Law No. (8)
of 2022
Regulating
the
Public Debt
of the Government of Dubai[1]
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We,
Mohammed bin Rashid Al Maktoum, Ruler of Dubai,
After perusal of:
Federal Law by Decree No. (9) of 2018
Concerning Public Debt;
Law No. (5) of 1995 Establishing the
Department of Finance;
Law No. (3) of 2003 Establishing the
Executive Council of the Emirate of Dubai;
Law No. (7) of 2008 Concerning Public
Debt Procedure;
Law No. (1) of 2016 Concerning the
Financial Regulations of the Government of Dubai;
Law No. (12) of 2020 Concerning
Contracts and Warehouse Management in the Government of Dubai;
Decree No. (24) of 2007 Forming the
Supreme Fiscal Committee in the Emirate of Dubai and its amendments; and
Executive Council Resolution No. (19)
of 2017 Approving the Organisational Structure of the Department of Finance,
Do hereby issue this Law.
This
Law will be cited as "Law No. (8) of 2022 Regulating the Public Debt of
the Government of Dubai".
The
following words and expressions, wherever mentioned in this Law, will have the
meaning indicated opposite each of them unless the context implies otherwise:
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Emirate: |
The Emirate of Dubai. |
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Government: |
The Government of Dubai. |
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Executive Council: |
The Executive Council of the Emirate
of Dubai. |
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SFC: |
The Supreme Fiscal Committee in the Emirate of Dubai. |
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DOF: |
The Department of Finance. |
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Director General: |
The director general of the DOF. |
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Government Entity: |
Any of the Government departments, public agencies or
corporations, Government councils or authorities, or public entities
affiliated to the Government. |
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Government Companies: |
This includes commercial corporations and companies wholly
owned by the Government or by Government Entities; and any other companies or
corporations determined by the SFC upon the recommendation of the DOF, in
accordance with the rules adopted by the SFC in this respect. |
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PDMO: |
The Public Debt Management Office established pursuant to
this Law at the DOF. |
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CEO: |
The chief executive officer of the PDMO. |
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Public Debt: |
The total financial liabilities of the Government, arising
from borrowing money from or through financial institutions. |
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Public Debt Instruments: |
Any instruments that are approved by the SFC, that are
issued by the Government or to which the Government is a party, and that involve an obligation on the Government to pay a specific amount.
This includes loan agreements and the Government sukuk and bonds tradeable in
financial markets. |
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Government Borrowing: |
The obtainment of any amounts by the Government from or
through financial institutions in the form of a loan. |
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Government Guarantees: |
The financial guarantees provided by the Government in accordance
with the provisions of this Law to ensure the settlement of its financial
liabilities. |
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General Budget: |
The Government budget, for a Financial Year, which is
approved pursuant to a law and which contains the total estimated Public
Revenue and estimated Public Expenditure of the Government and the Government
Entities whose budgets are included in that budget. |
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Financial Derivatives: |
Financial instruments in the form of contracts that derive
their value from a real or financial asset (the “Underlying Asset”). These contracts are concluded for the purpose of
responding to future risks that may arise from the fluctuations in prices of
commodities, stocks, and bonds, and in the rates of currency exchange or
interest, such as future contracts, forward contracts, options contracts, and
swap contracts. |
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This
Law applies to the following entities:
1.
Government
Entities;
2.
Government
Companies; and
3.
any entity
receiving financial support from the Government or benefiting from Government
loans or Government Guarantees.
This
Law aims to:
1.
meet the
financial needs of the Government in accordance with the risk management
standards and criteria adopted in this respect;
2.
maintain a
balanced risk profile of the Public Debt portfolio;
3.
manage the
Public Debt of the Government in accordance with safe and sound best practices;
4.
boost the
trust of investors and financial institutions in the financial position of the
Government, its strategic vision, and its initiatives in various fields, by
maintaining high levels of transparency and credibility; and
5.
ensure
sustainability in the management of financial obligations by the entities
governed by this Law.
a.
For
purposes of this Law, the SFC will have the duties and powers to:
1.
approve the
strategic goals and general policies related to Public Debt management;
2.
approve a
policy for distribution of the profits earned by Government Entities and
Government Companies;
3.
approve
loans on behalf of the Government;
4.
approve
Public Debt Instruments;
5.
approve the
contracts relating to Financial Derivatives;
6.
authorise,
upon the recommendations of the DOF, the entities governed by this Law to
undertake direct borrowing;
7.
approve the
issuance of Government Guarantees; and
8.
exercise
any other duties or powers that are related to Public Debt management and
required for the achievement of the objectives of this Law.
b.
Unless the
SFC decides otherwise, the loans that the SFC authorise any entity governed by
this Law to obtain will not be guaranteed by the Government.
a.
An office
named the “Public Debt Management Office” is hereby established at the DOF as
an organisational unit within its structure.
b.
A CEO will
be appointed to the PDMO pursuant to a resolution of the Chairman of the
Executive Council.
c.
