The Dubai Multi Commodities Centre (DMCC) has announced that it will develop and manage a range of Shariah-compliant commodities investments via a joint venture between its planned asset management company DCAM and US-based Shariah Capital.The joint venture entity, Dubai Shariah Asset Management (DSAM), will be owned 51% by DCAM and 49% by Shariah Capital. DMCC will buy purchase a 4.99% equity stake in Shariah Capital as part of the joint venture, and DMCC CEO David Rutledge is expected to join Shariah Capital’s board of directors.

DMCC chairman Ahmed bin Sulayem said DCAM and DSAM will offer the region’s first commodity-linked Shariah-compliant investment products. “We believe such products will be of great interest to institutions and high net worth individuals who are looking beyond traditional investment areas, and want to participate in the commodity boom in a sustainable and Shariah-compliant manner,” he said.

Rutledge said the launch of DCAM and DSAM sets similar goals in commodities management to DMCC’s initial objective to develop the physical and market infrastructure critical for building a commodities marketplace in the region.

“DMCC’s unique focus on commodities and precious metals will distinguish the DSAM brand, and we believe, establish a new specialty asset class in Shariah,” added Shariah Capital chairman Eric Meyer.

DMCC, a government-led initiative, has already applied for a license to establish Dubai Commodity Asset Management as a UAE investment company. It will be registered as a DMCC Free Zone company, and established with an initial capital of AED 25m ($6.8m). It will be 100% owned and managed by DMCC.