Entire Section

  • GEN 3.5 GEN 3.5 Additional Rules for Financial Promotions

    • GEN 3.5.1 GEN 3.5.1

      (1) A Person in GEN Rule 3.4.1(3) (a) to (d) must, subject to (2), take reasonable care to ensure that any Financial Promotion it makes in or from the DIFC:
      (a) is clear, fair and not misleading;
      (b) includes the Person's name, address and regulatory status;
      (c) if it is intended only for Professional Clients, is not sent or directed to any Person who appears on reasonable grounds not to be a Professional Client, and contains a clear statement that only a Person meeting the criteria for a Professional Client should act upon it; and
      (d) which is provided to or directed at a Retail Client and contains any information or representation relating to past performance, or any forecast based on past performance or on any other assumptions:
      (i) presents a balanced view of the financial products or financial services to which the Financial Promotion relates;
      (ii) identifies, in an easy to understand manner, the information from which the past performance or forecast is derived and how any key facts and assumptions used in that context are drawn; and
      (iii) contains a prominent warning that past performance is not necessarily a reliable indicator of future performance.
      (2) A Person described in GEN Rule 3.4.1(3)(a) who makes a Financial Promotion:
      (a) to an existing client in the DIFC; or
      (b) to a prospective client in the DIFC relating to the Passported Fund for which the DIFC is the Host Jurisdiction,
      is not required to comply with (1) provided that in making the Financial Promotion that Person complies with the requirements of the relevant Financial Services Regulator in the UAE which relate to Financial Promotions.
      Added in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]
      [Amended] DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]
      [Amended] DFSA RM234/2019 (Made 20th February 2019). [VER43/02-19]

      • GEN 3.5.1 Guidance

        1. In presenting information relating to past performance of a financial product or financial service, a Person should use a reputable independent actuarial, financial or statistical reporting service provider.
        2. The effect of GEN Rule 3.5.1(2) is that a Person who is licensed and regulated by a Financial Services Regulator in the UAE is not required to comply with GEN Rule 3.5.1(1) when communicating with an existing client or with a prospective client in relation to a Passported Fund where the DIFC is a Host Jurisdiction. However, when making any other Financial Promotion to a prospective client in the DIFC, GEN Rule 3.5.1(1) does apply to such Persons, as do the prohibitions on the making of offers contained in the Markets Law 2012 and Collective Investment Law 2010 respectively. The exclusion in GEN Rule 3.5.1(2) applies only if the Person is complying with the financial promotion requirements of its Financial Services Regulator in the UAE.
        Added in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]
        [Amended] DFSA RM95/2012 (Made 14th June 2012). [VER29/06-12]
        [Amended] DFSA RM234/2019 (Made 20th February 2019). [VER43/02-19]

    • GEN 3.5.2

      A Person must not, in any Financial Promotion, attempt to limit or avoid any duty or liability it may have under any DFSA-administered laws or the Rules.

      Added in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]

    • GEN 3.5.3 GEN 3.5.3

      A Person must not make a Financial Promotion, in or from the DIFC, in relation to a Restricted Speculative Investment offered by a Person outside the DIFC unless the Person making the Financial Promotion is reasonably satisfied that the issuer or provider of the Restricted Speculative Investment is:

      (a) a Regulated Financial Institution; and
      (b) subject to substantially similar requirements to the requirements applicable to an Authorised Firm under COB section 6.16.
      Derived from DFSA RMI297/2021 (Made 21st April 2021). [VER52/09-21]
      Derived from DFSA RMI305/2021 (Made 30th June 2021). [VER52/09-21]

      • GEN 3.5.3 Guidance

        1. A communication that is an ‘exempt financial promotion” under GEN Rule 3.4.1(4) is still permitted.
        2. A Person making a Financial Promotion relating to a Restricted Speculative Investment should be able to demonstrate to the DFSA the basis upon which it was reasonably satisfied that the issuer or provider of the Restricted Speculative Investment was subject to substantially similar requirements to those applicable under COB section 6.16.
        Derived from DFSA RMI297/2021 (Made 21st April 2021). [VER52/09-21]
        Derived from DFSA RMI305/2021 (Made 30th June 2021). [VER52/09-21]