SCA readies final draft of fund bill

10 Jan 2012
News, regulation, SCA

The UAE’s Securities and Commodities Exchange (SCA) is nearly ready to release the final version of its Draft Decision on Investment Funds legislation, more than one year after the original draft was announced. 

Dr Ryan Lemand, senior economic advisor and acting head of risk management at SCA, told Mena FM that the regulations  have entered the final review  stage. “The technical part of the regulations is finalised,”  he said. “It is now under review by the SCA’s top management in preparation for its signature. This final stage should not take too long, however it is hard to give an ETA.”

The first draft of the regulations was released on 6 January 2011 and was met with a backlash among industry professionals. During the initial review period, the regulator received 548 pages of comments, many of which have been taken into consideration, added Lemand. “The regulation tried to accommodate the comments that were valid to the extent SCA’s experts felt they added value to the different rules with regards to collective investment schemes,” he told Mena FM.

The key criticism was a lack of clarity regarding the promotion and distribution of mutual funds in the UAE (ex-DIFC). Lemand confirmed that the new regulation would give comfort to those companies looking to establish or promote mutual funds in the UAE as it gives an adequate regulatory framework, which in its turn would enhance long-term institutional investment inflow.