Home   Browse contents   View updates   Search  
     Quick search
Go
   

Dubai Financial Services Authority (DFSA): Contents

Dubai Financial Services Authority (DFSA)
Laws
Rulebook Modules
Sourcebook Modules
Consultation Papers
Policy Statements
DFSA Codes of Practice
Amendments to Legislation
Media Releases
Notices
Financial Markets Tribunal
Archive

BackText onlyPrint

You need the Flash plugin.

Download Macromedia Flash Player



  • General Module (GEN) [VER40/08-17]

    • GEN 1 Introduction

      • GEN 1.1 Application

        • GEN 1.1.1

          This module (GEN) applies to every PersonG to whom the Regulatory Law or Markets Law applies and to the same extent in relation to every such PersonG as that law, except to the extent that a provision of GENG provides for a narrower application.

          Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
          [Amended] [VER4/08-05]
          [Amended] DFSA RM95/2012 (Made 14th June 2012). [VER29/06-12]
          [Amended] DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

          • GEN 1.1.1 Guidance

            Pursuant to the application provisions in each chapter, only chapters 1 to 3 inclusive and sections 6.9, 6.10, 11.2, 11.3, 11.12 and 11.13 of GEN apply to a Representative OfficeG .

            [Added] DFSA RM68/2009 (Made 3rd January 2010). [VER24/01-10]
            [Amended] DFSA RM155/2015 (Made 9th December 2015) [VER35/02-16]
            [Amended] DFSA RM176/2016 (Made 19th June 2016) [VER37/08-16]

      • GEN 1.2 Overview of the module

        • GEN 1.2 Guidance

          1.  GEN Chapter 2 prescribes, pursuant to Article 41(2) of the Regulatory LawG , the activities which constitute a Financial ServiceG and, pursuant to Article 42(1) of the Regulatory LawG , the kind of Financial ServicesG that may be carried on by Authorised FirmsG and Authorised Market InstitutionsG . It also specifies various exclusions in relation to the 'by way of business' requirement and, where applicable, in relation to each Financial ServiceG . Further, the appendices contain detailed definitions of what constitutes a DepositG , InvestmentG , Collective Investment FundG and Contract of InsuranceG .
          1A. GEN Chapter 2A defines a Financial ProductG for the purposes of the general prohibition against misconduct in Article 41B of the Regulatory LawG .
          2.  GEN Chapter 3 sets out the requirements for a PersonG making or intending to make a Financial PromotionG in or from the DIFCG .
          3.  GEN Chapter 4 sets out the Principles for Authorised FirmsG and Authorised IndividualsG .
          4.  GEN Chapter 5 specifies the requirements upon senior management to implement effective systems and controls. There are also requirements upon the Authorised FirmG to apportion material responsibility among its senior management.
          5.  GEN Chapter 6 contains mainly guidance in respect of: interpretation of the RulebookG , emergency procedures, disclosure, the location of offices, close links, complaints against the DFSAG and the public register.
          6.  GEN Chapter 7 specifies the DFSA'sG authorisation requirements for any applicant intending to become an Authorised FirmG or Authorised IndividualG .
          7.  GEN Chapter 8 specifies, in relation to Authorised PersonsG , the auditing and accounting requirements which deal with such matters as the appointment and termination of auditors, accounts and regulatory returns and the functions of an auditor. There are also requirements for auditors to register with the DFSAG .
          8.  GEN Chapter 9 prescribes the manner in which an Authorised FirmG must handle ComplaintsG made against it by Retail ClientsG or Professional ClientsG .
          9.  GEN Chapter 10 contains three sets of transitional rules:
          a. Section 10.1 contains transitional rules relating to endorsements to hold Client AssetsG and Insurance MoniesG .
          b. Section 10.2 contains transitional rules relating to a Safe Custody Auditor's ReportG .
          c. Section 10.3 contains transitional rules relating to the reclassification of the Financial ServicesG of 'Arranging Credit or Deals in InvestmentsG ' and 'Advising on Financial Products or CreditG '.
          10. Chapter 11 specifies the DFSA'sG supervisory requirements for any Authorised PersonG being regulated by the DFSAG .
          11. Chapter 12 sets out Rules relating to business transfer schemes under Part 9 of the Regulatory LawG .
          12. Chapter 13 contains guidance on the DFSA's approach to facilitating the testing and development of innovative financial technology (Fintech) in the DIFCG ..
          Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
          [Amended][VER4/08-05]
          [Amended] DFSA RM56/2008 (Made 1st July 2008). [VER19/07-08]
          [Amended] DFSA RM58/2008 (Made 1st July 2008). [VER19/07-08]
          [Amended] DFSA RM62/2008 (Made 4th January 2009). [VER22/01-09]
          [Amended] DFSA RM66/2009 (Made 1st August 2009). [VER23/08-09]
          Amended in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]
          [Amended] DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]
          Derived from DFSA GMI11/2017 (Made 24th May 2017) [VER39/05-17]

    • GEN 2 Financial Services

      • GEN 2.1 Application

        • GEN 2.1.1

          This chapter applies to every PersonG to whom the Regulatory Law applies, and to the same extent in relation to every such PersonG as that law.


          Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
          [Amended] DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]
          [Amended] DFSA RMI201/2017 (Made 14th June 2017). [VER38/02-17]

      • GEN 2.2 Financial Service activities

        • GEN 2.2.1

          An activity constitutes a Financial ServiceG under the Regulatory Law and these RulesG where:

          (a) it is an activity specified in GEN Rule 2.2.2; and
          (b) such activity is carried on by way of business in the manner described in GEN section 2.3.

          Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
          [Amended] DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

        • GEN 2.2.2

          The following activities are specified for the purposes of GEN Rule 2.2.1:

          (a) Accepting DepositsG ;
          (b) Providing CreditG ;
          (c) Providing Money ServicesG ;
          (d) Dealing in Investments as PrincipalG ;
          (e) Dealing in Investments as AgentG ;
          (f) Arranging Deals in InvestmentsG ;
          (g) Managing AssetsG ;
          (h) Advising on Financial ProductsG ;
          (i) Managing a Collective Investment FundG ;
          (j) Providing CustodyG ;
          (k) Arranging CustodyG ;
          (l) Effecting Contracts of InsuranceG ;
          (m) Carrying Out Contracts of InsuranceG ;
          (n) Operating an ExchangeG ;
          (o) Operating a Clearing HouseG ;
          (p) Insurance IntermediationG ;
          (q) Insurance ManagementG ;
          (r) Managing a Profit Sharing Investment AccountG ;
          (s) Operating an Alternative Trading SystemG ;
          (t) Providing Trust ServicesG ;
          (u) Providing Fund AdministrationG ;
          (v) Acting as the TrusteeG of a FundG ;
          (w) Operating a Representative OfficeG ;
          (x) Operating a Credit Rating AgencyG ;
          (y) Arranging Credit and Advising on CreditG ; and
          (z) Operating a Crowdfunding PlatformG .
          Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
          [Amended] [VER4/08-05]
          [Amended] [VER6/12-05]
          [Amended] [VER7/01-06]
          [Amended] [VER8/04-06]
          [Amended] DFSA RM34/2006[VER11/08-06]
          [Amended] DFSA RM68/2009 (Made 3rd January 2010). [VER24/01-10]
          [Amended] DFSA RM72/2010 (Made 11th July 2010) [VER26/07-10]
          [Amended] DFSA RM96/2012 (Made 24th July 2012) [VER30/07-12]
          [Amended] DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]
          [Amended] DFSA RMI201/2017 (Made 14th June 2017). [VER40/08-17]

        • GEN 2.2.3

          Each activity specified in GEN Rule 2.2.2:

          (a) is to be construed in the manner provided under these RulesG ; and
          (b) is subject to exclusions under these RulesG which may apply to such an activity.

          Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

        • Permitted Financial Services for Authorised Firms

          • GEN 2.2.4

            Pursuant to Article 42(1)(a) of the Regulatory Law 2004 an Authorised FirmG , subject to the RulesG , may carry on any one or more Financial ServicesG other than Providing Money ServicesG .

            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
            [Amended] [VER4/08-05]
            [Amended] [VER6/12-05]
            [Amended] [VER7/01-06]
            [Amended] [VER8/04-06]
            [Amended] DFSA RM34/2006 [VER11/08-06]
            [Amended] DFSA RM68/2009 (Made 3rd January 2010). [VER24/01-10]
            [Amended] DFSA RM72/2010 (Made 11th July 2010) [VER26/07-10]
            Amended in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]

          • GEN 2.2.5

            The Financial ServicesG of Effecting Contracts of InsuranceG and Carrying Out Contracts of InsuranceG may be carried on only by an Authorised FirmG which by virtue of its LicenceG is permitted to carry on such Financial ServicesG and no other Financial ServicesG .

            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
            Amended in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]

          • GEN 2.2.6

            The Financial ServiceG of Managing a Profit Sharing Investment AccountG may be carried on only by an Authorised FirmG which by virtue of an appropriate endorsement on its LicenceG is permitted to conduct Islamic Financial BusinessG .

            Derived from DFSA RM01/2004(Made 16th September 2004). [VER1/09-04]
            Amended in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]

          • GEN 2.2.7

            The Financial ServiceG of ManagingG a Collective Investment FundG may be carried on in respect of an Islamic FundG only by an OperatorG which by virtue of an appropriate endorsement on its LicenceG is permitted to conduct Islamic Financial BusinessG .

            [Added][VER8/04-06]
            [Amended] DFSA RM72/2010 (Made 11th July 2010) [VER26/07-10]
            Amended in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]

          • GEN 2.2.8

            A Financial ServiceG may be carried on with or for a Retail ClientG only by an Authorised FirmG which is permitted to do so by endorsement on its LicenceG .

            [Added] DFSA RM56/2008 & DFSA RM58/2008 (Made 1st July 2008). [VER19/07-08]
            Amended in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]

          • GEN 2.2.9

            An Authorised FirmG which is licenced to carry on the Financial ServiceG of Operating a Representative OfficeG may not be licenced to carry on any other Financial ServiceG .

            [Added] DFSA RM68/2009 (Made 3rd January 2010). [VER24/01-10]
            Amended in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]

          • GEN 2.2.10

            An Authorised FirmG (other than a Representative OfficeG ) may carry on an activity of the kind described in GEN Rule 2.26.1 that constitutes marketing without the need for any additional authorisation to do so.

            [Added] DFSA RM68/2009 (Made 3rd January 2010). [VER24/01-10]
            Amended in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]

          • GEN 2.2.10A

            (1) An Authorised FirmG may hold or control Client AssetsG only if it is permitted to do so by an endorsement on its LicenceG .
            (2) In (1), the expression "hold or control Client Assets" has the meaning given in COB Rule 6.11.4.
            (3) An endorsement under (1) is not required by an Authorised FirmG that has an authorisation for Providing CustodyG .
            Derived from DFSA RM166/2016 (Made 10th February 2016). [VER36/04-16]

          • GEN 2.2.10B

            An Insurance IntermediaryG or Insurance ManagerG may hold Insurance MoniesG only if it is permitted to do so by an endorsement on its LicenceG .

            Derived from DFSA RM166/2016 (Made 10th February 2016). [VER36/04-16]

          • GEN 2.2.10C

            An Insurance IntermediaryG may conduct Insurance IntermediationG activities in respect of a contract of Long-Term InsuranceG , that is not a contract of reinsurance, only if it is permitted to do so by an endorsement on its LicenceG .

            Derived from DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

          • GEN 2.2.10D

            The Financial ServiceG of Operating a Crowdfunding PlatformG may be carried on only by a Body CorporateG incorporated under the DIFC Companies Law.

            [Added] DFSA RMI201/2017 (Made 14th June 2017). [VER40/08-17]

          • GEN 2.2.10E

            A Crowdfunding OperatorG must not carry on the following activities:

            (a) Managing AssetsG ;
            (b) Advising on Financial ProductsG ;
            (c) Managing a Collective Investment FundG ; or
            (d) Advising on CreditG .
            [Added] DFSA RMI201/2017 (Made 14th June 2017). [VER40/08-17]

          • GEN 2.2.10F

            A Crowdfunding OperatorG must not Operate a Crowdfunding PlatformG that facilitates a PersonG investing in the following kinds of InvestmentsG through the platform:

            (a) WarrantsG , CertificatesG , UnitsG or Structured ProductsG ; or
            (b) DerivativesG .
            [Added] DFSA RMI201/2017 (Made 14th June 2017). [VER40/08-17]

        • Permitted Financial Services for Authorised Market Institutions

          • GEN 2.2.11

            Pursuant to Article 42(1)(b) of the Regulatory Law 2004 and subject to Rule 2.2.12, an Authorised Market InstitutionG may carry on any one or more of the following Financial ServicesG :

            (a) Operating an ExchangeG ;
            (b) Operating a Clearing HouseG ; or
            (c) Operating an Alternative Trading SystemG to the extent that such activities constitute operating a Multilateral Trading FacilityG as defined in Rule 2.22.1(1)(a).
            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
            Amended in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]
            [Amended] DFSA RM119/2013 (Made 14th July 2013). [VER33/07-13]

            • [Deleted]

              [Deleted] DFSA RM119/2013 (Made 14th July 2013). [VER33/07-13]

          • GEN 2.2.12

            The Financial ServiceG of Operating an Alternative Trading SystemG , to the extent that such activities constitute operating a Multilateral Trading FacilityG , may be carried on by an Authorised Market InstitutionG which is permitted to do so by an endorsement on its LicenceG .

            [Added] DFSA RM119/2013 (Made 14th July 2013). [VER33/07-13]

        • Other permitted activities

          • GEN 2.2.13

            (1) The activity of maintaining a Trade RepositoryG may be carried on by an Authorised PersonG which is permitted to do so by an endorsement on its LicenceG .
            (2) In (1), a Trade RepositoryG is a centralised registry that maintains an electronic database containing records of transactions in InvestmentsG and over-the-counter derivatives.
            [Added] DFSA RM119/2013 (Made 14th July 2013). [VER33/07-13]

            • GEN 2.2.13 Guidance

              1. Maintaining a Trade RepositoryG is not a separately licensed Financial ServiceG , but may be carried on by an Authorised PersonG which has on its LicenceG an endorsement permitting it to do so. An Authorised PersonG maintaining a Trade RepositoryG is subject to some specific requirements relating to that activity, which are set out in App 5.
              2. The functions of a Trade RepositoryG promote increased transparency and integrity of information, particularly for centrally clearing over-the-counter derivatives. Currently there are no transaction reporting requirements in the DIFCG which require reporting to Trade RepositoriesG .
              3. An Authorised PersonG does not carry on the activities of a Trade RepositoryG to the extent that it maintains records of transactions pursuant to the record keeping requirements applicable to that firm (such as those relating to transactions carried out on behalf of its ClientsG by an Authorised FirmG , or transactions carried out on the facilities of an Authorised Market InstitutionG ).
              [Added] DFSA RM119/2013 (Made 14th July 2013). [VER33/07-13]

      • GEN 2.3 By way of business

        • GEN 2.3.1

          Subject to Rules GEN 2.3.2 and GEN 2.3.3, for the purpose of these RulesG a PersonG carries on an activity by way of business if the PersonG :

          (a) engages in the activity in a manner which in itself constitutes the carrying on of a business;
          (b) holds himself out as willing and able to engage in that activity; or
          (c) regularly solicits other PersonsG to engage with him in transactions constituting that activity.

          Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

        • Exclusions

          • GEN 2.3.2

            (1) Subject to GEN Rule 2.3.5, a PersonG does not carry on an activity specified under paragraphs (a), (b), (c), (d), (e), (f), (g), (h), (j), (k), (p), (q), (r) and (y) of GEN Rule 2.2.2 by way of business if:
            (a) the PersonG enters into transactions solely as a nominee for another PersonG and is bound to and does act on that other Person'sG instructions;
            (b) the PersonG is a Body CorporateG and carries on that activity solely as principal with or for other Bodies CorporateG :
            (i) which are within the same GroupG as that PersonG ; or
            (ii) which are or propose to become participators in a joint enterprise and the transaction is entered into for the purposes of or in connection with that enterprise;
            provided:
            (iii) for the purposes of the activities specified in paragraphs (g), (j), (k) and (r) of GEN Rule 2.2.2 the assets in question belong to a Body CorporateG falling within (i) or (ii); and
            (iv) for the purposes of the activities specified in paragraphs (f), (h), (p), (q) and (y) of GEN Rule 2.2.2, the activity does not involve an insurance PolicyholderG who is not a GroupG member; or
            (c) the PersonG carries on the activity solely for the purposes of or in connection with the sale of goods or the supply of services to a customer of the PersonG or a member of the same GroupG , provided that:
            (i) the supplier's main business is to sell goods or supply services and not to carry on any Financial ServiceG ; and
            (ii) the customer is not an individual;
            and for the purposes of the activities specified in paragraphs (g), (j), (k) and (r) of GEN Rule 2.2.2 the assets in question belong to that customer or member.
            (2) A PersonG who is a Body CorporateG does not carry on the activity specified under paragraph (d) or (e) of GEN Rule 2.2.2 by way of business, if:
            (a) the PersonG carries on such activities as a member of an Authorised Market InstitutionG or Recognised BodyG ;
            (b) the PersonG carries on such activities for its own account or for another Body CorporateG which is in the same GroupG as the PersonG , provided that any such member of the GroupG for which the PersonG acts is a wholly-owned SubsidiaryG of a Holding CompanyG within the GroupG or is the Holding CompanyG itself;
            (c) the PersonG restricts such activities to transactions involving or relating only to Commodity DerivativesG on that Authorised Market InstitutionG or Recognised BodyG ;
            (d) the main business of the PersonG is dealing in relation to Commodity DerivativesG ; and
            (e) the PersonG is not part of a GroupG whose main business is the provision of financial services.
            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
            [Amended][VER6/12-05]
            Amended in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]
            [Amended] DFSA RM119/2013 (Made 14th July 2013). [VER33/07-13]
            [Amended] DFSA RM155/2015 (Made 9th December 2015) [VER35/02-16]
            [Amended] DFSA RM176/2016 (Made 19th June 2016) [VER37/08-16]
            [Amended] DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

          • GEN 2.3.3

            A PersonG does not carry on an activity specified under paragraphs (d), (e), (f), (h), or (y) of GEN Rule 2.2.2 by way of business if the activity is carried on solely for the purposes of or in connection with the acquisition or disposal of SharesG in a Body CorporateG , other than an Investment CompanyG or Investment PartnershipG , provided that:

            (a) such SharesG carry at least 50% of the voting rights or the acquisition will take an existing holding to at least 50%; or
            (b) the object of the transaction may reasonably be regarded as being the acquisition of day to day control of the Body CorporateG ; and
            (c) he is to enter as principal into the transaction.
            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
            Amended in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]
            [Amended] DFSA RM155/2015 (Made 9th December 2015) [VER35/02-16]
            [Amended] DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

          • GEN 2.3.4 [Deleted]

            [Deleted] DFSA RM119/2013 (Made 14th July 2013). [VER33/07-13]

          • GEN 2.3.4

            (1) A Person who is a Trustee does not carry on an activity specified under paragraphs (d), (g), and (j) of Rule 2.2.2 by way of business in circumstances where he is acting as a trustee.

