A Financial Broker is an Agent with Commission Acting under Fiduciary Duty
Type
E-journal
Date
19 Apr 2016
Jurisdiction
United Arab Emirates
Taxonomy
Agency
Copyright
LexisNexis
Relevant company
Al Tamimi & Company
Legal reference
UAE Law No. 10/1980, UAE Law No. 18/1993, UAE Law No. 4/2000
Analysis
A Trading Agreement in stocks and bonds is an agreement between a brokerage company or agency and its customer (the “investor”), pursuant to which the brokerage company acts as the investor's broker and dealer for the purpose of buying and selling stocks and bonds.
Trading in securities in the UAE is subject to the provisions of many federal laws including most prominently: (a) the Federal Commercial Transactions Law (Law No. 18 of 1993), (b) the Emirates Securities and Commodities Authority and Market Law (Law No. 4 of 2000) and (c) the UAE Central Bank Law (Law No. 10 of 1980) and its amendments.
In the following judgment, the Dubai Court of Cassation classified the relationship between a Brokerage Agency and the investor as an agency created via agreement subject to the general statutory provisions governing bilateral contracts, and the provisions governing commercial agencies set out in the UAE Commercial Transactions Law.
Facts of the case