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  • 1. Introduction

    • 1.2. Applicability

      Unless otherwise noted, this Guidance applies to all natural and legal persons, which are licensed and/or supervised by CBUAE, in the following categories:

      •National banks, branches of foreign banks, exchange houses, finance companies, payment service providers, registered hawala providers and other LFIs; and
       
      •Insurance companies, agencies, and brokers.
       

    • 1.3. Legal Basis

      This Guidance builds upon the provisions of the following laws and regulations:

      •Decree Federal Law No. 20 of 2018 on Anti-Money Laundering and Combating the Financing of Terrorism and Illegal Organizations (“AML-CFT Law”).
       
      •Cabinet Decision No. (10) of 2019 concerning the Implementation Regulation of Decree Federal Law No. 20 of 2018 on Anti-Money Laundering and Combating the Financing of Terrorism and Illegal Organizations (“AML-CFT Decision”).
       
      •Cabinet Decision No. (74) of 2020 Regarding Terrorism Lists Regulation and Implementation of UN Security Council Resolutions on the Suppression and Combating of Terrorism, Terrorists Financing & Proliferation of Weapons of Mass Destruction, and Related Resolutions (“Cabinet Decision 74”).
       

      The AML-CFT Law and the AML-CFT Decision require LFIs to promptly apply directives issued by the competent authorities of the UAE for implementing the decisions issued by the United Nations Security Council (“UNSC”) under Chapter VII of the Charter of the United Nations (“UN”). In furtherance of this requirement, the Cabinet Decision 74 sets out the legislative and regulatory framework regarding the Targeted Financial Sanctions (“TFS”), including the Local Terrorist List and the UN Consolidated List.

      The Executive Office3 acts as a national lead to coordinate and liaison implementation of TFS with all the federal and local government stakeholders including financial institutions (FIs) and designated non-financial business and professions (DNFBPs) and has issued the Guidance on Targeted Financial Sanctions for FIs and DNFBPs”. The Executive office is mainly responsible for:

      •Receiving and processing grievances against Listing in UN and Local Lists decisions;
       
      •Receiving and processing applications to use frozen funds as per sanctions lists;
       
      •Working closely with the Supreme Council with regards to the local Listing;
       
      •Circulating updates to the local and UN lists to the government and private sector; and
       
      •Coordinating and exchanging information between Government Agencies.
       

      This Guidance issued by the CBUAE is supplementary to the above mentioned “Guidance on Targeted Financial Sanctions for Financial Institutions and Designated Non-financial Business and Professions” issued by the Executive Office.

      3 Website: Home | Committee for goods & material subjected to import & export (uaeiec.gov.ae)

    • 1.4. Definitions

      Controlling Shareholder: A shareholder who has the ability to directly or indirectly influence or control the appointment of the majority of the board of directors, or the decisions made by the board or by the general assembly of the entity, through the ownership of a percentage of the shares or stocks or under an agreement or other arrangement providing for such influence.

      Direct Relationship: A relationship between two parties that knowingly provide the other material, technological, logistical, or financial support and both parties are directly impacted by the other party.

      Funds: Assets of all types, in whatever form and however acquired, whether corporeal or incorporeal, tangible or intangible, movable or immovable, electronic, digital or encrypted, including national currency, foreign currencies, documents and legal instruments establishing ownership of such assets or any associated rights, in whatever form, including electronic or digital forms, as well as economic resources considered as assets of any kind, including oil and natural resources, and bank credits, cheques, money orders, shares, securities, bonds, drafts, and letters of credit and any interest, dividends, or other income accruing from or generated by such assets, and that may be used to obtain any other funds, goods or services including internet posting services or related services.

      Indirect Relationship: A relationship between two parties that affect each other through a third-party source or one or more intermediaries.

      Listed Person: Individuals, legal entities and groups listed by the UN Security Council on the UN Consolidated List, or listed by the UAE Cabinet on the Local Terrorist List, as the case may be.

      Listing: Identifying the individuals, legal entities and groups subject to sanctions imposed pursuant to relevant UNSC Resolutions (“UNSCRs”), decisions of the Sanctions Committee, or relevant decisions of the UAE Cabinet, as the case may be, and implementing relevant sanctions against such individuals, legal entities and groups, with a statement of the reasons for Listing.

      Local Terrorist List: Terrorism lists issued by the UAE Cabinet pursuant to the provisions of Article (63) paragraph (1) of Federal Law No. (7) of 2014 on Combating Terrorism Offences.

      Other Measures: Sanction measures other than freezing that must be enforced, and which may be included in Relevant UNSCRs or UAE Cabinet decisions regarding the issuance of Local Terrorist List, such as prohibitions relating to travel, weapons, imports, or provision of fuel supplies and other.

      Previous Customer: A customer with whom the relationship was terminated and the LFI maintains relevant records according to record keeping and other requirements.

      Relevant UNSCRs: All current and future UNSCRs relating to the suppression and combating of terrorism, terrorist financing and proliferation of weapons of mass destruction and its financing, including but not limited to Resolutions 1267 (1999), 1373 (2001), 1988 (2011), 1989 (2011), 1718 (2006), 2231 (2015) and any successor resolutions.

      Sanctions Committee: Any of the UN Security Council Committees established as per its resolutions, including UNSCRs 1267 (1999) and 1989 (2011) relating to ISIL and Al-Qaida, 1988 (2011) relating to the Security and Stability of Afghanistan, and 1718 (2006) relating to the suppression and combating of proliferation of weapons of mass destruction for the DPRK.

      Subsidiary: An entity owned by another entity by more than 50% of its capital or under full control of that entity regarding appointment of the Board of Directors.

      Targeted Financial Sanctions (TFS): The term Targeted Financial Sanctions means that such sanctions are against certain individuals, entities, groups, or undertakings. The term Targeted Financial Sanctions includes both asset freezing and prohibitions to prevent funds or other assets from being made available, directly, or indirectly, for the benefit of individuals, entities, groups, or organization who are sanctioned.

      The Executive Office: The Executive Office of the Committee for Goods and Materials Subject to Import and Export Control.

      UN Consolidated List: A list containing the names of individuals and organizations linked to terrorism, financing of terrorism or proliferation of weapons of mass destruction and its financing, and that are subject to sanctions imposed as per UNSCRs and decisions of the Sanctions Committee, along with information related to such persons and reasons for their Listing.

      Without Delay: Within 24 hours of the Listing decision being issued by the UNSC, the Sanctions Committee or the UAE Cabinet, as the case may be.