            (2) A Person who is an individual does not carry on an activity specified under paragraph (t) by way of business where he is acting as trustee, enforcer or protector or where he is arranging for a Person to act as trustee, in respect of less than three (3) trusts.

            [Amended] DFSA RMI201/2017 (Made 14th June 2017). [VER38/02-17]

          • GEN 2.3.5

            (1) A PersonG does not carry on an activity specified under paragraphs (d), (e), (f), (g), (h), (i), (j), (k), (p), (t), (u), (v) and (y) of GEN Rule 2.2.2 by way of business if:
            (a) that PersonG is the holder of a licence under the SFO RegulationsG to establish a Single Family OfficeG in the DIFCG ; and
            (b) the activity is carried on exclusively for the purposes of, and only in so far as it is, carrying out its duties as a Single Family OfficeG .
            (2) A Private Trust CompanyG or Family Fiduciary StructureG does not carry on an activity specified under paragraph (t) of GEN Rule 2.2.2 by way of business if it:
            (a) carries on that activity exclusively for the purposes of, and only in so far as it is, providing services to a Single FamilyG ; and
            (b) does not solicit trust business from, or provide trust services to, any PersonG outside the structure of the Single Family OfficeG and outside the Single FamilyG .
            [Added][VER7/01-06]
            [Amended] DFSA RM60/2008 (as from 2nd September 2008). [VER21/09-08]
            [Amended] DFSA RM119/2013 (Made 14th July 2013). [VER33/07-13]
            [Amended] DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

      • GEN 2.4 Accepting deposits

        • GEN 2.4.1

          In GEN Rule 2.2.2 Accepting DepositsG means Accepting DepositsG where:

          (a) money received by way of DepositG is lent to others; or
          (b) any other activity of the PersonG accepting the DepositG is financed, wholly or to a material extent, out of the capital of or returns on any money received by way of DepositG .

          Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

      • GEN 2.5 Providing credit

        • GEN 2.5.1

          In GEN Rule 2.2.2 Providing CreditG means providing a Credit FacilityG to a PersonG in his capacity as a borrower or potential borrower.


          Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

        • Exclusions

          • GEN 2.5.2

            A PersonG who is an Authorised FirmG does not Provide CreditG where the provision of the Credit FacilityG is incidental to or in connection with the trading of InvestmentsG , or conducting Insurance BusinessG .


            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
            Amended in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]

          • GEN 2.5.3

            A Crowdfunding OperatorG does not Provide Credit to the extent that it Operates a Loan Crowdfunding PlatformG .

            [Amended] DFSA RMI201/2017 (Made 14th June 2017). [VER38/02-17]

            • GEN 2.5.3 Guidance

              1. Where an Authorised FirmG is providing brokerage services pursuant to its Financial ServiceG of DealingG in InvestmentsG as AgentG , it may in the ordinary course of that business also be necessary to provide margin lending facilities to its ClientsG . In doing so the Authorised FirmG will not be considered to be Providing CreditG to its ClientG .
              2. Where an Authorised FirmG is Effecting Contracts of InsuranceG or Carrying Out Contracts of InsuranceG , it may in the ordinary course of that Insurance BusinessG be necessary to provide an instalment contract to a ClientG with respect to the payment of an insurance premium. In doing so the Authorised FirmG will not be considered to be Providing CreditG to its Client.
              [Added] DFSA RMI201/2017 (Made 14th June 2017). [VER40/08-17]

      • GEN 2.6 Providing money services

        • GEN 2.6.1

          (1) In GEN Rule 2.2.2 Providing Money ServicesG means providing currency exchange or money transmission.
          (2) In (1) 'money transmission' means:
          (a) selling or issuing payment instruments;
          (b) selling or issuing stored value; or
          (c) receiving money or monetary value for transmission, including electronic transmission, to a location within or outside the DIFCG .

          Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

        • Exclusions

          • GEN 2.6.2

            A PersonG who is an Authorised FirmG does not Provide Money ServicesG if it does so in relation to the carrying on of another Financial ServiceG where Providing Money ServicesG is in connection with and a necessary part of that other Financial ServiceG .


            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

      • GEN 2.7 Dealing in investments as principal

        • GEN 2.7.1

          In GEN Rule 2.2.2 Dealing in Investments as PrincipalG means buying, selling, subscribing for or underwriting any InvestmentG as principal.


          Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

        • Exclusions

          • GEN 2.7.2

            A PersonG does not Deal in Investments as PrincipalG merely by accepting an instrument, creating or acknowledging indebtedness in respect of any loan, credit, guarantee or other similar financial accommodation which that person has made or provided.


            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

          • GEN 2.7.3

            A PersonG does not Deal in Investments as PrincipalG by issuing or redeeming SecuritiesG issued by that person.


            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

          • GEN 2.7.4

            A PersonG who is not an Authorised FirmG or an Authorised Market InstitutionG does not Deal in Investments as PrincipalG in relation to an InvestmentG by entering into a transaction with or through an Authorised FirmG or a Regulated Financial InstitutionG .


            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

          • GEN 2.7.5

            A PersonG who is an Authorised FirmG does not Deal in Investments as PrincipalG if in the course of managing the assets of a Private Equity FundG :

            (a) the PersonG makes an initial subscription for UnitsG of that FundG ; and
            (b) the UnitsG are held by that PersonG for a period of more than 12 months.

      • GEN 2.8 Dealing in investments as agent

        • GEN 2.8.1

          In GEN Rule 2.2.2 Dealing in Investments as AgentG means buying, selling, subscribing for or underwriting any InvestmentG as agent.


          Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

        • Exclusions

          • GEN 2.8.2

            A PersonG does not Deal in Investments as AgentG if the activity:

            (a) is carried on in the course of providing legal or accountancy services which do not otherwise consist of the carrying on of Financial ServicesG ;
            (b) may reasonably be regarded as a necessary part of any other services provided in the course of providing legal or accountancy services; and
            (c) is not remunerated separately from the other services.

            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
            [Amended] DFSA RM166/2016 (Made 10th February 2016). [VER36/04-16]

          • GEN 2.8.3

            A PersonG does not Deal in Investments as AgentG if that PersonG :

            (a) is merely receiving and transmitting a ClientG order in respect of an InvestmentG ; and
            (b) does not execute the ClientG order for and on behalf of the ClientG or otherwise commit the ClientG to the transaction relating to the relevant InvestmentG .

          • GEN 2.8.4

            An ExchangeG does not DealG in InvestmentsG as AgentG merely by taking action in accordance with its Default RulesG .

            Derived from DFSA RM166/2016 (Made 10th February 2016). [VER36/04-16]

      • GEN 2.9 Arranging deals in investments

        • GEN 2.9.1

          (1) In GEN Rule 2.2.2, Arranging Deals in InvestmentsG means making arrangements with a view to another PersonG buying, selling, subscribing for or underwriting an InvestmentG (whether that other Person is acting as principal or agent).
          (2) The arrangements in (1) include:
          (a) arrangements which do not bring about the transaction; and
          (b) arrangements comprising or involving the receipt and transmission of ClientG orders in relation to InvestmentsG .
          (3) The arrangements in (1) do not include arrangements which amount to Operating an Alternative Trading SystemG .
          (4) In this Rule and in Rules 2.9.2 to 2.9.7, an "Investment" includes rights under a contract of Long-Term InsuranceG , that is not a contract of reinsurance.
          Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
          [Amended] [VER4/08-05]
          [Amended] [VER10/06-06]
          [Amended] DFSA RM49/2007 (Made 1st October 2007). [VER16/10-07]
          [Amended] DFSA RM68/2009 (Made 3rd January 2010). [VER24/01-10]
          Amended in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]
          [Amended] DFSA RM176/2016 (Made 19th June 2016) [VER37/08-16]
          [Amended] DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

          • GEN 2.9.1 Guidance

            What constitutes 'Arranging deals in Investments'?

            1. The activities which constitute making arrangements with a view to another PersonG buying, selling, underwriting or subscribing for an Investment (whether that other PersonG is acting as principal or agent) generally involve the following elements:
            a. the purpose of such an arrangement is to 'facilitate' or 'bring about' transactions between other parties such as:
            i. buyers and sellers of InvestmentsG ;
            ii. issuers of and subscribers for SecuritiesG (note — subscription is generally an activity associated with an initial offer of SecuritiesG );
            iii. issuers and underwriters of securities (note — underwriting here is an activity associated with an initial offer of SecuritiesG , as opposed to underwriting of risks, which is an activity of an insurer); and
            iv. insurers writing Long-Term InsuranceG and policyholders who wish to obtain such insurance.
            b. such arrangements can be either of an on-going nature, for example, an arrangement which is available to potential buyers or sellers of InvestmentsG , or an arrangement which is bespoke (i.e. available on a one-off basis for a particular client, such as an underwriter of SecuritiesG ).
            2. The activities referred to in Guidance item 1 can include one or more of the following:
            a. the introduction of:
            i. potential buyers of Investments to issuers or sellers of InvestmentsG , or vice versa;
            ii. potential subscribers for SecuritiesG to issuers;
            iii. potential underwriters to issuers of SecuritiesG , or vice–versa;
            iv. potential parties to a derivatives transaction; and
            v. policyholders or cedants to insurers or reinsurers underwriting Long-Term InsuranceG ;
            b. assisting any of the parties referred to in a. through activities, such as, completing the applications or other processes relevant to the transaction;
            c. negotiating and settling terms of the contracts between the parties referred to in a.;
            d. collecting and processing fees, commissions or other payments (such as premiums in the case of Long-Term InsuranceG ); and
            e. transmitting instructions or confirmations relating to transactions.

            Do arrangements which form part of another facility constitute arranging?

            3. An arrangement which is part of a wider arrangement for the purpose of bringing about transactions in InvestmentsG still falls within the scope of the Financial ServiceG of arranging. For example, an arranger may arrange (i.e. allow access) for potential investors to access a facility set up by an offeror of SecuritiesG . The arrangement to allow access constitutes arranging, although, for a transaction to be concluded, the investor will also need to use the offeror's facility.

            How does 'arranging deals' differ from 'dealing as agent'?

            4. 'Arranging Deals in InvestmentsG ' differs from the Financial ServiceG of 'Dealing in Investments as AgentG ' in GEN Rule 2.8.1 because:
            a. a PersonG 'arranging deals' (i.e. the 'arranger') does not have the authority to bind the parties to an InvestmentG transaction resulting from its 'arranging' activities; and
            b. a PersonG 'dealing as agent' acts as the agent of a party to the InvestmentG transaction and has the authority to bind its principal.
            5. For example, a PersonG acting as an agent either:
            a. executes the transaction for its principal (the ClientG ); or
            b. if using another broker to execute the client order, commits the ClientG to the transaction by giving a binding order to the broker.
            6. In contrast, a PersonG acting as an arranger may, for example, receive and transmit client orders to a broker, but does not have the power to execute or enter into the transaction for the client, or commit the client to a transaction. See the exclusion in GEN Rule 2.8.3 from 'Dealing in Investments as AgentG ', and GEN Rule 2.9.1(2)(b), both of which reflect the above position.

            Do arrangements that do not bring about transactions constitute arranging?

            7. An activity falls within the scope of the Financial ServiceG of 'arranging' even if it does not necessarily lead to a completed transaction. For example, a prospective buyer or seller of SecuritiesG may change his mind and not sign a contract for the sale or purchase of SecuritiesG . Similarly, a potential buyer of Long-Term InsuranceG , after having completed an application form for Long-Term InsuranceG with the assistance of an arranger, may not go ahead with the purchase of the policy. In both examples, just because the transaction has not been concluded, the arranger's activities do not cease to be 'arranging' under GEN Rule 2.9.1.

            Which activities do not constitute 'arranging'?

            8. A PersonG who performs for a financial service provider (in or outside the DIFCG ) delegated or outsourced functions, such as back office administration services, does not carry on 'arranging' activities under GEN Rule 2.9.1. For example, a PersonG undertaking administrative tasks (such as processing applications, transmitting orders, or issuing confirmations of transactions for a brokerage firm or an insurer) is not arranging transactions.
            9. A passive display of literature which advertises InvestmentsG does not amount to arranging, unless something more is done to help potential investors or policyholders to buy such InvestmentsG or policies. For example, a passive display of leaflets advertising InvestmentsG in property funds at the reception of an office, such as an accountant's office, or a display of leaflets advertising permanent health policies of an Long-Term InsuranceG insurer at a doctor's or dentist's waiting rooms, would not constitute arranging, provided the relevant service providers or employees in their offices do not assist or facilitate transactions by potential investors/policyholders.

            Arranging Long-Term Insurance

            10. An 'Investment' is defined in Rule 2.9.1(4) to include rights under a contract of Long-Term InsuranceG (other than a contract of reinsurance). As a result, arranging activities relating to contracts of Long-Term InsuranceG fall within Arranging Deals in Investments. 'Long-Term Insurance' is defined in GLO, in summary, as a contract of the type described in GEN Rule A4.1.2 (certain types of life insurance) that is expressed to be in force for more than one year and meets specified conditions.
            [Added] [VER10/06-06]
            [Amended] DFSA RM68/2009 (Made 3rd January 2010). [VER24/01-10]
            Amended in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]
            [Amended] DFSA RM176/2016 (Made 19th June 2016) [VER37/08-16]
            [Amended] DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

        • Exclusions

          • GEN 2.9.2

            A PersonG does not carry on the activity of Arranging DealsG in InvestmentsG under GEN Rule 2.9.1(1) in relation to a transaction if the PersonG becomes, or proposes to become, a party to the transaction (regardless of whether the transaction is effected). This exclusion does not apply in the case of a branch which makes arrangements for its head office, or any other branch of the same legal entity as itself, to enter into a transaction as provided under GEN Rule 2.9.1(1).

            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
            [Amended] DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

          • GEN 2.9.3

            A PersonG does not Arrange Deals in InvestmentsG merely by providing means by which one party to a transaction is able to communicate with other such parties.


            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
            [Amended] DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

          • GEN 2.9.4

            A PersonG does not Arrange Deals in InvestmentsG by making arrangements under which another PersonG accepts or is to accept an instrument creating or acknowledging indebtedness in respect of any loan, credit, guarantee or other similar financial accommodation which he or his principal has made or provided.


            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
            [Amended] DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

          • GEN 2.9.5

            A PersonG does not Arrange Deals in InvestmentsG merely by making arrangements having as their sole purpose the provision of finance to enable a PersonG to buy, sell, subscribe for or underwrite InvestmentsG .


            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
            [Amended] DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

          • GEN 2.9.6

            A PersonG does not Arrange Deals in InvestmentsG by making arrangements for the issue or redemption of SecuritiesG issued by it.

            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
            [Amended] DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

          • GEN 2.9.7

            A PersonG does not Arrange Deals in InvestmentsG if the activity:

            (a) is carried on in the course of providing legal or accountancy services, which do not otherwise consist of the carrying on of Financial ServicesG ;
            (b) may reasonably be regarded as a necessary part of any other services provided in the course of providing legal or accountancy services;
            (c) is not remunerated separately from the other services; and
            (d) in the case of a contract of Long-Term InsuranceG , does not assist in the conclusion or performance of the contract.
            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
            [Amended] DFSA RM166/2016 (Made 10th February 2016). [VER36/04-16]
            [Amended] DFSA RM176/2016 (Made 19th June 2016) [VER37/08-16]
            [Amended] DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

          • GEN 2.9.8

            An ExchangeG does not make arrangements referred to in GEN Rule 2.9.1(1), merely by making arrangements for, or taking steps that facilitate, another PersonG to act as Central CounterpartyG to transactions entered into on a facility operated by the ExchangeG .

            Derived from DFSA RM166/2016 (Made 10th February 2016). [VER36/04-16]
            [Amended] DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

            • GEN 2.9.8 Guidance

              1. GEN Rule 2.9.2 excludes the activities of a party to a transaction from being 'arranging'. This is because a person cannot be both a party to a transaction, and its arranger.

              2. Where a PersonG (an arranger) makes arrangements in the DIFCG for another PersonG to obtain dealing services (e.g. broking services) from its head office, the arranger is not regarded as 'Dealing in Investments as Agent' in the DIFCG merely because it is the same legal entity as its head office. However, to be able to do so without breaching the Financial ServicesG Prohibition, the arranger would need to have an AuthorisationG for 'Arranging Deals in InvestmentsG '. It would also need to take care not to conduct activities that go beyond 'arranging' (see Guidance under GEN Rule 2.9.1 for activities which constitute arranging).

              3. GEN Rule 2.9.3 excludes providers of means by which one party to a transaction (or potential transaction) communicates with the other contracting parties, from being arrangers. Communication channel providers, such as internet or telecommunication network providers, are excluded from being arrangers under this exclusion. However, if such a provider goes beyond being a 'mere' communication channel provider, for example, by adding value to the service provided to those communicating with each other, with a view to facilitating a contract being concluded, this exclusion will not apply to them.

              4. GEN Rule 2.9.4 excludes from being arranging the activity of making arrangements for a lender (such as a bank) to accept an instrument acknowledging debt by a person who has obtained credit, a loan, a guarantee or any other form of financial facility. This mirrors the similar carve-out from regulation available to banks and other lenders where they are not considered to be 'dealing as principal' in Investments merely because they accept instruments acknowledging debt from those obtaining credit, loans, guarantees or any other form of financial facility from them.

