Emirates Development Bank Launches Emirates Movable Collateral Registry Corporation EMCR
A New Tool to Publicize Lenders’ Rights in Movable Assets
April 03, 2018 – Emirates Development Bank (EDB) launched the Emirates Movable Collateral Registry Corporation (EMCR), a pioneering registry system aimed at helping secure creditors’ rights over movable collateral in the UAE.
EMCR is a wholly owned subsidiary of Emirates Development Bank and aims to achieve the objectives set forth in Federal Law No. 20 of 2016 on the Pledge of Moveable Property as collateral for Debt. The new federal law demonstrates the UAE’s continuous efforts to reform secured transactions and will enable entrepreneurs, small and medium companies to use movable assets (both tangible and intangible) as collaterals in exchange for loans. The new law is seen as a viable solution that can play a key role in enhancing investment opportunities in the UAE, particularly through the development of a world-class legislative system.
His Excellency Obaid Humaid Al Tayer, Minister of State for Financial Affairs and the Chairman of EDB said that the launch of the EMCR aims to achieve three main objectives, the first is to provide companies and projects with financing options as the EMCR is expected to increase access to finance and reduce interest rates on loans. The second objective is to provide an institutional framework and the appropriate legislation for secured lending. While the third objective is to contribute in raising the UAE’s competitiveness, enhance its business environment by improving the country’s “Legal Rights Index” in the ‘Doing Business’ report issued by World Bank.
H.E. Minister Al Tayer noted that the UAE government’s national agenda aims to reinforce the country’s position as one of the best countries in the world in terms of entrepreneurship, especially in the continuing efforts to encourage growth across Small and Medium Enterprises (SMEs) and providing them with the essential institutional framework and appropriate legislation for secured transactions. H.E. Minister Al Tayer expressed confidence in the EMCR, seeing it as a highly effective tool that will open new horizons for companies and projects in obtaining bank financing and encouraging banks to lend companies in light of the availability of an integrated legislative system.
The EMCR utilizes an advanced electronic system application that is available on the company’s website (www.emcr.ae). The application ensures the process of registering interest over movable collateral.
It is worth noting that Emirates Development Bank has held several training courses and workshops for all specialists involved in corporate finance as well as members of the judiciary, lawyers and prosecutors. More than 670 specialists; including representatives from 55 banks were trained and introduced to the mechanism and objectives of the electronic registry to facilitate the procedures for registering movable collateral upon the launch of the company’s operations. Emirates Development Bank shall manage and supervise EMCR in accordance with the UAE Cabinet decree No. 4/12 of 2017.