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UAE: Central Bank Issues Guidance for Licensed Financial Institutions on Politically Exposed Persons Risks

The UAE’s Central Bank has issued new guidance for Licensed Financial Institutions on Politically Exposed Persons risks.

The guidance will help these institutions understand risks, effectively implement their statutory anti-money laundering and terrorist financing obligations, and take Financial Action Task Force standards into account.

Under the guidance, Licensed Financial Institutions must demonstrate they have complied with its requirements within one month.

Customers who are Politically Exposed Persons and transactions involving these Persons may expose these Institutions to an increased risk of money laundering, terrorist financing and other illicit finance.

These Institutions must carry out specific mandatory due diligence measures on these Persons and their direct family members or close associates, as well as the standard customer due diligence required for all customers.

Institutions providing services to these Persons must develop risk-based policies to ensure they appropriately identify these Persons or related customers before starting the business relationship and risk rating and applying commensurate customer due diligence measures.

They must also conduct ongoing monitoring of the business relationships. In addition, they should maintain transaction monitoring systems equipped to identify unusual or suspicious activity patterns and report any behaviour linked to money laundering, terrorist financing or another criminal offence to the UAE’s Financial Intelligence Unit via the goAML portal.

They should integrate these preventive measures into their anti-money laundering and terrorist financing compliance programme and support it with appropriate governance and training.

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UAE: Penalties for Trademark Violations Increased

Gulf News (United Arab Emirates), 29 July 2022: The UAE authorities have approved increases to the fines imposed on those who commit trademark violations.

Offenders could be fined up to one million AED.

Under legislative changes, intellectual property protection will now be extended to investors and owners of foreign companies and owners of projects and companies in the UAE and authorised registration agents, lawyers and legal service providers.

Protections have also been extended to anyone concerned with trademark infringement protection, registration or prevention.

The amendments will help designers, talented investors, relevant local and federal government agencies, and public interest organisations.

In addition, new categories of trademarks are given protection, including those related to smell and sound and holograms.

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UAE: Wages Protection System Amended

The UAE’s Minister of Human Resources and Emiratisation has issued Ministerial Decision No. 346/2022, amending Ministerial Decision No. 43/2022 on the Wages Protection System.

Under the amendments, the Ministry of Human Resources and Emiratisation will take various administrative procedures against establishments that do not comply with the System.

The measures taken will depend on the length of delay in paying salaries, the size of the establishment and the number of employees who have not been paid.

The Ministry will also monitor establishments registered in its database, regardless of their size, through field visits and an electronic monitoring and inspection system to ensure it pays its employees on time.

In addition, the Ministry will issue reminders and notifications to non-compliant establishments. Where no action is taken following the receipt of notifications, the issuing of new work permits for these entities will be suspended.

The amendments include procedures which will be taken gradually against establishments that employ 50 or more people, where the relevant Public Prosecution will be notified. The establishment information will be sent to the appropriate local and federal authorities for further legal action.

The respective department in the Ministry will follow up on the establishment.

All non-compliant establishments, regardless of their size, that fails to pay wages four months after the date they are owed will not be able to apply for any new work permits. If the employer operates other establishments listed with the System, similar penalties will be applied to each after notifying the affected establishments about the suspension of work permits.

If the establishment repeats the same violation within six months, an administrative fine will be imposed on them in line with Cabinet Decision No. 21/2022.

The establishment will also be downgraded to Tier three under the Ministry’s establishments classification system.

Establishments will be able to submit requests for exemption from transferring their wages through the System if they are seamen or sailors working on board vessels or ships and workers of foreign establishments or their subsidiaries operating in the country who receive their wages from outside the country, subject to the workers’ consent.

These exemptions are in addition to exemptions for fishing boats owned by UAE nationals, public taxis owned by UAE nationals, banks and places of worship and also reported in Al Bayan on 28 July 2022. For the full story, click here.

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