Sheikh Mohammed forms Dubai Investment Fund to oversee government investments

His Highness Sheikh Mohammed Bin Rashid Al Maktoum, Vice President, Prime Minister and Ruler of Dubai, has issued Law No. (25) of 2023 establishing the Dubai Investment Fund as an independent public entity operating on a commercial basis.

The Law also endows the Fund with the financial and administrative independence to pursue its objectives along with the legal mandate to do so.

Furthermore, Sheikh Hamdan Bin Mohammed Bin Rashid Al Maktoum, Crown Prince of Dubai and Chairman of Dubai Executive Council, issued Dubai Executive Council Resolution No. (94) of 2023 related to the formation of the Fund’s Board of Directors chaired by Sheikh Maktoum Bin Mohammed Bin Rashid Al Maktoum, First Deputy Ruler of Dubai.

Meanwhile, Abdulrahman Saleh Al Saleh will serve as Vice Chairman of the Board, with Abdulaziz Mohammed Al Mulla, Rashid Ali Bin Obood, and Ahmad Ali Meftah as members.

As per the Law, Dubai Investment Fund will be responsible for investing Dubai Government funds, surpluses and the general reserve locally and internationally. The investments thus made will seek to generate returns benefiting both current and future generations while implementing best practices and the investment policy approved by the Fund’s Board of Directors.

The Fund also seeks to bolster the financial stability of the Dubai Government by financing the government’s deficit and establishing strong financial reserves, thereby promoting long-term financial sustainability.

The Dubai Investment Fund also endeavours to actively contribute to the realisation of the emirate's strategic priorities and endorsed public policies through efficient investments in strategic and development projects.

Priority is accorded to initiatives that foster Dubai's sustainable development across vital sectors, including the economic and social spheres, while diversifying income sources.

Multiple roles

The law specifies that, without infringing upon the powers and jurisdictions granted to the Investment Corporation of Dubai, established under Law No. (11) of 2006 and its amendments, and in accordance with prevailing regulations in the Emirate, the Dubai Investment Fund assumes diverse roles and responsibilities to fulfil its objectives.

This includes investing government surpluses, establishing companies and investment funds independently or in collaboration with third parties, acquiring or merging companies, projects and funds, besides holding stakes in them.

The Fund will focus on investments in stocks, bonds, and securities to achieve sustainable returns and can explore prospects in local or international financial markets while following investment policies approved by the Board of Directors.

Additionally, it can deal in movable and immovable assets, manage funds, provide mortgages and guarantees, besides participating in the financial derivatives business, all in compliance with Dubai's laws.

The Law defines the organisational structure of the Dubai Investment Fund, detailing the composition and responsibilities of its Board of Directors, along with its executive structure. This includes the appointment of the Fund’s CEO, who shall be determined pursuant to a decision by the Chairman of The Executive Council of Dubai.

In compliance with the Law, the Dubai Investment Fund is obligated to uphold principles of justice, transparency, and fair competition in conducting its activities and operations. It is mandated to make the data and information accessible to the public in accordance with the principles and regulations set by its Board of Directors in this regard.

The Law states that, effective from the date it takes effect, Dubai Investment Fund will function as Dubai Government’s vested authority when it comes to owning shares in entities like the Dubai Electricity and Water Authority (DEWA), Salik Company, Dubai Taxi Company, and other companies directly owned by the Dubai Government. Additionally, it covers government-owned companies as identified by Dubai’s Supreme Fiscal Committee.

Rights and obligations

The Fund will relieve the Dubai Government of rights and obligations related to companies, specifically in the context of ownership of shares comprising the capital of such companies, as well as all contracts, agreements, commitments, deposits, bank accounts, and loans associated with such shares.

Furthermore, all relevant government entities in Dubai must register under Dubai Investment Fund all their assets, stocks, shares, movable and immovable properties, licences, permits, bonds, privileges, and other instruments.

Additionally, Dubai World will be affiliated with the Dubai Investment Fund while preserving its legal identity as defined by Law No. (3) of 2006 and its amendments regarding the establishment of Dubai World.

The Chairman of the Board of Directors of the Dubai Investment Fund will issue decisions to implement the Law, subject to the Board’s approval.

Resolution No. (3) of 2022 pertaining to Dubai Government Representation in the Companies it Owns hereby stands annulled. Law No. (25) of 2023 and Executive Council Resolution No. (94) of 2023 annul any other legislation that may contradict them. The Law and the Resolution are effective from the date of their issuance and will be published in the Official Gazette.

WAM