UAE Central Bank and Financial Institutions Decree-Law — articles 1–100

In the implementation of provisions of this decree-law, and unless the context otherwise requires, the following words and expressions shall have the meanings cited against each: State: The United Arab Emirates (UAE). Go…

The provisions of this decree-law shall apply to the Central Bank, financial institutions, insurance business, financial activities, and Persons subject to it; and shall not apply to the Financial Free Zones in the State…

1. The Central Bank shall be considered a federal public institution having its own body corporate, and enjoying financial and managerial independence, and the required juridical capacity to conduct all business and acti…

Headquarters of the Central Bank and its official address, along with its main branch shall be located in the State’s capital and may, upon Board of Directors approval, establish affiliated entities and open branches, of…

1. The Central Bank aims at achieving the following objectives: a. Maintain stability of the national Currency within the framework of the monetary system; b. Contribute to the promotion and protection of the stability o…

1. The paid-up capital of the Central Bank shall be twenty billion (20,000,000,000) Dirhams. 2. The Central Bank shall maintain a ‘General Reserve Account’ for the purpose of building capital reserves from net profits it…

1. The Board of Directors shall, at the end of each financial year, determine the Central Bank’s annual net profits after deducting administrative and operational expenses, and allocating necessary funds for depreciation…

1. The financial year for the Central Bank shall commence on the first day of January and end on the thirty-first day of December of each Year. 2. Operations of the Central Bank shall be conducted, and its balance sheet …

The accounts of the Central Bank shall be audited by an auditor or more, selected periodically by the Board of Directors. The Board of Directors shall determine the auditors’ annual remunerations.

1. Within three (3) months from end of the financial year, the Central Bank shall submit to the Chairman of the Presidential Court an annual report to be presented to the President of the State on the following: a. The f…

The Central Bank shall be managed by a Board of Directors of seven (7) members, including the Chairman and the Governor.

1. Members of the Board of Directors shall be appointed by a federal decree based on recommendation of the Cabinet, and shall serve for a four (4) year term renewable for similar periods. The federal decree designates fr…

A member of the Board of Directors shall satisfy the following conditions: 1. Must hold UAE nationality; 2. Have experience in economic, financial, or banking affairs; 3. Not have been declared bankrupt or failed to repa…

1. A member of the Board of Directors appointed in accordance with Article (12) of this decree-law may seek approval of his resignation by a written request submitted to the Chairman. A federal decree accepting such resi…

1. Membership of the Board of Directors terminates upon end of the term of office without renewal, death, or resignation. Membership of the Board of Directors may also be terminated by a federal decree, based on the Cabi…

The Board of Directors shall, within the limits of the provisions of this decree-law, exercise all powers required for achieving the objectives for which the Central Bank has been established. The Board of Directors shal…

1. The Board of Directors may form committees it deems appropriate to assist in the discharge of its functions and jurisdictions in accordance with the provisions of this decree-law. 2. Such committees referred in item (…

1. The Board of Directors shall, upon invitation by the Chairman, hold an ordinary meeting, at least once every sixty (60) days. 2. The Chairman may call the Board of Directors to convene whenever the need arises. 3. The…

1. The Board of Directors meeting shall not be valid unless attended by at least (5) five members, including the Chairman, one of his deputies, or the Governor. 2. Decisions of the Board of Directors shall be adopted by …

The Board of Directors shall establish a regulation regarding remunerations of the Governor and his other entitlements, and the remunerations of the Chairman and members of the Board of Directors. A federal decree, to th…

1. Without prejudice to the powers established for the Board of Directors or the Chairman provided herein, the Governor shall be the legal representative of the Central Bank. 2. Without prejudice to any competencies esta…

The Governor shall have deputies and assistants with the rank of undersecretary, appointed by federal decree upon the proposal of the Chairman. They shall assist the Governor in exercising his powers. The Governor may de…

1. The Governor, his deputies and assistants shall devote their full time to their work at the Central Bank, and none of them shall hold any paid or unpaid position, or be a member of the board of directors of any Licens…

1. An authority named Higher Shari`ah Authority attached to the Central Bank shall be established with a membership of not less than five (5) members and not exceeding seven (7) members, of sufficient knowledge, experien…

1. The Central Bank, members of the Board of Directors, members of committees formed by the Board of Directors, whether from within its membership or from outside, members of advisory boards, staff of the Central Bank an…

