Brokerage firms can now seek license to receive subscription orders for private investment funds -Omran
Brokerage firms can now seek licenses to take orders for funds: The Financial Regulatory Authority (FRA) has issued new directives that allow brokerage firms to take orders for investments in funds, FRA boss Mohamed Omran said in a statement yesterday. Only brokerages that have been in the market for more than five years will be allowed to apply for licenses. Prior to the rule, investment funds have been closed to brokerages, accessible only through banks.
Other regulatory changes enacted at the same time: Setting a five-day window from the date of application for the FRA to respond to license requests; requiring firms to seek FRA approval before accepting subscriptions for more than one fund; and necessitating that proceeds from fund subscriptions flow into a bank account created especially for them to keep them separated from the company’s finances.