FPR 1.3 FPR 1.3 Glossary for FPR
FPR 1.3 Guidance1. Some of the defined terms and abbreviations in this module may also be found in the DFSA's
Glossarymodule (GLO). Where a defined term in this module does not appear in FPR Rule 1.3.1, a Personto whom these Rulesapply should refer to GLOto find the meaning.2. A reference to legislation includes a reference to the legislation as amended or reenacted from time to time.3. Note that some terms, such as Fundand Domestic Fund, are defined differently in this module than elsewhere the Rulebook.Derived from RMI233/2019 (Made 20th February 2019). [VER1/02-19]
In this module the terms and abbreviations listed in the table below have the following meanings:
Agent A Licensed Personappointed by the Fund Managerof a Passported Fundto Promotethe Unitsof that Fund. Authority The Securities and Commodities Authority(SCA), the Financial Services Regulatory Authority(FSRA) or the Dubai Financial Services Authority(DFSA). Domestic Fundor Fund Any arrangement that:(a) is established or domiciled in the UAE; and(b) is a "collective investment fund" as defined under the legislation administered by the DFSAor the FSRAor an "investment fund" as defined under the legislation administered by the SCA. Fund Manager The Personlicensed by a Home Regulatorto manage or operate a Domestic Fund. Home Regulator(a) In relation to a Fund, the Authority that is responsible for regulating the Fundin the Jurisdictionwhere the Fundis established or domiciled; and(b) In relation to the Fund Managerof a Fund, the Authority that is responsible for regulating the Fund Managerin the Jurisdictionwhere the Fundis established or domiciled. Home Jurisdiction In relation to a Fund, the Jurisdictionin which the Fundis established or domiciled. Host Jurisdiction In relation to a Passported Fund, a Jurisdictioninto which the Passported Fundmay be Promotedunder these Rules. Host Regulator In relation to a Passported Fund, the Authority in the Jurisdictioninto which the Fundmay be Promoted(Host Jurisdiction) under these Rules Jurisdiction The UAE(excluding the Financial Free Zones), the Dubai International Financial Centreor the Abu Dhabi Global Market. Licensed Person A Personwho is licensed or otherwise authorised by an Authority to Promote Funds. Passported Fund A Domestic Fundthat is registered on its Home Jurisdiction's Registerof Passported Funds. Person Any natural person, body corporate or body unincorporated, including a company, partnership, unincorporated association, government or state. Promote
The marketing and sale of units of a Passported Fundto investors domiciled in the UAEby means of any form of communication including a direct or indirect public offering or private placement performed by:(a) the Fund Manager;(b) an Agent; or(c) any otherIn this definition "sale" includes any arranging, dealing and advising activities in relation to the units. Licensed Person. Private Fund A Domestic Fundwhere:(a) the initial subscription paid by a Personto become a Unitholderof the Fundis no less than $50,000; and(b) participation in the Fundis restricted to Unitholderswho are Qualified Investors. Public Fund A Domestic Fundwhere:(a) Unitsof the Fundare offered to Personsin any of the Jurisdictionsby way of a public offer; or(b) any Unitholderof the Fundis a Retail Client. Qualified Investor Any Personwho is either a:(a) "Deemed" Qualified Investor;(b) "Service-based" Qualified Investor; or(c) "Assessed""Deemed" Qualified Investor Qualified Investor.
Personis a "deemed" Qualified Investorif the Personfalls within any of the following paragraphs and has not opted to be classified as a Retail Client:
(a) a supranational organisation whose members are either countries, central banks or national monetary authorities;(b) a properly constituted government, government agency, central bank or other national monetary authority of any country or jurisdiction;(c) a public authority or state investment body;(d) an investment exchange or a clearing house that is authorised by an Authority or a financial services regulator outside the
UAE;(e) a Personwho is authorised to carry on a financial service by an Authority or by a financial services regulator;(f) the management company of a regulated pension fund;(g) a Personwhich, as at the date of its most recent financial statements, met at least two of the following requirements:(i) a balance sheet total of US$20 million;(ii) a net annual turnover of US$40 million; or(iii) own funds or called up capital of at least US$2 million,or, in each case, equivalent amounts in another currency;(h) a Collective Investment Fundor a regulated pension fund;(i) a body corporate whose shares are listed or admitted to trading on any exchange of an IOSCO member country;(j) any other institutional investor whose main activity is to invest in financial instruments, including an entity dedicated to the securitisation of assets or other financial transactions;(k) a trustee of a trust which has, or had during the previous twelve months, assets of at least US$10,000,000, or an equivalent amount in another currency. An individual trustee on the board of such a trust is only a "deemed" Qualified Investorin relation to that particular trust;(l) a single family office with respect to its activities carried on exclusively for the purposes of, and only in so far as it is, carrying out its duties as a single family office; or(m) a subsidiary or a parent of any of the"Service-based" Qualified Investor Personsdescribed in 1(a)–(l).