The PDMO
will have the duties and powers to:
1.
develop, in
coordination with the concerned organisational units of the DOF, the general
policies for Public Debt management; and submit the same to the SFC for
approval;
2.
develop a
policy for distribution of the profits earned by Government Entities and
Government Companies and a process for the deposit of these profits into the
Government’s account; submit the policy and process to the Director General for
approval, in preparation for their final approval by the SFC; and follow up the
implementation of the same upon their approval;
3.
take the
necessary action to meet the financing needs of the Government by means of
Government Borrowing through issuing the Public Debt Instruments approved by
the SFC;
4.
manage the
Public Debt portfolio and ensure that the money raised through Public Debt is
used for the purposes for which Government Borrowing is made;
5.
adopt
Financial Derivatives to enhance the efficiency of the Public Debt portfolio
and minimise the potential risks of Government Borrowing;
6.
follow up
the management by Government Entities, Government Companies, and other similar
entities of the financial liabilities incurred by them as a result of loans;
7.
create a
reliable and transparent database of the Public Debt and the loans owed by
Government Entities and Government Companies;
8.
review, on
a regular basis, the financial risks related to the levels of Public Debt and
Government Guarantees; and submit the relevant reports to the Director General
to take the appropriate action in this respect;
9.
coordinate
with the Federal Public Debt Management Office and other local public debt
offices to develop the public debt management systems in the United Arab
Emirates;
10. consider the procedures for Government Borrowing, for
providing Government Guarantees, for repayment of loans, and for future
borrowing plans; and submit the relevant proposals to the Director General;
11. supervise the implementation of the standards of
transparency and disclosure of Government solvency; propose initiatives to
enhance the trust of local and international investors; and promote
relationships with investors and financial institutions in accordance with the
international best practices;
12. prepare periodic reports on Public Debt management, and
present the same to the Director General, in preparation for submission of the
same to the SFC. These reports must include all details related to the amount
of Public Debt, particularly the following:
a.
the current
state of Public Debt and the amounts of debts
owed by the Government, Government Entities, and Government Companies;
b.
plans for
provision of the finance required to meet the financial needs of the
Government; and
c.
the
recommendations required for improving Public Debt management and enhancing the
financial stability of the Government, and
13. exercise any other duties or powers required for the
achievement of the objectives of this Law, as assigned to it by the SFC or the
Director General.
Government
Borrowing will be exclusively intended for:
1.
financing
the General Budget deficit;
2.
financing
the projects included in the General Budget;
3.
refinancing
any mature or existing loans; and
4.
any other purposes
approved by the SFC.
The
SFC will determine the Persons authorised to represent the Government in
concluding any contracts related to Public Debt, in accordance with the
provisions of this Law, other legislation in force in the Emirate, and the
relevant table of financial approval powers adopted by the SFC.
a.
The DOF is
the entity authorised to issue Government Guarantees on behalf of the
Government. These guarantees will be provided exclusively to achieve any of the
purposes stipulated in Article (7) of this Law.
b.
The DOF
may, in accordance with the standards adopted by the SFC, charge the entities
benefiting from Government Guarantees any financial consideration for these
guarantees; and may request these entities to provide mortgage security and any
other guarantees in favour of the Government.
a.
Subject to
the policies adopted by the SFC, the Government Entities, the Government
Companies, and the entities benefiting from any Government loans, Government
Guarantees, or financial support from the Government must:
1.
not borrow
any money from, or provide any guarantee to, a third party without first
obtaining the approval of the SFC;
2.
provide the
PDMO with all reports, financial statements, and information it requests within
the deadlines, as per the procedures, and in the manner prescribed by the PDMO;
and
3.
in case of
Government Entities and Government Companies, deposit the annual profits earned
by them into the Public Treasury account in accordance with the profit
distribution policy adopted by the SFC in this respect.
b.
The
Chairman of the Executive Council may, upon the recommendations of the SFC,
exempt from compliance with any of the obligations stipulated in paragraph (a)
of this Article any Government Entity, Government Company, or other entity
receiving financial support from the Government or benefiting from Government
loans or Government Guarantees, based on a request submitted by that entity.
This exemption will be granted in accordance with the criteria adopted by the
SFC in this respect.
With
a view to serving their best interests and without prejudice to their financial
positions, the entities governed by this Law which obtain the SFC approval to
borrowing may repay the relevant loans prior to their maturity dates without
obtaining the prior approval of the SFC.
a. No taxes or fees may be imposed on the issuance of a Public
Debt Instrument or on the payment of its issue price or proceeds, or the
interest or profits resulting therefrom.
b. Any contracts concluded by the Government in accordance with
the provisions of this Law will not be subject to the provisions of the
above-mentioned Law No. (12) of 2020. However, these contracts will be subject
to the relevant rules, requirements, and procedures adopted by the SFC.
The
SFC may delegate any of its powers under this Law to the Director General or
the CEO, provided that such delegation is specific and in writing.
The
Chairman of the SFC will issue the resolutions required for the implementation
of the provisions of this Law.
The
above-mentioned Law No. (7) of 2008 is hereby repealed. Any provision in any
other legislation will also be repealed to the extent that it contradicts the
provisions of this Law.
This
Law will be published in the Official Gazette and will come into force on the
day on which it is published.
Mohammed bin Rashid Al Maktoum
Ruler of
Dubai
Issued in Dubai on 14 March 2022
Corresponding
to 11 Shaban 1443 A.H.
©2022 The Supreme
Legislation Committee in the Emirate of Dubai
[1]Every effort
has been made to produce an accurate and complete English version of this
legislation. However, for the purpose of its interpretation and application,
reference must be made to the original Arabic text. In case of conflict, the
Arabic text will prevail.