centre,
it has advantages such as its oil wealth - which Dubai lacks -
and one of the world's largest sovereign wealth funds.
"It is an important step in attracting foreign direct
investment into Abu Dhabi...It will be interesting if it finds
its niche in commodities or forex, which have prospects,"
Mohammed Yasin, head of National Bank of Abu Dhabi's
brokerage unit, said of the emirate's plan.
"We also need to see the relationship of the free zone's
regulator with other local regulators such as the central bank
and the Securities and Commodities Authority, and that there is
coordination between them."
(Reporting by Stanley Carvalho, Editing by Andrew Torchia)