New laws bring Bahrain on par with international financial capitals

Manama, 3rd April 2017: Bahrain’s latest three financial laws will be the focus of an outreach programme introduced by the Economic Development Board (EDB) in partnership with the Central Bank of Bahrain (CBB). The programme aims to explain the importance of the “Trusts Law”, the “Investment Limited Partnership” and the “Protected Cells Companies” to financial institutions and banks in the Kingdom, while also promote discussion to support in further enhancing the sector’s performance.

These new laws offer innovative forms of structures and financing that complement the range of existing structures available in the Kingdom. They work together to enhance Bahrain’s competitiveness in financial services and make it easier to raise finance, conventional and Islamic, for investment activities.

Mr. Khalid Al Rumaihi, Chief Executive of the Bahrain Economic Development Board (EDB) said: “We see great potential in the GCC for investors looking for strong returns – and the development of the local funds industry can play an important role in facilitating that investment.

“These reforms will provide a strong boost to the sector, support growth in a number of areas and help to make Bahrain a highly competitive location for those looking to access the opportunities around the Gulf.”

The outreach programme will facilitate an ongoing dialogue with industry to discuss opportunities of further boosting Bahrain’s position as a financial hub, said Mr. Abdulrahman Al Baker, Executive Director of Financial Institutions Supervision at the CBB.
“The Kingdom has a strong and mature financial sector that is only growing in par with international markets, and we at the CBB are looking for ways to nurture this growth with the joint support of the EDB, our main partner,

“We have introduced the outreach programme to stress the importance of the three laws enacted last year and to show the favourable position of Bahrain in the region, providing investor friendly, cost and time effective solutions.”

Mr. Brian Howard, Partner at Trowers & Hamlins, said: “The addition of the new investment limited partnership law, the protected cell companies law and the new trusts law in Bahrain, opens the door to many new lines of business and investment structures not previously available and brings Bahrain’s structuring options in line with the best modern international examples.

“The Kingdom of Bahrain is the first country in the GCC region to introduce such structures into its mainland legislative framework and we know that investors and institutions have been looking forward to the new opportunities these laws present. We are delighted to have been able to support the Central Bank of Bahrain, the Economic Development Board and the Kingdom of Bahrain in these developments.”

Bahrain has become the first country in the GCC region to integrate this type of laws into its legal system nationwide. Other jurisdictions have issued such limited partnership laws through free zones only.

The laws enhance the sector competitiveness and create new funding mechanisms. The Limited Partnership Law is expected to provide a strong boost to the sector, supporting growth in real estate funds, private equity funds, venture capital and technology funds, startups, and Shariah compliant funds, as well as captive insurance.

The introduction of the Trusts Law aims to regulate the creation of a trust and its liabilities, as well as allowing establishment of a trust for charitable and non-charitable purposes. Meanwhile, the Protected Cell Companies law is looked to allow strengthening investors’ rights in separating their private assets from company running the fund, as well as lowering running costs.

Further information:
Communications
Economic Development Board
Tel: + 973 1758 9966
Email: Communications@bahrainedb.com

About The Bahrain Economic Development Board (EDB)

The Bahrain Economic Development Board (EDB) is a dynamic public agency with an overall responsibility for attracting investment into Bahrain, and is focusing on target economic sectors in which the Kingdom offers significant strengths.

Key areas of focus include tourism, manufacturing, ICT, and logistics and transport services as well as other sub-sectors. The Financial Services sector in Bahrain is particularly strong and the EDB supports in the continuing growth of the banking industry and key sub-sectors, including Islamic Finance, Asset Management, Insurance and Re-Insurance.

For more information on the Bahrain EDB visit www.bahrainedb.com; for information about Bahrain visit www.bahrain.com