Exam UAE-Financial-Rules-and-Regulations Topic 1 Question 49 Discussion

Actual exam question for CISI's UAE-Financial-Rules-and-Regulations exam
Question #: 49
Topic #: 1

Following a public subscription, what must a Special Purpose Acquisition Company do with the proceeds?

A. Deposit not less than 90% of the public subscription proceeds within one business day of receipt B. Deposit not less than 90% of the public subscription proceeds within two business days of receipt C. Deposit not less than 100% of the public subscription proceeds within one business day of receipt D. Deposit not less than 100% of the public subscription proceeds within two business days of receipt

Suggested Answer: C Vote an answer

Special Purpose Acquisition Companies (SPACs) operating under UAE financial regulations must safeguard investors' funds post-public subscription. According to the CISI UAE Financial Rules and Regulations, SPACs are required to deposit100% of the public subscription proceeds within one business day of receipt into an escrow or segregated account. This requirement ensures that the funds are secured and managed transparently while awaiting acquisition activities. The strict one-business-day deadline prevents misuse or misallocation of investor money and aligns with international best practices for fund protection. This is critical in maintaining market confidence and regulatory compliance, as SPACs act as investment vehicles with inherent risk related to future mergers or acquisitions.
Reference:CISI UAE Financial Rules and Regulations - Investment Funds and SPAC Requirements, Section 6.3.1 (2023).

by Rae at Nov 29, 2025, 09:43 AM

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