Home   Browse contents   View updates   Search  
     Quick search
Go
   

Dubai Financial Services Authority (DFSA): Contents

Dubai Financial Services Authority (DFSA)
Laws
Rulebook Modules
Collective Investment Rules (CIR) [VER25/07-19]
Part 6 Rules Specific to Specialist Classes of Domestic Funds
CIR 13 Additional Requirements for Specialist Funds
Sourcebook Modules
Consultation Papers
Policy Statements
DFSA Codes of Practice
Amendments to Legislation
Media Releases
Notices
Financial Markets Tribunal
Archive

BackText onlyPrint

You need the Flash plugin.

Download Macromedia Flash Player



  • Related Party Transactions

    • Guidance

      1. A Fund ManagerG of a Public Property FundG is required pursuant to CIR Rule 8.3.2 to obtain the agreement of UnitholdersG by way of an ordinary resolution before undertaking a Related Party TransactionG where the total consideration or value of the transaction is 5% or more of the net asset value of the FundG . See also CIR App2 and CIR App3.
      2. A Fund ManagerG of a Public Property FundG may enter into a Related Party TransactionG for the acquisition or sale of Real PropertyG in the State without obtaining specific approval for the transaction under CIR Rule 8.3.2 if all of the conditions in CIR Rule 13.4.11A(1) are met.
      3. If a Fund ManagerG enters into a Related Party TransactionG under the exclusion in CIR Rule 13.4.11A, it must notify UnitholdersG of details of the transaction as soon as practicable after entering into the transaction. It also must disclose in the Fund'sG ProspectusG if it has UnitholderG approval to enter into such transactions without obtaining a resolution in each case (see CIR Rule 14.4.4B).
      Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
      [Amended] RM158/2015 (Made 9th December 2015). [VER19/02-16]

    • CIR 13.4.11A

      (1) The Fund ManagerG of a Public Property FundG is not required to comply with CIR Rule 8.3.2(3) and (4)(a) for a Related Party TransactionG if:
      (a) the transaction is for the acquisition or sale of Real PropertyG in the StateG ;
      (b) the Fund ManagerG has general Unitholder approval in accordance with (2) to enter into such transactions;
      (c) the oversight provider of the FundG has confirmed in writing, before the transaction is entered into, that it is on terms that comply with the requirement in CIR Rule 8.3.2(2) and that all other applicable requirements have been complied with; and
      (d) the investment committee of the FundG has confirmed in writing, before the transaction is entered into, that it is on terms that comply with the requirement in CIR Rule 8.3.2(2) and it has no objection to the transaction.
      (2) UnitholderG approval under (1)(b) must be by way of an ordinary resolution of the UnitholdersG of the FundG that:
      (a) was passed at the previous annual general meeting of the FundG ;
      (b) is valid only until the date of the next annual general meeting of the FundG (when it may be renewed): and
      (c) authorises the Fund ManagerG to enter into Related Party TransactionsG referred to in (1)(a) without obtaining prior UnitholderG approval in each case during the period for which the resolution is valid.
      (3) If a Fund ManagerG of a Public Property FundG enters into a Related Party TransactionG under this Rule, it must as soon as practicable after entering into the transaction provide written notification to UnitholdersG of the FundG setting out relevant details of the transaction including the identity of the Related PartyG and the nature and extent of his interest.
      [Added] RM158/2015 (Made 9th December 2015). [VER19/02-16]

    • CIR 13.4.12

      (1) The following information in relation to Related Party TransactionsG must be disclosed to UnitholdersG and where appointed, the TrusteeG , by the Fund ManagerG of a Public Property FundG :
      (a) any beneficial interests of the Related PartyG , and any changes thereof, in the FundG ; and
      (b) any potential conflicts of interests involving the Related PartyG and the measures implemented to address such conflicts.
      (2) If the Fund ManagerG operates more than one FundG and a transaction involves two or more of the FundsG operated by the Fund ManagerG , such transactions between the FundsG will be Related Party TransactionsG for each of the FundsG involved in the transactions.
      Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
      [Amended] RM158/2015 (Made 9th December 2015). [VER19/02-16]

    • CIR 13.4.13

      (1) Where any Related PartyG has an interest in an UndertakingG which competes or is likely to compete, either directly or indirectly, with the Fund'sG activities, the Fund ManagerG of a Public Property FundG must disclose to UnitholdersG and where appointed, the TrusteeG , the following:
      (a) a description of the UndertakingG of the Related PartyG and its management, to enable UnitholdersG to assess the nature, scope and size of such business, with an explanation as to how such UndertakingG may compete with the FundG ;
      (b) where applicable, a statement from the relevant Related PartyG that it is capable of performing, and shall perform, its duty in relation to the FundG independently of its related business and in the best interests of the FundG and its holders; and
      (c) a statement as to whether the FundG may acquire any of the related business or assets of the Related PartyG .
      (2) If there is any change in information required under (1) after initial disclosure, the Fund ManagerG must disclose such changes to the UnitholdersG and where appointed the TrusteeG .
      Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
      [Amended] RM158/2015 (Made 9th December 2015). [VER19/02-16]

    • CIR 13.4.14

      Where a Related PartyG has, for the purpose of the establishment of the FundG , agreed to sell Real PropertyG to the FundG , the Fund ManagerG of a Public Property FundG must disclose the following in the ProspectusG :

      (a) a valuation report by an independent valuer of the Real PropertyG that the Related PartyG has agreed to sell; and
      (b) the price to be paid by the FundG for the Real PropertyG and other material terms of the transaction.
      Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
      [Amended] RM158/2015 (Made 9th December 2015). [VER19/02-16]

    • CIR 13.4.15

      (1) The Fund ManagerG of a Public Property FundG must ensure that if any cash forming part of the Fund'sG assets is deposited with a Related PartyG (being an institution licensed to accept deposits), interest must be paid on the deposit at a rate not lower than the prevailing commercial rate for a deposit of that size and term.
      (2) The Fund ManagerG of a Public Property FundG must ensure that in the event of borrowing from a Related PartyG (being an institution licensed to lend money), interest charged on the borrowing is at a rate not higher than the prevailing commercial rate for a borrowing of that size and term.
      Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
      [Amended] RM158/2015 (Made 9th December 2015). [VER19/02-16]

    • CIR 13.4.16

      (1) This Rule applies to a Related Party TransactionG of a Public Property FundG that involves either:
      (a) services provided in the ordinary course of estate management of Real PropertyG of the FundG , including renovation and maintenance work; or
      (b) engaging a property agent to provide services to the FundG , including advisory or agency services in property transactions.
      (2) The Fund ManagerG , and if appointed, the TrusteeG , must ensure that if the 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, it is entered into only with the prior approval of the oversight provider of that FundG .
      Derived from RM72/2010 (Made 11th July 2010). [VER13/07-10]
      [Amended] RM158/2015 (Made 9th December 2015). [VER19/02-16]

      • CIR 13.4.16 Guidance

        The requirements in CIR Rule 13.4.16 are in addition to other requirements in these Rules applying to Related Party TransactionsG . For example, under CIR Rule 8.3.2, the Fund ManagerG must ensure the transaction is on normal commercial terms, is subject to UnitholderG approval if it represents 5% or more of the net asset value of the FundG and is disclosed to UnitholdersG .

        [Added] RM158/2015 (Made 9th December 2015). [VER19/02-16]

    • CIR 13.4.17 [Deleted]

      [Deleted] RM158/2015 (Made 9th December 2015). [VER19/02-16]