Investment Funds Regulation

Comprehensive regulation of local investment funds: establishing and licensing public and private funds, fund obligations, unitholder rights, change of fund manager, conversion and expiry, with appendices on offering documents, investment policies by fund type, fund classifications and in-kind share appraisal.

Summary

Decision No. 1/Chairman of 2023 is the main regulation for investment funds established and licensed onshore in the UAE (local funds). It covers public and private funds, open-ended and closed-ended funds, family funds and self-managed funds, and governs how they are set up and licensed, their obligations, unitholder rights, change of manager, conversion, expiry, liquidation and mergers. It was issued on 16 January 2023 and came into force on 1 February 2023, the day after Official Gazette publication (Article 48), and cancelled the 2016 investment funds regulations and three related decisions (Article 46). The CMA publishes it as a consolidated text reflecting Administrative Decisions No. 80/CEO of 2023 (in force 29 December 2023) and 21/CEO of 2025 (in force 24 April 2025), which amended the appendices on investment policies and fund classifications.

Article 2 applies it to local funds, their service providers and related parties, but not to bank deposits, insurance, intra-group joint investments, timeshares, employee incentive schemes, or government funds not offered to the public. A local fund may be established only by a CMA-licensed fund manager, a licensed family business investment manager (for a family fund whose units are 100% held by family members who are beneficial owners), or two or more founders of a self-managed fund who must subscribe at least AED 5 million and hold their units for six months; corporate founders need AED 20 million capital and two years of profits (Article 4).

The process runs in stages. The CMA gives initial approval within ten working days for a public fund and five for a private fund, and nothing may be promoted before approval (Article 6). Units must be offered within six months (Article 8), subscription runs five working days to three months (Article 9), and the manager files the auditor's completion certificate within 30 days of closing, after which the CMA issues the licence within five days. Licences last one year and the fund must start its strategy within 12 months (Article 12). Private funds have a minimum subscription of AED 180,000 per investor (except family funds), may not use public advertising, and units may be transferred only to existing holders, professional investors or counterparties (Articles 8, 31 and 32). Funds report under IFRS: reviewed semi-annual reports within 45 days and audited annual reports within three months (Article 15). Appendices cover offering document content, investment policies, fund classifications, in-kind appraisals and end-of-service gratuity savings funds.

Who it applies to

Investment funds established and licensed onshore in the UAE (public, private, family and self-managed funds), their managers, administrators, custodians, auditors and other service providers, founders of self-managed funds, related parties holding 5% or more of units, and investors subscribing for units.

Contents

English official text in 48 articles. Open the full text or jump to a provision:

1. Article 1 — Definitions
2. Article 2 — Scope of application
3. Article 3 — General provisions
4. Article 4 — The persons concerned with establishing the local fund
5. Article 5 — Request of initial approval
6. Article 6 — The Authority's decision on the initial approval application
7. Article 7 — Preparation of the offering document and the offering document information summary (KIID)
8. Article 8 — the invitation for subscription
9. Article 9 — Subscription coverage
10. Article 10 — Allotment and returning excessive amounts
11. Article 11 — Provisions on the closed- ended local fund
12. Article 12 — Final approval and issuance of the decision of incorporation and licensing
13. Article 13 — The local fund's board of directors
14. Article 14 — Local fund's accounts
15. Article 15 — Local fund's reports
16. Article 16 — Conversion of cash debts
17. Article 17 — Lending and borrowing by the local fund
18. Article 18 — Split or compound of the investment units and their classes
19. Article 19 — Wrong evaluation of the fund's net asset value
20. Article 20 — Listing the local fund's units
21. Article 21 — Amending the offering document and the offering document information summary (KIID)
22. Article 22 — Closed-ended local fund's purchase of its traded units
23. Article 23 — Rights and responsibility limits of the unit holders
24. Article 24 — Redemption of the local fund units
25. Article 25 — Local fund's profits
26. Article 26 — Rights issue for the closed-ended public fund unit holders
27. Article 27 — The general assembly of the public fund unit holders
28. Article 28 — Related party Transactions of the public fund
29. Article 29 — Disclosure requirements for the closed-ended public fund
30. Article 30 — Issuance of sukuk and bonds
31. Article 31 — Advertisements and promotional materials of the private fund
32. Article 32 — Restrictions on the private fund's units' title transfer
33. Article 33 — The general assembly of the private fund's units' owners
34. Article 34 — Change of the fund manager or the self-managed fund's board of directors
35. Article 35 — Withdrawal of the fund manager or the self-managed fund's board of directors
36. Article 36 — Vacancy of the position of one of the members of the self-managed fund's executive body
37. Article 37
38. Article 38 — Expiration cases and procedures
39. Article 39 — Liquidation of the local fund
40. Article 40 — Obligations of the fund manager and the board of directors of the self-managed fund upon liquidation
41. Article 41 — Merger of investment funds
42. Article 42 — Control & Inspection
43. Article 43 — Violations & sanctions
44. Article 44 — Complaints & Grievances
45. Article 45 — Resolutions, appendixes and forms
46. Article 46 — Cancellation of the previous resolutions
47. Article 47 — Regularization of Status
48. Article 48 — Enforceability of the Resolution

Key provisions

Obligations and deadlines

• Do not announce, promote or take subscriptions for a fund before the CMA's initial approval (Article 6).
• Offer units within six months of initial approval unless the CMA extends the period (Article 8).
• File the auditor's subscription certificate within 30 days of closing subscriptions (Article 12).
• Renew the fund licence annually, applying at least one month before expiry (Article 12).
• File reviewed semi-annual reports within 45 days and audited annual reports within three months (Article 15).

Penalties

Article 43 subjects breaches to the administrative penalties in the Cabinet decree issued under the Commercial Companies Law and allows the CMA to suspend or cancel a fund's establishment, licensing or approval procedures. Under Articles 6 and 12 any act based on an initial approval alone is void, and if the completion certificate is not filed within 30 days the establishment lapses and subscriptions must be returned.

History and citations

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