UAE Central Bank issues notice on mutual funds to banks and investment companies
The UAE Central Bank had ordered banks and financial companies to adhere to its Notice Number 237/2013 dated July 18, 2013, with regard to issuance and marketing of mutual funds. The Central Bank has asked all banks and investment companies to complete a sheet in respect of mutual funds issued or marketed by the bank/company in the UAE since inception up to February 24, 2009, in order to provide information to Securities and Commodities Authority (SCA). According to Article 2 of the Regulations, mutual funds established in a free zone within the UAE are treated as foreign funds. The regulations define a mutual or investment fund as essentially a financial vehicle for the purpose of investment against the issue of investment units of equal value and rights. As per the law, no local mutual fund may be established and no foreign mutual fund may be promoted within the UAE, prior to obtaining a licence for establishment or approval of the promotion of the mutual fund from the SCA.