The Financial Regulatory Authority (FRA) of Egypt, chaired by Mohamed Farid, has issued Decision No. 125 of 2025, introducing the country’s first comprehensive regulatory framework for digital platforms dedicated to investing in Real Estate Investment Fund (REIF) certificates.
The new regulation allows individuals to invest in fractional ownership of real estate units through REIF-issued certificates available on licensed digital platforms authorized for promotion, underwriting, and subscription collection. This initiative aligns with FRA’s strategy to broaden access to innovative, low-cost investment products that promote financial and investment inclusion.
The FRA’s decision establishes a unified legal framework governing all digital platforms offering REIF certificates, ensuring secure, transparent, and efficient investment environments. It also provides clarity for real estate developers and supports the regularization of existing platforms, with three companies already applying for licensing.
Under the decision, digital platforms must be FRA-licensed non-banking entities facilitating subscription and redemption of REIF certificates. Platforms are required to display all transaction-related data, provide full investor disclosures, publish periodic pricing based on FRA-approved valuations, and store all contracts and certificates electronically with FRA-licensed entities.
Investor registration mandates passing a knowledge test approved by the FRA, secure payment channels, opening accounts per Central Depository and Registry Company guidelines, and listing only FRA-approved REIFs. Subscription and redemption processes must follow an FRA-approved summary prospectus including minimum subscription levels and feasibility studies.
Platforms must maintain transparent communication with investors, promptly respond to inquiries, log and report complaints quarterly, and ensure all software and IT infrastructure comply with FRA standards. Pre-registration disclosures include registration conditions, platform manager details, complaint resolution procedures, operational risks, and refund policies.
Investors must have access to detailed disclosures including summary prospectus, audited financials, payment schedules, minutes from certificate holder meetings, asset valuations by FRA-registered valuers, dividend information, insurance documents, legal rulings affecting properties, and timely updates on any investment policy breaches.
Platforms are obligated to disclose material events impacting funds promptly and manage subscriptions through digital forms, dedicated bank accounts, and immediate refund mechanisms if withdrawals or subscription failures occur. They must notify investors and relevant authorities upon successful subscriptions and issue digital investment certificates.
Redemption rules require adherence to the approved prospectus, with redemption funding limited to available liquidity, new subscriptions, or loans. Redemption is capped at 20% of issued certificates, with reacquired certificates to be sold or canceled within a year and stripped of voting and dividend rights.
All involved parties—including platform managers, REIFs, investment managers, administration companies, and investors—are legally accountable for the accuracy of disclosures and liable for compensation if misleading or false information causes harm.
