What happened
A broad consultation, with six formal proposals
On 7 July 2026, the Dubai Financial Services Authority published Consultation Paper No. 173. The paper proposes a more flexible, risk-based funds framework aligned to the profile of each fund and its investors. It remains a consultation: existing rules continue to govern current applications and operations while the DFSA considers feedback and completes the DIFC legislative process.
The formal package covers specialist private-fund classifications, investment-manager permissions, master-feeder public funds, the external fund manager regime, employee participation in private funds and technical amendments to the Collective Investment Law. The DFSA is also seeking early views on tokenised fund units and assets, including tokenised money market funds, and on a possible long-term investment fund regime for retail access to illiquid real-economy assets.
Regulator facts
What the DFSA is proposing
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More flexible private-fund design
Replace rigid specialist classifications with a risk-based approach that can accommodate hybrid and multi-strategy private funds.
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Simpler investment-manager permissions
Treat dealing as agent and arranging activity integral to fund investment management as covered by the Managing Assets permission.
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Updated structures and participation
Modernise master-feeder public funds, remove the external fund manager regime and broaden employee investment in employer-managed private funds.
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Future-facing topics
Gather early feedback on fund tokenisation and a potential long-term investment fund route before detailed policy proposals are developed.
Who is affected
Current managers, service providers and applicants should all review it
The immediate audience is wider than fund managers. Administrators, custodians, asset managers, advisers and firms preparing a DFSA application may all see changes to permissions, structures, disclosures or the service model around a fund. Existing groups should compare each proposal with their current range. New entrants should test whether a planned hybrid strategy, master-feeder arrangement or employee vehicle becomes easier to present under the proposed architecture.
SKY7 view
Improve the route while the live project continues
CP173 points towards a clearer commercial proposition for DIFC fund platforms: permissions tied more closely to the work performed and structures that better reflect current investment strategies. That can reduce avoidable complexity for groups building several strategies or combining management, arranging and agency activity.
The practical response is a two-track plan. Keep any live authorisation or fund launch aligned to today's rulebook, while documenting where the proposal could change the target permission set, legal structure or implementation sequence. Firms with a material point should submit evidence-based feedback before the deadline. Once final instruments and commencement dates are published, the plan can be updated against the enacted text.
What to do now
Four actions before 7 September
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Map the current fund model
Record investor type, strategy, legal structure, manager permissions and every administration or custody dependency.
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Mark the proposals that change the file
Identify where CP173 could simplify a permission, widen a structure or require a transition decision.
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Quantify the commercial effect
Convert each relevant point into its cost, timing, product and distribution impact for the business.
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Preserve both scenarios
Continue under the live framework and maintain a second implementation view for the possible final changes.
SKY7 guidance
Place CP173 in the wider DIFC route
Primary evidence
Official sources
Sources checked .