Weekly Spotlight: Abu Dhabi Global Market Launches New Private Financing Platform Regulatory Framework
This week the spotlight is on regulatory developments in the UAE, where Abu Dhabi’s Global Market Financial Services Regulatory Authority has announced it has launched its framework to regulate Private Financing Platform operators to meet the equity investment, debt financing and trade receivable funding needs of start-ups, private enterprises and small and medium enterprises.
It follows a consultation on the proposed framework which ended on 16 August 2018. Private Financing Platforms are online platforms which enable start-ups and smaller enterprises to obtain financing from private and institutional investors to launch and grow their businesses. These Platforms allow innovative business models which serve different business and client segments. The new framework requires Platform operators to have appropriate systems and controls in due diligence of those enterprises listed on the Platform, risk disclosures, safeguarding of client assets, anti-money laundering and anti-terrorist financing (AML/CFT), amongst other things. The Authority has also published the Guidance-Regulatory Framework for Private Financing Platforms’ and the application form for interested applicants to operate a Platform in the Market. The Guidance elaborates on the Market’s approach towards regulating Platform operators.