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AML/CFT Legislations

Although the UAE criminalized the acquisition or hiding criminally obtained things according to Penal Law issued in 1987, the UAE decided to issue a special penal legislation for the first time to criminalize Money Laundering in 2002 and amended in 2014. The UAE first criminalised ML by Federal Law No. 4 of 2002 and has since evolved to fight money laundering and terrorism financing in the country. The UAE has adopted a mature and vigorous AML/CFT legal framework. In 2018, the (AML Law) repealed Federal Law No. (4) of 2002 and its amendments.

Under the new AML Law and its Cabinet Decision No. (10) of 2019 concerning the executive regulation of federal decree law no. (20) of 2018 on anti-money laundering and combating financing of terrorism and illegal organisations (AML By-law) , UAE streamlined AML/CFT measures and applied unified AML/CFT legal framework across all Emirates, Commercial Free Zones (CFZs) and Financial Free Zones (FFZs) in the UAE.

The AML Law and AML By-law cover all the requirements of the Financial Action Task Force (FATF) recommendations of 2012 and its methodology of 2013 in harmony with the UAE legislative system. It is a fundamental pillar and contributes to raising the effectiveness of the legal and institutional framework of the nation to achieve the desired results.

The new legislation provided further powers to domestic Competent Authorities, which refer to the government authorities in the UAE entrusted with the implementation of any provision of the AML Law, preventative measures expanded to include expansion including obligations on Financial Institutions (FIs) and Designated Non-Financial Businesses and Professions (DNFBPs), key provisions in relation to the ML and TF offences, national coordination, authorities, mandate, international cooperation, criminal and administrative sanctions.

The AML law requires the establishment of an independent Financial Intelligence Unit (the UAE FIU) within the Central Bank (CBUAE), to exclusively receive Suspicious Transaction Reports (STRs) and related information from all FIs and DNFBPs for consideration, analysis, and referral to the domestic Competent Authorities, spontaneously or upon request.