1. It is prohibited for any member of the Board of Directors, any member of the committees and advisory boards formed by the Board of Directors, any employee or representative of the Central Bank, any expert, technical p…

1. A member of the Board of Directors shall, upon his appointment, declare his interests, which may conflict with his membership at the Board of Directors. Should any member of the Board of Directors have a personal inte…

1. The Central Bank may cooperate with the regulatory authorities in the State, the concerned regulatory authorities outside the State or in Financial Free Zones , and with international organizations and institutions, i…

The Central Bank may seek assistance of experts, technical personnel and academics, or any other party deemed appropriate, and determine their remunerations and entitlements. The Board of Directors may also invite to its…

1. The Central Bank may elect to involve the public or industry professionals, within a prescribed time period, in providing their opinions on draft regulations and rules regulating the business of Licensed Financial Ins…

The Central Bank shall: 1. Determine its monetary management framework, related tools and operational set-up for implementation of its monetary policy objectives, including policies relating to the management of the exch…

1. The Central Bank may, for macroprudential and liquidity management purposes, impose minimum Reserve Requirements on qualified liabilities held with deposit-taking Licensed Financial Institutions. 2. The Central Bank s…

The Central Bank shall determine its macroprudential policy framework and therein establish related instruments to contribute in promoting and protecting financial stability in the State. Macroprudential policy tools ref…

The Central Bank and the Ministry shall establish a mechanism for coordinating monetary policy and fiscal policy for the purpose of achieving balanced and sustainable growth in the national economy. Such coordination sha…

The Central Bank shall solely have the authority to designate any Licensed Financial Institution as systemically important. For such purpose, the Central Bank may require the designated Licensed Financial Institution to …

1. The Public Sector and Government-Related Entities shall provide the Central Bank with all information and statistics it requires for the purpose of achieving its objectives and discharging its functions under the prov…

The Central Bank may undertake any of the following: 1. Conduct studies, research, surveys, working papers and analyses in areas including the macro-economy, monetary policy, financial stability, banking sector, insuranc…

1. Advise the Government on matters falling within its jurisdiction, and shall provide its opinion on monetary, banking, and financial affairs as requested by the Government. 2. Participate in negotiations relating to th…

1. For the purposes of achieving objectives of its monetary policy, and in order to provide for Public Sector and Government-Related Entities’ needs for Dirham and foreign currencies, the Central Bank shall buy or sell f…

Apart from the funds deposited with the Central Bank in accordance with the provisions of Article (39) of this decree-law, the Central Bank shall not interfere in the investment and deployment of Government funds or fund…

The Central Bank may: 1. Open Dirham or foreign currencies accounts for Licensed Financial Institutions, securities exchanges and central counterparties, central securities depositories, operating in the State, other mon…

The Central Bank may conduct the following money and capital markets operations: 1. Purchase, re-purchase, sell, accept and place deposits of gold bullion and precious metals. 2. Maintain interest bearing and non-interes…

The Central Bank may: 1. Take all necessary measures to maintain the conduct of operations of Licensed Financial Institutions, within the frameworks and controls it deems appropriate. For this purpose, the Central Bank s…

1. The Central Bank shall issue rules and guidelines to manage securities programs it establishes, provided that such rules shall include issuance terms and conditions, tender process rules, custody, settlement, and trad…

The Central Bank may: 1. Invest its funds in accordance with the investment policy and guidelines set by the Board of Directors, in all or any of the following: a. Gold bullions and other precious metals. b. Currencies i…

1. The market value of balance of Foreign Reserves held by the Central Bank, shall not, in all cases, be less than seventy percent (70%) of the value of the Monetary Base. Such Foreign Reserves shall consist of one or mo…

The Central Bank, for the purpose of achieving its objectives and discharging its functions stipulated in this decree-law, may establish or participate in establishing commercial or financial companies or institutions, o…

1. Debts of the Central Bank shall enjoy the same privilege that the Government debts have over property of its debtors. Debts of the Central Bank shall be collected in the same manner and by the same means prescribed fo…

1. The Central Bank shall be exempt from taxes, fees, and expenses relating to the following: a. Its capital, reserves, Currency issuance, or income. b. Its contribution, shares, or profits originating from companies and…

1. The Government shall provide guardianship for the Central Bank’s premises, and the security escort needed for the safe transport of funds and valuables, free of charge. 2. The Central Bank may establish necessary cont…

The Central Bank shall not be dissolved except by a law specifying the rules and timing of its liquidation.

