FRA releases new regulations regarding investment funds dealing in minerals

The Financial Regulatory Authority’s (FRA) chairperson, Mohamed Farid, has announced that the authority’s board of directors has issued two new decisions regarding investment funds dealing in minerals as one of the transferred financial values.

FRA issued Decision No. 50 of 2023 to amend the Authority’s Board of Directors’ Decision No. 71 of 2021 regarding the controls for dealing with these funds.

The new decision includes that the fund’s investment manager is obligated to deal in buying and selling minerals through the entities registered in the register and taking into account the controls set by the FRA in this regard, with the Fund’s obligation to provide the FRA with a copy of the contract concluded between it and the aforementioned service providers.

The period of registration in the register will be three years and shall be renewed for similar periods, provided that the application for renewal is submitted within the three months preceding the expiry of the registration period. Renewal of registration in the register requires the fulfillment of the conditions required for registration and its continuity.

The decision also included the conditions that must be met by the providers of the mineral preservation service in terms of the legal form of its establishment, the availability of the minimum technical and technological requirements determined by the FRA, the conditions that must be met in the premises and safes in which the Fund’s assets are kept in a secure manner, as well as the availability of systems and foundations for internal control and financial audit and what is useful for the company has a system for storing and retrieving customer instructions.

The FRA also issued Resolution No. 52 of 2023 regarding the controls for registration and deletion in the Authority’s register of entities that investment funds must deal with in the purchase and sale of minerals.

The decision stated that a committee was formed comprising of legal and technical elements for field and office examination to ensure that the conditions and documents required for registration are met, adding that it will provide its decision for any applications for registration within a period not exceeding fifteen days from the date of fulfilling the registration requirements.

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