Dubai: Dubai International Financial Centre (DIFC) announced the enactment of new Variable Capital Company (VCC) Regulations. The Regulations seek to significantly enhance investment structuring and asset management options for proprietary investment in DIFC.
According to Emirates News Agency, Jacques Visser, Chief Legal Officer, DIFC Authority, stated that the DIFC Authority is excited to announce the enactment of its Variable Capital Company Regulations. The Variable Capital Company Regulations advance DIFC's position as a global hub for sophisticated investment structures. The VCC regime also caters to a wide spectrum of applicants, supported by Corporate Service Providers to ensure strong compliance and operational integrity across the sector.
The proposed VCC framework is designed to accommodate proprietary investment activities and will not require DFSA authorisation or a requirement for a regulated fund manager, unless the vehicle engages in regulated financial services activities. This positions the VCC as an efficient vehicle for investors seeking the benefits of collective investment activity, or segregated investment strategies, whilst leveraging the flexibility and reduced procedural requirements for managing share capital.
Following public consultation, the Regulations introduce expanded eligibility criteria allowing any applicant to apply to establish a VCC in DIFC, provided the VCC appoints a Corporate Service Provider (CSP) to perform administrative, compliance, and regulatory liaison functions with the Registrar of Companies on its behalf. This requirement ensures robust governance and operational oversight for VCCs formed by unregulated or non DIFC entities.
Exempt VCCs, including those controlled by DIFC Registered Persons, Authorised Firms, government entities, or publicly listed companies, are not required to appoint a CSP. The VCC model will be of particular interest to family-owned businesses, high-value multi-asset holdings, and complex proprietary investment portfolios, such as secondaries structures, that wish to benefit from consolidated management and the structuring options and flexibility that a VCC provides.