Reg­u­la­tion that puts in place a frame­work to aid au­thor­i­ties is the lat­est in a se­ries to boost com­pet­i­tive­ness

The National - News - - BUSINESS - DA­NIA SAADI

The UAE has ap­proved an anti-money laun­der­ing law to com­bat ter­ror­ism fi­nanc­ing and a for­eign in­vest­ment law that will treat for­eign com­pa­nies as it does lo­cal com­pa­nies.

Pres­i­dent Sheikh Khal­ifa is­sued the two de­crees.

“This de­cree is a fun­da­men­tal pil­lar of anti-money laun­der­ing and coun­ter­ing the fi­nanc­ing of ter­ror­ism, and con­trib­utes to rais­ing the ef­fec­tive­ness of the le­gal and in­sti­tu­tional frame­work of the na­tion to achieve de­sired re­sults,” said Sheikh Hamdan bin Rashid, Deputy Ruler of Dubai and Min­is­ter of Fi­nance.

“This law aims to com­bat money laun­der­ing and to es­tab­lish a le­gal frame­work that sup­ports and strength­ens the ef­forts of the rel­e­vant au­thor­i­ties in the na­tion in coun­ter­ing money-laun­der­ing and re­lated crimes.

“The law also coun­ters fi­nanc­ing of ter­ror­ist op­er­a­tions and sus­pi­cious or­gan­i­sa­tions, which en­hances the UAE’s com­mit­ment to in­ter­na­tional rec­om­men­da­tions and treaties.”

The UAE has been is­su­ing a se­ries of laws to boost the com­pet­i­tive­ness of the econ­omy, in­clud­ing a debt law to help fi­nan­cial mar­kets.

The Arab world’s sec­ond-big­gest econ­omy is also in­tro­duc­ing re­forms aimed at boost­ing growth, cre­at­ing jobs and di­ver­si­fy­ing the econ­omy away from oil in­come. The mea­sures over the past few months in­clude waiv­ing cor­po­rate fines in Dubai and Abu Dhabi and al­low­ing 100 per cent for­eign own­er­ship in com­pa­nies in se­lected sec­tors from the end of this year.

The anti-money laun­der­ing law is in line with the re­quire­ments of the Fi­nan­cial Ac­tion Task Force, an in­ter-gov­ern­men­tal body set up in 1989 and re­spon­si­ble for de­vel­op­ing and up­hold­ing poli­cies to com­bat money laun­der­ing, ter­ror­ist fi­nanc­ing and other types of fi­nan­cial crime.

“Strength­en­ing anti-money laun­der­ing laws will give greater con­fi­dence to in­ter­na­tional in­vestor and trad­ing part­ners in cross-bor­der deal­ings,” said Tarek Fad­lal­lah, chief ex­ec­u­tive of No­mura As­set Man­age­ment Mid­dle East. The Dubai Govern­ment has also en­acted changes to the Dubai In­ter­na­tional Fi­nan­cial Cen­tre’s anti-money laun­der­ing laws fol­low­ing a self-as­sess­ment of the free zone’s ca­pac­ity to fight fi­nan­cial crime. Sheikh Mo­hammed bin Rashid, Vice Pres­i­dent and Ruler of Dubai, en­acted the reg­u­la­tory law of the DIFC, and sub­se­quent changes to the Dubai Fi­nan­cial Ser­vices Au­thor­ity’s Anti-Money Laun­der­ing rules, with the changes tak­ing ef­fect on Mon­day.

The changes in­clude strength­en­ing pro­vi­sions to su­per­vise non-fi­nan­cial busi­nesses in the DIFC and strike them off the reg­is­ter in the event of non-compliance.

Sep­a­rately, the UAE in­vest­ment law, which has been in the works for sev­eral years, will help to boost for­eign di­rect in­vest­ment, which grew by about 8 per cent last year, com­pared to 2016, reach­ing $10.86 bil­lion.

A for­eign di­rect in­vest­ment unit will be es­tab­lished at the Min­istry of Econ­omy, which will be re­spon­si­ble “for propos­ing for­eign di­rect in­vest­ment poli­cies in the coun­try and de­ter­min­ing its pri­or­i­ties, and set­ting up as­so­ci­ated plans and pro­grammes and work on their im­ple­men­ta­tion fol­low­ing their ap­proval by the UAE Cabi­net,” ac­cord­ing to the de­cree car­ried by state-run Wam news agency.

“Li­censed for­eign in­vest­ment com­pa­nies shall … be granted the same treat­ment as na­tional com­pa­nies, within the lim­its per­mit­ted by the leg­is­la­tion in force in the state and the in­ter­na­tional conventions to which the UAE is a party.”

For­eign com­pa­nies out­side free zones were al­lowed only up to 49 per cent own­er­ship of a com­pany.

The UAE’s econ­omy min­is­ter had pre­vi­ously said the for­eign in­vest­ment law would al­low 100 per cent for­eign own­er­ship in se­lected sec­tors for cer­tain com­pa­nies.

“The law on for­eign di­rect in­vest­ment cre­ates a unit to de­velop an at­trac­tive environment, but how they go about it will be crit­i­cal in de­ter­min­ing its suc­cess,” said Mr Fad­lal­lah.

“Im­por­tantly, li­censed for­eign in­vest­ment com­pa­nies will be treated the same as na­tional com­pa­nies un­der the law.”

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