By Ed Attwood
Buyout firm is first to trial new regulatory scheme in Dubai financial centre, designed to lure more firms to the emirate
Carlyle Group, the world’s second-biggest buyout firm, is to establish an investment vehicle in Dubai International Financial Centre under a new legal and regulatory process.
The firm is the first to trial the scheme, which allows firms based outside the tax-free business park to establish and advice investment funds from inside the zone.
Under the old regime, Carlyle’s Dubai investment team was only allowed to offer advisory services to funds based outside the emirate.
The new rules – which were introduced in July this year – will see Carlyle establish an investment vehicle to partner with its existing fund, Carlyle MENA Partners, and manage funds for larger investors in DIFC.
The new vehicle will not raise additional investment capital, it said.
DIFC’s new Funds Regime mimics regulatory processes seen in other markets like the US, where certain funds are exempted from government registration if they cater exclusively to sophisticated investors and are subject to certain disclosure and marketing restrictions.
In addition, the new rules also make it easier and cheaper for firms to set up funds in the DIFC, as part of the emirate’s bid to attract more financial services firms to the zone.
The move came after DIFC and the Dubai Financial Services Authority (DFSA) reviewed recommendations made by a panel of global fund specialists.
“We wanted to gauge what the funds community really wanted in order to create an environment which would stimulate further growth of the industry,” said Marwan Ahmad Lutfi, deputy CEO and head of business development at the DIFC Authority.
DIFC this month announced a new sliding scale of rents for tenants that could see rates for some companies drop by as much as 50 percent.
Effective from January, the rents will run from AED160 to AED280 per square foot, depending on the size of the office and its location within DIFC.
“Given the financial crisis and the global migration of staff from one centre to another, we need to make sure that the environment is comfortable for companies to plan their growth,” said Abdulla Al Awar, CEO of the DIFC Authority.