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Dubai Financial Services Authority (DFSA): Contents

Dubai Financial Services Authority (DFSA)
Laws
Rulebook Modules
Collective Investment Rules (CIR) [VER24/02-19]
Part 4 Core Rules Relating to Establishment and Management of Domestic Funds
Sourcebook Modules
Consultation Papers
Policy Statements
DFSA Codes of Practice
Amendments to Legislation
Media Releases
Notices
Financial Markets Tribunal
Archive

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  • Part 4 Core Rules Relating to Establishment and Management of Domestic Funds

    • CIR 7 Constitution

      • CIR 7.1 Application

        • CIR 7.1.1

          (1) This chapter applies to a Fund ManagerG , and where appointed a TrusteeG , of a Domestic FundG .
          (2) Only this Rule and Rules 7.1.2(1)(b), 7.1.2(2) and 7.1.4 apply to a Fund ManagerG and, where appointed, a TrusteeG , of a Qualified Investor FundG .
          Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
          [Amended] DFSA RM137/2014 (Made 21st August 2014). [VER17/06-14]

        • Instrument Constituting the Fund

          • CIR 7.1.2

            (1) The Fund ManagerG and, in the case of an Investment TrustG , both the Fund ManagerG and the TrusteeG of a FundG , must ensure that the written ConstitutionG which every FundG is required to have pursuant to Article 27(1) of the Law:
            (a) contains the statements and disclosures prescribed in the table in CIR App5 as are applicable to the FundG ; and
            (b) does not contain any provision that is prejudicial to the interests of the UnitholdersG generally or to the UnitholdersG of any class of UnitsG .
            (2) The Fund ManagerG and, in the case of an Investment TrustG , both the Fund ManagerG and the TrusteeG , are responsible for maintaining the ConstitutionG and for making necessary alterations to it in accordance with the applicable legislation.
            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]

          • CIR 7.1.3

            (1) A Fund ManagerG may issue and in the case of an Investment TrustG , may instruct the TrusteeG to issue such classes of UnitsG as are set out in the ConstitutionG , provided the rights of any class are not unfairly prejudicial to the interests of the UnitholdersG of any other class of UnitsG in that FundG .
            (2) UnitsG whose issue may be limited can be issued by a Fund ManagerG if permitted by the ConstitutionG and if in accordance with the conditions set out in the ProspectusG , provided that such issue will not materially prejudice any existing UnitholdersG in the FundG .
            (3) In the case of an Investment TrustG , the TrusteeG must take reasonable measures to ensure, before carrying out the Fund Manager'sG instructions, that those instructions comply with the requirements in (1) and (2).
            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]

        • Name of the Fund

          • CIR 7.1.4

            The Fund ManagerG , and if appointed the TrusteeG , of a FundG must ensure that the name of the FundG or any Sub-FundG or class of UnitsG in the FundG or Sub-FundG , is not undesirable, misleading or in conflict with the name of another FundG or another Sub-FundG or class of UnitsG in the FundG or Sub-FundG .

            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]

            • CIR 7.1.4 Guidance

              1. Article 27(4) of the Law and this RuleG give the DFSAG the power to make a direction if a name of a FundG , Sub-FundG or class of UnitsG in a FundG is undesirable, misleading or conflicts with a name used by another FundG , Sub-FundG or class of UnitsG of a FundG .
              2. In determining whether to make a direction under these powers, the matters that the DFSAG may take into account include whether the name of the FundG , Sub-FundG or class of UnitsG as the case may be:
              a. implies that the FundG , Sub-FundG or class of UnitsG has merits which are not, or might not be, justified;
              b. is inconsistent with the Fund'sG investment objectives or policy;
              c. might mislead UnitholdersG or prospective UnitholdersG into thinking that a PersonG other than the Fund ManagerG is responsible for the FundG , Sub-FundG or class of UnitsG of the FundG ;
              d. is substantially similar to the name of another Collective Investment FundG in the DIFCG or elsewhere;
              e. implies that it is a specialist class of FundG or Sub-FundG , where the relevant requirements relating to that class of specialist FundG are not met; or
              f. is in the opinion of the DFSAG likely to offend the public.
              Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
              [Amended] RM158/2015 (Made 9th December 2015). [VER19/02-16]

          • CIR 7.1.5

            Before using as part of or in connection with the name of a FundG , Sub-FundG or class of UnitsG in a FundG the words "guaranteed", "protected" or any other words with a similar meaning implying a degree of security in relation to the capital or income, the Fund ManagerG must demonstrate to the satisfaction of the DFSAG that:

            (a) the guarantor has the authority and resources to honour the terms of the guarantee; and
            (b) all the terms of the guarantee and the credentials of the guarantor are clearly set out in detail in the ProspectusG and that any exclusions such as force majeure are highlighted.
            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
            [Amended] RM158/2015 (Made 9th December 2015). [VER19/02-16]

            • CIR 7.1.5 Guidance

              In considering whether to permit a Fund ManagerG to use the words "guaranteed" or "protected" as part of or in connection with the name of a FundG , Sub-FundG or class of UnitsG in a FundG , the DFSAG will also take into account whether the degree of security implied by the name fairly reflects the nature of the arrangements for providing that security.

              Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
              [Amended] RM158/2015 (Made 9th December 2015). [VER19/02-16]

        • Alterations to the Constitution of a Fund

          • Guidance

            Articles 35 and 36 of the Law govern the process of making alterations to a ConstitutionG .

            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]

    • CIR 8 Management and Operation of A Fund

      • CIR 8 Guidance

        While most of the provisions in this chapter are of general application to all Domestic FundsG , in a few instances, some provisions which are specific to a certain type of Domestic FundG , for example a Public FundG , are retained in this Part. The DFSAG has, instead of removing such provisions to CIR Part 5 which contains provisions applicable to specific types of Domestic Funds, retained them in this Part because those requirements are integral to the main provisions applying to all Domestic Funds and therefore need to be read together.

        Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
        [Amended] DFSA RM137/2014 (Made 21st August 2014). [VER17/06-14]
        [Amended] DFSA RM218/2018 (Made 22nd February 2018) [VER23/12-18]

      • CIR 8.1 General Management duties

        • Application

          • CIR 8.1.1

            (1) This chapter applies to a Fund ManagerG , and if appointed the TrusteeG , of a Domestic FundG , except as provided in (3) or where otherwise provided in this chapter.
            (2) This chapter also applies, where expressly provided, to a Fund AdministratorG or Eligible CustodianG of a Domestic FundG .
            (3) Only this Rule and CIR Rules 8.1A.1, 8.1A.2, 8.4.1(1)(a), 8.6A.1 and 8.10.1 in this chapter apply to, or in relation to, a Qualified Investor FundG .
            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
            [Amended] DFSA RM137/2014 (Made 21st August 2014). [VER17/06-14]
            [Amended] DFSA RM218/2018 (Made 22nd February 2018) [VER23/12-18]

            • CIR 8.1.1 Guidance

              1. Article 22 of the Law requires the Fund ManagerG of a Domestic FundG to manage the FundG in accordance with the Fund'sG ConstitutionG and its most recent ProspectusG and to perform the functions conferred on it by the ConstitutionG and the Law. In doing so, the Fund ManagerG is required under that Article to comply with any conditions or restrictions on its LicenceG as well as any limitations or requirements imposed by or under the Law or RulesG .
              2. Article 38 of the Law requires the Fund ManagerG to establish and maintain systems and controls including but not limited to financial and risk controls to ensure sound management of the FundG in accordance with the Fund'sG ConstitutionG and its most recent ProspectusG , taking due account of the nature, scale and complexity of the Fund'sG investments and operations. There is an additional obligation on Fund ManagersG of all Open-ended Domestic FundsG to have adequate systems and controls to address liquidity risks in such FundG —see CIR Rule 8.6A.1.
              3. The requirements in this chapter apply to External Fund ManagersG in the same manner as they apply to Fund ManagersG of Domestic FundsG , unless otherwise provided. External Fund ManagersG and External FundsG attract additional requirements, which are set out in CIR chapter 6.
              4. This chapter sets out more detailed obligations of the Fund ManagerG , and where appointed the TrusteeG , of a Domestic FundG with regard to:
              a. Duties relating to Fund PropertyG ;
              b. Conflicts of interests;
              c. Valuation of FundG ;
              d. Determination of single price;
              e. Issue and redemption of UnitsG ;
              f. UnitholderG register;
              g. Meetings of Governing BodyG and UnitholdersG ;
              h. Approvals and notifications;
              i. Maintenance of records;
              j. Capital;
              k. Delegations and outsourcing; and
              l. Charges and expenses.
              Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
              [Amended] DFSA RM218/2018 (Made 22nd February 2018) [VER23/12-18]

      • CIR 8.1A Corporate Director

        • Application

          • CIR 8.1A.1

            This chapter applies to:

            (a) an Investment CompanyG which elects to have its sole Corporate DirectorG act as its Fund ManagerG ; and
            (b) that Corporate DirectorG .
            Derived from DFSA RM218/2018 (Made 22nd February 2018) [VER23/12-18]

