MCDC launches mechanism for regulating consolidated accounts

Muscat Clearing and Depository Company (MCDC) has introduced a new mechanism for regulating consolidated accounts, a move designed to boost investor access to the Omani capital market. This system allows for multiple beneficial owners to participate in investment opportunities through a single, aggregated account.

The initiative aligns with national efforts to increase the capital market's openness and attract foreign investment. By organizing the legislative and regulatory frameworks for consolidated accounts, MCDC aims to create a more inviting environment for international capital. The recently adopted rules for clearing and deposit operations further support this goal, bolstering foreign investor confidence and adhering to global best practices in deposit systems.

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Regulating consolidated accounts embodies the balance we are keen on between facilitating procedures for international investors and at the same time maintaining the highest standards of compliance and protecting investors’ rights.

Consolidated accounts are a key tool for global investment institutions, enabling them to manage client assets efficiently while upholding governance and transparency. Essentially, a consolidated account collects securities from different clients into a group account managed by a licensed operator. This operator, authorized by the Financial Services Authority or another relevant body, opens the account with MCDC to manage the collective holdings of various investors.

Mohammed bin Said Al Abri, CEO of MCDC, stated that regulating consolidated accounts strikes a balance between facilitating international investors and maintaining high standards of compliance and investor protection. The regulatory framework ensures legal clarity, particularly in exceptional circumstances like operator default or restructuring, safeguarding investors' ownership rights. He added that customers can transfer securities to personal accounts or other consolidated accounts, emphasizing MCDC's commitment to improving clearing and settlement efficiency and the overall investor experience. This development is expected to increase foreign investment, enhance liquidity, and support Oman Vision 2040's goals for economic diversification and sustainable growth in the financial sector.

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The customer in the consolidated account has the right to transfer securities to any account in his name registered with Muscat Clearing and Depository Company, or to transfer it to another consolidated account with another operator.