The official Currency of the State ‘the Dirham’ shall be referred as (إ هـ د) in Arabic letters and as (AED) in Latin letters or as ( ) in symbol, and be subdivided into one hundred (100) fils.…

1. Issuance of Currency shall be the exclusive right of the State. This right shall be exercised solely and exclusively by the Central Bank. 2. No Person shall issue or put into circulation Currency or use any instrument…

1. Currency notes and currency in digital form issued by the Central Bank shall be legal tender for payment of any amount with its full-face value. 2. Currency coins issued by the Central Bank shall be legal tender in th…

1. Currency notes issued by the Central Bank shall be of such denominations, designs, and specifications, and bear such features as shall be decided by the Board of Directors and shall bear the official signature of the …

1. The Board of Directors shall determine conditions for sale and purchase of commemorative coins of precious metals and commemorative banknotes at the Central Bank. 2. The Central Bank may issue commemorative Currency f…

1. New Currency notes and coins shall be put in circulation by a Board of Directors decision specifying their denominations and quantities. Such decision shall be published in the Official Gazette and communicated to the…

1. The Board of Directors shall issue a decision regulating the Currency in digital form to be put in circulation and redeemed in exchange for payment of its full nominal value, such decision may prescribe the method of …

No Person is permitted to mutilate/deform, destroy or shred Currency, in whichever manner. The Board of Directors shall issue regulations on replacement of mutilated/deformed, destroyed or shredded Currency.

1. No Person may carry on any of the Licensed Financial Activities without obtaining the required license in accordance with the provisions of this decree-law. 2. Licensed Financial Activities shall only be carried on, i…

1. The following activities shall be considered financial activities subject to the Central Bank licensing in accordance with the provisions of this decree-law: a. Taking deposits of all types, including Shari`ah-complia…

Without prejudice to the Licensed Financial Activities referred to in item (1) of Article (61) of this decree-law, any Person carrying on, offering, issuing, or facilitating, whether directly or indirectly, any Licensed …

1. Any Person may, in accordance with regulations issued by the Board of Directors, submit to the Central Bank an application for a license to carry on one or more Licensed Financial Activities or addition of one or more…

1. Deciding on licensing application or extension thereof shall be within a period not exceeding sixty (60) working days from date of meeting all conditions and requirements for licensing. The expiry of the period withou…

1. The Central Bank may impose conditions or restrictions, or otherwise change or cancel conditions or restrictions imposed on a license issued for any Licensed Financial Institution. 2. The Central Bank may, prior to is…

1. The Central Bank may suspend, withdraw, or revoke a license issued to a Licensed Financial Institution, in any of the following cases: a. If the Licensed Financial Institution ceased to meet, or breached one or more o…

1. Entities other than Banks licensed in accordance with the provisions of this decree-law shall not use, in their business addresses or advertisements, the expressions ‘Bank’, ‘Masraf’ or any other expression derived th…

1. An electronic register named ‘Register of Licensed Financial Institutions’ shall be created at the Central Bank, to which names of Licensed Financial Institutions and their related data and any amendments thereto, sha…

1. Banks and (Re)Insurance Companies shall take the form of public joint-stock companies, with incorporating law or decree so permits. Branches of foreign Banks, specialized Banks, and branches of foreign (Re)Insurance C…

The Board of Directors shall establish regulations on the minimum capital requirement for Licensed Financial Institutions, and conditions and instances of increase or decrease of capital, and shall determine risk-based c…

1. Without prejudice to the financial and commercial activities restricted to UAE nationals prescribed in any other law, the Board of Directors shall determine the conditions and controls for shareholding and ownership i…

1. No Licensed Financial Institutions established outside the State or in a Financial Free Zone is allowed to conduct the business of a representative office within the State without being licensed by the Central Bank. 2…

1. Licensed Financial Institutions shall seek prior approval from the Central Bank for amendments they wish to incorporate to their memorandum or articles of association. 2. The Central Bank shall decide on the request r…

1. Islamic Financial Institutions may carry on the Licensed Financial Activities referred to in Article (61) of this decree-law in accordance with the rules and principles of the Islamic Shari`ah, whether for their accou…

1. An independent committee named ‘Internal Shari`ah Supervision Committee’ shall be established within each Islamic Financial Institution. Such committee shall consist of experienced specialists and those with capabilit…