        • Requirements relating to a Corporate Director

          • CIR 8.1A.2

            (1) The Investment CompanyG must:
            (a) not have any directors other than a Corporate DirectorG ; and
            (b) have Articles of AssociationG that permit the company to appoint that Corporate DirectorG as its Fund ManagerG .
            (2) The Corporate DirectorG must ensure that:
            (a) the requirements in (1) are met;
            (b) it is registered under the Companies LawG of the DIFCG ;
            (c) it has at least two individuals appointed as its directors; and
            (d) it does not act as the Fund ManagerG of any FundG other than the Investment CompanyG or Manage AssetsG for another PersonG .
            [Derived from] DFSA RM218/2018 (Made 22nd February 2018) [VER23/12-18]

            • CIR 8.1A.2 Guidance

              1. The Companies RegulationsG permit Investment CompaniesG to have a sole corporate director. An Investment CompanyG has the option to be internally managed, by having that corporate director act as its Fund ManagerG . Alternatively, an Investment CompanyG has the option to have an 'external' Fund ManagerG . In both cases, the Fund ManagerG must be licensed and is legally accountable to UnitholdersG in the FundG (i.e., to its shareholders) for the proper management of the FundG (i.e. the Fund PropertyG ).
              2. A Corporate DirectorG of an Investment CompanyG , which elects to be internally managed, is required to meet all the other requirements that are applicable to an applicant for a Fund Manager's LicenceG , including the capital requirements (in PIBG ), and the adequate systems and controls requirements (in GENG ). However, as such a Corporate DirectorG can only act as the Fund ManagerG of the Investment CompanyG (and not of any other FundsG ), the systems and controls requirements would apply proportionately to the nature and scale of the activities of that company.
              3. A Corporate DirectorG that is a Fund ManagerG may delegate and outsource its functions and activities in the same manner and subject to the same requirements as other Fund ManagersG . A Corporate DirectorG who outsources functions cannot thereby delegate responsibility for meeting the Fund Manager'sG duties and obligations and its legal accountability to investors in the FundG . Please refer to GENG Rules 5.3.21 and 5.3.22 and CIR Rule 8.12.4 for outsourcing and delegation requirements applicable to Fund ManagersG .
              Derived from DFSA RM218/2018 (Made 22nd February 2018) [VER23/12-18]

      • CIR 8.2 Duties in Relation to Fund Property

        • Fund Manager

          • CIR 8.2.1

            (1) A Fund ManagerG must make decisions as to the constituents of the Fund PropertyG that are in accordance with the ConstitutionG of the FundG and investment objectives and policy stated in the ProspectusG .
            (2) A Fund ManagerG must take all steps and execute all documents to ensure that transactions relating to the Fund PropertyG are properly entered into for the account of the relevant FundG or Sub-FundG .
            (3) A Fund ManagerG of an Investment TrustG must ensure that instructions it gives to the TrusteeG in relation to the Fund PropertyG are in accordance with the agreement creating the Investment TrustG , the Fund'sG ConstitutionG , and the ProspectusG .
            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]

          • CIR 8.2.2

            (1) In the case of an Investment CompanyG or an Investment PartnershipG , the Fund ManagerG is responsible to the UnitholdersG for the safekeeping of the Fund PropertyG .
            (2) Without removing the generality of the obligation under (1) and subject to (3), a Fund ManagerG must, in the case of a FundG which is an Investment CompanyG or Investment PartnershipG :
            (a) delegate the activity of Providing CustodyG in relation to the Fund PropertyG to a Service ProviderG who is an Eligible CustodianG ; and
            (b) comply with the delegation procedures set out in CIR section 8.12 in relation to such a delegation.
            (3) The requirement in (2) does not apply to:
            (a) a Property FundG in respect of Real PropertyG :
            (i) that is held by the Fund ManagerG in accordance with CIR Rule 13.4.2 or CIR 13.4.2A; or
            (ii) for which the Fund ManagerG has made adequate alternative arrangements in accordance with CIR Rule 13.4.2B;
            (b) a Private Equity FundG where the Fund ManagerG has made adequate alternative arrangements that are in accordance with CIR Rule 13.3.1; or
            (c) an Exempt FundG where the Fund PropertyG :
            (i) comprises of an interest in the operation of a Real PropertyG asset (such as an investment in an infrastructure project); and
            (ii) the Fund ManagerG makes alternative arrangements to ensure that the Fund PropertyG is clearly distinguishable as belonging to the FundG , and is segregated from the assets of the Fund ManagerG and from the assets of any other FundG which the Fund ManagerG manages.
            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
            [Amended] RM158/2015 (Made 9th December 2015). [VER19/02-16]
            [Amended] DFSA RM218/2018 (Made 22nd February 2018) [VER23/12-18]

            • CIR 8.2.2 Guidance

              1. CIR Section 8.12 of this module governs the power of a Fund ManagerG to delegate certain of its Financial ServiceG activities, and to outsource its functions.
              2. Where a FundG invests in infrastructure projects (for example, the development of public facilities such as roads, railways or bridges), the interest acquired by the FundG may not necessarily be suited to the conventional forms of holding custody of Real PropertyG . Where this is the case, a Fund ManagerG may use adequate alternative custody arrangements that meet the requirements in CIR 8.2.2(3)(c)(2)(ii).
              Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
              [Amended] DFSA RM218/2018 (Made 22nd February 2018) [VER23/12-18]

        • Trustee

          • CIR 8.2.3

            In the case of an Investment TrustG :

            (a) the TrusteeG of the FundG must hold the Fund PropertyG in trust for the UnitholdersG and accordingly is responsible to the UnitholdersG for the safekeeping of the Fund PropertyG ;
            (b) the legal title of the Fund PropertyG must be registered with the TrusteeG except in the case of a Property FundG investing in Real PropertyG where the TrusteeG has made adequate alternative arrangements that are in accordance with CIR Rule 13.4.2B; and
            (c) the TrusteeG must not act on instructions of the Fund ManagerG in relation to the Fund PropertyG if such instructions are not in accordance with the agreement creating the Investment TrustG , the Fund'sG ConstitutionG , or the ProspectusG .
            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
            [Amended] RM158/2015 (Made 9th December 2015). [VER19/02-16]

            • CIR 8.2.3 Guidance

              CIR Section 8.12 of this module governs the power of a TrusteeG to delegate certain of its Financial ServiceG activities, and to outsource its functions.

              Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]

        • Eligible Custodian

          • CIR 8.2.4

            For the purposes of the Rules in this module, except as provided in CIR Rule 8.2.5, an Eligible CustodianG is a PersonG who is a separate legal entity from the Fund ManagerG and who also meets one of the following criteria:

            (a) an Authorised FirmG whose LicenceG authorises it to Provide Custody ServicesG ;
            (b) an Authorised FirmG that is a BankG ;
            (c) an Authorised Market InstitutionG ;
            (d) a legal entity that is authorised to provide custody services, and is supervised, by a Financial Services RegulatorG in the StateG ;
            (e) a legal entity that is authorised to provide custody services, and is supervised, by a Financial Services RegulatorG in a Recognised JurisdictionG ;
            (f) a legal entity where it, or its holding company, is authorised to provide custody services and is supervised by a Financial Services RegulatorG in another jurisdiction which is a Zone 1G country; or
            (g) a legal entity that is authorised or recognised by a Financial Services RegulatorG to operate as an exchange or a clearing house in a Recognised JurisdictionG ;
            (h) a legal entity that is:
            (i) controlled and wholly owned by one or more of the national governments of the five member states of the Gulf Cooperation Council, other than the StateG ; and
            (ii) authorised to provide custody services, and supervised, by a Financial Services RegulatorG of at least one of the national governments specified in (i).
            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
            [Amended] RM158/2015 (Made 9th December 2015). [VER19/02-16]
            [Amended] RM235/2019 (Made 20th February 2019). [VER24/02-19]

          • CIR 8.2.5

            For a Public FundG (other than a Property FundG ) that is a Passported FundG , the Eligible CustodianG must be a PersonG who meets the requirements in FPR Rule 6.5.3.

            Derived from RM235/2019 (Made 20th February 2019). [VER24/02-19]

      • CIR 8.3 Conflicts of Interest

        • CIR 8.3.1

          (1) The Fund ManagerG and, if it is a FundG structured as an Investment TrustG , the TrusteeG , must take reasonable steps to ensure that in any dealing in relation to the Fund PropertyG such dealings do not give rise to a conflict of interest.
          (2) Where a conflict of interest arises, whether in dealings with Related PartiesG or otherwise, the Fund ManagerG and, if appointed, the TrusteeG , must disclose to the UnitholdersG the nature of the conflict and how the conflict will be managed.
          (3) The Fund ManagerG must take reasonable steps to establish and implement remuneration policies and practices which:
          (a) are consistent with sound and effective risk management of the FundsG it manages; and
          (b) do not, to the extent practicable, encourage risk-taking inconsistent with the investment objectives and risk profile of such FundsG .
          Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
          [Amended] RM195/2016 (Made 7th December 2016). [VER22/02-17]
          [Amended] DFSA RM218/2018 (Made 22nd February 2018) [VER23/12-18]

          • CIR 8.3.1 Guidance

            GEN Rule 4.2.12 (Principle 12) requires an Authorised FirmG to have remuneration structures and strategies which are well aligned with the long term interests of the firm, and are appropriate to the nature, scale and complexity of its business. That requirement is extended under CIR Rule 8.3.1(3) to cover remuneration practices relating to FundsG which a Fund ManagerG manages.

