Redemption of ETFs to Investors
Regulation 70
Redemption of ETFs to Investors
IFSCA (Fund Management) Regulations, 2025No change in 2026Chapter IV · Exchange Traded Funds (ETFs)
Chapter IV · Exchange Traded Funds (ETFs)
Regulation 70 – Redemption of ETFs to Investors
Medium importance about 3 min
Exchange Traded Funds: Index, debt, commodity and actively-managed ETFs, and how ETF units trade and redeem.
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In plain English
Beyond market makers, investors may redeem ETF units directly with the FME with no exit load in defined liquidity-failure situations: a persistent NAV discount above 5% for 30 trading days, no quotes for 5 consecutive days, or thin bid size over a 7-day average.
In plain English
2
The rule, in its own words
Read the exact text of Regulation 70
70. Investors other than market makers may also directly approach the FME for redemption of ETFs, and no exit load shall be charged if:
(a) Traded price (based on closing price) of the ETF units is at a discount of more than five per cent. (5%) of NAV for continuous thirty (30) trading days; or
(b) No quotes are available on the recognised stock exchange for five (5) consecutive trading days; or
(c) Total bid size on the recognised stock exchange is less than higher of one per cent. (1%) of the total units valued at NAV in ETF or USD 2,500 in value, averaged over a period of seven (7) consecutive trading days.
Statutory text — Principal Regulations, 2025 (as amended to 30 January 2026), consolidated where amended. The notified Gazette text prevails. Tap a highlighted word for how it functions.
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What this means in practice
Compliance actions
- Applies to
- ETF
- Frequency
- Ongoing monitoring
- Evidence
- Discount/quote/bid-size monitoring records
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Where it connects
Read alongside
5
Check yourself
Quiz Centre
Test yourself on Regulation 70
6 questions in the unified bank test this regulation. Each explains every option and cites the provision.
Investors may redeem ETF units directly with the FME without exit load when, for example:
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Your notes
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