MENA Asset Management Survey 2012 - National Bank of Abu Dhabi

Global Trends
level of supervision and transparency requirements through the information provided to
investors (prospectus, key investor information document, annual and semi-annual
report). UCITS must also ensure a certain level of diversification of their assets, maintain
an appropriate risk management process and only invest in certain types of assets
(mostly listed securities, bonds, index components (directly or indirectly), derivatives and
assimilated assets).
3. supervision
UCITS are subject to prior approval and ongoing supervision of the Luxembourg
regulator (the “Commission de Surveillance du Secteur Financier” (CSSF)). UCITS need
in particular to evidence some substance in Luxembourg either by themselves or by
appointing a management company in Luxembourg or in another Member State.
In addition, the investment manager of a UCITS must be regulated and is subject to
CSSF approval. Where such an asset manager is supervised by a non-EU regulator,
such as in the UAE, SCA or DFSA, a certain cooperation needs to exist between such
regulator and the CSSF. This is usually established through the signature of a
memorandum of understanding (MOU) between the two authorities. There are a number
of such MOU in place with GCC regulators, such as SCA, DFSA and QFCRA.
II. Specialised Investment Funds
SIFs are governed by the law of 13 February 2007, as amended.
1. institutional by nature
SIFs are reserved for investment by qualified investors complying with certain conditions.
As such investors are deemed knowledgeable of the finance industry; the transparency
requirements are also lighter. For instance, no half annual report nor key investor
information document are required.
SIFs are usually favored by asset managers looking for a regulated fund structure
without the constraints of a UCITS product, as they are targeting a limited base of
investors. The increasing interest of family offices for this type of investment vehicle is
also worth noting.
2. lighter regulation
SIFs may invest in all types of asset classes and strategies (hedge funds, private
equity…), are subject to light diversification requirements (in principle no more than 30%
per issuer) and may be close ended.
However, in anticipation of the implementation of the Alternative Investment Fund
Managers Directive (AIFMD), in Luxembourg, the legislator has recently imposed that
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