FSRA

The Financial Services Regulatory Authority supervises the financial activities carried on in Abu Dhabi Global Market. ADGM is a financial free zone created under UAE federal legislation. Abu Dhabi Law No. 4 of 2013 sets its governance and regulatory framework. The Financial Services and Markets Regulations 2015 form the framework for financial services in the zone. They draw on the UK Financial Services and Markets Act 2000. ADGM rules rest on English common law. The FSRA authorises the firms that carry on a regulated financial activity in ADGM and supervises compliance with anti-money laundering rules. It acts as Listing Authority for securities offerings and admission to the official list. On 4 May 2023, it published its rules on private credit funds. These rules add a Private Credit Funds category to ADGM’s specialist funds and allow funds domiciled in the zone to originate and acquire loans. These funds and their managers are exempt from the specific authorisation and the base capital requirement attached to the Providing Credit and Arranging Credit activities. The rules apply to conventional and Islamic lenders. Islamic lenders comply with ADGM’s Islamic finance rules. The FSRA regime imposes fewer obligations and lower capital requirements than the DIFC credit fund regime. A borrower negotiating with an ADGM fund checks the manager’s FSRA authorisation and the fund category under which it lends.

A French engineering company with €35m of EBITDA receives a €100m loan offer from a private credit fund domiciled in ADGM. Its finance director asks the manager for proof of its FSRA authorisation and for the fund’s regulations. These regulations state the Private Credit Fund category and the investment limits that govern the size of the loan.

• The FSRA authorisation of the lending fund’s manager
• The Private Credit Fund category created by the rules of 4 May 2023
• For Islamic financing, compliance with ADGM’s Islamic finance rules
• The investment limits set in the fund’s regulations