The Capital Market Authority Approves the Closed-Ended Investment Traded Funds Instructions

The Capital Market Authority's Board issued its resolution to approve the Closed-Ended Investment Traded Funds Instructions after the Instructions were published on the Authority's website for 15 days for consultation and the Instructions shall be effective from its publication date.

It's worth mentioning that the Instructions were drafted in light of the best international practices in this regard. In addition, the Authority has taken into consideration the comments received from the public, discussed with the market participants and coordinated with the concerned parties in a manner that help in achieving the desired objectives of these Instructions, as the Authority attaches great importance to the asset management industry as one of the main securities businesses that the Authority regulates. The asset management industry contributes to the provision of diversified investment products, professional management of clients' assets and the enhancement of professional practices and institutional behavior in the market.

Some of the notable provisions are found in stating the unitholder's right to exercise all rights in relation to the units including, but not limited to, the right to vote at meetings of unitholders, beside enabling the investment of a percentage exceeding (10%) of the fund's net assets value in illiquid assets. Moreover, the Authority have taken into consideration a number of the public views , including but not limited to, reducing the minimum amount for the fund's establishment to become SAR (300) million.

And the Instructions can be viewed via the following link:

التعليمات الخاصة بصناديق الاستثمار المغلقة المتداولة

The Closed-Ended Investment Traded Funds Instructions