The Central Bank of Bahrain (CBB) is the principal regulator of the investment funds industry in Bahrain. All investment funds established and/or marketed in/from Bahrain are supervised and regulated by the CBB. Since 1999, the CBB has permitted banks and financial institutions that are not operating in/from Bahrain to establish and market schemes in/from Bahrain, provided the institutions are of high standing, good reputation, and are operating from reputable international financial centres. Fund structures include:
- Retail Collective Investment Undertakings (CIUs) – May be offered to all types of investors and are subject to detailed requirements, including restrictions on the types of financial instruments or other assets that may be held in the CIU, in order to limit risks to the general investor.
- Expert CIUs – may be offered only to expert investors and have greater investment flexibility, notably in terms of asset classes and risk concentration limits. The minimum initial investment is USD 10,000.
- Exempt CIUs – largely unregulated CIUs that may be offered only to accredited investors, and impose a minimum initial investment of USD 100,000. Exempt CIUs are only regulated to the extent that they must register with the CBB prior to being offered to investors. They are not subject to any restrictions on their investment policies.