Legislation Details
- Full Title: Federal Decree by Law Regarding the Regulation of Capital Market
- Law Type: Federal Decree-Law
- Law Number: [no number] of 2025
- Issued Date: 01 Oct 2025
- Effective Date: 01 Jan 2026
- Official Gazette: No. 809
- Sector: Finance and Banking
- Status: Active
- Number of Articles: 181
- Chapters/Parts: 0
- Amendments: 0
Summary
This Federal Decree-Law regulates the capital market in the United Arab Emirates. It establishes the Capital Market Authority and defines its powers and responsibilities in overseeing financial activities, licensing market participants, and protecting investors. The law covers a wide range of capital market operations, including the issuance, trading, and settlement of securities, the regulation of investment funds, and the supervision of systemically important institutions. Its provisions aim to enhance the transparency, efficiency, and stability of the UAE's financial system. (Federal Decree by Law Regarding the Regulation of Capital Market, 2025, Arts. 1-85) The law is significant for businesses and individuals engaged in the UAE's capital markets, as it sets the legal framework for their activities and establishes the regulatory oversight of the Capital Market Authority. It introduces new requirements for licensing, disclosure, and risk management, which will impact financial institutions, issuers, and investors operating in the UAE. The law also empowers the Authority to take enforcement actions and impose penalties for non-compliance, underscoring the importance of adherence to the new regulations. (Federal Decree by Law Regarding the Regulation of Capital Market, 2025, Arts. 1-85)
What is the scope and purpose of this law?
The scope of this Federal Decree-Law is to regulate the capital market in the United Arab Emirates. It applies to financial products traded within the UAE, financial activities carried out within the UAE or by any person in a free zone, licensed persons, approved persons, issuers, foreign issuers, investment funds, and any person who targets clients within the UAE through their activities, even if conducted from outside the country. (Federal Decree by Law Regarding the Regulation of Capital Market, 2025, Art. 2) The purpose of the law is to establish the Capital Market Authority and define its powers and responsibilities in overseeing the capital market, including licensing, approving, and supervising market participants, ensuring the transparency and efficiency of capital market operations, and protecting investors. (Federal Decree by Law Regarding the Regulation of Capital Market, 2025, Arts. 1-2)
What are the key definitions under this law?
The law provides the following key definitions:
- State: The United Arab Emirates
- Local Governments: The local governments of the Emirates of the State
- Central Bank: The Central Bank of the United Arab Emirates (CBUAE)
- Authority: The Capital Market Authority
- Board: The Board of Directors of the Authority
- Authority Law: Federal Decree by Law No. (32) of 2025 Regarding the Capital Market Authority
- Companies Law: Federal Decree by Law No. (32) of 2021 Regarding Commercial Companies
- Relevant Legislation: The Authority Law, the legislation regulating the Authority and the Capital Market in force in the State, and the resolutions issued in implementation thereof
- Free Zone: Any free zone established or to be established within the State, excluding the Financial Free Zone
- Financial Free Zone: The zones that are subject to the provisions of Federal Law No. (8) of 2004 Regarding the Financial Free Zones
- Relevant Authorities: The Ministry of Economy and Tourism, the Central Bank, the competent local licensing authorities, and any other entity in the State related to the provisions of this Decree by Law and the Relevant Legislation
(Federal Decree by Law Regarding the Regulation of Capital Market, 2025, Art. 1)
What are the main obligations and requirements?
The law imposes several key obligations and requirements: 1. Persons must obtain a license, approval, registration, or accreditation from the Authority to carry out financial activities within the scope of the law. (Federal Decree by Law Regarding the Regulation of Capital Market, 2025, Art. 6) 2. Licensed persons and their employees must comply with the law's provisions, including obligations related to client funds, risk management, and disclosures. (Federal Decree by Law Regarding the Regulation of Capital Market, 2025, Arts. 12, 23-25) 3. Issuers and foreign issuers must comply with requirements for the issuance, listing, trading, and disclosure of securities. (Federal Decree by Law Regarding the Regulation of Capital Market, 2025, Arts. 28-37) 4. Capital market institutions, such as the market, central clearing, and central depository, must fulfill certain financial resource and risk management obligations. (Federal Decree by Law Regarding the Regulation of Capital Market, 2025, Arts. 22-24) 5. Persons subject to the Authority's supervision must cooperate with the Authority's inspection, investigation, and enforcement actions. (Federal Decree by Law Regarding the Regulation of Capital Market, 2025, Arts. 46-61)
What licensing, registration, or approval requirements exist?
The law requires persons to obtain a license, approval, registration, or accreditation from the Authority to carry out financial activities within the scope of the law. The Authority is responsible for granting these authorizations and can impose conditions on them. (Federal Decree by Law Regarding the Regulation of Capital Market, 2025, Art. 6) The law also requires the Authority to establish public registers of persons subject to its supervision, including licensed persons, approved persons, and capital market institutions. (Federal Decree by Law Regarding the Regulation of Capital Market, 2025, Art. 43)
Which authorities or bodies are responsible for enforcement?
The Capital Market Authority is the primary regulatory body responsible for the enforcement of this law. The law grants the Authority various powers, including: - Licensing, approving, registering, and accrediting persons to carry out financial activities - Supervising and inspecting licensed persons and capital market institutions - Conducting administrative investigations and imposing administrative sanctions and measures - Designating systemically important persons and exercising settlement and resolution powers - Cooperating with judicial authorities and other relevant authorities (Federal Decree by Law Regarding the Regulation of Capital Market, 2025, Arts. 41-59)
What are the penalties for non-compliance?
The law provides for the following penalties for non-compliance: 1. Imprisonment for a period not exceeding 5 years, and/or a fine not exceeding AED 5 million. (Federal Decree by Law Regarding the Regulation of Capital Market, 2025, Art. 71) 2. Supplementary penalties, such as the revocation or suspension of a license, approval, registration, or accreditation, the closure of a business, or the deportation of a natural person. (Federal Decree by Law Regarding the Regulation of Capital Market, 2025, Art. 73)
How does this law interact with other UAE legislation?
This Federal Decree-Law is related to and interacts with the following UAE legislation: - Federal Law No. (1) of 1972 Regarding the Competencies of Ministries and the Powers of Ministers - Federal Law No. (4) of 2000 Regarding the Emirates Securities and Commodities Authority and Market - Federal Law No. (8) of 2004 Regarding the Financial Free Zones - Federal Decree by Law No. (22) of 2020 Regarding the Distribution of Competencies and Powers between the Securities and Commodities Authority (SCA), and the Securities and Commodities Markets Licensed in the State - Federal Decree by Law No. (32) of 2025 Regarding the Capital Market Authority - Federal Decree by Law No. (32) of 2021 Regarding Commercial Companies (Federal Decree by Law Regarding the Regulation of Capital Market, 2025, Preamble)
When did this law come into effect?
This Federal Decree-Law comes into effect on 01 January 2026, as stated in the Effective Date provision. (Federal Decree by Law Regarding the Regulation of Capital Market, 2025, Art. 85)
Source Documents
This article analyses Federal Decree by Law Regarding the Regulation of Capital Market for legal research and educational purposes. For the purpose of interpretation and application, reference must be made to the original Arabic text. In case of conflict, the Arabic text prevails. This does not constitute legal advice.