              5. GEN Rule 2.9.6 excludes issuers of SecuritiesG from being regarded as arrangers. For example, if an issuer of SecuritiesG sets up a website which enables prospective buyers of SecuritiesG to read the offer document and apply for the relevant SecuritiesG , the issuer is not required to have a LicenceG as an arranger due to this exclusion (but may have to comply with the disclosure requirements in MKT relating to the offer).

              6. GEN Rule 2.9.7 excludes from being 'arrangers' lawyers and accountants, who, in the course of conducting their legal and accounting business, arrange for their clients to buy or sell SecuritiesG . To have the benefit of this exclusion, certain conditions have to be met (such as the activity being reasonably regarded as a necessary part of services provided by legal and accounting practitioners and not being separately remunerated). For example, if a lawyer arranges as part of estate planning services for a portfolio of investments to be sold by a brokerage firm, this exclusion can be applied, provided the lawyer's fees do not include a separate charge for arranging the liquidation of the portfolio, and the lawyer does not assist or participate in the conclusion of the contracts.

              Derived from DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

          • GEN 2.9.9

            A Crowdfunding OperatorG does not Arrange Deals in InvestmentsG to the extent that it Operates an Investment Crowdfunding PlatformG .

            [Added] DFSA RMI201/2017 (Made 14th June 2017). [VER40/08-17]

      • GEN 2.10 Managing assets

        • GEN 2.10.1

          In GEN Rule 2.2.2 Managing AssetsG means managing on a discretionary basis assets belonging to another PersonG if the assets include any InvestmentG or rights under a contract of Long-Term InsuranceG , not being a contract of reinsurance.


          Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

        • Exclusions

          • GEN 2.10.2

            A PersonG who is not an Authorised FirmG or an Authorised Market InstitutionG does not Manage AssetsG if:

            (a) he is a PersonG formally appointed in writing by the owner of the assets to manage the assets in question; and
            (b) all day-to-day decisions relating to the InvestmentsG which are included in those assets are taken by an Authorised FirmG or a Regulated Financial InstitutionG .

            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

            • GEN 2.10.2 Guidance

              1. A PersonG does not become a Fund ManagerG of a FundG merely by being appointed by a Fund ManagerG of a FundG to provide the Financial ServiceG of Managing AssetsG to the FundG . This is because the Fund ManagerG remains legally accountable to the UnitholdersG of the FundG for the proper management of the FundG in accordance with its ConstitutionG and ProspectusG .
              2. If an Authorised FirmG has a discretionary portfolio mandate from a ClientG to manage assets on behalf of the ClientG , the firm controls those Client AssetsG as it can execute transactions relating to those assets, within the parameters set in the mandate (see also COB Rule 6.11.4(d)).
              [Added] DFSA RM72/2010 (Made 11th July 2010) [VER26/07-10]
              [Amended] DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

      • GEN 2.11 Advising on financial products

        • GEN 2.11.1

          (1) In GEN Rule 2.2.2 Advising on Financial ProductsG means giving advice to a PersonG in his capacity as an investor or potential investor, or in his capacity as agent for an investor or a potential investor, on the merits of his buying, selling, holding, subscribing for or underwriting a particular financial product (whether as principal or agent).
          (2) Advice in (1) includes a statement, opinion or report:
          (a) where the intention is to influence a PersonG , in making a decision, to select a particular financial product or an interest in a particular financial product; or
          (b) which could reasonably be regarded as being intended to have such an influence.
          (3) Giving advice to a PersonG under (1) includes operating an Insurance Aggregation SiteG relating to contracts of Long-Term InsuranceG , other than contracts of reinsurance.
          (4) For the purposes of this RuleG and GEN Rule 2.11.2 a financial product is an InvestmentG , DepositG , Profit Sharing Investment AccountG or rights under a contract of Long-Term InsuranceG , that is not a a contract of reinsurance.

          Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
          [Amended] [VER10/06-06]
          [Amended] DFSA RM49/2007 (Made 1st October 2007). [VER16/10-07]
          [Amended] DFSA RM68/2009 (Made 3rd January 2010). [VER24/01-10]
          Amended in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]
          [Amended] DFSA RM176/2016 (Made 19th June 2016) [VER37/08-16]
          [Amended] DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

          • GEN 2.11.1 Guidance

            1. As a 'financial product' is defined in GEN Rule 2.11.1(4) to include rights under a contract of Long-Term InsuranceG (other than a contract of reinsurance), advice on contracts of Long-Term InsuranceG will fall within Advising on Financial ProductsG , instead of Insurance IntermediationG .
            2. An 'Insurance Aggregation SiteG ' is defined in GLO. In summary, it is a website or other form of electronic media that provides a facility for a user to search for, and then to conclude, directly or indirectly, a Contract of InsuranceG . The site may, for example, enable the user to conclude a Contract of InsuranceG :
            a. directly, if the user can enter into the Contract of InsuranceG by clicking a button on the website itself; or
            b. indirectly, if it provides a link to the insurer, transmits the details of one party to the other party or otherwise facilitates contact between the parties.
            3. Operating an Insurance Aggregation SiteG will fall under Advising on Financial ProductsG to the extent that it relates to contracts of Long-Term InsuranceG , and under Insurance IntermediationG to the extent that it relates to other types of Contracts of InsuranceG .
            4. An operator of an Insurance Aggregation SiteG that can be used by Retail ClientsG will need an endorsement on its LicenceG to deal with Retail ClientsG (see GEN Rule 2.2.8).
            Derived from DFSA RM176/2016 (Made 19th June 2016) [VER37/08-16]
            [Amended] DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

        • Exclusions

          • GEN 2.11.2

            A PersonG does not Advise on Financial ProductsG by giving advice in any newspaper, journal, magazine, broadcast service or similar service in any medium if the principal purpose of the publication or service, taken as a whole, is neither:

            (a) that of giving advice of the kind mentioned in GEN Rule 2.11.1; nor
            (b) that of leading or enabling PersonsG to buy, sell, subscribe for or underwrite a particular financial product of the kind in GEN Rule 2.11.1(4).

            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
            [Amended] DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

          • GEN 2.11.3

            A PersonG does not Advise on Financial ProductsG if the activity:

            (a) is carried on in the course of providing legal or accountancy services, which do not otherwise consist of the carrying on of Financial ServicesG ;
            (b) may reasonably be regarded as a necessary part of any other services provided in the course of providing legal or accountancy services; and
            (c) is not remunerated separately from the other services.
            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
            [Amended] DFSA RM166/2016 (Made 10th February 2016). [VER36/04-16]
            [Amended] DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

      • GEN 2.12 Managing a collective investment fund

        • GEN 2.12.1

          (1) In GEN Rule 2.2.2, Managing a Collective Investment FundG means:
          (a) being legally accountable to the UnitholdersG in the FundG for the management of the property held for or within a FundG under the Fund'sG ConstitutionG ; and
          (b) establishing, managing or otherwise operating or winding up a Collective Investment FundG ; and
          (2) To the extent that any activity under (1) constitutes Managing AssetsG , Providing Fund AdministrationG , Dealing as AgentG , Dealing as PrincipalG , Arranging Deals in InvestmentsG , or Providing CustodyG , such a Financial ServiceG is taken to be incorporated within Managing a Collective Investment FundG .
          (3) The PersonG referred to in (1) is a Fund ManagerG .
          Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
          [Amended][VER8/04-06]
          [Amended] DFSA RM56/2008 (Made 1st July 2008). [VER19/07-08]
          [Amended] DFSA RM72/2010 (Made 11th July 2010) [VER26/07-10]
          [Amended] DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

        • Exclusions

          • GEN 2.12.2

            Pursuant to Article 20(3) of the Collective Investment Law 2010, a PersonG is hereby prescribed by the DFSAG as not Managing a Collective Investment FundG merely because that PersonG :

            (a) is acting as an agent, employee or delegate of the Fund ManagerG ; or
            (b) takes steps to wind up or dissolve a FundG or remedy a defect that led to a FundG being deregistered.
            [Added] DFSA RM56/2008 (Made 1st July 2008). [VER19/07-08]
            [Amended] DFSA RM72/2010 (Made 11th July 2010) [VER26/07-10]

      • GEN 2.13 Providing custody

        • GEN 2.13.1

          (1) In GEN Rule 2.2.2 Providing CustodyG means one or more of the following activities:
          (a) safeguarding and administering InvestmentsG belonging to another PersonG ;
          (b) in the case of a FundG , safeguarding and administering Fund PropertyG ; or
          (c) acting as a Central Securities DepositoryG .
          (2) In (1)(a) and (b), the following activities do not constitute administering InvestmentsG or Fund PropertyG :
          (a) providing information as to the number and value of any InvestmentsG or Fund PropertyG safeguarded;
          (b) converting currency; or
          (c) receiving documents relating to an InvestmentG or Fund PropertyG for the purpose of onward transmission to, from or at the direction of the PersonG to whom the InvestmentG or Fund PropertyG belongs.
          (3) In (1)(c), "acting as a Central Securities DepositoryG " means holding securities in uncertificated (dematerialised) form to enable book entry transfer of such securities for the purposes of clearing or settlement of transactions executed on a facility operated by an Authorised Market InstitutionG or an Alternative Trading SystemG or a similar facility regulated and supervised by a Financial Services RegulatorG .
          Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
          [Amended] DFSA RM56/2008 (Made 1st July 2008). [VER19/07-08]
          [Amended] DFSA RM119/2013 (Made 14th July 2013). [VER33/07-13]
          [Amended] DFSA RM166/2016 (Made 10th February 2016). [VER36/04-16]

          • GEN 2.13.1 Guidance

            1. A PersonG does not become a Fund ManagerG of a FundG merely by being appointed by a Fund ManagerG of a FundG to provide the Financial ServiceG of Providing CustodyG to the FundG . This is because the Fund ManagerG remains legally accountable to the UnitholdersG of the FundG for the safe custody and proper management of the FundG in accordance with its ConstitutionG and ProspectusG .

            How does Providing Custody differ from Arranging Custody?

            2. The Financial ServiceG of Providing CustodyG differs from that of Arranging CustodyG because:
            a. a PersonG Providing CustodyG is legally accountable to ClientsG for safeguarding and administering Client InvestmentsG (which are defined as Client AssetsG — see the GLO definition), even if it appoints a Third Party AgentG (see GLO) to hold Client InvestmentsG ; and
            b. a PersonG arranging CustodyG does not become a party to the arrangement to Provide CustodyG and hence does not assume any duties or responsibilities to the ClientG for the safe custody of the Client's InvestmentsG — instead, such a PersonG merely facilitates a custodian to provide its services to a potential user of its services.

            What is 'Safeguarding' and 'Administering' Investments?

            3. As set out in GEN Rule 2.13.1, both the elements (i.e. the activities) of safeguarding and administering, must be present before a Person is said to carry on the Financial ServiceG of Providing CustodyG .
            4. A PersonG :
            a. 'safeguards' a Client's InvestmentsG if that PersonG is the holder of the legal title to the Client's InvestmentsG (whether in certificated or uncertificated form); and
            b. 'administers' a Client's InvestmentsG if that PersonG carries out activities as the holder of legal title to the InvestmentsG , such as effecting transactions, reinvesting dividends or other income arising from the InvestmentsG , and carrying out corporate actions relating to the exercise of rights attaching to the InvestmentsG (e.g. voting or appointing proxies to vote and accepting a rights offer/issue of Investments).

            Who is a Third Party Agent?

            5. A Third Party AgentG is simply an agent of the firm which Provides CustodyG . A PersonG is regarded as Providing CustodyG even if it appoints a Third Party AgentG (see GLO) to carry out either or both of the activities of safeguarding and administering its Clients' InvestmentsG . The Person Providing CustodyG (and not the Third Party AgentG ) remains accountable to the ClientG for the safe custody of the InvestmentsG of the ClientG .
            6. The DFSA requires a firm which Provides CustodyG , if it is outsourcing or delegating the safeguarding or administering of Client InvestmentsG to a Third Party AgentG , to undertake due diligence relating to the Third Party AgentG (see COB Rule A6.5.1).

            What is the relationship between 'Providing Custody' and 'holding or controlling' Client Assets?

            7. A firm Providing CustodyG , in order to safeguard and administer Client InvestmentsG , must hold and control those Investments. Therefore, a firm Providing CustodyG is subject to the Client InvestmentsG provisions in COB section 6.13 and the Safe Custody Provisions in COB App6. The firm may hold and control Client InvestmentsG directly (i.e. itself) or indirectly (i.e. through a Third Party AgentG ).
            8. Activities that constitute 'holding or controlling' Client InvestmentsG and 'safeguarding and administering' Client InvestmentsG can overlap. Guidance items 9 to 11 set out some examples to illustrate the interconnectivity and overlap of such activities.
            9. In the case of InvestmentsG the title to which is evidenced by a physical instrument (e.g. a share or debenture certificate), a PersonG who has physical possession of the certificate 'holds' it. It is possible that the PersonG who has physical possession is also the legal owner (i.e. the PersonG in whose name the title to the certificate is registered). If this is not the case, the Person who 'holds' the certificate is generally regarded as an agent of the legal owner whose name appears on the share or debenture certificate. An example would be a firm Providing CustodyG in whose name the certificates are registered, but the actual possession of the certificates is with a Third Party AgentG (custodian) appointed by the firm. In this example, the firm Providing CustodyG continues to be subject to the Client InvestmentsG provisions in COB 6.13 and the Safe Custody ProvisionsG in COB App6.
            10. In the case of InvestmentsG which are held in uncertificated or dematerialised form, the PersonG in whose name the rights to the relevant InvestmentsG are registered (by the central securities depository) is the holder and controller of the relevant InvestmentsG . Generally, the 'PIN' or other unique identifier of the owner of the InvestmentsG will be issued to the PersonG in whose name the dematerialised InvestmentsG are registered. Again, a firm that Provides CustodyG may appoint a Third Party AgentG to hold and have access to them, in which case, the firm Providing CustodyG indirectly holds and controls those InvestmentsG , and remains accountable to the ClientG for the safe custody of those InvestmentsG . The firm must also comply with the Client InvestmentsG provisions in COB 6.13 and the Safe Custody ProvisionsG in COB App6.
            11. A PersonG , who has the power and authority to give directions in relation to InvestmentsG , controls the relevant InvestmentsG . Generally, the PersonG who is the legal owner would have the power to give such directions. Examples are directions to effect transactions, to reinvest dividends or other income arising from the InvestmentsG , and to carry out corporate actions relating to the exercise of rights attaching to the Investments (e.g. to vote or appoint proxies to vote and to accept or renounce a rights offer/issue of InvestmentsG ). A firm Providing CustodyG would carry out such tasks for the purposes of administering Client InvestmentsG , either directly (i.e. itself) or indirectly (i.e. through a Third Party AgentG appointed by it).
            [Added] DFSA RM72/2010 (Made 11th July 2010) [VER26/07-10]
            [Amended] DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

      • GEN 2.14 Arranging custody

        • GEN 2.14.1

          In GEN Rule 2.2.2 Arranging CustodyG means arranging for one or more PersonsG to carry on the activity described in GEN Rule 2.13.1 (Providing Custody).


          Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
          [Amended] DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

        • Exclusions

          • GEN 2.14.2

            A PersonG (an 'introducer') does not carry on the activity of Arranging CustodyG specified in GEN Rule 2.14.1 merely by introducing another PersonG to a custodian who is an Authorised FirmG or a Regulated Financial InstitutionG authorised to provide custody. This exclusion does not apply if:

            (a) the custodian is a member of the same GroupG as the introducer;
            (b) the custodian is a part of the same legal entity as the introducer and, conducts custody services outside the DIFCG ; or
            (c) the introducer is remunerated for making the introduction by any PersonG , including by an entity referred to in (a) or (b).
            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
            Amended in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]
            [Amended] DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

          • GEN 2.14.3

            An ExchangeG does not Arrange CustodyG merely by making arrangements for, or taking steps that facilitate:

            (a) the safeguarding and administration of assets belonging to MembersG or other participants for the purposes of AMI section 5.10; or
            (b) the settlement by another PersonG of transactions entered into on a facility operated by the ExchangeG .
            Derived from DFSA RM166/2016 (Made 10th February 2016). [VER36/04-16]

            • GEN 2.14.3 Guidance

              How does Providing Custody differ from Arranging Custody?

              1. Refer to Guidance item 2 under Providing CustodyG in GEN section 2.13.

              Activities which constitute arranging

              2. The type of activities that constitute Arranging CustodyG include:
              a. negotiating and settling terms of the contract between the custody provider and the PersonG who is obtaining that service (the ClientG );
              b. assisting the ClientG to complete application forms and other processes;
              c. collecting and processing the Client'sG payments; and
              d. transmitting information (including instructions from the ClientG and confirmations by the custody provider) between the CustomerG and the custody provider.

              Non-application of the Client Asset provisions

              3. The Client AssetG provisions only apply to firms holding or controlling Client AssetsG and to firms Providing CustodyG . As a firm Arranging CustodyG does not 'safeguard and administer InvestmentsG ' (see Guidance items 3 and 4 under Providing CustodyG in GEN section 2.13), the Client AssetG provisions in COB section 6.11 have only limited application to such a firm (see COB Rule 6.11.2(3)). The requirement for a Safe Custody Auditor'sG Report under GEN Rule 8.6.1(e) also does not apply to a firm Arranging CustodyG .
              4. A firm 'Arranging CustodyG ', although not subject to substantive Client AssetG provisions (because it does not hold or control Client AssetsG ), is still required to undertake due diligence on a non-DIFC custodian with whom it arranges for its ClientG to obtain custody services — see COB Rule A6.5.1A.

              Who can rely on the exclusion in GEN Rule 2.14.2

              5. The exclusion in GEN Rule 2.14.2 is available to an introducer who introduces a potential customer to a regulated firm. However, this exclusion does not apply if the introducer:
              a. is a member of the same GroupG as the custodian;
              b. is part of the same legal entity as the custodian (i.e. the custodian is the introducer's head office or another branch of the same legal entity as the introducer); or
              c. receives remuneration for making the introduction from any Person — which can be a related party referred to in a. or b. above or any unrelated party.
              Derived from DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

      • GEN 2.15 Effecting contracts of insurance

        • GEN 2.15.1

          (1) In GEN Rule 2.2.2 Effecting Contracts of InsuranceG means effecting such contracts as principal.
          (2) An InsurerG authorised to Effect Contracts of InsuranceG is taken under that authorisation to be authorised also to carry on an activity that:
          (a) is referred to in GEN Rule 2.9.1(1), GEN Rule 2.11.1(1) or GEN Rule 2.19(1)(a) or (c); and
          (b) relates to a Contract of InsuranceG entered into, or to be entered into, as principal by the InsurerG .
          Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
          [Amended] DFSA RM176/2016 (Made 19th June 2016) [VER37/08-16]
          [Amended] DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

          • GEN 2.15.1 Guidance

            A Contract of InsuranceG is defined in GEN App 4 to include a contract of reinsurance.