            [Derived from] DFSA RM218/2018 (Made 22nd February 2018) [VER23/12-18]

        • Related Party Transactions

          • CIR 8.3.2

            (1) A Fund ManagerG must not enter into a Related Party TransactionG unless it is in accordance with the requirements in this Rule.
            (2) A Fund ManagerG must ensure that any Related Party TransactionG is on terms at least as favourable to the FundG as any comparable arrangement on normal commercial terms negotiated at arm's length with an independent third party.
            (3) The Fund ManagerG must, before entering into a Related Party TransactionG :
            (a) issue to the UnitholdersG a circular containing the details of the proposed transaction; and
            (b) obtain Unitholders'G prior approval by Special ResolutionG , or by ordinary resolution in the case of a Property FundG , in respect of the proposed transaction if the total consideration or value of the transaction is 5% or more of the most recent net asset value of the FundG as disclosed in the latest published audited accounts of the FundG .
            (4) The Fund ManagerG must:
            (a) if Unitholder'sG prior approval is required pursuant to (3)(b), issue a notice to UnitholdersG providing details of the results of the Unitholders'G voting at the general meeting as soon as practicable after the meeting;
            (b) include, in the Fund'sG next published interim or annual report, a brief summary of the Related Party TransactionG , and certification that the requirements in these Rules have been met for the transaction; and
            (c) include, in the annual report of the FundG , the total value of any Related Party TransactionsG , their nature and the identities of the Related PartiesG with whom such transactions were made. Where there is no such transaction conducted during the financial year covered by the annual report, an appropriate negative statement to that effect must be made in the annual report.
            (5) The requirements in (3) and (4)(a) do not apply in relation to an Exempt Property FundG .
            (6) The requirements in (3) and (4)(a) do not apply to a Public Property FundG in respect of a Related Party TransactionG if:
            (a) the transaction is for the acquisition or sale of Real PropertyG in the StateG ; and
            (b) all of the conditions in CIR Rule 13.4.11A(1) are met.
            (7) The requirements in (3) and (4) do not apply to the Fund ManagerG of an ETF in relation to the appointment of a Price Information ProviderG , who is a Related PartyG , where such an appointment occurs at the time of establishment of the ETF.
            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
            [Amended] RM158/2015 (Made 9th December 2015). [VER19/02-16]
            [Amended] DFSA RM218/2018 (Made 22nd February 2018) [VER23/12-18]

            • CIR 8.3.2 Guidance

              1. If a Fund ManagerG of an Exchange Traded FundG (ETF) has an arrangement with a Related PartyG , for that Related PartyG to provide an index or benchmark, then the Fund ManagerG is required to also treat that arrangement as a Related Party TransactionG (see CIR Rule 13.9.5) and comply with CIR Rule 8.3.2 in relation to the transaction.
              2. An ETFG Fund ManagerG is not required to comply with the requirements in CIR Rule 8.3.2(3) and (4) in relation to a Price Information ProviderG (PIP), who is a Related PartyG and provides a custom made index or other benchmark which the ETFG tracks, if that appointment takes place at the time of establishing the ETFG . This is because, generally, there are no investors in the FundG at that time to give the prior approval that is envisaged.
              3. However, such an ETFG Fund ManagerG does need to comply with the arm's length transaction requirement in CIR Rule 8.3.2(2) and, also, disclose in the Fund ProspectusG that it tracks a custom made index, or other benchmark, provided by a Related PartyG PIP (under CIR Rule 14.4.8(d)).
              Derived from DFSA RM218/2018 (Made 22nd February 2018) [VER23/12-18]

        • Best Execution and Fair Allocation

          • CIR 8.3.3

            Without limiting the generality of the obligations of the Fund ManagerG including those in Rules CIR 8.3.1 and CIR 8.3.2, the Fund Manager'sG systems and controls must include policies and procedures which are designed to ensure that:

            (a) when executing or procuring execution of trades for or on behalf of the FundG , the transactions are executed:
            (i) as soon as reasonably practicable after a decision to effect a transaction has been made; and
            (ii) on the best terms available at the time of dealing;
            (b) where the Fund ManagerG undertakes investment transactions for or on behalf of a FundG which it operates and one or more other FundsG or ClientsG , there is timely and fair allocation of trades to each FundG and ClientG ;
            (c) trading of the investment portfolio forming part of the Fund PropertyG is not excessive in light of the Fund'sG investment objective as stated in its ConstitutionG and the most recently issued ProspectusG ; and
            (d) any underwriting arrangements it undertakes are carried out in the best interest of the FundG .
            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]

            • CIR 8.3.3 Guidance

              1. For the purposes of (a), a Fund Manager'sG procedures should take into account matters such as the market in which the trade is to be executed, the kind and size of the transaction concerned and type of services provided by the executing broker that has been selected. A Fund Manager'sG procedures should be adequate to demonstrate that when the transaction was executed, it was done at the best price available. For this purpose, a Fund ManagerG may require a print out of a computer screen containing information about the price available at the time of the execution to be maintained.
              2. For the purposes of (b), a Fund ManagerG should have a policy in place which demonstrates how it achieves timely and fair allocation of trades. For example, where a Fund ManagerG places an order on behalf of a number of FundsG it operates, its policy should state the basis of allocation of trades to each FundG and, where any deviation from that policy occurs, record the reasons for such deviations.
              3. For the purposes of (c), a Fund Manager'sG policies and procedures should encompass requirements such as maintenance of sufficient records to demonstrate that any brokerage, commissions or other benefits directly or indirectly derived from any transactions it has undertaken on behalf of the FundG are not unusual, when considered in light of industry practice. However, where there are other requirements relating to disclosure of benefits, a Fund ManagerG should comply with those requirements separately, as maintenance of records for the purposes of this Rule may not be sufficient to discharge those obligations.
              4. For the purposes of (d), where a Fund ManagerG seeks to underwrite or participate in an initial public offering, its policies should ensure that it does not do so in a manner that is in any way detrimental to the FundG . The Fund ManagerG will also need to ensure that the best execution obligations under (a) are met.
              Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]

      • CIR 8.4 Valuation of Fund Property

        • CIR 8.4.1

          (1) A Fund ManagerG must:
          (a) ensure that the Fund PropertyG is valued at regular intervals as appropriate to the nature of the FundG , except where such valuation is suspended in any circumstances that are set out in the Fund'sG ConstitutionG or ProspectusG ;
          (b) prepare a valuation in accordance with (3) for each relevant type of UnitG at each relevant valuation point; and
          (c) as soon as practicable after each valuation point, both publish and make available to the UnitholdersG and prospective UnitholdersG of the FundG , the price of the UnitsG of the FundG .
          (2) The value of the Fund PropertyG is the net value of the Fund PropertyG after deducting any expenses and outstanding borrowings, including any capital outstanding on a mortgage of any Real PropertyG .
          (3) The value of the Fund PropertyG must, except as otherwise provided in this section, be determined in accordance with the provisions of the ConstitutionG and the ProspectusG , as appropriate.
          (4) For the purposes of (2), any charges that were paid, or would be payable, on acquiring or disposing of the asset must be excluded from the value of that asset.
          (5) A Fund ManagerG must not make a dilution levy or dilution adjustment unless stated as permitted in the Fund'sG ProspectusG . Such a measure must be applied in a fair manner to reduce dilution and solely for that purpose.
          Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]

          • CIR 8.4.1 Guidance

            1. A dilution levy or adjustment means a charge of such amount or such rate as is determined by a Fund ManagerG of a FundG to be made for the purpose of reducing the effect of dilution, i.e., the amount of dealing costs incurred, or expected to be incurred, by a Fund ManagerG , to the extent that these costs may reasonably be expected to result, or to have resulted, from the acquisition or disposal of Investments by the Fund ManagerG as a consequence (whether or not immediate) of the increase or decrease in the cash resources of the FundG resulting from the issue or cancellation of UnitsG over a period.
            2. Dealing costs referred to in Guidance 1 include both the costs of dealing in an InvestmentG , professional fees incurred, or expected to be incurred, in relation to the acquisition or disposal of Real PropertyG and, where there is a spread between the buying and selling prices of the InvestmentG , the indirect cost resulting from the differences between those prices.
            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]

        • CIR 8.4.2

          (1) A Fund ManagerG must:
          (a) ensure that at each valuation point there are at least as many UnitsG in issue of any class as there are UnitsG registered to UnitholdersG of that class; and
          (b) not do, or omit to do, anything that is or is reasonably likely to confer on itself a benefit or advantage at the expense of a UnitholderG or prospective UnitholderG .
          (2) Where a Fund ManagerG has not complied with (1) or there is any other valuation error, it must correct the error as soon as possible and must reimburse the FundG any costs it may have incurred in correcting the position, subject to any reasonable minimum level for such reimbursement as set out in the ProspectusG .
          (3) If the FundG is structured as an Investment TrustG :
          (a) the Fund ManagerG must notify the TrusteeG of the matters specified in (2);
          (b) the TrusteeG must also:
          (i) take reasonable steps to ensure that the Fund ManagerG complies with the matters specified in (1) and (2); and
          (ii) provide any other notification required under these RulesG .
          Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]

          • CIR 8.4.2 Guidance

            CIR Appendix 4 (App4) contains guidance on asset valuation and pricing.

