Oman has significantly expanded its collective investment framework with the introduction of 11 distinct categories of investment funds under the newly issued Executive Regulations of the Securities Law, marking a major step towards deepening the Sultanate's capital markets and aligning its regulatory regime with international best practices.
The new regulations empower the Financial Services Authority (FSA) to license and supervise a diverse range of collective investment funds, creating a legal foundation for new investment products while strengthening investor protection, governance and market transparency.
Under the regulations, collective investment funds may now be established as securities mutual investment funds, money market funds, real estate investment funds, debt instruments funds, holding funds, exchange-traded funds (ETFs), venture capital funds, private equity funds, endowment funds, green funds and sustainable-purpose funds, with the FSA retaining the authority to approve additional fund types as market needs evolve.
The reforms represent a substantial evolution from Oman's previous mutual fund regime by formally recognising several internationally established investment vehicles that had not previously operated under a comprehensive regulatory framework in the Sultanate. The regulations also establish licensing and prudential requirements for the full investment fund ecosystem, including fund managers, investment managers, custodians, trustees, administrators, distributors and investment advisers.
Each category is expected to play a distinct role in broadening Oman's financial services landscape.
Securities mutual investment funds will continue to provide retail and institutional investors with professionally managed diversified portfolios of listed securities. Money market funds will offer low-risk, highly liquid investment options for cash management, benefiting both corporate and institutional investors.
Real estate investment funds are expected to channel long-term capital into property development and income-generating real estate assets, while debt instruments funds will expand investment opportunities in government and corporate bonds, sukuk and other fixed-income securities, helping deepen the domestic debt capital market.
Holding funds will enable strategic investments in corporate assets and subsidiaries, supporting business consolidation and long-term ownership structures.
The formal recognition of exchange-traded funds (ETFs) introduces globally popular, low-cost investment vehicles that trade on stock exchanges and can improve market liquidity while giving investors efficient exposure to diversified indices and asset classes.
Among the most significant additions are venture capital and private equity funds, which establish a regulatory platform for mobilising institutional capital into startups, high-growth enterprises, SMEs and established businesses seeking expansion or restructuring. Their introduction supports Oman Vision 2040's objectives of fostering entrepreneurship, innovation and economic diversification.
The inclusion of endowment funds creates a regulated framework for long-term charitable and institutional investment vehicles, while green funds and sustainable-purpose funds position Oman to capture growing global demand for environmental, social and governance (ESG) investments. These funds are expected to channel capital into renewable energy, climate-related projects, sustainable infrastructure and other investments aligned with responsible finance principles.
The regulations also provide flexibility for future innovation by allowing the FSA to approve additional categories of collective investment funds as financial markets evolve, potentially paving the way for specialised investment structures in emerging sectors.
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