Finders Fee Agreement For Raising Capital Template for the United Arab Emirates

A Finders Fee Agreement For Raising Capital is essential when your company needs to engage an intermediary to help secure investment funding in the United Arab Emirates. This legal document establishes a clear framework between your business and a finder who will introduce you to potential investors, while ensuring compliance with strict UAE financial regulations.

When do you need this document?

You need this agreement when your company is seeking equity investment, debt financing, or other forms of capital but lacks direct access to qualified investors. This document is particularly crucial for startups, growing businesses, or established companies looking to expand operations through external funding. The agreement becomes necessary when you want to engage consultants, business advisors, or professional intermediaries who have networks of high-net-worth individuals, institutional investors, or private equity firms. It's also required when you need to clearly distinguish between legitimate finder activities and regulated financial services that require licensing from the UAE Securities and Commodities Authority.

Key legal considerations

The agreement must carefully define the finder's role to avoid triggering regulatory requirements for licensed financial services. You need to specify that the finder's activities are limited to making introductions and cannot include investment advice, fund management, or securities dealing. Success criteria must be clearly established, including what constitutes a "qualified investor" and "successful introduction" to avoid payment disputes. The compensation structure should align with industry standards while ensuring transparency and compliance with anti-corruption laws. Confidentiality clauses are essential to protect sensitive business information shared during the capital raising process. You should also include termination provisions that protect both parties' interests and address scenarios where multiple finders claim credit for the same investor introduction.

Legal requirements in United Arab Emirates

Under UAE law, finder's fee arrangements must comply with multiple regulatory frameworks including the Securities and Commodities Authority Law and the Commercial Companies Law. The agreement must explicitly state that the finder is not providing regulated financial services and does not hold the necessary licenses for investment advice or fund management. You must ensure compliance with UAE Anti-Money Laundering regulations by including appropriate due diligence requirements for both the finder and potential investors. The Commercial Agency Law may apply to certain finder arrangements, requiring careful structuring to avoid unintended agency relationships. Your agreement should reference compliance with UAE Federal Law No. 20 of 2018 regarding permissible capital raising activities and ensure that all fee arrangements are transparent and properly documented for tax and regulatory purposes. Additionally, any cross-border elements of the capital raising must comply with UAE foreign investment regulations and currency exchange controls.