            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]

      • CIR 8.5 Determination of Single Price

        • CIR 8.5.1

          (1) A Fund ManagerG must take all reasonable steps and exercise due diligence to ensure that the UnitsG in the FundG are correctly priced in accordance with the applicable accounting procedures to ascertain an accurate single price for a UnitG .
          (2) The price of a UnitG must be calculated on the basis of the valuation in CIR Rule 8.4.1 in a manner that is fair and reasonable as between UnitholdersG .
          Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]

        • CIR 8.5.2

          (1) A Fund ManagerG must take immediate action to rectify any breach of CIR Rule 8.4.1 where such breach relates to the incorrect pricing of UnitsG .
          (2) In (1), unless the incorrect pricing in respect of an issue is of minimal significance, the Fund ManagerG must inform the DFSAG , and if appointed, the TrusteeG or Eligible CustodianG or other PersonsG providing oversight functions in relation to the FundG , of such a rectification.
          Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]

      • CIR 8.6 Issue and Redemption of Fund Units

        • CIR 8.6.1

          (1) A Fund ManagerG of an Open-ended Fund must, within any conditions in its constitution and offer documents:
          (a) at all times during the dealing day, be willing to issue or sell UnitsG in the FundG to any eligible ClientG ; and
          (b) do so in a manner that is fair and reasonable as between all UnitholdersG and prospective UnitholdersG for whom the Fund ManagerG does not have reasonable grounds to refuse such issue or sale.
          (2) A Fund ManagerG of an Open-ended Fund must, within any conditions in its constitution and offer documents:
          (a) at all times during the dealing day, be willing to effect a redemption of the UnitsG on the request of any UnitholderG ; and
          (b) do so in a manner fair and reasonable as between redeeming UnitholdersG and continuing UnitholdersG .
          (3) On agreeing to a redemption of UnitsG within (2), the Fund ManagerG must pay the full proceeds of the redemption to the UnitholderG within any reasonable period specified in the constitution and offer documents, unless it has reasonable grounds for withholding payment.
          Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
          [Amended] DFSA RM218/2018 (Made 22nd February 2018) [VER23/12-18]

          • CIR 8.6.1 Guidance

            1. Refer to Article 18A(2) of the Law for the definition of an Open-ended FundG .
            2. The ProspectusG of a Public FundG is required to set out, among other things, the dealing days and times in the dealing day on which the Fund ManagerG will receive requests for the sale and redemption of UnitsG and redemption procedures. The ConstitutionG or offer documents (i.e. the Information MemorandumG ) of an Open-ended Exempt FundG or QIF may specify the Fund's dealing days, but where it does not do so, the maximum period between dealing days will depend on the reasonable expectations of the target investor group and the particular investment objectives and policy of the FundG .
            3. Capital reductions or share buy-backs that occur in a Closed-ended Fund are not treated as redemptions and resales of UnitsG of FundsG based on NAV in the same manner as occurs in the case of an Open-ended Fund as provided in these RulesG . See Article 18A(3) of the Law for the definition of a Closed-ended Fund.
            4. The circumstances in which a Fund ManagerG may withhold redemption proceeds under (3) include where there are any dues from the redeeming UnitholderG , such as under any margin lending arrangements.
            5. See Article 37 of the Law for provisions dealing with suspension of dealings of Open-ended Funds.
            6. If an Open-ended Domestic FundG is listed and traded, the redemption and reissue of its UnitsG in the primary market does not generally take place concurrently, unless it is an Exchange Traded FundG (ETF). However, the exchange on which an Open-ended FundG is listed and traded may permit the Fund ManagerG to offer periodic windows for redemption and reissue of UnitsG of the FundG (which would have to be based on NAV). The DFSAG regime allows such windows, subject to disclosure in the Fund's ProspectusG and to the relevant exchange as to when such windows would be offered.
            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
            [Amended] DFSA RM218/2018 (Made 22nd February 2018) [VER23/12-18]

      • CIR 8.6A Systems and controls for liquidity risk management in Open-ended Funds

        • CIR 8.6A.1

          (1) A Fund ManagerG of an Open-ended Domestic FundG must ensure that the FundG has sufficient liquidity to meet redemption requests as stated in the Fund's ConstitutionG and its most recent ProspectusG , as appropriate to the nature and risk profile of the relevant FundG .
          (2) For the purposes of meeting the requirement in (1), the Fund Manager'sG systems and controls must, at a minimum, contain well-documented and detailed policies and strategies, which:
          (a) include appropriate liquidity buffers and limits on illiquid assets, and the availability of other resources, such as lines of credit;
          (b) take into account:
          (i) the underlying classes of assets of the FundG ;
          (ii) if such assets are traded on-exchange, the liquidity in those markets;
          (iii) investors' redemption patterns and behaviour; and
          (iv) any other factors that affect or potentially affect the liquidity of the relevant classes of assets;
          (c) include appropriate mechanisms to measure, monitor, stress test and manage the controls referred to in (a) to assess whether they are adequate, and are operating as intended in both normal and stressed conditions and the procedures available to the Fund ManagerG to address any gaps and failures identified; and
          (d) include powers available to the Fund ManagerG to address liquidity stresses which pose, or have the potential to pose, risks to its ability to effect redemptions (such as the power to impose anti-dilution levies, create side pockets to ring-fence illiquid assets and create redemption gates or suspend redemptions), and clear triggers and procedures for exercising such powers.
          Derived from DFSA RM218/2018 (Made 22nd February 2018) [VER23/12-18]

          • CIR 8.6A.1 Guidance

            1. The DFSAG expects Fund ManagersG to take into account the Final ReportG : "Open-ended Fund liquidity and risk management—Good Practices and Issues for Consideration" issued by OICU-IOSCO in February 2018, (which can be found at http://www.iosco.org/library/pubdocs/pdf/IOSCOPD591.pdf). The DFSAG believes that the measures identified in that report would, if adopted by the Fund ManagersG as appropriate to the nature, scale and complexity of their FundsG , would enable such managers to meet their overarching obligations in CIR Rule 8.6A.1.
            2. In the DFSA's view, there are certain specialist classes of FundsG which generally do not lend themselves to be Open-endedG , such as Private Equity FundsG (because of the long-term nature of their investments), and Fund of FundsG or Feeder FundsG (unless the Funds in which they invest themselves are Open-endedG ). Conversely, there are FundsG which may lend themselves better to being structured as Open-ended FundsG offering redemptions, such as FundsG investing in transferable securities (e.g. UCITS style Funds), or ETFs—due to the liquidity of the underlying classes of their assets, provided they meet the liquidity risk management controls referred to in CIR Rule 8.6A.1. However, it is a matter for the Fund ManagerG to objectively assess the liquidity profile of the FundG and associated risks.
            Derived from DFSA RM218/2018 (Made 22nd February 2018) [VER23/12-18]

      • CIR 8.6B Confirmation notes

        • CIR 8.6B.1

          (1) When the Fund ManagerG of a Public FundG Executes a TransactionG relating to a UnitG of the FundG , it must ensure that a confirmation note is sent to the UnitholderG as soon as possible and no later than two business days after the date of Execution of the TransactionG .
          (2) The confirmation note must set out:
          (a) the Fund Manager'sG name and address;
          (b) the Unitholder'sG name;
          (c) a description of the FundG ;
          (d) the date and time of receipt of the request for the TransactionG to be executed and the method of payment;
          (e) the nature of the TransactionG ;
          (f) the number of UnitsG subject to the TransactionG ;
          (g) the date, time and price at which it was executed;
          (h) the reference valuation date;
          (i) the gross value of the TransactionG , including charges for subscribing or net amount after charges for redemptions; and
          (j) the total sum of commissions and expenses charged, and a breakdown of those commissions and charges.
          [Added] RM158/2015 (Made 9th December 2015). [VER19/02-16]

      • CIR 8.7 Unitholder Register

        • CIR 8.7.1

          (1) Subject to (5), a Fund ManagerG must maintain a register of UnitholdersG .
          (2) The register must contain:
          (a) the name and address of each UnitholderG ;
          (b) the number of UnitsG including fractions of a UnitG of each class held by each UnitholderG ; and
          (c) the date on which the UnitholderG was registered in the register for the UnitsG standing in his name.
          (3) A Fund ManagerG must take all reasonable steps and exercise all due diligence to ensure that the register is kept complete and up to date.
          (4) A Fund ManagerG or, if applicable the Appointed Fund Administrator or Appointed Custody Provider, must, subject to (5), make the UnitholderG register in electronic or hard copy form available for inspection by UnitholdersG during normal business hours at the Fund Manager'sG or Appointed Fund Administrator's place of business in the DIFCG or otherwise in a designated location in the DIFCG .
          (5) Where a FundG is structured as an Investment TrustG , the TrusteeG must maintain the register of UnitholdersG in accordance with the requirements in the Investment Trust Law 2006 and make the register in electronic or hard copy form available for inspection by UnitholdersG during normal business hours at the Trustee'sG place of business in the DIFCG or otherwise in a designated location in the DIFCG .
          Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]

      • CIR 8.8 Meetings of Unitholders

        • CIR 8.8.1

          In the case of a Public FundG , the Fund ManagerG must hold at least two meetings of the Governing BodyG of every Public FundG which has such a BodyG every 12 month period from the date of registration of that FundG with the DFSAG .

          Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]

        • CIR 8.8.2

          The Fund ManagerG of a FundG other than an Exempt FundG must hold at least one general meeting of the UnitholdersG of the FundG in every 12 month period (i.e. an annual general meeting). The annual general meeting must be held in the case of a Public FundG within 12 months from the date of registration of the FundG . The annual report required under CIR Rule 9.4.2(1)(a) must be presented at that annual general meeting.

          Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
          [Amended] DFSA RM137/2014 (Made 21st August 2014). [VER17/06-14]

        • CIR 8.8.3

          (1) The Fund ManagerG and if appointed the TrusteeG of a FundG other than an Exempt FundG :
          (a) may convene a general meeting of UnitholdersG at any time; and
          (b) must convene a general meeting of UnitholdersG of the FundG immediately upon a request being made by UnitholdersG in accordance with (2).
          (2) The UnitholdersG of the FundG may request the Fund ManagerG , or if appointed the TrusteeG , to convene a general meeting of UnitholdersG at any time. Such a request must:
          (a) state the purpose of the meeting;
          (b) be dated;
          (c) be signed by a number of registered UnitholdersG representing at least one-tenth in value of all of the UnitsG then in issue; and
          (d) be deposited at the place of business of the Fund ManagerG , or if applicable, the TrusteeG or Appointed Fund Administrator of the FundG .
          (3) If the FundG is an Investment TrustG , the primary responsibility to convene meetings in accordance with this RuleG rests with the Fund ManagerG , failing which, with the TrusteeG .
          (4) A meeting of UnitholdersG of a FundG duly convened and held in accordance with the Law and RulesG is competent by Special ResolutionG to require, authorise or approve any act, matter or document in respect of which any such resolution is required. Such a resolution has no other powers or effect.
          (5) Where no Special ResolutionG is specifically required or permitted by the Law or RulesG , any resolution of UnitholdersG required under the RulesG is passed by a simple majority of the votes validly cast for and against the resolution at a general meeting of UnitholdersG .
          Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]

        • CIR 8.8.4

          The Fund ManagerG of an Exempt FundG must hold meetings of UnitholdersG in accordance with the requirements included in the Fund'sG ConstitutionG and its most recent ProspectusG .

          Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]

          • CIR 8.8.4 Guidance

            Exempt FundsG are required to have an Information Memorandum under which its UnitsG are marketed to prospective UnitholdersG by way of private placement. Under Article 50(3) of the Law, such a document is a ProspectusG .

            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]

        • Unitholder Meetings Procedures

          • CIR 8.8.5

            (1) A Fund ManagerG must set out, if it is a Public FundG , in its procedures manual the procedures for holding UnitholderG meetings and the conduct of such meetings including but not limited to, the following matters:
            (a) voting rights;
            (b) right to demand a poll;
            (c) proxies;
            (d) minutes; and
            (e) variation of class rights and class meetings.
            (2) The meeting procedures under (1) must comply with the provisions in CIR App2. Any provisions in such procedures that are inconsistent with the procedures in CIR App2 are void.
            (3) In the case of a Public FundG , the Fund ManagerG must distribute the meetings procedures manual to all UnitholdersG .
            (4) If the FundG is structured as an Investment TrustG , the Fund ManagerG must obtain the prior approval of the TrusteeG in respect of its meetings procedures.
            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
            [Amended] DFSA RM137/2014 (Made 21st August 2014). [VER17/06-14]

      • CIR 8.9 Approvals and Notifications

        • CIR 8.9.1

          A Fund ManagerG of a Public FundG must comply with the provisions in CIR App3 in regard to:

          (a) fundamental changes requiring prior approval of the UnitholdersG ;
          (b) significant changes requiring pre-event notification to the UnitholdersG ; and
          (c) notifiable changes, that is, a change other than one in (a) or (b) which requires post notification to the UnitholdersG .
          Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
          [Amended] DFSA RM137/2014 (Made 21st August 2014). [VER17/06-14]

      • CIR 8.10 Maintenance of Records

        • CIR 8.10.1

          (1) A Fund ManagerG must make and retain accounting and other records that are necessary:
          (a) to enable it to comply with RulesG in this module; and
          (b) to demonstrate at any time that such compliance has been achieved.
          (2) A Fund ManagerG must make and retain for a period of six years a record of the UnitsG held, acquired or disposed of, by it, including the classes of such UnitsG , and the balance of any acquisitions and disposals.
          (3) A Fund ManagerG must make the record available for inspection by the DFSAG in the DIFCG and, if applicable, the TrusteeG or appointed Eligible CustodianG , free of charge at all times during ordinary office hours and must supply a copy of the record or any part of it.
          (4) Where a Fund ManagerG makes a dilution levy or dilution adjustment in accordance with CIR Rule 8.4.1(5), it must make and retain for a period of six years from the date such action is taken a record of:
          (a) how it calculates and estimates dilution; and
          (b) its policy and method for determining the amount of any dilution levy or dilution adjustment.
          Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]

      • CIR 8.11 Capital

        • CIR 8.11.1

          (1) In the case of a Public FundG , if at any time after the size of the Fund'sG capital has reached the minimum size provided in its ConstitutionG the size of that capital falls below that minimum size, the Fund ManagerG must immediately notify the DFSAG of that fact.
          (2) The notification under (1) must also:
          (a) state the Fund Manager'sG grounds for believing that the FundG is still commercially viable and the purpose of the FundG can still be accomplished; and
          (b) be accompanied by the relevant Unitholders'G resolution supporting the Fund Manager'sG views in (1); or
          (c) state what steps the Fund ManagerG has taken or will take to wind up the FundG .
          Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
          [Amended] DFSA RM137/2014 (Made 21st August 2014). [VER17/06-14]

      • CIR 8.12 Delegation and Outsourcing

        • CIR 8.12 Guidance

          1. This section sets out the general requirements that apply to a Fund ManagerG , or where appointed the TrusteeG , of a Domestic FundG where it delegates or outsources any Financial ServiceG activity or function to another PersonG . Such a PersonG is defined as a "Service ProviderG " for the purposes of this module.
          2. Under Article 24 of the Law and Article 24 of the Investment Trust Law 2006, a Fund ManagerG or where appointed the TrusteeG of a FundG respectively may, subject to any restriction in the ConstitutionG of the Domestic FundG and any provisions of the RulesG , delegate any of its Financial ServiceG activities or outsource any of its functions to a Service ProviderG , which may be located in or outside the DIFCG .
          3. Fund ManagersG of Domestic FundsG structured as an Investment CompanyG or Investment PartnershipG are required under CIR Rule 8.2.2(2) to delegate the activity of Providing CustodyG to an Eligible CustodianG . This obligation does not apply where there are adequate alternative arrangements. This chapter sets out the circumstances in which the obligation under CIR Rule 8.2.2(2) does not apply.
          4. A Fund ManagerG or TrusteeG 'outsources' a function relating to the operation of the FundG where the function, whether or not relating to a Financial ServiceG activity, is contracted to be performed by a Service ProviderG . Where the extent of any such function or functions is such that they effectively constitute the carrying on of a Financial ServiceG activity, the DFSAG will consider this to comprise a 'delegation' of the Financial ServiceG .
          5. If the Fund ManagerG or the TrusteeG delegates any activities or outsources any functions, the Fund ManagerG or the TrusteeG remains liable to the UnitholdersG for any acts or omissions of the Service ProviderG as if they were the acts or omissions of the Fund ManagerG or TrusteeG .
          6. The RulesG permitting the use of a Service ProviderG do not relieve the Fund ManagerG or the TrusteeG from their obligations, including any restrictions on delegation or outsourcing arising from the Fund'sG ConstitutionG or ProspectusG .
          7. Rules GEN 5.3.21 and GEN 5.3.22 also govern outsourcing of functions and activities by an Authorised FirmG . Those RulesG are not disapplied by this section.
          Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]

        • Fund Manager

          • CIR 8.12.1

            In accordance with the Delegation AgreementG , the Fund ManagerG :

            (a) must register the legal title of the Fund PropertyG with the Eligible CustodianG ; and
            (b) may give instructions to the Eligible CustodianG to deal with the Fund PropertyG .
            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]

            • CIR 8.12.1 Guidance

              See CIR Rule 8.2.4 for the definition of an Eligible CustodianG

              Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]

          • CIR 8.12.2

            (1) Subject to the requirements in CIR Rule 8.12.4, a Fund ManagerG may delegate one or both of the Financial ServiceG activities of Providing Fund AdministrationG and Managing AssetsG to a Service ProviderG .
            (2) For the purposes of (1), and in relation to Providing Fund AdministrationG for a Public FundG , the Service ProviderG must be:
            (a) a PersonG authorised by the DFSAG to carry on the activity of Providing Fund AdministrationG ; or
            (b) a PersonG who is lawfully entitled in a Zone 1G jurisdiction or Recognised JurisdictionG to carry on in that jurisdiction the activities of:
            (i) asset pricing and FundG valuation;
            (ii) issuing and redemption of UnitsG ; and
            (iii) record keeping and maintaining the UnitholdersG register.
            (3) For the purposes of (1), and in relation to Managing AssetsG , the Service ProviderG must be:
            (a) a PersonG authorised by the DFSAG to carry on the activity of Managing AssetsG ; or
            (b) a PersonG who is authorised by a Financial Services RegulatorG in a Zone 1G jurisdiction or Recognised JurisdictionG to carry on an equivalent activity in that jurisdiction.
            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]

            • CIR 8.12.2 Guidance

              As CIR Rule 8.12.2(2) only applies in relation to a Public FundG , a Fund ManagerG of an Exempt FundG may make other appropriate arrangements in respect of the provision of Fund AdministrationG .

              Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
              [Amended] RM158/2015 (Made 9th December 2015). [VER19/02-16]

        • Trustee

          • CIR 8.12.3

            (1) Subject to CIR Rules 8.12.4, a TrusteeG may, with the prior written consent of the Fund ManagerG , delegate one or both of the Financial ServiceG activities of Providing Fund AdministrationG and Providing CustodyG to a Service ProviderG .
            (2) For the purposes of (1), and in relation to Providing Fund AdministrationG for a Public FundG , the Service ProviderG must be:
            (a) a PersonG authorised by the DFSAG to carry on the activity of Providing Fund AdministrationG ; or
            (b) a PersonG who is lawfully entitled in a Zone 1G jurisdiction or Recognised JurisdictionG to carry on in that jurisdiction the activities of:
            (i) asset pricing and FundG valuation;
            (ii) issuing and redemption of UnitsG ; and
            (iii) record keeping and maintaining the UnitholdersG register.
            (3) For the purposes of (1), and in relation to Providing CustodyG , the Service ProviderG must be an Eligible CustodianG .
            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]

        • Delegation and Outsourcing Process and Requirements

          • CIR 8.12.4

            (1) When delegating, a Fund ManagerG or TrusteeG must:
            (a) carry out due diligence on a proposed Service ProviderG to ensure eligibility prior to effecting a delegation of a Financial ServicesG activity; and
            (b) comply with the requirements in GEN chapter 5 of GEN and CIR App1 and ensure that any delegation is made in a written Delegation AgreementG as prescribed in CIR App1.
            (2) Delegation to a Service ProviderG does not relieve the Fund ManagerG or TrusteeG from accountability for the proper conduct of a delegated activity.
            (3) The DFSAG may, as a condition on a Fund Manager'sG or Trustee'sG LicenceG , require the delegation of one or more specified Financial ServiceG activities to a Service ProviderG .
            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]

            • CIR 8.12.4 Guidance

              The DFSAG may impose a condition under CIR Rule 8.12.4(3) when, for example, it considers that a Fund ManagerG is unable to conduct the activity under its own LicenceG .

              Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]

          • CIR 8.12.5

            (1) When a Fund ManagerG or TrusteeG outsources any function to a Service ProviderG , it must:
            (a) comply with any relevant requirements in GEN chapter 5 of GEN;
            (b) enter into an Outsourcing AgreementG which complies with the requirements in CIR App1; and
            (c) before entering into such agreement, carry out due diligence on the proposed Service ProviderG to conclude on reasonable grounds that the PersonG is suitable to perform the relevant functions.
            (2) Outsourcing to a Service ProviderG does not relieve the Fund ManagerG or TrusteeG from accountability for the proper conduct of the outsourced activity.
            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]

        • Systems and Controls

          • CIR 8.12.6

            If a Fund ManagerG or TrusteeG delegates any activity or outsources any function under this section, it must take reasonable steps to ensure that it implements and maintains systems and controls to monitor the Service ProviderG .

            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]

            • CIR 8.12.6 Guidance

              This RuleG supplements the requirements under GEN section 5.3G .

              Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]

        • Review

          • CIR 8.12.7

            (1) A Fund ManagerG or the TrusteeG of a Public FundG , which has delegated any Financial ServiceG activities or outsourced any functions, must conduct a review of the carrying out of the relevant activities or functions by the Service ProviderG and present the findings of the review to either:
            (a) the Fund'sG Governing BodyG every 6 months at the Fund'sG board meeting; or
            (b) in the case of a FundG structured as an Investment TrustG , to the TrusteeG .
            (2) Notwithstanding the requirement in (1), if a Fund ManagerG or the TrusteeG discovers non-compliance in regard to a term of the Delegation AgreementG or Outsourcing AgreementG , the Fund ManagerG or the TrusteeG , as the case may be, must take immediate action to remedy the matter and also notify the DFSAG and, as applicable, its Governing BodyG or the TrusteeG forthwith.
            (3) For the purposes of (2), the Fund ManagerG or the TrusteeG must notify the DFSAG only where the non-compliance is material.
            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]

      • CIR 8.13 Fees, Charges and Other Levies

        • Permissible Fees, Charges, Levies and Expenses

          • CIR 8.13.1

            (1) A Fund ManagerG must not make any charge or levy in connection with the issue or sale of UnitsG except in accordance with the ConstitutionG and ProspectusG .
            (2) A preliminary or redemption charge must not be made by the Fund ManagerG unless:
            (a) it is permitted by the ConstitutionG ; and
            (b) it is expressed either as a fixed amount or calculated as a percentage of the price of a UnitG .
            (3) The preliminary charge must not exceed the amount or rate stated in the current ProspectusG in respect of any class of UnitsG .
            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]

          • CIR 8.13.2

            (1) No payment may be made, or benefit given, to the Fund ManagerG out of the Fund PropertyG , whether by way of remuneration for its services, reimbursement of expenses or otherwise, unless it is permitted by the ConstitutionG and the ProspectusG specifies how it will be calculated, accrued, when it will be paid and the maximum and current rates or amount of such remuneration.
            (2) The Fund ManagerG must give not less than 90 days written notice of any increase proposed within the parameters of the ConstitutionG and ProspectusG .
            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]

          • CIR 8.13.3

            A Fund ManagerG must not introduce a new category of remuneration for its services or make any increase in the current rate or amount of its remuneration payable out of the Fund PropertyG unless it has given not less than 90 days written notice of that introduction or increase and of the date of its commencement to the UnitholdersG and the UnitholdersG approve such new category by Special ResolutionG .

            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]

        • Reimbursement of Remuneration and Expenses

          • CIR 8.13.4

            (1) A Fund ManagerG must take reasonable steps to ensure that no payment is made to a TrusteeG , an Eligible CustodianG or PersonsG providing oversight function out of the Fund PropertyG , whether by way of reimbursement of expenses or otherwise, except:
            (a) remuneration in respect of services provided and in respect of which the following have been stated in the ProspectusG :
            (i) the actual amount or rate of the remuneration together with the current maximum or how these are determined;
            (ii) the periods in respect of which the remuneration is to be paid;
            (iii) how the remuneration is to accrue; and
            (iv) when the remuneration is to be paid; and
            (b) reimbursement of expenses properly incurred by the TrusteeG , Eligible CustodianG or PersonsG providing oversight functions for performing such functions conferred on the TrusteeG , Eligible CustodianG or other PersonsG by the RulesG .
            (2) Payment under (1)(a) must not be made unless permitted by the ConstitutionG .
            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]

        • Promotional Payments, Performance Fees and Set Up Costs

          • CIR 8.13.5

            No promotional payment, performance fee or benefit may be made out of or given at the expense of the Fund PropertyG to the Fund ManagerG unless it is permitted by the ConstitutionG and specified in the ProspectusG .

            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]

          • CIR 8.13.6

            Costs of the registration, exemption and incorporation of a FundG and of its initial OfferG or issue of UnitsG , including UnitsG in respect of a Sub-FundG , may be amortised over a period not exceeding five years.

            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]

        • Allocation of Payments to Capital or Income

          • CIR 8.13.7

            (1) The Fund ManagerG and the TrusteeG or the PersonsG providing the oversight function may agree that all or any part of any permitted payments, charges and expenses of the FundG may be treated as a capital expense or income expense and allocated to the capital account or income account respectively.
            (2) The Fund ManagerG must ensure that any agreement in (1) is permitted by the ConstitutionG and specified in the ProspectusG in sufficient detail for a UnitholderG or a prospective UnitholderG to make an informed decision in relation to the allocation of such charges and expenses to be paid from the capital property or the income property as the case may be.
            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]

        • Payments of Liabilities on Transfer of Assets

          • CIR 8.13.8

            Where the property of a Body CorporateG or of another FundG is transferred to a FundG or to the Fund ManagerG for the account of the FundG or to the TrusteeG to hold on trust for the UnitholdersG in consideration of the issue of UnitsG in the FundG to UnitholdersG in that Body CorporateG or in that other FundG , CIR Rule 8.13.9 applies.

            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
            [Amended] RM158/2015 (Made 9th December 2015). [VER19/02-16]

          • CIR 8.13.9

            The Fund ManagerG or in the case of an Investment TrustG , the TrusteeG , as the successor in title to the property transferred, may pay out of the Fund PropertyG any liability arising after the transfer which, had it arisen before the transfer, could properly have been paid out of the property transferred, but only if:

            (a) there is nothing in the ConstitutionG of the FundG expressly forbidding the payment; and
            (b) the Fund ManagerG or the TrusteeG , as the case may be, is of the opinion that proper provision was made for meeting such liabilities as were known or could reasonably have been anticipated at the time of the transfer.
            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
            [Amended] RM158/2015 (Made 9th December 2015). [VER19/02-16]

    • CIR 9 Accounting, Audit and Periodic Reporting of a Fund

      • CIR 9.1 Application

        • CIR 9.1.1

          (1) This chapter applies to a Fund ManagerG and a TrusteeG of a Domestic FundG .
          (2) In this Chapter, references to a "Fund" mean a "Domestic Fund".
          Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
          [Amended] DFSA RM137/2014 (Made 21st August 2014). [VER17/06-14]

          • CIR 9.1.1 Guidance

            The IFR module contains specific requirements relating to reporting that apply to a FundG and its Fund ManagerG where that FundG is an Islamic FundG .

