Weekly Spotlight: New Anti-Money Laundering System Launched by the Central Bank of the UAE

The UAE’s Central Bank has announced it has launched a new anti-money laundering system and is the first GCC country to adopt it. The new system means all financial institutions in the country will have to report any suspicious transactions through goAML. They must register with the system by 27 June. Any transactions over 60,000 AED must be reported. goAML has been developed with the UN Office on Drugs and Crime. It aims to step up intelligence, identify complex, organised criminal activities and curb them.

Elsewhere, Saudi Arabia has become the region’s first Financial Action Task Force member. Previously the Kingdom was an observer of the anti-money laundering body and they were one of the only Middle Eastern jurisdictions not to be included in a blacklisting of countries earlier this year. The organisation makes recommendations to governments on combating money laundering and terrorist-financing.

Weekly Spotlight: The DIFC Launches a Consultation on Amendments to the 2007 Data Protection Law

The DIFC has launched a consultation on proposed amendments to the 2007 Data Protection Law. The consultation ends on 18 August 2019. If the amendments to DIFC Law No. 1/2007 are approved the Law’s remit will be expanded.

The main proposals are to align the 2007 law to incorporate international data protection standards, including elements of the EU General Data Protection Regulation and the California Consumer Privacy Act and not just incorporate EU best practices.

It is also proposed to expand the compliance framework and safeguards to include principles of accountability, jurisdiction, data breach notification, prior consultation and data protection officer appointments and provide clarity on consent and data subjects’ rights with respect to advance technology developments. Finally it is proposed to revise the powers of the Commissioner of Data Protection, administrative requirements and sanctions and enforcement.

Weekly Spotlight: DIFC Insolvancy Law Approved

Dubai’s Ruler has approved a new DIFC Insolvency Law which will come into force on 28 August 2019. New Insolvency Regulations have also been approved and they will come into force on 28 August 2019 as well.

DIFC Law No. 1/2019 provides for a new administration process where there is evidence of mismanagement or misconduct. It also enhances the rules governing winding up procedures and incorporates the Uncitral Model Law on cross border insolvency proceedings with certain modifications for application in the Centre. In addition, it introduces a new debtor in possession bankruptcy regime in line with best international practices.

Weekly Spotlight: Launch of a New Residency System for Expatriates in Dubai

Dubai’s Ruler and the UAE’s Vice President has announced the launch of a new residency system for expatriates. Under the Golden Card Scheme, residency for qualifying investors, entrepreneurs, those with special talents, researchers and outstanding students will be available. The spouses and children of Golden Card holders will also be able to obtain permanent residency under the scheme.

6800 expatriates from more than 70 countries have already been selected for the scheme. The investors are worth. an estimated 100 billion AED. The new permanent visa will generate foreign investment, encourage entrepreneurship, and attract top engineers, scientists and students. Exact criteria for the visa are yet to be made public but more details are expected in the coming days.

In the past, foreign residents typically had renewable visas valid for two or three years which were often tied to their employment. However, last year the government announced plans to reform its visa policies.

Weekly Spotlight: Amendments to the Abu Dhabi Global Market’s Crypto Asset Activities Guidance

Abu Dhabi Global Market’s Financial Services Regulatory Authority has amended its Crypto Asset Activities Guidance. The Guidance was first issued in mid-2018 and has since been amended twice. It was the first guidance of its kind when it was published then. The amended Guidance includes key updates on Stablecoins and Fiat Tokens, Custody, Technology Governance and Anti-Money Laundering and Sanctions Rules and Guidance.

Stablecoins which are fully backed by fiat currencies (Fiat Tokens) will be treated as a form of digital currency. When they are used as a payment instrument for Money Transmission which is defined under the Global Market’s Financial Services and Markets Regulations 2015, the activity will be licensed and regulated as Providing Money Services. The amended guidance also sets out the Authority’s approach to regulating issuers, custodians and exchanges using Fiat Tokens. The amended guidance provides further clarity on the types of crypto asset custody activities which can be undertaken and sets out the Authority’s expectations in terms of custody governance and operations.

In addition, there are amendments to the technology governance provisions in the guidance. For example, there are changes in the underlying protocol of a crypto asset which results in a fork or coding change, and the associated governance and control expectations for crypto asset exchanges and license holders.

Finally, the guidance has been amended to reflect the latest changes in anti-money laundering and sanctions changes and there is additional clarity on the use of new regulatory and surveillance technologies in this area.