1. The Internal Shari`ah Supervisory Committee shall prepare an annual Shari`ah report to be presented to the general assembly of the Islamic Financial Institution. The report shall be prepared in accordance with the tem…

Where it is established that an Islamic Financial Institution, has conducted business that contravene the rules and principles of Islamic Shari`ah, as per the Higher Shari`ah Authority rulings, resolutions and standards,…

1. Insurance business and services shall be divided into the following two types: a. Insurance of Persons and fund accumulation operations; and b. Property and liability insurance. 2. The resolutions, regulations and ins…

The Board of Directors may impose compulsory insurance against some risks pursuant to regulations whereby the controls and conditions of such insurance and other provisions related thereto are identified.

1. It is prohibited for Insurance Companies to combine insurance of Persons and fund accumulation operations and property and liability insurance operations. 2. Insurance Companies licensed to carry on the two types of i…

1. It is prohibited for an Insurance Company’s chairman, board members, and Authorized Individuals or any Person acting on their behalf to: a. Engage in managing other competing Insurance Company or any company that carr…

1. Insurance or insurance brokerage of properties existing in the State or liabilities arising therefrom may only be carried on by Insurance Companies licensed in accordance with the provisions of this decree-law. 2. An …

1. Insurance Companies shall provide the Central Bank with forms of Insurance Policies and related annexes, including general and special terms and conditions, technical grounds of such policies and Premium rates annexed…

1. Should the chairman and board members of an Insurance Company submit their resignations or should the vacant positions reach one-quarter (1/4) of the company’s board members, the Governor shall: a. Form an interim com…

1. An Insurance Company shall not publish an invitation to hold general assembly meeting in daily newspapers unless approved by the Central Bank. The concerned company shall not include any additional items on the genera…

Insurance Companies shall comply with Technical Provisions, Solvency Margin requirements, and any reserves as determined by the Central Bank to be maintained in the State, in accordance with the directions issued by the …

An Insurance Company shall appoint or approve an Actuary within one (1) month from date the license is granted, and shall so notify the Central Bank within one (1) month from the date of appointment or approval of the Ac…

Insurance Companies may together establish one Insurance Pool or more, which include collective arrangements among several (Re)Insurance Companies, for the purpose of underwriting specific risks by contributing Premiums …

An Insurance Company shall conclude Insurance Policy for all motor vehicles licensed in the State when so requested by concerned parties. The Board of Directors may set the insurance rates as commensurate with the severi…

1. Insurance Companies and Insurance-Related Professions shall provide any data or information requested by the Central Bank concerning them or about any company has an ownership or subsidiary relationship therewith in a…

Insurance Companies and Insurance-Related Professions shall comply with the principles of disclosure and transparency while dealing with the Insured and Beneficiaries and in all policies, documents, leaflets, advertiseme…

1. (Re)Insurance Companies shall make a cash deposit at the Central Bank, as a guarantee for meeting their obligations referred to in this decree-law. The value of the cash deposit shall be determined in accordance with …

An Insurance Company that carries on Insurance of Persons and fund accumulation operations shall maintain funds, in the State, whose value is at least equivalent to the full amount of the mathematical reserve of contract…

Insurance Companies shall not reinsure with another Insurance Company unless the other Insurance Company is licensed to carry on the insurance type entrusted to reinsure it, in accordance with the regulations issued by t…

1. Branches of foreign Insurance Companies shall be obligated to submit an unconditional and irrevocable bank guarantee in favor of the Central Bank, in an amount determined by the Board of Directors, from time to time, …

Insurance Companies engaged in insurance business for Persons and fund accumulation operations shall not differentiate between Insurance Policies issued of the same type; in terms of insurance rates, the proportion of pr…

1. Insurance Companies that carry on the insurance of Persons and fund accumulation operations shall examine the financial position of this type of insurance and assess the value of its outstanding obligations on a quart…

1. The regulations issued by the Board of Directors, pursuant to this decree-law, shall set the data required to be included in the ‘Actuary Report’ on the result of the assessment and examination referred to in Article …

1. Insurance Companies that engage in the insurance of Persons and fund accumulation operations shall not deduct, whether directly or indirectly, any part of their funds corresponding to their obligations arising from In…

In the event of bankruptcy or liquidation of an Insurance Company engaged in the insurance of Persons or fund accumulation operations, the amounts due to each of Insured not yet expired shall be assessed to equate the ma…