In new rule, UAE investors can no longer subscribe directly to ‘foreign funds’

In new rule, UAE investors can no longer subscribe directly to ‘foreign funds’

Investors based in the UAE need to be careful about their future commitments to foreign funds being aggressively promoted to them. Banks have been telling their clients who can and cannot invest in such funds.

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Dubai: Individual investors based in the UAE will no longer be able to directly subscribe to foreign funds through their bank accounts here, according to new rules from the regulator.

Banks in the UAE have been communicating this to their clients as the new rule became effecting from April 1. It is believed that the new rule applies only to subscriptions made after this date – all existing investment commitments can still proceed, according to banking sources.

What this means is that ‘ordinary investors’ in the UAE will find that foreign funds will no longer be available for subscription.

As for ‘professional investors’, their participation in foreign funds can still go ahead, provided they meet the minimum threshold investment of Dh500,000 per foreign fund.

And ordinary funds will find only local funds will be directly accessible via their bank accounts in the UAE.

The UAE’s Securities & Commodities Authority has issued these directives to banks, and which in turn are communicating the same to