Personis a "Service-based" Qualified Investorif:
(a) the financial service provided to that
Personis "Advising on Investments" or "Arranging Credit";(b) the service is provided for the purposes of corporate structuring and financing; and(c) the"Assessed" Qualified Investor Personhas not opted to be classified as a Retail Client.
Personis an "assessed" Qualified Investorif the Personfalls within any of the following paragraphs and has not opted to be classified as a Retail Client:
(1) An individual is an "assessed"
(a) the individual has net assets of at least US$1,000,000 (or an equivalent amount in another currency), the calculation of which must:(i) exclude the value of that person's primary residence; and(ii) include any assets held directly or indirectly by that
Person; and(b) either:(2) Any legal structure or vehicle, such as an undertaking, trust or foundation, is an "assessed"(i) the individual is, or has been, in the previous two years, an employee in a professional position in a Person authorised to carry on a financial service by an Authority or by a financial services regulator outside the UAE; or(ii) the individual appears, on reasonable grounds, to have sufficient experience and understanding of relevant financial markets, products or transactions and any associated risks. Qualified Investorif it is set up solely for the purpose of facilitating the management of an investment portfolio of an individual assessed as meeting the requirements in (1).
(3) An individual who has a joint account (a "joint account holder") with an individual assessed as meeting the requirements in (1) (the "primary account holder") is an "assessed"
(a) the joint account holder is a family member of the primary account holder;(b) the account is used for the purposes of managing investments for the primary account holder and the joint account holder; and(c) the joint account holder has confirmed in writing that investment decisions relating to the joint account are generally made for, or on behalf of, him by the primary account holder.(4) An individual classified as a
Qualified Investormay operate a joint account with more than one family member. Provided that each such family member meets the requirements set out in (3) above, they may all be classified as Qualified Investors.
(5) A legal structure or vehicle of a
Qualified Investorwhich is itself classified as a Qualified Investormay not opt to be treated as a Retail Client, as that right belongs to the Qualified Investor for whose purposes the vehicle is set up.
(6) A family member of a
Qualified Investorclassified as a Qualified Investor under (3) above does not per se have a right to opt to be classified as a Retail Clientwith regard to the operation of the joint account.
(7) A family member of a
Qualified Investorclassified as a Qualified Investorunder (3) may withdraw his confirmation given to have decisions on behalf of him made by the Qualified Investorwho is the primary account holder of the joint account. An Authorised Personmust ensure that once such a withdrawal is made, the withdrawing individual is no longer classified as a Qualified Investor.
(8) An undertaking is an "assessed"
Qualified Investorif the undertaking:
(a) has own funds or called up capital of at least US$1,000,000 (or an equivalent amount in another currency); and(b) appears, on reasonable grounds, to have sufficient experience and understanding of relevant financial markets, products or transactions and any associated risks.(9) An undertaking is an "assessed"
Qualified Investorif the undertaking has a controller, holding company, a subsidiary or a joint venture partner which meets the requirement to be an "assessed" Qualified Investorunder (1), (2) or (4), or a "deemed" Qualified Investor. Register of Passported Funds(a) In relation to the DFSA, the register of Passported Fundsmaintained by the DFSA; and(b) In relation to another Authority, the register of Passported Fundsmaintained by that Authority. Retail Investor A Personwho is not classified as a Qualified Investor Unit A unit in or a share representing the rights or interests of a Unitholderin a Fund. Unitholder In relation to a Fund, any holder of a Unitin the Fundor of any right or interest in such a Unit, and whose name is entered on the Fund'sregister in relation to that Unit.Derived from RMI233/2019 (Made 20th February 2019). [VER1/02-19]