Matthew Shanahan


In the past year the United Arab Emirates (UAE) has witnessed a number of important developments in the area of compliance and financial crime which will have a significant impact on the risk exposure of companies operating in the UAE for the foreseeable future. Over time, collectively, these changes will have a profound impact on the compliance environment in the UAE, particularly as it relates to financial crimes, and companies can no longer approach compliance issues casually.

The Dubai International Financial Centre (DIFC) has reinforced its position as one of the world’s top financial and business centres, introducing changes to its companies regime and enhancing the ease of doing business in the centre. On 12 November 2018, the DIFC has issued amongst other laws and regulations, the DIFC Companies Law No. 5 of 2018 (Companies Law 2018), repealing the previous Companies Law No. 2 of 2009 (Previous Law).

The UAE has issued by Decree Federal Law No. (10) of 2018 on Netting (the UAE Netting Law), with the aim of strengthening the regulatory framework for the settlement of obligations arising from qualified financial contracts. Parties to a contract previously relied on Article 183 of Federal Law No. (9) of 2016 on Bankruptcy (the Bankruptcy Law) to settle debts agreed to under a contract, provided that it is within the context of insolvency and that such contract does not fall within the claw-back provisions (Article 168 of the Bankruptcy Law). 

The UAE has enhanced the authority of the Central Bank over the licensing and regulation of all financial institutions and their activities in the UAE, with the issuance by Decree of Federal Law No. (14) of 2018 (the Central Bank Law). This effectively repeals and replaces the Central Bank Law of 1980 (the 1980 Law), which has become out of date and no longer adequately caters to the needs of the highly complex financial industry, which has developed tremendously over the last 40 years.