UAE Financial Services Authorisations

Over the past few decades, the United Arab Emirates (UAE) has emerged as a major global business hub. Dubai and Abu Dhabi, in particular, have become a magnet for top investment firms, funds, fintechs, and venture capital investments. Naturally, this has attracted applicants from all over the world interested in becoming authorised in the UAE.

The Dubai Financial Services Authority (DFSA), an independent regulatory authority and the responsible authority for all authorisation matters, has played a crucial role in this financial success. DFSA is responsible for regulating all financial and ancillary services in Dubai and works closely with the Dubai International Financial Centre (DIFC) to maintain the smooth functioning of the regulated financial hub.

Besides the DFSA, additional authorisation options are available within the UAE with the main one to highlight being the Abu Dhabi Global Market (ADGM). ADGM is an international financial centre established in Abu Dhabi, UAE, in 2013, that operates as a free zone and offers a range of financial services and a legal framework based on English common law. ADGM is the responsible authority for licensing regulated firms based in Abu Dhabi. The licensing route is similar to that of DFSA, and our firm can project manage the application towards final authorisation in Abu Dhabi.

Establishing and running a business within the Dubai International Financial Centre or the Abu Dhabi Global Market area offers numerous benefits. The DIFC takes pride in its legislative framework, modelled after globally recognized regulators such as the United Kingdom’s Financial Conduct Authority (FCA). Furthermore, ADGM aims to position itself as a leading financial hub in the Middle East, serving as a platform for businesses to access opportunities in the region and beyond. Taking into consideration the vision and approach of both ADGM and DFSA, these frameworks are ideal for any applicant interested in receiving authorisation.

Following a number of successful authorisations in Dubai and the UAE, our team is fully equipped to advise you on the proper permissions and type of license requirements available based on your business model, as well as to project manage and submit the authorisation application on your behalf.

DFSA License Categories and General Requirements for DIFC Firms

In the Dubai International Financial Centre (DIFC), firms must adhere to the regulations set by the Dubai Financial Services Authority (DFSA). Here’s a breakdown on its main characteristics and general requirements:

DFSA License Categories

1. Category 1 – Banks: Institutions authorised for banking activities like deposit-taking and financial services provision.
2. Category 2 – Market Maker and Provider of Credit: Entities providing liquidity or extending credit facilities.
3. Category 3A – Brokerage: Firms facilitating securities trading.
4. Category 3B – Custodian and Employee Money Purchase Schemes: Entities safeguarding assets and managing benefit schemes.
5. Category 3C – Asset and Fund Managers: Firms managing investment assets or funds.
6. Category 3D – Money Service Businesses: Businesses offering money transfer or currency exchange services.

DFSA General Authorisation Requirements 

1. Obtaining Licenses: Firms must acquire DFSA authorisation for DIFC operations.
2. Maintaining Capital Adequacy: Compliance with DFSA capital requirements is mandatory for financial stability.
3. Personnel Suitability Assessment: Key personnel must meet DFSA criteria for competence, integrity, and financial stability.
4. Establishing Governance and Controls: Robust governance structures and internal controls are essential for regulatory compliance.
5. Client Due Diligence: Thorough client due diligence is imperative to comply with AML and CTF regulations.
6. Implementing Compliance Policies: Enforcing comprehensive compliance policies ensures adherence to legal and ethical standards.
7. Investing in Training: Training initiatives are crucial for employee competency and regulatory compliance.

By meeting these criteria, DFSA-regulated firms demonstrate their dedication to upholding high standards of integrity, professionalism, and regulatory adherence within the DIFC. Our team is able to assist you in each of these specs, ensuring that threshold conditions are met before submitting your applications to the regulator.

ADGM Authorisation Categories

In the Abu Dhabi Global Market (ADGM), Investment Funds are classified into three categories: Public Funds, Exempt Funds, and Qualified Investor Funds. Each is subject to distinct levels of scrutiny and reporting requirements based on their authorisation status.

1. Public Funds: These funds offer units publicly or include Retail Clients as investors, necessitating rigorous scrutiny and reporting standards upon authorisation.
2. Exempt Funds: Reserved for Professional Clients, Exempt Funds offer units privately with a minimum initial subscription of US$50,000 per investor. They enjoy less stringent reporting requirements post-authorisation compared to Public Funds.
3. Qualified Investor Funds: Targeting Professional Clients with a higher minimum initial subscription of US$500,000 per investor, these funds typically undergo minimal reporting requirements following authorisation, owing to the elevated investment threshold.

The Abu Dhabi Global Market (ADGM) offers several benefits for work authorisation, particularly for financial institutions and other businesses operating within its jurisdiction. These include:

1. Strategic Location: Situated in the heart of Abu Dhabi, ADGM provides access to the growing markets of the Middle East, Africa, and South Asia, making it an attractive hub for businesses seeking to expand their operations globally.
2. Regulatory Environment: ADGM has developed a progressive and business-friendly regulatory environment designed to foster innovation, while ensuring financial stability and investor protection. The regulatory framework is aligned with international standards, providing confidence to investors and counterparties seeking work authorisation.
3. Streamlined Authorisation Process: ADGM offers a streamlined authorisation process for financial institutions, fintechs, and other businesses, reducing the time and effort required to establish operations in the jurisdiction. This efficient process helps companies get up and running quickly, enabling them to capitalise on market opportunities.
4. Access to Talent: Abu Dhabi is home to a diverse pool of talent, including professionals with expertise in finance, technology, law, and other key sectors. ADGM’s ecosystem attracts skilled individuals from around the world, providing businesses with access to the human capital they need to thrive and obtain work authorisation.
5. Infrastructure and Support Services: ADGM provides state-of-the-art infrastructure and support services to businesses, including office space, technology infrastructure, legal and administrative support, and access to networking events and industry forums. These resources enable companies to focus on their core activities, while leveraging ADGM’s ecosystem for growth and expansion, further facilitating work authorisation processes.

ADGM’s tiered authorisation approach ensures tailored regulation, which in turn accommodates diverse investor needs, while maintaining appropriate oversight.

Our UAE Licensing Services

Here’s what we can offer you and your organisation when it comes to authorisations in the UAE:

• Consulting on the establishment of a financial group’s presence in the UAE, identifying suitable permissions.
• Advisory and project management support towards obtaining authorisation or registration as a regulated entity in the UAE.
• Preparation of the Application File in accordance with current regulatory requirements, including:

• • Designing and structuring the financial institution to meet your specific needs in a cost-effective manner.
  • Creating a customised Operations Manual tailored to your requirements.
  • Developing Anti-Money Laundering (AML) and Know Your Client (KYC) policies aligned with regulatory standards.
  • Drafting the regulatory business plan based on the DFSA / ADGM requirements.
  • Completing application forms for submission to the relevant UAE regulatory authority.
  • Review questionnaires and supporting documentation for shareholders, directors, and key personnel.
  • Providing necessary justifications to the regulatory authority, as required on a post-submission basis.
  • Regulatory interview preparation sessions and workshops.
  • Assistance in locating qualified UAE-based Directors and key personnel.
  • Full legal, accounting, and auditing support to ensure compliance with UAE regulatory standards.

This comprehensive suite of services is designed to assist financial institutions in navigating the regulatory landscape of the UAE, facilitating a smooth and compliant licensing process from start to finish.

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Obtain Your UAE Authorisation:

For more information on how we may assist with your UAE Authorisation, please contact us or complete the form below, and a member of our expert team will get back to you.