Legislation Details
- Full Title: Federal Decree-Law Regarding the Central Bank, Regulation of Financial Institutions and Activities, and Insurance Business
- Law Type: Federal Decree-Law
- Law Number: [number] of 2025
- Issued Date: 08 Sep 2025
- Effective Date: 16 Sep 2025
- Official Gazette: No. 807
- Sector: Finance and Banking
- Status: Active
- Number of Articles: 419
- Chapters/Parts: 0
- Amendments: 0
Summary
This Federal Decree-Law regulates the Central Bank of the UAE, the licensing and supervision of financial institutions and activities, and the insurance business in the country. Its primary purpose is to establish a comprehensive legal framework for the financial sector, strengthen the Central Bank's role and independence, and enhance financial stability and consumer protection. The law is of significant practical importance for businesses and individuals operating in the UAE's financial industry. It sets out detailed requirements for licensing, governance, and prudential supervision of banks, insurance companies, and other financial entities. It also empowers the Central Bank to designate systemically important institutions, implement macroprudential policies, and oversee critical financial market infrastructures. The law's provisions on early intervention, resolution, and liquidation of distressed financial institutions are crucial for safeguarding financial stability. (Federal Decree-Law Regarding the Central Bank, Regulation of Financial Institutions and Activities, and Insurance Business, 2025, Arts. 1-419)
What is the scope and purpose of this law?
The scope of this Federal Decree-Law is to regulate the Central Bank of the UAE, the licensing and supervision of financial institutions and activities, and the insurance business in the country. Its primary purpose is to establish a comprehensive legal framework for the financial sector, strengthen the Central Bank's role and independence, and enhance financial stability and consumer protection. (Federal Decree-Law Regarding the Central Bank, Regulation of Financial Institutions and Activities, and Insurance Business, 2025, Arts. 1-2)
What are the key definitions under this law?
The law provides the following key definitions:
- State: The United Arab Emirates (UAE)
- Government: The UAE Federal Government
- Ministry: The Ministry of Finance
- Minister: The Minister of Finance
- Central Bank: The Central Bank of the United Arab Emirates
- Board of Directors: The Board of Directors of the Central Bank
- Chairman: The Chairman of the Board of Directors
- Governor: The Governor of the Central Bank
(Federal Decree-Law Regarding the Central Bank, Regulation of Financial Institutions and Activities, and Insurance Business, 2025, Art. 1)
What are the main obligations and requirements?
The law imposes several key obligations and requirements, including: 1. Licensed financial institutions must comply with the Central Bank's instructions and submit information and reports as required. (Federal Decree-Law Regarding the Central Bank, Regulation of Financial Institutions and Activities, and Insurance Business, 2025, Art. 114) 2. Licensed financial institutions must establish and maintain a risk bureau to share information on customers' credit history and risk profiles. (Federal Decree-Law Regarding the Central Bank, Regulation of Financial Institutions and Activities, and Insurance Business, 2025, Art. 115) 3. Deposit-taking licensed financial institutions are prohibited from engaging in certain operations, such as providing credit facilities exceeding a certain percentage of their capital and reserves. (Federal Decree-Law Regarding the Central Bank, Regulation of Financial Institutions and Activities, and Insurance Business, 2025, Arts. 118-119) 4. Licensed financial institutions must comply with the Central Bank's regulations and instructions on governance, risk management, and other prudential requirements. (Federal Decree-Law Regarding the Central Bank, Regulation of Financial Institutions and Activities, and Insurance Business, 2025, Arts. 130-131)
What licensing, registration, or approval requirements exist?
The law establishes the following key licensing and registration requirements: 1. Financial institutions must obtain a license from the Central Bank to carry out any licensed financial activities. (Federal Decree-Law Regarding the Central Bank, Regulation of Financial Institutions and Activities, and Insurance Business, 2025, Arts. 60-61) 2. The Central Bank has the authority to decide on licensing applications, impose conditions and restrictions on licenses, and suspend, withdraw, or revoke licenses. (Federal Decree-Law Regarding the Central Bank, Regulation of Financial Institutions and Activities, and Insurance Business, 2025, Arts. 64-66) 3. Licensed financial institutions must meet minimum capital requirements and comply with ownership and shareholding restrictions. (Federal Decree-Law Regarding the Central Bank, Regulation of Financial Institutions and Activities, and Insurance Business, 2025, Arts. 69-71) 4. Insurance companies and related professions must obtain authorization from the Central Bank to conduct specific insurance-related activities. (Federal Decree-Law Regarding the Central Bank, Regulation of Financial Institutions and Activities, and Insurance Business, 2025, Arts. 107-111)
What rights and protections does this law provide?
The law provides several rights and protections, including: 1. The Central Bank is granted independence and exemption from liability for its actions taken in good faith. (Federal Decree-Law Regarding the Central Bank, Regulation of Financial Institutions and Activities, and Insurance Business, 2025, Arts. 3, 25) 2. The law mandates the confidentiality of customer data and information held by licensed financial institutions. (Federal Decree-Law Regarding the Central Bank, Regulation of Financial Institutions and Activities, and Insurance Business, 2025, Art. 147) 3. The law establishes mechanisms for the protection of customers of licensed financial institutions, including fraud prevention and the creation of specialized funds. (Federal Decree-Law Regarding the Central Bank, Regulation of Financial Institutions and Activities, and Insurance Business, 2025, Arts. 148-151) 4. The law provides for the finality of payment and settlement transactions processed through financial market infrastructures, ensuring legal certainty. (Federal Decree-Law Regarding the Central Bank, Regulation of Financial Institutions and Activities, and Insurance Business, 2025, Arts. 162-165)
Which authorities or bodies are responsible for enforcement?
