The marketing of both Domestic and Foreign Funds are based on generally accepted principles of disclosure through prospectus requirements. However, the level of prospectus disclosure required for Public Funds, which are open to retail investors, is higher than the disclosure requirements for Exempt Funds, which are open only to professional investors.
Foreign Funds can only be marketed in or from the DIFC by DFSA licensed Firms holding advisory or arranging authorisations. Such Firms can now market units of Foreign Funds if one of the following criteria is met:
• The Foreign Fund is a regulated Fund in a jurisdiction included in the DFSA's Recognised Jurisdictions list (available on the DFSA website) and the Fund is a Designated Fund in that list; or
• The Fund Custodian / Investment Manager can meet the required criteria or the Fund itself has been rated or graded at least ‘investment grade’ by an appropriate international rating agency; or
• The Firm makes a suitability recommendation of the investment in the Units of the Foreign Fund to the particular investor, in light of that investor's investment objectives and circumstances; or
• The Foreign Fund is open to 100 or fewer investors each of whom meets the Professional Client test and makes a minimum subscription of USD $50,000 and is not offered to investors by way of public offer.
Property Funds cannot be marketed unless they meet specific criteria including 60% or more of assets invested in Property, the fund is closed ended, the units are either listed or traded in a recognised jurisdiction or offered only by means of private placement.
Foreign Funds which cannot be marketed to retail investors in the home jurisdiction of that fund are prohibited from being marketed to retail investors in or from the DIFC.