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Dubai Regulations for Crowdfunding: Issuers May Raise Up To $5 Million


CrowdfundInsider | By JD Alois | August 1, 2017

The Dubai Financial Services Authority (DFSA) announced the enactment of a regulatory regime designed to engender a robust crowdfunding ecosystem for the country. The new regulations are part of a strategy to foster an innovation driven economy. Empowering entrepreneurs and startups by providing the access to capital they must have. DFSA specifically pointed to the importance of small business to the local economy.

But what is hidden in the crowdfunding rules? First of all, the new rules are designed to regulate both debt and equity crowdfunding offers. As in the UK, crowdfunding is a blanket term that includes peer to peer lending platforms

As for the specifics of the rules, you may view them here. A DFSA representative guided us to this section of their web site and indicated that Appendixes 1 through 7 includes the details of the new rules.

At a high level, crowdfunding offers are capped at $5 million. This is in line with the UK but far higher than Reg CF in the US. But then Dubai has crafted a single regime, more in line with the UK. You may view how Dubai defines an exempt offering here.

See: Why crowdfunding appeals to the Middle East

As for investor limits, a retail investor may lend nor more than $5000 to a single borrower. In any given calendar year, an investor may lend in total $50,000.

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The National Crowdfunding Association of Canada (NCFA Canada) is a cross-Canada non-profit actively engaged with both social and investment crowdfunding stakeholders across the country. NCFA Canada provides education, research, leadership, support, and networking opportunities to over 1500+ members and works closely with industry, government, academia, community and eco-system partners and affiliates to create a strong and vibrant crowdfunding industry in Canada. Learn more at ncfacanada.org.