QROPS in Dubai
Paul Evans, MD of Brookland Penions has warned that regulations currently under consultation in the United Arab Emirates (UAE) may pose a threat to the legitimacy of QROPS being used by expats across the region.
The Emirates Security and Commodities Authority is now drafting new rules with proposals curtailing the promotion of funds in the jurisdiction without United Arab Emirates central bank approval.
Some providers are using QROPS to skirt the current rules which does not allow the promotion of offshore investment products. This could lead to a backlash.
Evans stated that restricting the fund choices within some QROPS pension transfers to a few select products, providers are actually promoting those investments without central bank approval.
“If regulators realise that QROPS are being used in this way to mainly promote funds by the back door, regulators will take a dim view,” Evans said.
He added these restricted QROPS are already being promoted in Singapore and Hong Kong as a way around strong regulation controlling investment promotion.
Evans warned the method of circumventing promotion restrictions is not a priority of regulators yet but added the issue is “just under the radar”.
The new regulations are expected to be finalised and agreed within the next few months.
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QROPS in Dubai article by QROPS specialists. Thanks to Rachel Dalton of IFAonline.QROPS in Dubai under Threat by Richard Malpass