            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
            [Amended] DFSA RM107/2012 (Made 23rd December 2012). [VER15/07-12]

      • CIR 9.2 Preparation of Fund financial statements

        • Financial statements and financial reporting standards

          • CIR 9.2.1

            (1) A Fund ManagerG of a FundG must prepare financial statements for each financial year of the FundG .
            (2) A Fund ManagerG must, in respect of a FundG , prepare and maintain all financial statements in accordance with the International Financial Reporting Standards (IFRS)G or USGAAPG as supplemented by the Statement of Recommended Practice (SORP)G .
            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
            [Amended] DFSA RM107/2012 (Made 23rd December 2012). [VER15/07-12]
            [Amended] DFSA RM137/2014 (Made 21st August 2014). [VER17/06-14]

        • Accounting Records

          • CIR 9.2.2

            A Fund ManagerG must keep Accounting RecordsG that are sufficient to show and explain transactions and are as such, to:

            (a) be capable of disclosing the financial position of the FundG on an ongoing basis; and
            (b) record the financial position of the FundG as at its financial year end.
            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
            [Amended] DFSA RM126/2013 (Made 14th July 2013). [VER16/07-13]

          • CIR 9.2.3

            Accounting RecordsG must be maintained by a Fund ManagerG such as to enable the Governing BodyG and, if appointed, the TrusteeG or any PersonsG providing the oversight function of the FundG to ensure that any financial statements prepared by the Fund ManagerG in relation to the FundG comply with the legislation applicable in the DIFCG .

            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
            [Amended] DFSA RM126/2013 (Made 14th July 2013). [VER16/07-13]
            [Amended] DFSA RM137/2014 (Made 21st August 2014). [VER17/06-14]

          • CIR 9.2.4

            The Accounting RecordsG must be:

            (a) retained by the Fund ManagerG or FundG for at least six years from the date to which they relate;
            (b) at all reasonable times, open to inspection by the DFSAG or the Registered AuditorG of the FundG ; and
            (c) capable of reproduction, within a reasonable period not exceeding 3 business days, in hard copy and in English.
            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
            [Amended] DFSA RM126/2013 (Made 14th July 2013). [VER16/07-13]
            [Amended] DFSA RM137/2014 (Made 21st August 2014). [VER17/06-14]

      • CIR 9.3 Auditors of a Fund

        • CIR 9.3 Guidance

          1. Article 27(1)(c) of the Law requires every Domestic FundG to have a Registered AuditorG appointed to it in accordance with Part 8 of the Regulatory LawG and any Rules made for the purposes of that Part.
          2. Part 8 of the Regulatory LawG sets out how an AuditorG must be appointed to each Domestic FundG and the main duties and functions of the AuditorG . This section sets out additional requirements that apply in relation to Registered AuditorsG of a FundG .
          3. Under Article 97C(1) of the Regulatory LawG a PersonG is prohibited from providing any Audit ServiceG to a Domestic FundG unless that PersonG is a Registered AuditorG .
          Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
          [Amended] DFSA RM137/2014 (Made 21st August 2014). [VER17/06-14]

        • Appointment and Termination of Auditors

          • CIR 9.3.1

            A Fund ManagerG must:

            (a) notify the DFSAG of the appointment of a Registered AuditorG to the FundG by completing and submitting the appropriate form in AFN;
            (b) prior to the appointment of the Registered AuditorG , take reasonable steps to ensure that the Registered AuditorG has the required skills, resources and experience to audit the type of FundG for which the Registered AuditorG has been appointed; and
            (c) ensure that the Registered AuditorG , at the time of appointment and for the duration of the engagement is registered with the DFSAG as a Registered AuditorG .
            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
            [Amended] DFSA RM137/2014 (Made 21st August 2014). [VER17/06-14]

            • CIR 9.3.1 Guidance [Deleted]

              [Deleted] DFSA RM137/2014 (Made 21st August 2014). [VER17/06-14]

          • CIR 9.3.2

            A Fund ManagerG must notify the DFSAG immediately if the appointment of the Registered AuditorG is or is about to be terminated, or on the resignation of the Fund'sG Registered AuditorG , by completing and submitting the appropriate form in AFN.

            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
            [Amended] DFSA RM137/2014 (Made 21st August 2014). [VER17/06-14]

          • CIR 9.3.3

            A Fund ManagerG must appoint a Registered AuditorG to fill any vacancy in the office of Registered AuditorG and ensure that the replacement Registered AuditorG can take up office at the time the vacancy arises or as soon as reasonably practicable.

            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
            [Amended] DFSA RM137/2014 (Made 21st August 2014). [VER17/06-14]

          • CIR 9.3.4

            (1) A Fund ManagerG must take reasonable steps to ensure that the Registered AuditorG and the relevant audit staff of the Registered AuditorG are independent of, and not subject to, any conflict of interest with respect to the Fund ManagerG , the TrusteeG or the FundG .
            (2) A Fund ManagerG or TrusteeG must notify the DFSAG if it becomes aware, or has reason to believe, that the Registered AuditorG or the relevant audit staff of the Registered AuditorG are no longer independent of the Fund ManagerG , the TrusteeG or the FundG , or have a conflict of interest which may affect their judgement in respect of the FundG .
            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
            [Amended] DFSA RM137/2014 (Made 21st August 2014). [VER17/06-14]

            • CIR 9.3.4 Guidance

              1. A Fund ManagerG should consider whether there is any financial or personal relationship between it or any of its relevant EmployeesG and the Registered AuditorG or any of the relevant EmployeesG of the Registered AuditorG that may affect the judgement of the Registered AuditorG when conducting an audit of the FundG or complying with all its legal obligations, including the Regulatory LawG , AUDG , AMLG and other relevant modules of the DFSAG Rulebook.
              2. A Fund ManagerG should consider rotating the appointed relevant staff of the Registered AuditorG on a regular basis to ensure that the relevant staff of the Registered AuditorG remain independent.
              Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
              [Amended] DFSA RM137/2014 (Made 21st August 2014). [VER17/06-14]

          • CIR 9.3.5 [Deleted]

            [Deleted] DFSA RM137/2014 (Made 21st August 2014). [VER17/06-14]

        • Co-operation with Auditors

          • CIR 9.3.5

            A Fund ManagerG must take reasonable steps to ensure that it and its EmployeesG :
            (a) provide any information to its Registered AuditorG that its Registered AuditorG reasonably requires, or is entitled to receive as Registered AuditorG ;
            (b) give the Registered AuditorG right of access at all reasonable times to relevant records and information within its possession;
            (c) allow the Registered AuditorG to make copies of any records or information referred to in (b);
            (d) do not interfere with the Registered AuditorG 's ability to discharge its duties;
            (e) report to the Registered AuditorG any matter which may significantly affect the financial position of the FundG ; and
            (f) provide such other assistance as the Registered AuditorG may reasonably request it to provide.
            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
            [Amended] DFSA RM137/2014 (Made 21st August 2014). [VER17/06-14]

          • CIR 9.3.6

            A TrusteeG must take reasonable steps to ensure that it and its EmployeesG act in compliance with Rule 9.3.5(a)–(f).

            [Added] DFSA RM137/2014 (Made 21st August 2014). [VER17/06-14]

          • CIR 9.3.7

            A Fund ManagerG must, in writing, require any PersonG to whom the Fund ManagerG has delegated or outsourced any functions to co-operate with the Fund'sG Registered AuditorG in accordance with the provisions specified in CIR Rule 9.3.5.

            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
            [Amended] DFSA RM137/2014 (Made 21st August 2014). [VER17/06-14]

        • Function of the Registered Auditor

          • Guidance [Deleted]

            [Deleted] DFSA RM137/2014 (Made 21st August 2014). [VER17/06-14]

          • CIR 9.3.8

            A Fund ManagerG must, in writing, require its Registered AuditorG to:

            (a) conduct an audit of the Fund'sG financial statements in accordance with the requirements of the relevant standards published by the International Auditing and Assurance Standards Board (IAASB); and
            (b) produce a Fund Auditor's ReportG on the audited financial statements in accordance with AUD App5.
            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
            [Amended] DFSA RM107/2012 (Made 23rd December 2012). [VER15/07-12]
            [Amended] DFSA RM137/2014 (Made 21st August 2014). [VER17/06-14]

          • CIR 9.3.9 [Deleted]

            [Deleted] DFSA RM137/2014 (Made 21st August 2014). [VER17/06-14]

      • CIR 9.4 Periodic Reports

        • Annual and Interim Reports

          • CIR 9.4.1

            (1) In order to provide the UnitholdersG with relevant and up-to-date information about the performance and management of a FundG , a Fund ManagerG must, subject to (2), produce one interim report and one annual report in respect of each FundG it operates in accordance with the RulesG in this section.
            (2) The Fund ManagerG of a Qualified Investor FundG is not required to comply with the requirements in (1) relating to the production of an interim report for that FundG unless there has been a material change relating to the Fund during the relevant period.
            (3) For the purposes of (2), the relevant period in relation to a Qualified Investor FundG is the 6 month period referred to in Rule 9.4.2(4).
            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
            [Amended] DFSA RM137/2014 (Made 21st August 2014). [VER17/06-14]

