AML/CFT laws and related decisions
Although a UAE Penal Law issued in 1987 criminalised the acquisition or hiding of criminally-obtained items, the first legislation to criminalise money-laundering specifically was introduced in 2002, and amended in 2014.
Since then, Federal Law No. 4 of 2002 has evolved to combat money laundering (ML) and terrorism financing (TF) 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In 2018, the AML Law repealed Federal Law No. (4) of 2002 and its amendments.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 combatting financing of terrorism and illegal organisations (AML By-law), the UAE streamlined its AML/CFT measures and applied a 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-laws cover all requirements of the Financial Action Task Force (FATF) recommendations of 2012 and its methodology of 2013, in accordance with the UAE legislative system. This is a fundamental legal pillar and contributes to raising the effectiveness of the legal and institutional framework of the nation to achieve the desired results.
The current legislation provides additional powers to domestic competent authorities — entities that refer their findings to the relevant government entities entrusted with the implementation of any provision of the AML Law. It allows competent authorities to put in place preventative measures, including the expansion of obligations on Financial Institutions (FIs) and Designated Non-Financial Businesses and Professions (DNFBPs), alongside key provisions in relation to the ML and TF offences, national co-ordination, authorities, mandate, international co-operation, and 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.