The SCA, DFSA, and FSRA have agreed on a framework in their respective jurisdictions, enabling them to “facilitate regulatory co-ordination among them in licensing domestic funds upon the adoption of the legislation”.
The three authorities confirmed that funds, licensed in accordance with the provisions of the agreement and the licensing regulations, may be promoted in or from the financial free zones in the UAE, in line with the provisions of the agreement and the licensing regulations.
Ahmed Ali Al Sayegh, minister of state to the UAE and chairman of the Abu Dhabi Global Markets (ADGM), said: “We welcome this partnership to strengthen UAE’s position as an international financial and business hub.
“This collaboration will enable greater number of current and new market participants, investors and companies to access growth opportunities in the UAE and the region as a whole.”
The regime is expected to “stimulate” the development of the domestic investment funds market by “encouraging the incorporation of new investment funds
Under the terms of the agreement, a notification and registration facility will be established by each regulator, “facilitating the promotion and sale of domestic funds, set up within the UAE, in either of the [Dubai International Financial Centre] or ADGM, to potential investors based anywhere in the UAE and under a single licence”.
The SCA, DFSA, and the FSRA have also agreed to establish common rules to implement the regulatory agreement.
The regime is expected to “stimulate” the development of the domestic investment funds market by “encouraging the incorporation of new investment funds”, in addition to “facilitating the conduction of business in the UAE”.
It will also look to provide greater protection to investors, as a result of the enhanced exchange of regulatory information among the authorities in relation to the promotion and sale of local investment fund units in the UAE.
The DFSA and FSRA will launch a consultation on the proposed regime.
Saeb Eigner, chairman of the DFSA, said: “This agreement between counterpart regulators reflects our joint efforts to encourage the development of the domestic funds market and create a stronger and more diversified financial market in the UAE.
“The DFSA remains committed to developing the financial services sector and fostering long-term economic growth for the UAE.
The SCA regulates the capital markets operating in the UAE, except for financial free zones. The DFSA is the independent regulator of financial services conducted in or from the DIFC, while the FSRA is the independent regulator for financial services in or from the ADGM.