Private Placement Agent Agreement Template for the United Arab Emirates

A Private Placement Agent Agreement is a specialized contract that governs the relationship between a company seeking capital and a licensed financial institution or broker appointed to market private securities to qualified investors in the United Arab Emirates. This document ensures that your capital raising activities comply with strict UAE regulatory requirements while protecting both parties' interests throughout the placement process.

When do you need this document?

You need this agreement when your UAE company plans to raise capital through private placement of securities rather than public offerings. This is particularly relevant for established businesses seeking growth capital, startups requiring significant funding, or companies pursuing strategic investments from high-net-worth individuals or institutional investors. The document is also essential when engaging multiple placement agents or sub-agents to maximize market reach, or when your company operates in regulated sectors requiring specialized investor targeting. International companies establishing UAE subsidiaries or joint ventures often use this agreement to access local capital markets through licensed UAE placement agents.

Key legal considerations

The agreement must clearly define the placement agent's authority and limitations to prevent unauthorized commitments on your company's behalf. Compensation structures require careful consideration, including success fees, retainer arrangements, and expense reimbursements, all of which must comply with SCA guidelines. Confidentiality and non-disclosure provisions are crucial given the sensitive financial information shared during the placement process. The document should address regulatory compliance responsibilities, specifying which party handles investor verification, anti-money laundering checks, and regulatory filings. Risk allocation clauses are essential, particularly regarding misrepresentations, regulatory violations, or market condition changes that could affect the placement's success.

Legal requirements in United Arab Emirates

Under UAE Securities and Commodities Authority Decision No. 3/R of 2017, placement agents must hold valid SCA licenses for promoting financial products. The agreement must specify compliance with investor qualification criteria, ensuring only qualified investors participate in the private placement. Federal Law No. 32 of 2021 (Commercial Companies Law) requires adherence to corporate governance standards and disclosure obligations throughout the capital raising process. Anti-money laundering compliance under Federal Decree-Law No. 20 of 2018 mandates due diligence procedures for investor identification and source of funds verification. The agreement must include specific termination clauses that comply with UAE commercial law and provide clear dispute resolution mechanisms, preferably through UAE courts or recognized arbitration centers. Documentation must be in Arabic or officially translated if executed in other languages, and all regulatory filings must be completed within SCA-specified timeframes.