            Derived from DFSA RM176/2016 (Made 19th June 2016) [VER37/08-16]
            [Amended] DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

      • GEN 2.16 Carrying out contracts of insurance

        • GEN 2.16.1

          In GEN Rule 2.2.2 Carrying Out Contracts of InsuranceG means carrying out such contracts as principal.


          Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

          • GEN 2.16.1 Guidance

            A Contract of InsuranceG is defined in GEN App 4 to include a contract of reinsurance.

            Derived from DFSA RM176/2016 (Made 19th June 2016) [VER37/08-16]

      • GEN 2.17 Operating an exchange

        • GEN 2.17.1

          (1) In GEN Rule 2.2.2, Operating an ExchangeG means operating a facility which functions regularly and brings together multiple third party buying and selling interests in InvestmentsG , in accordance with its nondiscretionary rules, in a way that can result in a contract in respect of InvestmentsG admitted to trading or traded on the facility.
          (2) The facility referred to in (1) may be organised on a temporary or permanent basis and can be an order driven system, a quote driven system or a hybrid of such systems that enables the market to operate electronic trading or trading by other means.
          Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
          [Amended] DFSA RM119/2013 (Made 14th July 2013). [VER33/07-13]
          [Amended] DFSA RM166/2016 (Made 10th February 2016). [VER36/04-16]

          • GEN 2.17.1 Guidance

            1. An Authorised Market InstitutionG authorised to Operate an ExchangeG may carry on the Financial ServiceG of operating a Multilateral Trading FacilityG , as defined in GEN Rule 2.22.1(1)(a), provided it has an endorsement on its LicenceG that permits it to do so (see GEN Rule 2.2.12).
            2. An Authorised Market InstitutionG may also act as a Trade RepositoryG if it has an endorsement on its LicenceG that permits it to do so (see GEN Rule 2.2.13). Acting as a Trade RepositoryG does not constitute a Financial ServiceG but is subject to the additional conduct requirements in GEN App 5.
            [Added] DFSA RM19/2005 (as from 19th April 2005). [VER3/04-05]
            [Amended][VER4/08-05]
            Amended in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]
            [Amended] DFSA RM119/2013 (Made 14th July 2013). [VER33/07-13]
            [Amended] DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

        • [Deleted]

          [Deleted] DFSA RM119/2013 (Made 14th July 2013). [VER33/07-13]

          • GEN 2.17.2 [Deleted]

            [Deleted] DFSA RM119/2013 (Made 14th July 2013). [VER33/07-13]

      • GEN 2.18 Operating a clearing house

        • GEN 2.18.1

          (1) In GEN Rule 2.2.2, operating a Clearing HouseG means operating a facility where confirmation, clearance and settlement of transactions in InvestmentsG are carried out in accordance with the non-discretionary rules of the facility, under which the PersonG operating the facility:
          (a) becomes a Central CounterpartyG ("CCP"); or
          (b) provides a book-entry Securities Settlement SystemG ("SSS"),
          regardless of whether or not such a PersonG also operates a Central Securities DepositoryG .
          (2) In (1), confirmation, clearance and settlement means the process of:
          (a) establishing settlement positions, including the calculation of net positions arising from any transactions in Investments (the transactions);
          (b) checking that InvestmentsG , cash or both, including margin, are available to secure the exposure arising from the transactions; and
          (c) securing the timely discharge (whether by performance, compromise or otherwise) of the rights and liabilities in relation to the transactions.
          (3) In (1)(a), a PersonG operates as a CCPG where it:
          (a) ensures the performance of open contracts relating to InvestmentsG made on a facility for trading InvestmentsG ; and
          (b) does so by interposing itself between counterparties to such contracts by becoming either the buyer to every seller, or the seller to every buyer.
          (4) In (1)(b), a PersonG operates an SSS where it operates a system which enables InvestmentsG held in accounts to be transferred and settled by book entry according to a set of predetermined multilateral rules.
          (5) Acting as a Central Securities DepositoryG in (1) means holding securities in uncertificated (dematerialised) form to enable book entry transfer of such securities for the purposes of clearing or settlement of transactions on its own facility and on any other similar facility, including an Alternative Trading FacilityG or a facility supervised or regulated by another Financial Services RegulatorG .
          (6) To the extent that any activity under (1) constitutes Dealing In Investments as PrincipalG , Dealing in Investments as AgentG , Arranging Deals in InvestmentsG , Managing AssetsG , Arranging CustodyG or Arranging CreditG , such Financial ServicesG are taken to be incorporated within Operating a Clearing HouseG , provided such activities are carried out as an incidental and integral part of Operating a Clearing HouseG .
          Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
          [Amended] DFSA RM119/2013 (Made 14th July 2013). [VER33/07-13]
          [Amended] DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

          • GEN 2.18.1 Guidance

            1. The activity of operating a Central Securities DepositoryG may be carried on by an Authorised Market InstitutionG licensed to Operate a Clearing HouseG in conjunction with its regulated activities, particularly operating an SSS. An Authorised FirmG which has a licence authorising it to carry on Providing CustodyG may also operate a CSD under its licence (see GEN Rule 2.13.1(3)). If a Clearing HouseG were to operate a CSD through a subsidiary, that subsidiary would need to be licensed separately as an Authorised Firm Providing CustodyG .
            2. An Authorised Market Institution licensed to Operate a Clearing HouseG may also act as a Trade RepositoryG if it has an endorsement on its LicenceG that permits it to do so (see GEN Rule 2.2.13). Acting as a Trade RepositoryG does not constitute a Financial ServiceG but is subject to the additional conduct requirements in GEN App 5.
            [Added] DFSA RM19/2005 (as from 19th April 2005). [VER3/04-05]
            [Amended][VER4/08-05]
            Amended in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]
            [Amended] DFSA RM119/2013 (Made 14th July 2013). [VER33/07-13]
            [Amended] DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

        • [Deleted]

          [Deleted] DFSA RM119/2013 (Made 14th July 2013). [VER33/07-13]

          • GEN 2.18.2 [Deleted]

            [Deleted] DFSA RM119/2013 (Made 14th July 2013). [VER33/07-13]

      • GEN 2.19 Insurance intermediation

        • GEN 2.19.1

          (1) In GEN Rule 2.2.2 Insurance IntermediationG means:
          (a) advising on a Contract of InsuranceG ;
          (b) acting as agent for another PersonG in relation to the buying or selling of a Contract of InsuranceG for that other PersonG ;
          (c) making arrangements with a view to another PersonG , whether as principal or agent, buying a Contract of InsuranceG ; or
          (d) operating an Insurance Aggregation SiteG .
          (2) In (1)(a), 'advising' means giving advice to a PersonG in his capacity as a PolicyholderG , or in his capacity as agent for a PolicyholderG on the merits of his entering into a Contract of InsuranceG whether as principal or agent.
          (3) In (2), 'advice' includes a statement, opinion or report:
          (a) where the intention is to influence a PersonG , in making a decision, to select a Contract of InsuranceG or insurance cover; or
          (b) which could reasonably be regarded as being intended to have such influence.
          (4) The arrangements in (1)(c) include arrangements which do not bring about the transaction.
          (5) The arrangements in (1)(c) do not include the mere provision of information about:
          (a) a Contract of InsuranceG , insurer, insurance intermediary or insurance manager to a PolicyholderG ; or
          (b) a PolicyholderG to an insurer, insurance intermediary or insurance manager,
          if the PersonG providing that information does not take any further steps to assist in concluding the Contract of InsuranceG .

          Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
          [Amended] [VER6/12-05]
          [Amended] [VER10/06-06]
          [Amended] DFSA RM68/2009 (Made 3rd January 2010). [VER24/01-10]
          [Amended] DFSA RM176/2016 (Made 19th June 2016) [VER37/08-16]
          [Amended] DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

          • GEN 2.19.1 Guidance

            1. Insurance IntermediationG activities may be carried on by an Insurance AgentG (i.e. a PersonG who acts as an agent of one or more insurers) or an Insurance BrokerG (i.e. a PersonG who acts as an agent of a policyholder), or by an InsurerG itself, in relation to its own Contracts of InsuranceG . Generally, most activities of an Insurance AgentG can be carried on by an Insurance ManagerG that has the authority to underwrite Contracts of InsuranceG in the DIFCG .
            2. For more information about Insurance Aggregation SitesG , see Guidance items 2 to 4 under GEN Rule 2.11.1.
            3. See the Guidance under Arranging Deals in InvestmentsG in GEN section 2.9 for the distinction between the activities of 'acting as agent' and 'arranging'.
            4. A PersonG 'acting as agent' as set out in GEN Rule 2.19.1(1)(b) for an InsurerG effecting or carrying out contracts of Long-Term InsuranceG will need to hold an Insurance IntermediationG or Insurance ManagementG LicenceG .
            5. If an Insurance IntermediaryG wishes to carry on Insurance IntermediationG activities in respect of a contract of Long-Term InsuranceG , that is not a contract of reinsurance, it must obtain an endorsement on its LicenceG (see GEN Rule 2.2.10C).
            6. See also Guidance item 2 under GEN Rule 2.9.1 for examples of activities that constitute arranging.
            [Added] [VER10/06-06]
            [Amended] DFSA RM66/2009 (Made 1st August 2009). [VER23/08-09]
            [Amended] DFSA RM68/2009 (Made 3rd January 2010). [VER24/01-10]
            Amended in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]
            [Amended] DFSA RM176/2016 (Made 19th June 2016) [VER37/08-16]
            [Amended] DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

        • Exclusions

          • GEN 2.19.2

            A PersonG (an 'arranger'), does not carry on the activity of Insurance IntermediationG specified in GEN Rule 2.19.1(1) if that PersonG enters, or is to enter, into a transaction in respect of a Contract of InsuranceG as principal. This exclusion does not apply in the case of a branch which makes arrangements for its head office, or any other branch of the same legal entity as itself, to enter into a transaction as provided under GEN Rule 2.19.1(1).


            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04] [Amended] DFSA RM176/2016 (Made 19th June 2016) [VER37/08-16]
            [Amended] DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

          • GEN 2.19.3

            A PersonG does not carry on Insurance IntermediationG if the activity:

            (a) is carried on in the course of any professional business which does not otherwise consist of the carrying on of Financial ServicesG ;
            (b) may reasonably be regarded as a necessary part of any other services provided in the course of that professional business; and
            (c) is not remunerated separately from the other services; and
            (d) does not assist in the conclusion or performance of a Contract of InsuranceG .

            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
            [Amended][VER6/12-05]
            [Amended] DFSA RM176/2016 (Made 19th June 2016) [VER37/08-16]

          • GEN 2.19.3A

            A PersonG does not carry on an Insurance IntermediationG activity if:

            (a) the activity is carried on in the course of a business of providing goods or services (other than Financial ServicesG );
            (b) providing goods or services referred to in (a) is the principal business of that PersonG ; and
            (c) the activity:
            (i) can reasonably be regarded as being ancillary and complementary to the principal business of that PersonG ; and
            (ii) does not relate to a contract of Long-Term InsuranceG .

            Derived from DFSA RM176/2016 (Made 19th June 2016) [VER37/08-16]

            • GEN 2.19.3A Guidance

              1. The exclusions in GEN Rules 2.19.3 and 2.19.3A apply to certain Insurance IntermediationG activities which occur in the course of carrying on other businesses.
              2. GEN Rule 2.19.3 applies to activities carried on as a necessary part of a professional service, such as insurance advice provided by an accountant or solicitor as part of estate planning or tax advice.
              3. GEN Rule 2.19.3A applies to activities that are ancillary and complementary to a business of providing goods or services. This might include, for example, a travel agent arranging travel insurance or a supplier of electrical goods arranging insurance of those goods. It does not apply if the main service or good is not provided to the customer, for example, if a travel agent does not provide the main travel service to the customer.

              Derived from DFSA RM176/2016 (Made 19th June 2016) [VER37/08-16]

          • GEN 2.19.4

            A PersonG does not give advice in relation to a Contract of InsuranceG by giving advice in any newspaper, journal, magazine, broadcast service or similar service in any medium if the principal purpose of the publication or service, taken as a whole, is neither:

            (a) that of giving advice of the kind mentioned in GEN Rule 2.19.1; nor
            (b) that of leading or enabling PersonsG to buy types of insurance.

            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

          • GEN 2.19.5

            A PersonG does not arrange a Contract of InsuranceG merely by providing the means by which one party to a transaction is able to communicate with other such parties.


            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

          • GEN 2.19.6

            A PersonG who is an Authorised FirmG does not advise in relation to a Contract of InsuranceG if it is authorised under its LicenceG to carry on the Financial ServiceG of Advising on Financial ProductsG , to the extent the advice relates to a contract of Long-Term InsuranceG , that is not a contract of reinsurance.


            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
            [Amended] DFSA RM176/2016 (Made 19th June 2016) [VER37/08-16]
            [Amended] DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

          • GEN 2.19.7

            A PersonG who is an Authorised FirmG does not arrange a Contract of InsuranceG if it is authorised under its LicenceG to carry on the Financial ServiceG of Arranging Deals in InvestmentsG , to the extent that the arranging relates to rights under a contract of Long-Term InsuranceG , that is not a contract of reinsurance.


            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
            [Amended] DFSA RM176/2016 (Made 19th June 2016) [VER37/08-16]
            [Amended] DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

          • GEN 2.19.8

            An Insurance ManagerG does not carry on Insurance IntermediationG to the extent that it carries on an activity that constitutes Insurance ManagementG .


            Derived from DFSA RM176/2016 (Made 19th June 2016) [VER37/08-16]

          • GEN 2.19.9

            A PersonG does not carry on Insurance IntermediationG by reason only of providing either or both of the following services:

            (a) an insurance loss adjustment service; or
            (b) the expert appraisal of insurance claims.

            Derived from DFSA RM176/2016 (Made 19th June 2016) [VER37/08-16]

      • GEN 2.20 Insurance management

        • GEN 2.20.1

          (1) In GEN Rule 2.2.2, Insurance ManagementG means:
          (a) performing underwriting or administration functions for or on behalf of an insurer, for the purposes of that insurer effecting or carrying out a Contract of InsuranceG as principal;
          (b) advising on a Contract of InsuranceG for which the Person performs, or is proposing to perform, underwriting functions referred to in (a); or
          (c) arranging reinsurance for and on behalf of an insurer for whom it is underwriting.
          (2) In (1):
          (a) "administration" includes, without limitation, one or more of the following activities:
          (i) processing applications for, and endorsements on, Contracts of InsuranceG ;
          (ii) collecting and processing premiums;
          (iii) negotiating terms of settlement of claims; or
          (iv) settling claims;
          (b) "advising" has the same meaning as in GEN Rule 2.19.1(2) and (3); and
          (c) "underwriting" includes, without limitation, one or more of the following activities:
          (i) assessing underwriting risks;
          (ii) negotiating and settling terms of Contracts of InsuranceG including exclusions;
          (iii) negotiating and settling premiums;
          (iv) negotiating commissions; or
          (v) countersigning, stamping and issuing Contracts of InsuranceG .
          (3) In this Rule, a reference to an "insurer" is a reference to:
          (a) an InsurerG ; or
          (b) a Non-DIFC insurerG .

          Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
          [Amended] DFSA RM176/2016 (Made 19th June 2016) [VER37/08-16]

          • GEN 2.20.1 Guidance

            1. As a Contract of InsuranceG is defined in GEN App4 to include a contract of reinsurance, Insurance ManagementG includes functions performed for or on behalf of a reinsurer. A PersonG may carry on Insurance ManagementG for or on behalf of a domestic (i.e. DIFC) InsurerG or a Non-DIFC insurerG (i.e. an insurer located and regulated outside the DIFCG ). A PersonG may also do so for a single insurer or a number of insurers.
            2. An Insurance ManagerG can under GEN Rule 2.20.1(1)(b) advise on Contracts of InsuranceG for which it performs, or proposes to perform, underwriting functions. This includes advising sponsors and members of captive cells it manages or proposes to manage.
            3. An Insurance ManagerG advising on contracts of insurance which it underwrites or proposes to underwrite is not generally expected to act also as an Insurance BrokerG , i.e. as agent of a PolicyholderG , because this would cause conflicts of interest that are difficult to manage. See the Guidance under COB Rule 7.9.1.

            Derived from DFSA RM176/2016 (Made 19th June 2016) [VER37/08-16]

        • Exclusions

          • GEN 2.20.2

            A PersonG does not provide Insurance ManagementG to an InsurerG if he is an EmployeeG of that InsurerG .


            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
            [Amended] DFSA RM176/2016 (Made 19th June 2016) [VER37/08-16]

          • GEN 2.20.3

            A PersonG who is an Authorised FirmG does not carry on Insurance ManagementG if it is an InsurerG .


            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
            [Amended] DFSA RM176/2016 (Made 19th June 2016) [VER37/08-16]

          • GEN 2.20.4

            A PersonG does not carry on Insurance ManagementG by reason only of providing to an insurer any one or more of the following services:

            (a) an actuarial service;
            (b) an insurance loss adjustment service; or
            (c) advice relating to insurance risks.

            Derived from DFSA RM176/2016 (Made 19th June 2016) [VER37/08-16]

      • GEN 2.21 Managing a profit sharing investment account

        • GEN 2.21.1

          In GEN Rule 2.2.2 Managing a Profit Sharing Investment AccountG means managing an account or portfolio which is a Profit Sharing Investment AccountG .

          Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
          [Amended] DFSA RM56/2008 (Made 1st July 2008). [VER19/07-08]

      • GEN 2.22 Operating an alternative trading system

        • GEN 2.22.1

          (1) In Rule 2.2.2, Operating an Alternative Trading SystemG means:
          (a) operating a Multilateral Trading FacilityG ("MTF"); or
          (b) operating an Organised Trading FacilityG ("OTF").
          (2) In (1)(a), a PersonG operates an MTF if that PersonG operates a system which brings together multiple third party buying and selling interests in InvestmentsG , in accordance with its non-discretionary rules, in a way that results in a contract in respect of such InvestmentsG .
          (3) In (1)(b), a PersonG operates an OTF if that Person operates a system which brings together multiple third party buying and selling interests in InvestmentsG , in accordance with its discretionary rules, in a way that results in a contract in respect of such InvestmentsG .
          [Added][VER4/08-05]
          [Amended] DFSA RM119/2013 (Made 14th July 2013). [VER33/07-13]

          • GEN 2.22.1 Guidance

            The main distinction between operating an MTFG and operating an OTFG is that the former is operated in accordance with the non-discretionary rules adopted and implemented by the operator, whereas the latter is operated in accordance with the discretionary rules of the operator. Accordingly, a PersonG operating an OTFG has more flexibility relating to how it applies its rules to participants on its facility, whereas a PersonG operating an MTFG is required to apply its rules in a non-discretionary manner across all participants on its facility.

            [Added] DFSA RM119/2013 (Made 14th July 2013). [VER33/07-13]

        • Exclusion

          • GEN 2.22.2

            A PersonG does not carry on the activity of the kind specified in Rule 2.22.1 if it operates a facility which is merely an order routing system where buying and selling interests in, or orders for, InvestmentsG are merely transmitted but do not interact.

            [Added][VER4/08-05]
            [Amended] DFSA RM119/2013 (Made 14th July 2013). [VER33/07-13]

          • GEN 2.22.3

            A Crowdfunding OperatorG does not Operate an Alternative Trading SystemG to the extent that it Operates a Crowdfunding PlatformG .

            [Added] DFSA RMI201/2017 (Made 14th June 2017). [VER40/08-17]

      • GEN 2.23 Providing Trust Services

        • GEN 2.23.1

          In GEN Rule 2.2.2 Providing Trust ServicesG means:

          (a) the provision of services with respect to the creation of an express trust;
          (b) arranging for any PersonG to act as a trustee in respect of any express trust;
          (c) acting as trustee in respect of an express trust;
          (d) the provision of Trust Administration ServicesG in respect of an express trust; or
          (e) acting as protector or enforcer in respect of an express trust.
          [Added][VER7/01/06]

          • GEN 2.23.1 Guidance

            Providing generic advice on the desirability of using a trust does not amount to Providing Trust ServicesG as defined in GEN Rule 2.23.1.

            [Added][VER7/01/06]

        • Exclusions

          • GEN 2.23.2 [Deleted]

            Deleted in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]

          • GEN 2.23.2

            A PersonG meeting part (1) (d) or (e) of the definition of a DNFBPG does not provide Trust Services where it only:

            (a) arranges for a PersonG to act as trustee in respect of an express trust; or
            (b) provides services with respect to the creation of an express trust; provided that:
            (i) the provision of such services is solely incidental to the practice of law or accounting as the case may be; and
            (ii) the DNFBPG is not holding itself out as Providing Trust ServicesG .
            [Added][VER7/01-06]
            [Amended] DFSA RM60/2008 (as from 2nd September 2008). [VER21/09-08]
            Amended in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]
            [Amended] DFSA RM119/2013 (Made 14th July 2013). [VER33/07-13]

            • GEN 2.23.2 Guidance

              Acting as trustee, protector or enforcer or Providing Trust Administration ServicesG are not activities incidental to the practice of law or accounting and require a LicenceG .

              [Added][VER7/01/06]
              Amended in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]

          • GEN 2.23.3

            A PersonG is not Providing Trust ServicesG if that PersonG is the TrusteeG of a FundG and the activities are in connection with or arise from, acting as the TrusteeG of the FundG .

            [Added]DFSA RM34/2006[VER11/08-06]
            Amended in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]

      • GEN 2.24 Providing Fund Administration

        • GEN 2.24.1

          In GEN Rule 2.2.2, Providing Fund AdministrationG means providing one or more of the following services in relation to a FundG :

          (a) processing dealing instructions including subscriptions, redemptions, stock transfers and arranging settlements;
          (b) valuing of assets and performing net asset value calculations;
          (c) maintaining the share register and UnitholderG registration details;
          (d) performing anti money laundering requirements;
          (e) undertaking transaction monitoring and reconciliation functions;
          (f) performing administrative activities in relation to banking, cash management, treasury and foreign exchange;
          (g) producing financial statements, other than as the FundG 's registered auditor; or
          (h) communicating with participants, the FundG , the Fund ManagerG , and investment managers, the prime brokers, the RegulatorsG and any other parties in relation to the administration of the FundG .

          [Added][VER8/04-06]
          [Amended] DFSA RM72/2010 (Made 11th July 2010) [VER26/07-10]

      • GEN 2.25 Acting as the Trustee of a Fund

        • GEN 2.25.1

          (1) In GEN Rule 2.2.2, Acting as the Trustee of a FundG means holding the assets of a FundG on trust for the UnitholdersG where the FundG is in the form of an Investment TrustG .
          (2) To the extent that any activity under (1) constitutes Providing Fund AdministrationG or Providing CustodyG , such a Financial ServiceG is taken to be incorporated within Acting as the Trustee of a FundG .

          [Added] DFSA RM34/2006 [VER11/08-06]
          [Amended] DFSA RM56/2008 (Made 1st July 2008). [VER19/07-08]

          • GEN 2.25.1 Guidance

            Rule 2.25.1(2) alleviates any requirement upon a TrusteeG to obtain further authorisations for certain Financial ServicesG where the activities fall within the ordinary scope of the activity of Acting as the Trustee of a FundG . The provision also facilitates the delegation of these discrete activities under CIR section 7.3.

            [Added] DFSA RM56/2008 (Made 1st July 2008). [VER19/07-08]

        • Exclusions

          • GEN 2.25.2

            A PersonG is not Acting as the Trustee of a FundG merely because he is acting as an agent, employee or delegate of a TrusteeG .

            [Added] DFSA RM56/2008 (Made 1st July 2008). [VER19/07-08]

      • GEN 2.26 Operating a Representative Office

        • GEN 2.26.1

          (1) In GEN Rule 2.2.2 Operating a Representative OfficeG means the marketing of one or more financial services or financial products, provided such services or products are those offered:
          (a) in a jurisdiction other than the DIFCG ; and
          (b) by a related party of the Representative OfficeG .
          (2) For the purposes of (1) 'marketing' means:
          (a) providing information on one or more financial products or financial services;
          (b) engaging in Financial Promotions in relation to (a); or
          (c) making introductions or referrals in connection with the offer of financial services or financial products;
          provided that such activities do not constitute:
          (d) Advising on Financial ProductsG ;
          (e) Advising on CreditG ; or
          (f) 'arranging' under GEN Rules 2.9.1, 2.14.1, 2.19.1(1)(c) and 2.28.1(1)(a), including receiving and transmitting orders in relation to a financial product.
          (3) For the purposes of this Rule:
          (a) a 'financial product' means an InvestmentG , a Credit FacilityG , a DepositG , a Profit Sharing Investment AccountG or a Contract of InsuranceG ; and
          (b) a 'related party' of a Representative OfficeG means:
          (i) the same Body CorporateG as the Representative OfficeG , including its head office or any other branch; and
          (ii) a member of the same GroupG as the Body CorporateG referred to in (i).
          [Added] DFSA RM68/2009 (Made 3rd January 2010). [VER24/01-10]
          [Amended] DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

        • Exclusions

          • GEN 2.26.2

            An Authorised FirmG other than a Representative OfficeG does not Operate a Representative OfficeG if it undertakes any activities of the kind described in GEN Rule 2.26.1 that constitute marketing.

            [Added] DFSA RM68/2009 (Made 3rd January 2010). [VER24/01-10]

          • GEN 2.26.3

            Any communication which amounts to marketing in respect of a financial service or financial product, which is issued by or on behalf of a government or non-commercial government entity, does not constitute marketing for the purposes of GEN Rule 2.26.1.

            [Added] DFSA RM68/2009 (Made 3rd January 2010). [VER24/01-10]

            • GEN 2.26.3 Guidance

              Refer to Guidance under REP section 1.3 for the scope of the activities which a Representative OfficeG can conduct under its LicenceG .

              Derived from DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

      • GEN 2.27 Operating a Credit Rating Agency

        • GEN 2.27.1

          (1) In GEN Rule 2.2.2, Operating a Credit Rating AgencyG means undertaking one or more Credit Rating ActivitiesG for the purpose of producing a Credit RatingG with a view to that Credit RatingG being:
          (a) disseminated to the public; or
          (b) distributed to a PersonG by subscription;
          whether or not it is in fact disseminated or distributed.
          (2) For the purposes of (1):
          (a) Credit Rating ActivitiesG are data and information analysis relating to a Credit RatingG or the evaluation, approval, issue or review of a Credit RatingG ; and
          (b) a Credit RatingG is an opinion expressed using an established and defined ranking system of rating categories regarding the creditworthiness of a Rating SubjectG .
          (3) In (2), a Rating SubjectG means:
          (a) a PersonG other than a natural person;
          (b) a credit commitment; or
          (c) a debt or debt-like InvestmentG .
          [Added] DFSA RM96/2012 (Made 24th July 2012) [VER30/07-12]

        • Exclusions

          • GEN 2.27.2

            A PersonG does not Operate a Credit Rating AgencyG where that PersonG prepares any credit scores, credit scoring systems or similar assessments relating to obligations arising from consumer, commercial or industrial relationships.

            [Added] DFSA RM96/2012 (Made 24th July 2012) [VER30/07-12]

            • GEN 2.27.2 Guidance

              1. The effect of GEN Rule 2.27.1 is that even if a PersonG undertakes from a place of business in the DIFC some but not all of the Credit Rating ActivitiesG for the purpose of producing a Credit RatingG , that PersonG needs to have a LicenceG authorising it to Operate a Credit Rating Agency.
              2. Where a Credit Rating AgencyG outsources some of its Credit Rating ActivitiesG , it will need to ensure that it meets the relevant requirements, including those relating to outsourcing, in GEN Rule 5.3.21.
              3. There is no express prohibition against carrying on the Financial ServiceG of Operating a Credit Rating Agency by PersonsG who are authorised to carry on other Financial ServicesG . However, the specific conduct requirements applicable to Credit Rating AgenciesG in COB chapter 8, include a prohibition against certain types of consultancy and advisory services being provided by a Credit Rating AgencyG . Therefore, even if a Credit Rating AgencyG has an appropriate LicenceG authorising it to provide advice on financial products, it will not be able to provide the prohibited type of consultancy and advisory services.
              4. A PersonG may provide a private Credit RatingG for the exclusive use of another PersonG (Second Person) without seeking a LicenseG authorising it to Operate a Credit Rating Agency where the Credit RatingG is produced based on the request of the Second Person and is not intended to be disseminated to the public or distributed by subscription. Such a PersonG may wish to include an express warning in the Credit RatingG that it is intended only for the exclusive use of the Second Person and obtain from such Second Person a prior written undertaking that the Credit RatingG will not be disseminated to the public or distributed on subscription.
              5. Credit scoring referred to in GEN Rule 2.27.2 is a method of assessing creditworthiness. A credit score is primarily based on credit report information typically sourced from credit bureaus. A PersonG does not become a Credit Rating AgencyG merely by preparing or providing credit assessments. Lenders, such as banks and credit card companies, use credit scores to evaluate the potential risk posed by lending money to consumers and to mitigate losses due to bad debt. Insurance companies, and government departments also employ the same techniques.
              [Added] DFSA RM96/2012 (Made 24th July 2012) [VER30/07-12]

      • GEN 2.28 Arranging Credit and Advising on Credit

        • GEN 2.28.1

          (1) In GEN Rule 2.2.2, Arranging CreditG and Advising on CreditG means:
          (a) making arrangements for another PersonG , whether as principal or agent, to borrow money by way of a Credit FacilityG ; or
          (b) giving advice to a PersonG in his capacity as a borrower or potential borrower or as agent for a borrower or potential borrower on the merits of his entering into a particular Credit FacilityG .
          (2) Advice in (1)(b) includes a statement, opinion or report:
          (a) where the intention is to influence a PersonG , in making a decision, to enter into a particular Credit FacilityG ; or
          (b) which could reasonably be regarded as being intended to have such an influence.
          [Added] DFSA RM131/2014 (Made 21st August 2014). [VER34/06-14]
          [Amended] DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

          • GEN 2.28.1 Guidance

            Activities that constitute 'Arranging Credit'

            1. Generally, the following activities constitute Arranging CreditG :
            a. Introducing potential borrowers to a credit provider (who can be in the DIFC or outside the DIFCG );
            b. Assisting a potential borrower to obtain credit, such as completing application forms and other processes relevant to the transaction;
            c. Negotiating terms of credit, including any fees payable to the arranger; and
            d. Arranging collateral or other assurances needed by the potential borrower to obtain credit.
            2. The Guidance under 'Arranging Deals in Investments' is generally relevant for 'Arranging Credit', although the activities relate to 'credit' in this context, instead of 'Investments'. Therefore, a reference to Investment in that Guidance should be read as 'credit' for the purposes of 'Arranging Credit'.
            Derived from DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

        • Exclusions

          • GEN 2.28.2

            A PersonG does not carry on the activity of Arranging CreditG under GEN Rule 2.28.1(1)(a) if that PersonG enters, or is to enter, into the transaction to Provide CreditG . This exclusion does not apply in the case of a branch which makes arrangements for its head office, or any other branch of the same legal entity as itself, to enter into a transaction as provided under GEN Rule 2.28.1(1)(a).

            Derived from DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

          • GEN 2.28.3

            A PersonG does not make arrangements referred to in GEN Rule 2.28.1(1)(a) merely by providing means by which one party to a transaction is able to communicate with other such parties.

            Derived from DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

          • GEN 2.28.4

            A PersonG does not carry on the activity referred to in GEN Rule 2.28.1(1)(a) by making arrangements under which another PersonG accepts or is to accept an instrument creating or acknowledging indebtedness in respect of any loan, credit, guarantee or other similar financial accommodation which he or his principal has made or provided.

            Derived from DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

          • GEN 2.28.5

            A PersonG does not Arrange CreditG merely by making arrangements having as their sole purpose the provision of finance to enable a PersonG to buy, sell, subscribe for or underwrite InvestmentsG .

            Derived from DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

          • GEN 2.28.6

            A PersonG does not carry on the activities in GEN Rule 2.28.1(1)(a) or (b) if the activity:

            (a) is carried on in the course of Providing Legal ServicesG or Providing Accountancy ServicesG , which does not otherwise consist of the carrying on of Financial ServicesG ;
            (b) may reasonably be regarded as a necessary part of any other services provided in the course of Providing Legal ServicesG or Providing Accountancy ServicesG ; and
            (c) is not remunerated separately from the other services.
            Derived from DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

          • GEN 2.28.7

            A PersonG does not carry on the activity in GEN Rule 2.28.1(1)(b) by giving advice in any newspaper, journal, magazine, broadcast service or similar service in any medium if the principal purpose of the publication or service, taken as a whole, is neither:

            (a) that of giving advice of the kind mentioned in GEN Rule 2.28.1(1)(b); nor
            (b) that of leading or enabling PersonsG to enter into a particular Credit FacilityG .
            Derived from DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

            • GEN 2.28.7 Guidance

              The Guidance relating to the exclusions from the activity of 'Arranging Deals in Investments' is generally relevant for the exclusions from 'Arranging Credit', although the activities relate to 'credit' in this context, instead of 'Investments'. To the extent relevant, a reference to an InvestmentG in that Guidance should be read as 'credit' for the purposes of Guidance on exclusions from 'Arranging Credit'.

              Derived from DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

          • GEN 2.28.8

            A Crowdfunding OperatorG does not Arrange CreditG to the extent that it Operates a Loan Crowdfunding PlatformG .

            [Added] DFSA RMI201/2017 (Made 14th June 2017). [VER40/08-17]

      • GEN 2.29 Operating a Crowdfunding Platform

        • GEN 2.29.1

          (1) In GEN Rule 2.2.2, a PersonG carries on the activity of Operating a Crowdfunding Platform if the PersonG :
          (a) Operates a Loan Crowdfunding PlatformG ; or
          (b) Operates an Investment Crowdfunding PlatformG .
          (2) A PersonG Operates a Loan Crowdfunding PlatformG under (1)(a) if it does both of the following:
          (a) operates an electronic platform that facilitates the bringing together of potential lenders and borrowers; and
          (b) administers a loan agreement that results from operating the electronic platform.
          (3) If the PersonG referred to in (2) also provides a facility that assists a lender to transfer his rights and obligations under a loan agreement referred to in that paragraph, that activity is also included within Operating a Loan Crowdfunding PlatformG .
          (4) A PersonG Operates an Investment Crowdfunding PlatformG under (1)(b) if it does both of the following:
          (a) operates an electronic platform that facilitates the bringing together of potential investors and PersonsG who wish to obtain funding for a business or project, resulting in an investor making an InvestmentG with the PersonG seeking funding; and
          (b) administers an InvestmentG that results from operating the electronic platform.
          (5) If the PersonG referred to in (4) also provides a facility that assists an investor to sell an investment referred to in that paragraph, that activity is also included within Operating an Investment Crowdfunding PlatformG .
          (6) In this RuleG :
          (a) "administer a loan agreement" means:
          (i) provide information or perform other duties under the loan agreement on behalf of the borrower or lender;
          (ii) take steps to obtain the repayment of the loan; or
          (iii) exercise rights or perform obligations under the loan agreement on behalf of the borrower or lender;
          (b) "administer an InvestmentG " means:
          (i) provide information or perform other duties relating to the InvestmentG on behalf of the IssuerG or investor;
          (ii) take steps to obtain the payment of any amount payable by the IssuerG to an investor; or
          (iii) exercise rights or perform obligations relating to the Investment on behalf of the IssuerG or investor;
          (c) "electronic platform" means a website or other form of electronic media.
          (7) A PersonG (A) administers a loan agreement or an Investment for the purposes of this RuleG if A performs a function itself or through another PersonG who has been appointed by A, acts under an arrangement with A or acts at A's direction.
          [Added] DFSA RMI201/2017 (Made 14th June 2017). [VER40/08-17]

          • GEN 2.29.1 Guidance

            1. Operating a Crowdfunding PlatformG under GEN Rule 2.29.1 requires a PersonG not only to operate an electronic platform that brings together lenders and borrowers or investors and issuers, but also to administer a resulting loan agreement or InvestmentG . The administration may be carried out by the platform operator itself or by another person acting under an arrangement with, or at the direction of, the platform operator.
            2. The activity in GEN Rule 2.29.1(2)(a) and (4)(a) only covers electronic systems such as online portals and does not include, for example, meetings to facilitate a loan.
            3. A Crowdfunding OperatorG may in some cases also provide a facility that assists lenders or investors using the platform to transfer their rights and obligations under aloan agreement to another lender or to sell their InvestmentG to another investor. If a Crowdfunding OperatorG provides such a facility, that activity will also fall within the definition of Operating a Crowdfunding PlatformG (see GEN Rule 2.29.1(3) and (5)).
            4. Operating a Loan Crowdfunding PlatformG will apply to a number of types of crowdfunding services such as 'peer to peer' lending, 'peer to business' lending and 'business to business' lending. However, it should be noted that COB Rule 11.3.5 requires a borrower to be a Body CorporateG .
            5. Investment CrowdfundingG differs from Loan CrowdfundingG in that, instead of the platform facilitating a loan, it facilitates the issue of an investment to an investor. Under GEN Rule 2.2.10F, the type of InvestmentG that can be facilitated is restricted to InvestmentsG such as SharesG , DebenturesG or Sukuk and facilitating other more complex InvestmentsG such as DerivativesG or Structured ProductsG is not permitted.
            6. Other types of crowdfunding such as 'reward crowdfunding' (i.e. where a financial contribution is made in anticipation of a benefit in existing or future goods or services) and 'donation crowdfunding' (i.e. where contributions are made in support of a social cause) will not usually constitute an activity referred to in GEN Rule 2.29.1 unless a loan or InvestmentG is involved.
            7. A Crowdfunding OperatorG will need an endorsement on its LicenceG to deal with Retail ClientsG if it carries on its activities with a borrower or lender or an IssuerG or investor that is a Retail ClientG (see GEN Rule 2.2.8). It will also need an endorsement on its LicenceG if it holds or controls Client AssetsG (see GEN Rule 2.2.10A).
            8. A Crowdfunding OperatorG must be a Body CorporateG incorporated under the DIFC Companies Law (see GEN Rule 2.2.10D).
            [Added] DFSA RMI201/2017 (Made 14th June 2017). [VER40/08-17]

        • Exclusions

          • GEN 2.29.2

            A PersonG does not carry on the activity referred to in GEN Rule 2.29.1 if the PersonG who carries on those activities is itself the sole lender or the sole investor on the electronic platform.

