A) This regulation aims to organize real estate investment funds whose units are publicly offered in the Kingdom, in relation to the offering, registration, management of their units, and the protection of the rights of their owners.

B) This regulation does not prejudice the provisions of the law or its executive regulations, including the provisions contained in the Market Conduct Regulation, the Financial Market Institutions Regulation, the Securities Business Regulation, and the rules governing special purpose entities.

• A) The term (Law) wherever mentioned in the provisions of this Regulation meansCapital Market Lawissued by Royal Decree No. (M/30)and dated 2/6/1424 AH.

• B) The words and phrases mentioned in this Regulation shall have the meanings assigned to them in the Law, and in the glossary of terms used in the regulations and rules of the Capital Market Authority.

A) Any person wishing to offer units of a Real Estate Investment Fund publicly in the Kingdom must comply with the provisions of this Regulation, and the provisions contained in the rules governing Special Purpose Entities (where applicable).

B) Any Fund Manager, Custodian, Distributor, and any member of the Boards of Directors of public Real Estate Investment Funds in the Kingdom must comply with the provisions of this Regulation, and the provisions contained in the rules governing Special Purpose Entities (where applicable).

The Authority has the power to exempt any person subject to this Regulation from the application of any of its provisions, in whole or in part, based on a request received from them or on its own initiative.

The authority shall impose a financial fee on the fund manager and the distributor as determined by it.

Any person subject to the provisions of this Regulation has the right to submit a grievance to the Committee regarding any decision or action taken by the Authority in accordance with the provisions of this Regulation.

A) The applicant - who wishes to obtain the Authority's approval to offer units of a Real Estate Investment Fund - must be a financial market institution licensed by the Authority to practice investment management and fund operation activities.

B) Units of the Real Estate Investment Fund shall not be offered publicly except after submitting the information detailed in the annex (3) of this regulation to the Authority and obtaining its approval.

C) The applicant must submit any other requirement requested by the Authority in accordance with the law and its executive regulations.

• A) The Authority may, when reviewing any application to offer fund units, take any of the following actions:

  • 1. Conduct any investigation it deems appropriate.

  • 2. Request the applicant or their representative to appear before the Authority to answer any questions and explain any matter the Authority considers related to the application. The applicant shall be subject to this regulation from the date of submitting their application.

  • 3. Request any additional information it deems necessary or verify the accuracy of the submitted information, provided this is done within (30) days from the date of the request.

  • 4. Verify the accuracy of any information provided by the applicant.

• B) If the applicant fails to provide the requested information, or does not provide it within the time period specified in subparagraph (3) of paragraph (A) of this article, the Authority may reject the application. The Authority reserves the right to reject any application if it deems that the fund conflicts with the interests of investors, may not be compatible with the fund manager's capabilities, or may result in a violation of the law or its executive regulations.

• C) After receiving all the required information and documents, the Authority shall notify the applicant in writing and take one of the following decisions within a period not exceeding (30) days from the date of notification:

  • 1. Approve the application in whole or in part.

  • 2. Approve the application with the conditions and restrictions it deems appropriate.

  • 3. Reject the application with reasons stated.

• D) The Authority shall notify the applicant in writing of the decision it makes regarding the application.

• E) The applicant shall not offer, market, or advertise units in the fund before obtaining the Authority's approval decision.