Foreigners in Dubai are most likely to adopt a special investment tool like the private equity fund. This usually involves a limited partnership for a fixed term of 10 years where partners can make investments in numerous equity securities. The partners involved in private equity investments can gather equal funds which are then withdrawn when the term ends. The legal matters for private equity funds can be explained by our team of lawyers in Dubai for both foreigners and nationals willing to explore this type of investment fund.
The legal structure of a private equity fund in Dubai
As mentioned above, private equity funds can be established in the form of a limited partnership under certain terms and conditions. For instance, the limited partnership is conditioned by the fixed term, usually for 10 years, where the general partner can raise the capital with the help of insurance companies, pension plans, or charities. These are then invested by the limited partner in the established time. As for the returns of private equity funds, these are established by both partners at the time of investment fund creation, in respect to the applicable legislation for foreign investments. It is good to know that private equity funds cannot be traded or transferred, but for a proper understanding of how such funds work, we suggest you address to our Dubai attorneys.
Targets of a private equity fund in Dubai
Private equity funds in Dubai are subject to important assets, like USD 1,000,000 as a starting point which can be drawn at the supervisor’s choice in the first 10 years of the fund’s existence. The leading form of a private equity investment in Dubai is the limited liquidity which involves the illiquid investments like bonds and shares. It is good to know that private equity funds in Dubai are long-term investments which aim to sell or withdraw the investments in a selection of companies for substantial returns. In recent years, the private equity market in Dubai developed all sorts of investment strategies, among which, selling the company portfolio to another private equity firm proved successful.
If you want to know more about the investments you can make in Dubai, you can contact our law firm in Dubai for complete legal assistance and information at any time.