            [Added] DFSA RMI201/2017 (Made 14th June 2017). [VER40/08-17]

            • GEN 2.29.2 Guidance

              The activity in GEN Rule 2.29.1 does not cover an electronic platform where the operator itself is the sole lender providing the loans e.g. if it is a credit provider and provides an electronic facility for use by its clients. Similarly, it does not apply to a platform where the operator is the sole investor. However, if the operator itself lends or invests, it is likely to be carrying on the Financial ServiceG of Providing CreditG or Dealing in Investments as PrincipalG , and will require a separate authorisation for that activity.

              [Added] DFSA RMI201/2017 (Made 14th June 2017). [VER40/08-17]

    • GEN 2A. Definition of Financial Product in the General Prohibition Against Misconduct

      • GEN 2A.1.1

        For the purposes of Article 41B of the Regulatory Law, a "Financial Product" means an InvestmentG , a Credit FacilityG , a DepositG , a Profit Sharing Investment AccountG , a Contract of InsuranceG or a Crowdfunding Loan AgreementG .

        Derived from DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]
        [Amended] DFSA RMI201/2017 (Made 14th June 2017). [VER40/08-17]

    • GEN 3 Financial Promotions

      • GEN 3.1 Application

        • GEN 3.1.1

          This chapter applies to any PersonG who approves, makes or intends to make a Financial PromotionG in or from the DIFCG .

          Added in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]

        • GEN 3.1.2

          Rules GEN 3.4.1 to GEN 3.6.3 do not apply to a PersonG who makes an OfferG which is in accordance with the requirements relating to:

          (a) an Offer of SecuritiesG under the Markets Law and the MKT Rules; or
          (b) an Offer of UnitsG under the Collective Investment Law 2010 and CIR Rules.
          Added in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]
          [Amended] DFSA RM95/2012 (Made 14th June 2012). [VER29/06-12]
          [Amended] DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

          • GEN 3.1.2 Guidance

            The purpose of the exclusion in GEN Rule 3.1.2 is to ensure that a PersonG who makes an OfferG referred to in that Rule is not subject to duplicative requirements under this chapter. The exclusion applies only to a communication by a PersonG making an OfferG and if that communication is subject to requirements specified in the relevant laws or Rules.

            Derived from DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

      • GEN 3.2 Overview

        • GEN 3.2.1

          The RulesG in this chapter are made for the purposes of the Financial Promotions ProhibitionG in Article 41A of the Regulatory Law.

          Added in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]
          [Amended] DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

          • GEN 3.2.1 Guidance

            1. Article 41A(3) of the Regulatory Law defines a Financial PromotionG as:

            "Any communication, however made, which invites or induces a PersonG to:
            (a) enter into, or offer to enter into, an agreement in relation to the provision of a financial service; or
            (b) exercise any rights conferred by a financial product or acquire, dispose of, underwrite or convert a financial product."
            2. The GuidanceG in this chapter is designed to help explain the scope of the Financial Promotions ProhibitionG .
            3. The definition of a Financial PromotionG is very broad and encompasses the definitions of a "financial promotion" in Article 19(3) of the Collective Investment Law 2010. A Financial PromotionG also includes "marketing material" as defined elsewhere in the RulebookG .
            4. The DFSAG considers that a Financial PromotionG may be made in any manner and by any form including, but not limited to, an oral, electronic or written communication and includes an advertisement, or any form of promotion or marketing. A disclaimer stating that a communication is not a Financial PromotionG would not, on its own, prevent a communication from being a Financial PromotionG .
            5. A PersonG who is permitted to make a Financial PromotionG in the DIFCG pursuant to these RulesG should ensure that in making such a Financial PromotionG he does not breach the Financial Services ProhibitionG in Article 41 of the Regulatory Law.
            6. Depending on the nature and scale of the activities, if a PersonG makes Financial PromotionsG on a regular basis or for a prolonged period while physically located in the DIFCG , for example by way of a booth, meetings or conferences, the DFSAG may consider such activities as constituting the carrying on of a Financial ServiceG , such as Operating a Representative OfficeG . The DFSAG considers that in the context of Financial PromotionsG , "a regular basis" would be anything more than occasional and "a prolonged period" would usually be anything more than 3 consecutive days.
            Added in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]
            [Amended] DFSA RM95/2012 (Made 14th June 2012). [VER29/06-12]
            [Amended] DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

      • GEN 3.3 Definition of a Financial Product

      • GEN 3.4 Scope of the Financial Promotions Prohibition

        • GEN 3.4.1

          (1) A PersonG shall not, subject to (2) and (3), make a Financial PromotionG in or from the DIFCG unless that PersonG is an Authorised PersonG .
          (2) A Representative OfficeG may make a Financial PromotionG in or from the DIFCG only in relation to a financial service or financial product offered:
          (a) in a jurisdiction other than the DIFCG ; and
          (b) by a related party (as defined in GEN Rule 2.26.1(3)) of the Representative OfficeG .
          (3) A PersonG other than an Authorised PersonG may make a Financial PromotionG in or from the DIFCG if, and only to the extent that, the PersonG :
          (a) is licensed and supervised by a Financial Services RegulatorG in the UAEG ;
          (b) is a Recognised BodyG or External Fund ManagerG ;
          (c) is a Reporting EntityG and makes a Financial PromotionG in or from the DIFCG exclusively for the purpose of discharging its mandatory disclosure requirements; or
          (d) makes an exempt Financial PromotionG as specified in (4).
          (4) For the purposes of (3)(d), a communication is an "exempt Financial PromotionG " if it is:
          (a) approved by an Authorised FirmG other than a Representative OfficeG ;
          (b) approved by a Representative OfficeG and it is a communication relating to a financial service or financial product offered by a related party (as defined in GEN Rule 2.26.1(3)) of the Representative OfficeG ;
          (c) directed at and capable of acceptance exclusively by a PersonG who appears on reasonable grounds to be a Professional ClientG of the type specified in COB Rule 2.3.4;
          (d) made to a PersonG in the DIFCG (the "recipient") as a result of an unsolicited request by the recipient to receive the Financial PromotionG ;
          (e) made or issued by or on behalf of a government or noncommercial government entity; or
          (f) made in the DIFCG by a PersonG in the course of providing legal or accountancy services and may reasonably be regarded as incidental to and a necessary part of the provision of such services.
          Added in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]
          [Amended] DFSA RM95/2012 (Made 14th June 2012). [VER29/06-12]
          [Amended] DFSA RM155/2015 (Made 9th December 2015) [VER35/02-16]
          [Amended] DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

          • GEN 3.4.1 Guidance

            If a PersonG proposes to conduct Financial PromotionsG in or from the DIFCG other than as permitted under (3) and (4), that PersonG should consider obtaining an appropriate LicenceG .

            Derived from DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

        • GEN 3.4.2

          A PersonG does not breach the Financial Promotions ProhibitionG if:

          (a) the PersonG causes a Financial PromotionG to be made in the course of providing a facility which is a mere conduit for the making of the Financial PromotionG ;
          (b) the PersonG is located outside the DIFCG and makes a Financial PromotionG which appears, on reasonable grounds, to be a communication which is not directed at or intended to be acted upon by a PersonG in the DIFCG ; or
          (c) the Financial PromotionG is not made for a commercial or business purpose.
          Added in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]

          • GEN 3.4.2 Guidance

            1. Examples of a mere conduit would include a newspaper or magazine, a website carrying third-party banner ads, a postman or courier, a person paid to hand out promotional material to the public and an event venue - unless in each case they were the originator i.e the PersonG who makes the Financial PromotionG .
            2. In GEN Rule 3.4.2(b) the DFSAG considers that the following non-exhaustive list of factors may each be indicative of whether or not a Financial PromotionG is "intended to be acted upon by, or targeted at, PersonsG in the DIFCG ":
            a. whether it is expressed to be for a PersonG or type of PersonG in the DIFCG ;
            b. whether it is sent to an address (including a P.O. Box) in the DIFCG ;
            c. whether it is physically distributed to PersonsG in the DIFCG ;
            d. whether it takes place in the DIFCG ;
            e. whether it makes reference to the DIFCG ;
            f. whether it appears in a DIFCG publication;
            g. whether it appears on a DIFC-based or related website or other media;
            h. whether it is sent to the email of a PersonG in the DIFCG ; or
            i. whether it contains a prominent and clear disclaimer on its face that it is not intended to be acted upon by PersonsG in the DIFCG .
            3. The DFSAG in applying GEN Rule 3.4.2(c) will generally consider that for a communication to be made "for a commercial or business purpose" there must be a commercial element to the Financial PromotionG , whether or not the Financial PromotionG actually leads to the provision of any financial service. However, the DFSAG considers that "for a commercial or business purpose" requires a commercial or business interest on the part of the communicator and the nature of the communicator's business need not be related to any specific financial service.
            4. The DFSAG considers that a PersonG located outside the DIFCG who makes a Financial PromotionG into the DIFCG , makes that communication in the DIFCG . The DFSAG considers that the prohibition in Article 41A(1) applies irrespective of where the communicator of the Financial PromotionG is located.
            Added in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]

      • GEN 3.5 Additional Rules for Financial Promotions

        • GEN 3.5.1

          (1) A PersonG in GEN Rule 3.4.1(3) (a) to (d) must, subject to (2), take reasonable care to ensure that any Financial PromotionG it makes in or from the DIFCG :
          (a) is clear, fair and not misleading;
          (b) includes the Person'sG name, address and regulatory status;
          (c) if it is intended only for Professional ClientsG , is not sent or directed to any PersonG who appears on reasonable grounds not to be a Professional ClientG , and contains a clear statement that only a PersonG meeting the criteria for a Professional ClientG should act upon it; and
          (d) which is provided to or directed at a Retail ClientG and contains any information or representation relating to past performance, or any forecast based on past performance or on any other assumptions:
          (i) presents a balanced view of the financial products or financial services to which the Financial PromotionG relates;
          (ii) identifies, in an easy to understand manner, the information from which the past performance or forecast is derived and how any key facts and assumptions used in that context are drawn; and
          (iii) contains a prominent warning that past performance is not necessarily a reliable indicator of future performance.
          (2) A PersonG described in GEN Rule 3.4.1(3)(a) who makes a Financial PromotionG to an existing client in the DIFCG is not required to comply with (1) provided that in making the Financial PromotionG that PersonG complies with the requirements of the relevant Financial Services RegulatorG in the UAEG which relate to Financial PromotionsG .
          Added in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]
          [Amended] DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

          • GEN 3.5.1 Guidance

            1. In presenting information relating to past performance of a financial product or financial service, a PersonG should use a reputable independent actuarial, financial or statistical reporting service provider.
            2. The effect of GEN Rule 3.5.1(2) is that a PersonG who is licensed and regulated by a Financial Services RegulatorG in the UAEG is not required to comply with GEN Rule 3.5.1(1) when communicating with an existing client. However, when making a Financial PromotionG to a prospective client in the DIFCG , GEN Rule 3.5.1(1) does apply to such PersonsG , as do the prohibitions on the making of offers contained in the Markets Law 2012 and Collective Investment Law 2010 respectively.
            Added in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]
            [Amended] DFSA RM95/2012 (Made 14th June 2012). [VER29/06-12]

        • GEN 3.5.2

          A PersonG must not, in any Financial PromotionG , attempt to limit or avoid any duty or liability it may have under any DFSA-administered laws or the RulesG .

          Added in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]

      • GEN 3.6 Approval of Financial Promotions by an Authorised Firm

        • GEN 3.6.1

          For the purposes of GEN Rule 3.4.1(4)(a) and (b), an Authorised FirmG must not approve a Financial PromotionG unless:

          (a) the Financial PromotionG includes a clear and prominent statement that it has been "approved by" the relevant Authorised FirmG ; and
          (b) the Financial PromotionG is made in accordance with the requirements in GEN Section 3.5.
          Added in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]
          [Amended] DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

        • GEN 3.6.2

          An Authorised FirmG must not approve a Financial PromotionG which is directed at a PersonG who appears on reasonable grounds to be a Retail ClientG unless:

          (a) it has an endorsement on its LicenseG which permits it to carry on a Financial ServiceG with or for a Retail ClientG ; and
          (b) the scope of its LicenseG includes the Financial ServiceG and, if applicable, the particular financial product, to which the Financial PromotionG relates.
          Added in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]

        • GEN 3.6.3

          An Authorised FirmG must ensure that a Financial PromotionG it has approved complies with the requirements in this chapter on an on-going basis.

          Added in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]

          • GEN 3.6.3 Guidance

            An Authorised FirmG which proposes to approve a Financial PromotionG where all or part of that promotion will be real time, such as a live event, will need to consider whether it is able to comply effectively with any relevant RulesG in relation to the Financial PromotionG or its approval.

            Added in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]

    • GEN 3 [Deleted]

      Deleted in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]

    • GEN 4 Core Principles

      • GEN 4.1 Principles for Authorised Firms — application

        • GEN 4.1.1

          (1) The twelve Principles for Authorised FirmsG , set out in GEN section 4.2, apply subject to (2) and (3) to every Authorised FirmG in accordance with Rules GEN 4.1.2 and GEN 4.1.3.
          (2) The twelve Principles for Authorised FirmsG , set out in GEN section 4.2, do not apply to an Authorised FirmG which is a Representative OfficeG .
          (3) An Authorised FirmG which is a Credit Rating AgencyG does not have to comply with the Principles set out in Rules GEN 4.2.6, GEN 4.2.7, GEN 4.2.8 and GEN 4.2.9.
          Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
          [Amended]DFSA RM43/2007 (Made 1st June 2007). [VER14/06-07]
          [Amended] DFSA RM68/2009 (Made 3rd January 2010). [VER24/01-10]
          [Amended] DFSA RM95/2012 (Made 14th June 2012). [VER29/06-12]
          [Amended] DFSA RM96/2012 (Made 24th July 2012) [VER30/07-12]

        • GEN 4.1.2

          (1) For the purposes of GEN Rule 4.1.3 the term 'activities' means:
          (a) Financial ServicesG business;
          (b) activities carried on in connection with a Financial ServiceG business;
          (c) activities held out as being for the purpose of a Financial ServiceG business; and
          (d) in relation to any particular Principle, any activity specified in (2), (3) and (4).
          (2) Principles 3 and 4 also apply in a Prudential ContextG to an Authorised FirmG with respect to the carrying on of all its activities.
          (3) Principles 3 and 4 also take into account any activities of other members of the GroupG of which the Authorised FirmG is a member.
          (4) Principles 10 and 11, to the extent that it relates to disclosing to the DFSAG , also applies to an Authorised FirmG with respect to the carrying on of all its activities, and takes into account any activities of other members of the GroupG of which the Authorised FirmG is a member.

          Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
          [Amended]DFSA RM43/2007 (Made 1st June 2007). [VER14/06-07]
          [Amended] DFSA RM95/2012 (Made 14th June 2012). [VER29/06-12]

        • GEN 4.1.3

          (1) The PrinciplesG apply to an Authorised FirmG only with respect to activities carried on from an establishment maintained by it in the DIFCG , unless an extension in (2), (3), (4) or (5) applies.
          (2) Where another applicable RuleG , which is relevant to the activity, has a wider territorial scope than that in (1), any related PrincipleG applies with that wider scope in relation to the activity described in the RuleG .
          (3) Principles 1, 2 and 3 apply in a Prudential ContextG to an Authorised FirmG with respect to activities wherever they are carried on.
          (4) Principles 4 and 11 apply to an Authorised FirmG with respect to activities wherever they are carried on.
          (5) Principle 5 also applies to an Authorised FirmG with respect to the activities carried on in or from any place outside the DIFCG if and to the extent that the activities have, or might reasonably be regarded as likely to have, a negative effect on confidence in the financial markets operating in the DIFCG .
          Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
          [Amended]DFSA RM43/2007 (Made 1st June 2007). [VER14/06-07]

          • GEN 4.1.3 Guidance

            1. The Principles for Authorised FirmsG have the status of RulesG and are a general statement of fundamental regulatory requirements which apply alongside the other RulesG and also in new or unforeseen situations which may not be covered elsewhere by a specific RuleG . RulesG in other areas of the RulebookG build upon these fundamental principles. Consequently the RulesG and GuidanceG elsewhere in the RulebookG should not be seen as exhausting the implications of the Principles.
            2. Breaching a Principle for Authorised FirmsG makes an Authorised FirmG liable to disciplinary action, and may indicate that it is no longer fit and proper to carry on a Financial ServiceG or to hold a LicenceG and the DFSAG may consider withdrawing authorisation or the LicenceG on that basis.
            3. The onus will be on the DFSAG to show that the Authorised FirmG has been at fault in some way, taking into account the standard of conduct required under the Principle in question.