          • CIR 9.4.2

            (1) A Fund ManagerG must produce the required annual report and interim report as follows:
            (a) an annual report within four months after the end of each annual accounting period; and
            (b) an interim report within two months after the end of each interim accounting period.
            (2) For the purposes of (1), the first annual accounting period of a FundG begins:
            (a) in the case of a Public FundG , on the date of registration by the DFSAG ; or
            (b) in the case of an Exempt FundG or a Qualified Investor FundG , on the date of notification to the DFSAG ; and
            ends 12 months later. Thereafter, annual accounting periods cover the period between each subsequent financial year end.
            (3) Notwithstanding the requirement in (2), a Fund ManagerG may, subject to the prior approval of the DFSAG , produce the Fund'sG reports and financial statements in accordance with the Fund Manager'sG reporting periods.
            (4) For the purposes of (1), an interim accounting period is the period covering:
            (a) 6 months after the date of registration of the FundG with the DFSAG in the case of a Public FundG , or the date of notification to the DFSAG in the case of an Exempt FundG or Qualified Investor FundG ; and
            (b) 6 months after the anniversary of each annual accounting period.
            (5) If a FundG intends to change its annual or interim accounting period, the Fund ManagerG must:
            (a) obtain written confirmation from its Registered AuditorG that the change of its annual accounting period would not result in any significant distortion of the financial position of the FundG ; and
            (b) obtain the DFSA'sG prior consent before implementing the change.
            (6) For a FundG which is an Umbrella FundG , the Fund ManagerG must prepare an interim report for each Sub-FundG , but this is not necessary for the Umbrella FundG as a whole.
            (7) The Fund ManagerG must prepare the annual and interim reports of the FundG in accordance with CIR Rule 9.2.1.
            (8) The reports must:
            (a) be supplied free of charge to UnitholdersG ;
            (b) be available in English,
            (c) be sent to the DFSAG ; and
            (d) if the FundG is a Public FundG , be available for inspection free of charge during ordinary office hours at a place specified.
            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
            [Amended] DFSA RM137/2014 (Made 21st August 2014). [VER17/06-14]

          • CIR 9.4.3

            The Fund ManagerG must take reasonable steps to ensure that the interim and annual reports for a FundG or the Sub-FundsG of an Umbrella FundG are clear, complete and true and contain information for the relevant period and:

            (a) the name of the FundG or Sub-FundG , its stated investment objectives, the policy of achieving those objectives and a brief assessment of its risk profile;
            (b) a review of the Fund'sG or Sub-Fund'sG investment activities and investment performance during the period;
            (c) sufficient information to enable UnitholdersG to form a view on where the portfolio is invested at the end of the period and the extent to which that has changed over the period; and
            (d) any other significant information which would reasonably enable UnitholdersG to make an informed judgment on the activities of the FundG or Sub-FundG during the period and the results of those activities at the end of the reporting period.
            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]

        • Contents of the Interim Report

          • CIR 9.4.4

            The Fund ManagerG must produce an interim report which contains:

            (a) the total expense ratio at the end of the period;
            (b) particulars of any material issues raised by the Eligible CustodianG and, if applicable, the TrusteeG , the investment committee or any PersonG providing oversight in relation to the FundG ; and
            (c) matters required to be included in the Fund Manager'sG report under CIR Rule 9.4.9.
            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]

        • Contents of the Annual Report

          • CIR 9.4.5

            An annual report of a FundG , other than a FundG which is an Umbrella FundG , must contain:

            (a) the full audited financial statements for the annual accounting period;
            (b) the report produced by the Registered AuditorG in accordance with CIR Rule 9.3.8(b);
            (c) the report of the Fund ManagerG in accordance with CIR Rule 9.4.9;
            (d) if the FundG is a Public FundG , the comparative table in accordance with Rule CIR 9.4.10; and
            (e) if the FundG is a Public FundG , the OversightG report in accordance with CIR Rule 10.3.13.
            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
            [Amended] DFSA RM137/2014 (Made 21st August 2014). [VER17/06-14]

          • CIR 9.4.6

            An annual report on a FundG which is an Umbrella FundG must contain:

            (a) for each Sub-FundG :
            (i) the full audited financial statements for the annual accounting period;
            (ii) the report of the Fund ManagerG in accordance with CIR Rule 9.4.9; and
            (iii) if the FundG is a Public FundG , the comparative table in accordance with CIR Rule 9.4.10;
            (b) an aggregation of the financial statements required by (a)(i) for each Sub-FundG ;
            (c) the report produced by the Registered AuditorG in accordance with CIR Rules 9.3.8(b); and
            (d) if the FundG is a Public FundG , the Oversight ReportG in accordance with CIR Rule 10.3.13.
            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
            [Amended] DFSA RM137/2014 (Made 21st August 2014). [VER17/06-14]

          • CIR 9.4.7

            (1) Where a FundG is required to appoint an investment committee pursuant to CIR Rule 13.3.1(1) or CIR 13.4.3, the annual report must also include a report by that committee.
            (2) Where a FundG is a Hedge FundG , the annual report must also include a report of its Eligible CustodianG .
            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
            [Amended] RM158/2015 (Made 9th December 2015). [VER19/02-16]

          • CIR 9.4.8

            The Fund ManagerG must ensure that the financial statements give a true and fair view of the net income and the net gains and the losses on the Fund PropertyG of the FundG , or, the Sub-FundG , for the annual accounting period in question and the financial position of the FundG or Sub-FundG as at the end of that period.

            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
            [Amended] DFSA RM137/2014 (Made 21st August 2014). [VER17/06-14]

        • Fund Manager's Report

          • CIR 9.4.9

            The matters set out in (a) to (h) must be included in any Fund Manager'sG report:

            (a) a restatement of the investment objectives of the FundG ;
            (b) a restatement of the policy for achieving those objectives;
            (c) a review of the investment activities, including in relation to (a) and (b), during the period to which the report relates;
            (d) particulars of any fundamental change requiring prior approval by UnitholderG meeting made since the date of the last report;
            (e) particulars of any significant change requiring pre-event notification since the date of the last report;
            (f) any other information which would enable UnitholdersG to make an informed judgement on the development of the activities of the FundG during this period and the results of those activities as at the end of that period;
            (g) for a report on an Umbrella FundG , the information required in (a) to (h) must be given for each Sub-FundG if it would vary from that given in respect of the Umbrella FundG as a whole; and
            (h) for a FundG which invests a substantial proportion of its assets in other FundsG , a statement as to the maximum proportion of management fees charged to the FundG itself and to other FundsG in which that FundG invests.
            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]

        • Comparative Table

          • Guidance

            In presenting past performance information, the DFSAG recommends that Fund ManagersG follow the Global Investment Performance Standards (GIPS) issued by Institute of Chartered Financial Analysts of the USA.

            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]

          • CIR 9.4.10

            The comparative table for the annual report for a Public FundG must set out:

            (a) the performance record over the last five calendar years, or if the FundG has not been in existence during the whole of that period, over the whole period in which it has been in existence, showing:
            (i) the highest and the lowest price of a UnitG of each class in issue during each of those years; and
            (ii) the net income distributed or, for accumulation UnitsG , allocated for a UnitG of each class in issue during each of those years, taking account of any sub-division or consolidation of UnitsG that occurred during that period;
            (b) as at the end of each of the last three annual accounting periods or all of the Fund'sG annual accounting periods, if less than three:
            (i) the total net asset value of the Fund PropertyG at the end of each of those years;
            (ii) the net asset value per UnitG of each class; and
            (iii) for a report of the directors of an Investment CompanyG , the number of UnitsG of each class in issue; or
            (iv) for a report of the Fund ManagerG of any other FundG , the number of UnitsG of each class in existence or treated as in existence; and
            (c) if, in the period covered by the table:
            (i) the Fund ManagerG has been the subject of any event such as a transfer scheme having a material effect on the size of the FundG , but excluding any issue or cancellation of UnitsG for cash; or
            (ii) there have been changes in the investment objectives of the FundG ;
            an indication, related in the body of the table to the relevant year in the table, of the date of the event or change in the investment objectives and a brief description of its nature.
            Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]

      • CIR 9.5 Table Illustrating Content of the Annual Report

        • CIR 9.5 Guidance

          Type of Report CIR Ref Public Funds Exempt Funds QIF
          Annual and interim reports CIR 9.4.2 Annual Report only. An interim report is required only if there has been a material change during the interim accounting period
          Fund Manager's Report CIR 9.4.9
          Fund Auditor's Report CIR 9.3.8(b)
          Oversight Report CIR 10.3.13 Not applicable Not applicable
          Comparative Table CIR 9.4.10 Not applicable Not applicable
          Eligible Custodian Report CIR 9.4.7(2) Hedge Funds only Hedge Funds only Hedge Funds only
          Investment Committee CIR 13.3.1 & CIR 13.4.3 Private Equity Funds and Property Funds Private Equity Funds and Property Funds Not applicable

          This table illustrates the different content requirements for reports of a Domestic FundG .

          Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
          [Amended] DFSA RM137/2014 (Made 21st August 2014). [VER17/06-14]