A new Sustainable Finance Regulatory Framework is now in force in the ADGM, enacted on 4 July 2023 following a consultation in late 2022. Integrating sustainability into regulatory frameworks is a strategic priority for the ADGM and the UAE, as the UAE gears up to host the 28th edition of the climate conference this year (COP28).
The framework has been implemented by way of amendments to the Companies Regulations 2020, the Financial Services and Markets Regulations, and the Conduct of Business (COBS), Funds (FUNDS), Markets (MKT) and Glossary (GLO) Rulebooks.
Key features of the new regime are:
You can read more about global ESG developments in our ESG Legal Outlook 2023 and our Sustainable Futures blog.
You can find out more about ESG in the Middle East by listening to our podcast series – #LetsTalkESG – which shares insights from a range of industry experts as they discuss the transition, governance, and sustainability of ESG principles in the region. Please click here to explore our podcast.
The DIFC has consulted on amendments to DIFC Data Protection Regulations (the “Regulations”), in DIFC Consultation Paper No 2. of 2023. The proposals would amend the existing Regulations issued in 2020, pursuant to the DIFC Data Protection Law 2020 (DIFC Law No. 5 of 2020).
The proposed amendments would address, among other things:
The SCA has extended the transitional period for compliance with the new regime for the promotion or distribution of foreign funds in the UAE. The new regime, set out in SCA Decision No. 4/RM/2023 Concerning the Mechanisms of Regularisation of Status for Promotion of Foreign Fund Units and SCA Decision No. 02/RM/2023 which amended the SCA Rulebook, came into force in January 2023 (read more...).
The general rule is that only firms licensed by the SCA to conduct the regulated activity of “Promotion” may promote foreign funds to “Professional Investors” and “Counterparties” (as defined in the SCA Rulebook) in the UAE on a private placement basis, with SCA approval.
All foreign funds to be distributed in the UAE must be registered with the SCA.
In limited circumstances, promoters of foreign funds may apply to the SCA to benefit from a transitional period allowing foreign funds to be promoted to retail investors in the UAE up to 31 March 2024 (extended from 30 June 2023) or the expiration of the relevant promotion agreement (whichever is earlier), provided that the foreign fund was registered with the SCA for retail promotion on or before 31 December 2022 and is subject to a valid promotion agreement (which would be breached if the promotion were required to cease in accordance with the new SCA rules). The promoter must provide the required supporting documentation with its application. Where agreements for promotion or distribution are often drafted so as to require the promoter to comply with local laws and regulations, and in such circumstances, the extended transitional period for compliance will not be available to promoters of foreign funds. Accordingly, the transitional period may be of limited application in practice.
The rules relating to foreign investment in securities have been consolidated and updated, pursuant to the new Rules for Foreign Investment in Securities issued by the Capital Market Authority (“CMA”) on 27 March 2023.
The Rules consolidate, update and replace a number of previous rules on foreign investment in listed securities, which had restricted investment to those foreign investors who are:
There is also a separate CMA Circular regarding permission for capital market agreements to enter into swap agreements.
Applicable requirements for each category of investment are all set out in the Rules. The Rules also relax certain requirements in relation to each category of investment.
16 5월 2023
The first quarter of 2023 saw a number of legal developments in the Gulf Cooperation Council (GCC) region (Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates). This edition of our GCC Quarterly Review summarises a selection of the major developments in that period, with links to further reading where available.
2 2월 2023
The last quarter of 2022 saw a number of legal developments in the Gulf Cooperation Council (GCC) region (Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates). The latest edition of our GCC Quarterly Review summarises a selection of the major developments in that period, with links to further reading where available.
9 11월 2022
The third quarter of 2022 saw a number of legal developments in the Gulf Cooperation Council (GCC) region (Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates). The latest edition of our GCC Quarterly Review summarises a selection of the major developments in that period, with links to further reading where available.