The key authorities and bodies responsible for the enforcement of this law are: 1. The Central Bank of the UAE, which is responsible for the regulation, supervision, and oversight of financial institutions and activities. (Federal Decree-Law Regarding the Central Bank, Regulation of Financial Institutions and Activities, and Insurance Business, 2025, Arts. 5, 120-137) 2. The Board of Directors of the Central Bank, which is responsible for setting the Central Bank's policies, issuing regulations and instructions, and overseeing the Central Bank's operations. (Federal Decree-Law Regarding the Central Bank, Regulation of Financial Institutions and Activities, and Insurance Business, 2025, Arts. 11-20) 3. The Governor of the Central Bank, who is responsible for the day-to-day management and implementation of the Central Bank's policies and decisions. (Federal Decree-Law Regarding the Central Bank, Regulation of Financial Institutions and Activities, and Insurance Business, 2025, Arts. 21-23) 4. The Higher Shari'ah Authority, which is responsible for overseeing the compliance of Islamic financial institutions with Shari'ah principles. (Federal Decree-Law Regarding the Central Bank, Regulation of Financial Institutions and Activities, and Insurance Business, 2025, Art. 24)
What are the penalties for non-compliance?
The law specifies the following penalties for non-compliance: 1. Imprisonment for a term not exceeding 5 years and/or a fine not exceeding AED 5 million for carrying on or promoting financial activities without a license. (Federal Decree-Law Regarding the Central Bank, Regulation of Financial Institutions and Activities, and Insurance Business, 2025, Art. 169) 2. Imprisonment for a term not exceeding 3 years and/or a fine not exceeding AED 3 million for providing false or misleading information to the Central Bank. (Federal Decree-Law Regarding the Central Bank, Regulation of Financial Institutions and Activities, and Insurance Business, 2025, Art. 170) 3. A fine not exceeding AED 1 million for failure to comply with the Central Bank's instructions or regulations. (Federal Decree-Law Regarding the Central Bank, Regulation of Financial Institutions and Activities, and Insurance Business, 2025, Art. 171) 4. Imprisonment for a term not exceeding 1 year and/or a fine not exceeding AED 1 million for obstructing the Central Bank's examination or investigation. (Federal Decree-Law Regarding the Central Bank, Regulation of Financial Institutions and Activities, and Insurance Business, 2025, Art. 172)
What fees, charges, or financial provisions are specified?
The law does not specify any fees, charges, or financial provisions. It states that the Central Bank may impose fees and charges for the services it provides, but the exact amounts are not mentioned. (Federal Decree-Law Regarding the Central Bank, Regulation of Financial Institutions and Activities, and Insurance Business, 2025, Art. 182)
What exemptions or exceptions apply?
The law does not provide any explicit exemptions or exceptions. It applies broadly to the regulation of the Central Bank, financial institutions, and insurance business in the UAE. (Federal Decree-Law Regarding the Central Bank, Regulation of Financial Institutions and Activities, and Insurance Business, 2025, Arts. 1-2)
How are disputes resolved under this law?
The law establishes a Grievances and Appeals Committee to handle disputes arising from the Central Bank's decisions and actions. Aggrieved parties can submit grievances to the Committee, whose decisions are final and binding. (Federal Decree-Law Regarding the Central Bank, Regulation of Financial Institutions and Activities, and Insurance Business, 2025, Art. 167)
What are the key deadlines and time limits?
The law does not specify any key deadlines or time limits. It does not mention any specific periods for compliance, reporting, or other actions. (Federal Decree-Law Regarding the Central Bank, Regulation of Financial Institutions and Activities, and Insurance Business, 2025)
How does this law interact with other UAE legislation?
This Federal Decree-Law repeals and replaces the previous Decretal Federal Law No. (14) of 2018 Regarding the Central Bank and Organization of Financial Institutions and Activities. It also interacts with several other UAE federal laws, including: - Federal Law No. (1) of 1972, Regarding Jurisdictions of Ministries and Powers of Ministers - Federal Law No. (8) of 2004, Regarding Financial Free Zones - Decretal Federal Law No. (9) of 2018, Regarding Public Debt - Federal Decree-Law No. (20) of 2018, on Anti-Money Laundering, Combating the Financing of Terrorism and Financing of Illegal Organizations - Federal Decree-Law No. (32) of 2021, on Commercial Companies - Federal Decree-Law No. (42) of 2022, Promulgating the Civil Procedure Code - Federal Decree-Law No. (50) of 2022, Promulgating the Commercial Transactions Law - Federal Decree-Law No. (13) of 2023, Regarding Establishment and Organization of the Financial Stability Board - Federal Decree-Law No. (48) of 2023, Regulating Insurance Activities - Federal Decree-Law No. (51) of 2023, Promulgating the Financial Restructuring and Bankruptcy Law - Federal Decree-Law No. (31) of 2024, Regarding Netting (Federal Decree-Law Regarding the Central Bank, Regulation of Financial Institutions and Activities, and Insurance Business, 2025, Art. 185)
When did this law come into effect?
This Federal Decree-Law came into effect on 16 September 2025, following its publication in the Official Gazette No. 807 on 15 September 2025. (Federal Decree-Law Regarding the Central Bank, Regulation of Financial Institutions and Activities, and Insurance Business, 2025, Art. 188)
Source Documents
This article analyses Federal Decree-Law Regarding the Central Bank, Regulation of Financial Institutions and Activities, and Insurance Business 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.