            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

      • GEN 4.2 The Principles for Authorised Firms

        • Principle 1 — Integrity

          • GEN 4.2.1

            An Authorised FirmG must observe high standards of integrity and fair dealing.


            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

        • Principle 2 — Due skill, care and diligence

          • GEN 4.2.2

            In conducting its business activities an Authorised FirmG must act with due skill, care and diligence.


            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

        • Principle 3 — Management, systems and controls

          • GEN 4.2.3

            An Authorised FirmG must ensure that its affairs are managed effectively and responsibly by its senior management. An Authorised FirmG must have adequate systems and controls to ensure, as far as is reasonably practical, that it complies with legislation applicable in the DIFCG .


            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

        • Principle 4 — Resources

          • GEN 4.2.4

            An Authorised FirmG must maintain and be able to demonstrate the existence of adequate resources to conduct and manage its affairs. These include adequate financial and system resources as well as adequate and competent human resources.


            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

        • Principle 5 — Market conduct

          • GEN 4.2.5

            An Authorised FirmG must observe proper standards of conduct in financial markets.


            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

        • Principle 6 — Information and interests

          • GEN 4.2.6

            An Authorised FirmG must pay due regard to the interests of its customers and communicate information to them in a way which is clear, fair and not misleading.


            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

        • Principle 7 — Conflicts of interest

          • GEN 4.2.7

            An Authorised FirmG must take all reasonable steps to ensure that conflicts of interest between itself and its customers, between its EmployeesG and customers and between one customer and another are identified and then prevented or managed, or disclosed, in such a way that the interests of a customer are not adversely affected.


            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
            [Amended] DFSA RM95/2012 (Made 14th June 2012). [VER29/06-12]

        • Principle 8 — Suitability

          • GEN 4.2.8

            An Authorised FirmG must take reasonable care to ensure the suitability of its advice and discretionary decisions for customers who are entitled to rely upon its judgement.


            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

        • Principle 9 — Customer assets and money

          • GEN 4.2.9

            Where an Authorised FirmG has control of or is otherwise responsible for assets or money belonging to a customer which it is required to safeguard, it must arrange proper protection for them in accordance with the responsibility it has accepted.


            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

        • Principle 10 — Relations with regulators

          • GEN 4.2.10

            An Authorised FirmG must deal with RegulatorsG in an open and co-operative manner and keep the DFSAG promptly informed of significant events or anything else relating to the Authorised FirmG of which the DFSAG would reasonably expect to be notified.


            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

        • Principle 11 — Compliance with high standards of corporate governance

          • GEN 4.2.11

            An Authorised FirmG must have a corporate governance framework as appropriate to the nature, scale and complexity of its business and structure, which is adequate to promote the sound and prudent management and oversight of the Authorised Firm'sG business and to protect the interests of its customers and stakeholders.

            [Added] DFSA RM43/2007 (Made 1st June 2007). [VER14/06-07]
            [Amended] DFSA RM95/2012 (Made 14th June 2012). [VER29/06-12]

            • GEN 4.2.11 Guidance

              Corporate governance framework encompasses structural and procedural arrangements such as systems, policies and practices that are put in place to promote good governance and include the specific measures required under GEN Rule 5.3.30.

              [Added] DFSA RM95/2012 (Made 14th June 2012). [VER29/06-12]

        • Principle 12 — Remuneration practices

          • GEN 4.2.12

            An Authorised FirmG must have a remuneration structure and strategies which are well aligned with the long term interests of the firm, and are appropriate to the nature, scale and complexity of its business.

            [Added] DFSA RM95/2012 (Made 14th June 2012). [VER29/06-12]

      • GEN 4.3 Principles for Authorised Individuals — application

        • GEN 4.3.1

          The six Principles for Authorised IndividualsG set out in GEN section 4.4 apply to every Authorised IndividualG in respect of every Licensed FunctionG .


          Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

          • GEN 4.3.1 Guidance

            1. The Principles for Authorised IndividualsG do not apply to an Authorised IndividualG in respect of any other functions he may carry out, although his conduct in those functions may be relevant to his fitness and propriety.
            2. Breaching a Principle for Authorised IndividualsG makes an Authorised IndividualG liable to disciplinary action and may indicate that he is no longer fit and proper to perform a Licensed FunctionG and the DFSAG may consider suspending or withdrawing Authorised IndividualG status on that basis.
            3. The onus will be on the DFSAG to show that he is culpable, taking into account the standard of conduct required under the Principle in question. In determining whether or not the particular conduct of an Authorised IndividualG complies with the Principles for Authorised IndividualsG , the DFSAG will take account of whether that conduct is consistent with the requirements and standards relevant to his Authorised FirmG , the Authorised Individual'sG own role and the information available to him.

            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

      • GEN 4.4 The Principles for Authorised Individuals

        • Principle 1 — Integrity

          • GEN 4.4.1

            An Authorised IndividualG must observe high standards of integrity and fair dealing in carrying out every Licensed FunctionG .


            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

        • Principle 2 — Due skill, care and diligence

          • GEN 4.4.2

            An Authorised IndividualG must act with due skill, care and diligence in carrying out every Licensed FunctionG .


            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

        • Principle 3 — Market conduct

          • GEN 4.4.3

            An Authorised IndividualG must observe proper standards of conduct in financial markets in carrying out every Licensed FunctionG .


            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

        • Principle 4 — Relations with the DFSA

          • GEN 4.4.4

            An Authorised IndividualG must deal with the DFSAG in an open and co-operative manner and must disclose appropriately any information of which the DFSAG would reasonably be expected to be notified.


            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

        • Principle 5 — Management, systems and control

          • GEN 4.4.5

            An Authorised IndividualG who has significant responsibility must take reasonable care to ensure that the business of the Authorised FirmG for which he is responsible is organised so that it can be managed and controlled effectively.


            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

        • Principle 6 — Compliance

          • GEN 4.4.6

            An Authorised IndividualG who has significant responsibility must take reasonable care to ensure that the business of the Authorised FirmG for which he is responsible complies with any legislation applicable in the DIFCG .


            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

    • GEN 5 Management, Systems and Controls

      • GEN 5.1 Application

        • GEN 5.1.1

          (1) Subject to (5), this chapter applies to every Authorised PersonG with respect to the Financial ServicesG carried on in or from the DIFCG .
          (2) It also applies in a Prudential ContextG to a Domestic FirmG with respect to all its activities wherever they are carried on.
          (3) GEN Section 5.3 also applies to an Authorised FirmG in a Prudential ContextG with respect to its entire DIFCG branch's activities wherever they are carried on.
          (4) This chapter also applies to an Authorised Market InstitutionG , if it has an endorsed LicenceG authorising it to maintain an Official List of SecuritiesG , with respect to such maintenance.
          (5) GEN Rules 5.3.13, 5.3.14, 5.3.15, 5.3.23, 5.3.24, 5.3.30 and 5.3.31 do not apply to an Authorised ISPVG .
          (6) This chapter does not apply to a Representative OfficeG .
          Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
          [Amended] DFSA RM19/2005 (as from 19th April 2005). [VER3/04-05]
          [Amended] DFSA RM48/2007 (Made 1st October 2007). [VER16/10-07]
          [Amended] DFSA RM68/2009 (Made 3rd January 2010). [VER24/01-10]
          [Amended] DFSA RM95/2012 (Made 14th June 2012). [VER29/06-12]

          • GEN 5.1.1 Guidance

            1. The purpose of this chapter is to set out the requirements for the Governing BodyG and the senior management within an Authorised PersonG who are to take direct responsibility for the Authorised Person'sG arrangements on matters likely to be of interest to the DFSAG wherever they may give rise to risks to the DFSA'sG objectives or they affect the DFSA'sG functions under the legislation applicable in the DIFCG . See also the requirements relating to organisation in Rules 5.3.2 and 5.3.3.
            2. In relation to an Authorised Market InstitutionG , this chapter should be read in conjunction with the AMI module.
            3. In relation to an Authorised FirmG which is a Fund ManagerG or the TrusteeG , this chapter should be read in conjunction with the CIR module and construed to take into account any FundG which the Authorised FirmG operates or for which it acts as the TrusteeG .
            4. In relation to an Authorised PersonG which carries on Islamic Financial BusinessG in or from the DIFC, this chapter should be read in conjunction with the IFR module.
            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
            [Amended] DFSA RM19/2005 (as from 19th April 2005). [VER3/04-05]
            [Amended][VER8/04-06]
            [Amended]DFSA RM34/2006[VER11/08-06]
            [Amended] DFSA RM72/2010 (Made 11th July 2010) [VER26/07-10]
            [Amended] DFSA RM95/2012 (Made 14th June 2012). [VER29/06-12]
            [Amended] DFSA RM105/2012 (Made 23rd December 2012). [VER32/12-12]

      • GEN 5.2 Allocation of significant responsibilities

        • Apportionment of significant responsibilities

          • GEN 5.2.1

            An Authorised PersonG must apportion significant responsibilities between the members of its Governing BodyG and its senior management and maintain such apportionment in such a way that:

            (a) it meets the corporate governance requirements in Rule 5.3.30;
            (b) it is appropriate with regard to:
            (i) the nature, scale and complexity of the business of the Authorised PersonG ; and
            (ii) the ability and qualifications of the responsible individuals;
            (c) it is clear who is responsible for which matters; and
            (d) the business of the Authorised PersonG can be adequately monitored and controlled by the Authorised Person'sG Governing BodyG and senior management.

            [Amended]DFSA RM43/2007 (Made 1st June 2007). [VER14/06-07]
            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
            [Amended] DFSA RM95/2012 (Made 14th June 2012). [VER29/06-12]

          • GEN 5.2.2

            An Authorised PersonG must allocate to the Senior Executive OfficerG or to the individual holding equivalent responsibility for the conduct for the Authorised Person'sG business or the Governing BodyG , the functions of:

            (a) dealing with the apportionment of responsibilities; and
            (b) overseeing the establishment and maintenance of systems and controls.

            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

            • GEN 5.2.2 Guidance

              Rules 5.2.1 and 5.2.2 do not derogate from the overall responsibility of the Governing BodyG in Rule 5.3.30(2).

              [Added]DFSA RM43/2007 (Made 1st June 2007). [VER14/06-07]
              [Amended] DFSA RM95/2012 (Made 14th June 2012). [VER29/06-12]

        • Recording of apportionment

          • GEN 5.2.3

            (1) An Authorised PersonG must establish and maintain an up-to-date record of the arrangements it has made to comply with Rules GEN 5.2.1 and GEN 5.2.2.
            (2) The record must show that the members of the Governing BodyG and the senior management are aware of and have accepted the responsibilities apportioned in accordance with GEN Rule 5.2.1.
            (3) Where a responsibility has been allocated to more than one individual, the record must show clearly how that responsibility is allocated between the individuals.
            (4) The record must be retained for six years from the date on which it was established or superseded by a more up-to-date record.

            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
            [Amended] DFSA RM95/2012 (Made 14th June 2012). [VER29/06-12]

      • GEN 5.3 Systems and controls

        • General requirement

          • GEN 5.3.1

            (1) An Authorised PersonG must establish and maintain systems and controls, including but not limited to financial and risk systems and controls, that ensure that its affairs are managed effectively and responsibly by its senior management.
            (2) An Authorised PersonG must undertake regular reviews of its systems and controls.
            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
            [Amended] DFSA RM43/2007 (Made 1st June 2007). [VER14/06-07]

            • GEN 5.3.1 Guidance

              The nature and extent of the systems and controls of an Authorised PersonG will depend upon a variety of factors including the nature, scale and complexity of its business. While all Authorised PersonsG , irrespective of the nature, scale, and complexity of their business and legal structure or organisation need to comply with this chapter, the DFSAG will take into account these factors and the differences that exist between Authorised PersonsG when assessing the adequacy of an Authorised Person'sG systems and controls. Nevertheless, neither these factors nor the differences relieve an Authorised PersonG from compliance with its regulatory obligations.


              Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
              [Amended] DFSA RM95/2012 (Made 14th June 2012). [VER29/06-12]

        • Organisation

          • GEN 5.3.2

            (1) An Authorised PersonG must establish and implement, taking due account of the nature, scale and complexity of its business and structure, adequate measures to ensure that:
            (a) the roles and responsibilities assigned to its Governing BodyG and the members of that body, senior management and Persons Undertaking Key Control FunctionsG are clearly defined;
            (b) there are clear reporting lines applicable to the individuals undertaking those functions; and
            (c) the roles, responsibilities and reporting lines referred to in (a) and (b), are documented and communicated to all relevant EmployeesG .
            (2) An Authorised FirmG must ensure that any EmployeeG who will be delivering Financial ServicesG to its customers is clearly identified, together with his respective lines of accountability and supervision.
            (3) An Authorised FirmG which is conducting Investment BusinessG or the Financial ServicesG of Providing Fund AdministrationG or Providing Trust ServicesG , must ensure it makes publically available details of any EmployeeG who delivers Financial ServicesG to its customers, by including such information:
            (a) in a register, maintained by the Authorised FirmG at its place of business and open for inspection during business hours; or
            (b) on the website of the Authorised FirmG .
            (4) An Authorised FirmG referred to in (3), must have complete and up to date information on its register or website, including:
            (a) the date on which the relevant EmployeeG commenced delivering of Financial ServicesG to customers; and
            (b) the Financial ServicesG which that EmployeeG is permitted by the Authorised FirmG to deliver to customers.
            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
            [Amended][VER10/06-06]
            [Amended] DFSA RM95/2012 (Made 14th June 2012). [VER29/06-12]
            [Amended] DFSA RM96/2012 (Made 24th July 2012) [VER30/07-12]

            • GEN 5.3.2 Guidance

              1. The term EmployeeG is defined in the GLOG widely and includes members of the Governing BodyG or directors and senior managers of the Authorised FirmG . Therefore, the requirements relating to EmployeesG in Rules 5.3.3 and 5.3.6 apply to all EmployeesG including those across the organisation.
              2. The division of responsibilities between the Governing BodyG and the senior management should be clearly established and set out in writing. In assigning duties, the Governing BodyG should take care that no one individual has unfettered powers in making material decisions.
              3. Members of the Governing BodyG may include individuals undertaking senior management functions (such as the chief executive of the firm) and Persons Undertaking Key Control FunctionsG . In assigning specific functions to such individuals, care should be taken to ensure that the integrity and effectiveness of the functions they are to perform are not compromised. For example, if the ChairpersonG of the Governing BodyG is also the chief executive officer of the Authorised PersonG , the Governing BodyG should ensure that the performance assessment of that individual in his roles should be undertaken by a senior non-executive member of the Governing BodyG or an independent external consultant.
              4. Persons Undertaking Key Control FunctionsG are defined in GLOG in an inclusive manner to encompass PersonsG such as the heads of risk control, compliance and internal audit functions. In the case of an InsurerG , the actuary also is a PersonG who Undertakes a Key Control FunctionG .
              5. An example of an EmployeeG providing Financial ServicesG to a customer is a client relationship manager employed by an Authorised FirmG providing wealth management services. In contrast, an EmployeeG who may be employed in the back office of an Authorised FirmG with responsibility for setting up client accounts would not be client facing.
              [Added] DFSA RM95/2012 (Made 14th June 2012). [VER29/06-12]
              [Amended] DFSA RM96/2012 (Made 24th July 2012) [VER30/07-12]

          • GEN 5.3.3

            An Authorised PersonG must ensure that key duties and functions are segregated. Such segregation must ensure that the duties and functions to be performed by the same individual do not conflict with each other, thereby impairing the effective discharge of those functions by the relevant individuals (such as undetected errors or any abuse of positions) and thus exposing the Authorised PersonG or its customers or users to inappropriate risks.

            [Added] DFSA RM96/2012 (Made 24th July 2012) [VER30/07-12]

        • Risk management

          • GEN 5.3.4

            An Authorised PersonG must establish and maintain risk management systems and controls to enable it to identify, assess, mitigate, control and monitor its risks.


            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

          • GEN 5.3.5

            An Authorised PersonG must develop, implement and maintain policies and procedures to manage the risks to which the Authorised PersonG and where applicable, its customers or users, are exposed.


            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

          • GEN 5.3.6

            (1) An Authorised PersonG must appoint an individual to advise its Governing BodyG and senior management of such risks.
            (2) An Authorised PersonG which is part of a GroupG should be aware of the implications of any GroupG wide risk policy and systems and controls regime.

            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

        • Compliance

          • GEN 5.3.7

            An Authorised PersonG must establish and maintain compliance arrangements, including processes and procedures that ensure and evidence, as far as reasonably practicable, that the Authorised FirmG complies with all legislation applicable in the DIFCG .


            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
            [Amended] DFSA RM119/2013 (Made 14th July 2013). [VER33/07-13]

          • GEN 5.3.8

            An Authorised PersonG must document the organisation, responsibilities and procedures of the compliance function.


            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
            [Amended] DFSA RM119/2013 (Made 14th July 2013). [VER33/07-13]

          • GEN 5.3.9

            An Authorised PersonG must ensure that the Compliance OfficerG has access to sufficient resources, including an adequate number of competent staff, to perform his duties objectively and independently of operational and business functions.


            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
            [Amended] DFSA RM119/2013 (Made 14th July 2013). [VER33/07-13]

          • GEN 5.3.10

            An Authorised PersonG must ensure that the Compliance OfficerG has unrestricted access to relevant records and to the Authorised Person'sG Governing BodyG and senior management.


