The Gulf Cooperation Council (GCC) has taken a significant step towards regional economic integration with the approval of a unified regulatory framework for fund passporting. This landmark decision, made during the 29th meeting of the GCC Committee of Heads of Financial Market Authorities in Abu Dhabi, is expected to go into effect in early 2025, pending legislative finalisation in member states.

A New Era for Cross-Border Investments

The unified fund passporting framework aims to simplify and enhance cross-border investments across GCC member states by creating a streamlined process for registering and promoting investment funds. For the first time, the region will operate under a shared regulatory structure for financial products, reflecting a collective commitment to fostering a transparent, integrated, and investor-friendly financial ecosystem.

This initiative aligns with the GCC's broader economic integration and sustainable development goals, reducing operational barriers and opening significant opportunities for both regional and international investors.

Key Features of the Framework

The newly approved framework introduces several measures to enhance cross-border investment and ensure robust governance:

• Simplified Fund Registration: A unified registration process that facilitates the promotion of cross-border investment opportunities within GCC states.

• Enhanced Transparency and Governance Standards: Clear obligations for fund managers and promoters, mechanisms for fee regulation, and comprehensive compliance oversight.

• Investor Protection Measures: Provisions to safeguard unit holders’ rights, including standards for fund listing, trading, and adherence to financial and legislative requirements.

• Enforcement Powers: Regulatory authorities within GCC states have the power to deregister non-compliant funds, ensuring strict adherence to the framework.

Developed through close collaboration between GCC legal and technical experts, this initiative sets the stage for a more unified and efficient financial market within the region.

Implications for the GCC as a Global Investment Hub

The approval of the unified fund passporting framework is a major milestone in the GCC's efforts to position itself as a leading international destination for investments. By simplifying processes and enhancing regulatory transparency, the framework reduces barriers for investors and fosters trust in the regional financial markets.

Moreover, the initiative reflects the GCC’s ambition to promote deeper economic ties among member states while simultaneously advancing sustainable development goals. The shared regulatory approach will not only attract foreign investment but also empower local markets, creating a competitive and dynamic financial landscape.

How j. awan & partners Can Support

At j. awan & partners, we are dedicated to helping our clients navigate the complexities of regulatory compliance across the GCC. With extensive expertise in governance, risk, and compliance (GRC), our team is well-equipped to assist financial institutions and fund managers in adapting to the new framework.

We offer comprehensive services, including:

• Strategic guidance on fund registration and compliance.

• Tailored risk management frameworks aligned with regional regulations.

• Ongoing support to ensure seamless operations under the unified framework.

  
  

As the framework takes effect in early 2025, j. awan & partners is ready to provide the tools and expertise necessary to help our clients thrive in this evolving financial landscape.