            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
            [Amended] DFSA RM119/2013 (Made 14th July 2013). [VER33/07-13]

          • GEN 5.3.11

            An Authorised PersonG must establish and maintain monitoring and reporting processes and procedures to ensure that any compliance breaches are readily identified, reported and promptly acted upon.


            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
            [Amended] DFSA RM119/2013 (Made 14th July 2013). [VER33/07-13]

          • GEN 5.3.12

            An Authorised PersonG must document the monitoring and reporting processes and procedures as well as keep records of breaches of any of legislation applicable in the DIFCG .

            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
            [Amended] DFSA RM119/2013 (Made 14th July 2013). [VER33/07-13]

            • [Deleted]

              [Deleted] DFSA RM119/2013 (Made 14th July 2013). [VER33/07-13]

        • Internal audit

          • GEN 5.3.13

            (1) An Authorised PersonG must establish and maintain an internal audit function with responsibility for monitoring the appropriateness and effectiveness of its systems and controls.
            (2) The internal audit function must be independent from operational and business functions.

            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

            • GEN 5.3.13 Guidance

              The PersonG appointed as the Internal AuditorG of an Authorised Market InstitutionG is a Key IndividualG pursuant to AMI Rule 5.3.1.

              [Added] DFSA RM119/2013 (Made 14th July 2013). [VER33/07-13]

          • GEN 5.3.14

            An Authorised PersonG must ensure that its internal audit function has unrestricted access to all relevant records and recourse when needed to the Authorised Person'sG Governing BodyG or the relevant committee, established by its Governing BodyG for this purpose.


            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

          • GEN 5.3.15

            An Authorised PersonG must document the organisation, responsibilities and procedures of the internal audit function.


            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

        • Business plan and strategy

          • GEN 5.3.16

            (1) An Authorised PersonG must produce a business plan which enables it, amongst other things, to manage the risks to which it and its customers are exposed.
            (2) The business plan must take into account the Authorised Person'sG current business activities and the business activities forecast for the next twelve months.
            (3) The business plan must be documented and updated as appropriate to take account of changes in the business environment and to reflect changes in the business of the Authorised PersonG .

            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

        • Management information

          • GEN 5.3.17

            An Authorised PersonG must establish and maintain arrangements to provide its Governing BodyG and senior management with the information necessary to organise, monitor and control its activities, to comply with legislation applicable in the DIFCG and to manage risks. The information must be relevant, accurate, comprehensive, timely and reliable.


            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
            [Amended] DFSA RM95/2012 (Made 14th June 2012). [VER29/06-12]

        • Staff and agents

          • GEN 5.3.18

            An Authorised PersonG must establish and maintain systems and controls that enable it to satisfy itself of the suitability of anyone who acts for it.

            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

          • GEN 5.3.19

            (1) An Authorised FirmG must ensure, as far as reasonably practical, that its EmployeesG are:
            (a) fit and proper;
            (b) competent and capable of performing the functions which are to be assigned to those EmployeesG ; and
            (c) trained in the requirements of the legislation applicable in the DIFCG .
            (2) An Authorised FirmG must establish and maintain systems and controls to comply with (1). An Authorised FirmG must be able to demonstrate that it has complied with these requirements through appropriate measures, including the maintenance of relevant records.
            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
            [Amended] [VER10/06-06]
            [Amended] DFSA RM56/2008 (Made 1st July 2008). [VER19/07-08]

            • GEN 5.3.19 Guidance

              1.  When considering whether an EmployeeG is fit and proper, competent and capable, an Authorised FirmG should consider any training undertaken or required by an EmployeeG , the nature of the ClientsG to whom an EmployeeG provides Financial ServicesG , and the type of activities performed by an EmployeeG in the provision of such Financial ServicesG including any interface with ClientsG .
              2.  When assessing the fitness and propriety of EmployeesG , an Authorised FirmG should be guided by the matters set out in section 2.3 of the RPP Sourcebook and should also monitor conflicts or potential conflicts of interest arising from all of the individual's links and activities.
              3.  When assessing the competence and capability of an Authorised FirmG should:
              a.  obtain details of the skills, knowledge and experience of the EmployeeG relevant to the nature and requirements of the role;
              b.  take reasonable steps to verify the relevance, accuracy and authenticity of any information obtained;
              c.  determine, in light of the Employee'sG relevant skills, knowledge and experience, that the EmployeeG is competent and capable of fulfilling the duties of the role; and
              d.  consider the level of responsibility that the EmployeeG will assume within the Authorised FirmG , including whether the EmployeeG will be providing Financial ServicesG to Retail ClientsG in an interfacing role.
              4.  An Authorised FirmG should also satisfy itself that an EmployeeG :
              a.  continues to be competent and capable of performing its the role;
              b.  has kept abreast of market, product, technology, legislative and regulatory developments that are relevant to the role, through training or other means; and
              c.  is able to apply his knowledge.
              5. Refer to section 2.2.13 of the RPP Sourcebook for criteria for suitability of members of the Governing BodyG of the Authorised FirmG .
              Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
              [Amended] [VER10/06-06]
              [Amended] DFSA RM56/2008 (Made 1st July 2008). [VER19/07-08]
              Amended in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]
              [Amended] DFSA RM95/2012 (Made 14th June 2012). [VER29/06-12]

        • Conduct

          • GEN 5.3.20

            An Authorised PersonG must establish and maintain systems and controls that ensure, as far as reasonably practical, that the Authorised PersonG and its EmployeesG do not engage in conduct, or facilitate others to engage in conduct, which may constitute:

            (a) market abuse, whether in the DIFCG or elsewhere; or
            (b) a financial crime under any applicable U.A.E.G laws.
            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
            [Amended] DFSA RM119/2013 (Made 14th July 2013). [VER33/07-13]
            [Amended] DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

            • GEN 5.3.20 Guidance [Deleted]

              [Deleted] DFSA RM95/2012 (Made 14th June 2012). [VER29/06-12]

        • Outsourcing

          • GEN 5.3.21

            (1) An Authorised PersonG which outsources any of its functions or activities directly related to Financial ServicesG to service providers (including within its GroupG ) is not relieved of its regulatory obligations and remains responsible for compliance with legislation applicable in the DIFCG .
            (2) The outsourced function under this RuleG shall be deemed as being carried out by the Authorised PersonG itself.
            (3) An Authorised PersonG which uses such third party providers must ensure that it:
            (a) has undertaken due diligence in choosing suitable service providers;
            (b) effectively supervises the outsourced functions or activities; and
            (c) deals effectively with any act or failure to act by the service provider that leads, or might lead, to a breach of any legislation applicable in the DIFCG .

            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
            Amended in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]

          • GEN 5.3.22

            (1) An Authorised PersonG must inform the DFSAG about any material outsourcing arrangements.
            (2) An Authorised PersonG which has a material outsourcing arrangement must:
            (a) establish and maintain comprehensive outsourcing policies, contingency plans and outsourcing risk management programmes;
            (b) enter into an appropriate and written outsourcing contract; and
            (c) ensure that the outsourcing arrangements neither reduce its ability to fulfil its obligations to customers and the DFSAG , nor hinder supervision of the Authorised PersonG by the DFSAG .
            (3) An Authorised PersonG must ensure that the terms of its outsourcing contract with each service provider under a material outsourcing arrangement require the service provider to:
            (a) provide for the provision of information under section 11.1 in relation to the Authorised PersonG and access to their business premises; and
            (b) deal in an open and co-operative way with the DFSAG .
            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
            Amended in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]

            • GEN 5.3.22 Guidance

              1. An Authorised Person'sG outsourcing arrangements should include consideration of:
              a. applicable guiding principles for outsourcing in financial services issued by the Joint ForumG ; or
              b. any equivalent principles or regulations the Authorised PersonG is subject to in its home country jurisdiction.
              2. An outsourcing arrangement would be considered to be material if it is a service of such importance that weakness or failure of that service would cast serious doubt on the Authorised Person'sG continuing ability to remain fit and proper or to comply with DFSAG administered Laws and Rules.

        • Business continuity and disaster recovery

          • GEN 5.3.23

            (1) An Authorised PersonG must have in place adequate arrangements to ensure that it can continue to function and meet its obligations under the legislation applicable in the DIFCG in the event of an unforeseen interruption.
            (2) These arrangements must be kept up to date and regularly tested to ensure their effectiveness.
            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

            • GEN 5.3.23 Guidance

              1. In considering the adequacy of an Authorised Person'sG business continuity arrangements, the DFSAG will have regard to the Authorised Person'sG management of the specific risks arising from interruptions to its business including its crisis management and disaster recovery plans.
              2. The DFSAG expects an Authorised PersonG to have:
              a. arrangements which establish and maintain the Authorised Person'sG physical security and protection for its information systems for business continuity purposes in the event of planned or unplanned information system interruption or other events that impact on its operations;
              b. considered its primary data centres' and business operations' reliance on infrastructure components, for example transportation, telecommunications networks and utilities and made the necessary arrangements to minimise the risk of interruption to its operations by arranging backup of infrastructure components and service providers; and
              c. considered, in its plans for dealing with a major interruption to its primary data centre or business operations, its alternative data centres' and business operations' reliance on infrastructure components and made the necessary arrangements such that these do not rely on the same infrastructure components and the same service provider as the primary data centres and operations.

              Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

        • [Deleted]

          [Deleted] DFSA RM56/2008 (Made 1st July 2008). [VER19/07-08]

          • GEN 5.3.24 [Deleted]

            [Deleted] DFSA RM56/2008 (Made 1st July 2008). [VER19/07-08]

            • [Deleted]

              [Deleted] DFSA RM56/2008 (Made 1st July 2008). [VER19/07-08]

        • Records

          • GEN 5.3.24

            (1) An Authorised PersonG must make and retain records of matters and dealings, including Accounting RecordsG and corporate governance practices which are the subject of requirements and standards under the legislation applicable in the DIFC.
            (2) Such records, however stored, must be capable of reproduction on paper within a reasonable period not exceeding 3 business days.
            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
            [Amended] DFSA RM42/2007 (Made 15th February 2007). [VER13/02-07]
            Amended in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]
            [Amended] DFSA RM119/2013 (Made 14th July 2013). [VER33/07-13]

          • GEN 5.3.25

            Subject to GEN Rule 5.3.26, the records required by GEN Rule 5.3.24 or by any other rule in this RulebookG must be maintained by the Authorised PersonG in the English language.


            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
            Amended in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]

          • GEN 5.3.26

            If an Authorised Person'sG records relate to business carried on from an establishment in a territory outside the DIFCG , an official language of that territory may be used instead of the English language as required by GEN Rule 5.3.25.


            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
            Amended in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]

          • GEN 5.3.27

            An Authorised PersonG must have systems and controls to fulfil the Authorised Person'sG legal and regulatory obligations with respect to adequacy, access, period of retention and security of records.


            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
            Amended in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]

        • Fraud

          • GEN 5.3.28

            An Authorised PersonG must establish and maintain effective systems and controls to:

            (a) deter and prevent suspected fraud against the Authorised PersonG ; and
            (b) report suspected fraud and other financial crimes to the relevant authorities.
            [Added]DFSA RM43/2007 (Made 1st June 2007). [VER14/06-07]
            Amended in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]

        • [Deleted]

          [Deleted] DFSA RM119/2013 (Made 14th July 2013). [VER33/07-13]

          • GEN 5.3.29 [Deleted]

            [Deleted] DFSA RM119/2013 (Made 14th July 2013). [VER33/07-13]

            • GEN 5.3.29 Guidance [Deleted]

              [Deleted] DFSA RM119/2013 (Made 14th July 2013). [VER33/07-13]

        • Corporate Governance

          • GEN 5.3.30

            (1) An Authorised PersonG must have a Governing BodyG and senior management that meet the requirements in (2) and (3) respectively.
            (2) The Governing BodyG of the Authorised PersonG must:
            (a) be clearly responsible for setting or approving (or both) the business objectives of the firm and the strategies for achieving those objectives and for providing effective oversight of the management of the firm;
            (b) comprise an adequate number and mix of individuals who have, among them, the relevant knowledge, skills, expertise and time commitment necessary to effectively carry out the duties and functions of the Governing BodyG ; and
            (c) have adequate powers and resources, including its own governance practices and procedures, to enable it to discharge those duties and functions effectively.
            (3) The senior management of the Authorised PersonG must be clearly responsible for the day-to-day management of the firm's business in accordance with the business objectives and strategies approved or set by the Governing BodyG .
            [Added] DFSA RM95/2012 (Made 14th June 2012). [VER29/06-12]

            • GEN 5.3.30 Guidance

              Scope of corporate governance

              1. Corporate governance is a framework of systems, policies, procedures and controls through which an entity:
              a. promotes the sound and prudent management of its business;
              b. protects the interests of its customers and stakeholders; and
              c. places clear responsibility for achieving (a) and (b) on the Governing BodyG and its members and the senior management of the Authorised PersonG .
              2. Many requirements designed to ensure sound corporate governance of companies, such as those relating to shareholder and minority protection and responsibilities of the Board of DirectorsG of companies, are found in the company laws and apply to Authorised PersonsG . Additional disclosure requirements also apply if they are listed companies. The requirements in this Module are tailored to Authorised PersonsG and are designed to augment and not to exclude the application of those requirements.
              3. Whilst Rule 5.3.30 deals with two aspects of corporate governance, the requirements included in other provisions under sections 5.2 and 5.3 also go to the heart of sound corporate governance by promoting prudent and sound management of the Authorised Person'sG business in the interest of its customers and stakeholders. These requirements together are designed to promote sound corporate governance practices in Authorised PersonsG whilst also providing a greater degree of flexibility for Authorised PersonsG in establishing and implementing a corporate governance framework that are both appropriate and practicable to suit their operations.
              4. Stakeholder groups of an Authorised PersonG , who would benefit from the sound and prudent management of firms, can be varied but generally encompass its owners (shareholders), customers (in the case of an AMIG , its members and investors), creditors, counterparties and employees, whose interests may not necessarily be mutually coextensive. A key objective in enhancing corporate governance standards applicable to Authorised PersonsG is to ensure that firms are soundly and prudently managed, with the primary regard being had to its customers.

              Proportionate application to firms depending on the nature of their business

              5. One of the key considerations that underpins how the corporate governance requirements set out in Rule 5.3.30 apply to an Authorised PersonG is the nature, scale and complexity of the Authorised Person'sG business, and its organisational structure.
              6. While requiring banks, insurers and dealers to have more detailed and complex corporate governance systems and controls, simpler systems and procedures could be required for other firms, depending on the nature and scale of their Financial ServicesG . For example, in the case of certain types of Category 4 Financial ServiceG providers such as arranging or advising only firms, less extensive and simpler corporate governance systems and procedures may be sufficient to meet their corporate governance obligations.
              7. For example, an Authorised PersonG which is a small scale operation with a tightly held ownership structure may not have a Governing BodyG which comprises members who are fully independent of the firm's business and from each other, nor be sufficiently large to be able to form numerous committees of the Governing BodyG to undertake various functions such as nomination and remuneration. In such cases, whilst strict adherence to such aspects of best practice would not be required, overall measures as appropriate to achieve the sound and prudent management of the business would be needed. For example, a firm with no regulatory track record would be expected to have additional corporate governance controls in place to ensure the sound and prudent management of its business, such as the appointment of an independent director (who has relevant regulatory experience) to its Governing BodyG .

              Application to Branches and Groups

              8. As part of the flexible and proportionate application of corporate governance standards to firms, whether a firm is a BranchG or a subsidiary within a GroupG is also taken into account. An Authorised PersonG which is a member of a GroupG may, instead of developing its own corporate governance policies, adopt group-wide corporate governance standards. However, the Governing BodyG of the Authorised PersonG should consider whether those standards are appropriate for the firm, and to the extent possible, make any changes as necessary.
              9. In the case of a BranchG , corporate governance practices adopted at the head office would generally apply to the BranchG and are expected to be adequate. The DFSAG considers, as part of its authorisation of a BranchG and on-going supervision, the adequacy of regulatory and supervisory arrangements applicable in the home jurisdiction, including a corporate governance framework adopted and implemented by the head office (see section 3.2.15 of the RPP Sourcebook).

              Best practice relating to corporate governance

              10. In addition to the considerations noted above, best practice that an Authorised PersonG may adopt to achieve compliance with the applicable corporate governance standards is set out in Guidance at Appendix 3.1. An Authorised PersonG may, where the best practice set out in App3.1 is not suited to its particular business or structure, deviate from such best practice or any aspects thereof. The DFSAG will expect the Authorised PersonG to demonstrate to the DFSAG , upon request, what the deviations are and why such deviations are considered by the Authorised PersonG to be appropriate.
              [Added] DFSA RM95/2012 (Made 14th June 2012). [VER29/06-12]

        • Remuneration structure and strategies

          • GEN 5.3.31

            (1) The Governing BodyG of an Authorised PersonG must ensure that the remuneration structure and strategy of the firm:
            (a) are consistent with the business objectives and strategies and the identified risk parameters within which the firm's business is to be conducted;
            (b) provide for effective alignment of risk outcomes and the roles and functions of the EmployeesG , taking account of:
            (i) the nature of the roles and functions of the relevant EmployeesG ; and
            (ii) whether the actions of the EmployeesG may expose the firm to unacceptable financial, reputational and other risks;
            (c) at a minimum, include the members of its Governing BodyG , the senior management, Persons Undertaking Key Control FunctionsG and any major risk-taking EmployeesG ; and
            (d) are implemented and monitored to ensure that they operate, on an on-going basis, effectively and as intended.
            (2) The Governing BodyG must provide to the DFSAG and relevant stakeholders sufficient information about its remuneration structure and strategies to demonstrate that such structure and strategies meet the requirements in (1) on an on-going basis.
            (3) For the purposes of this Rule, "major risk-taking EmployeesG " are EmployeesG whose actions have a material impact on the risk exposure of the Authorised PersonG .
            [Added] DFSA RM95/2012 (Made 14th June 2012). [VER29/06-12]

            • GEN 5.3.31 Guidance

              Proportionate application to firms depending on the nature of their business

              1. Those considerations set out in Guidance items 5 – 7 under Rule 5.3.30 apply equally to the way in which the remuneration structure and strategies related requirement in Rule 5.3.31 is designed to apply to an Authorised PersonG . Accordingly, whilst most Category 4 firms may have simple arrangements to achieve the outcome of aligning performance outcomes and risks associated with remuneration structure and strategies, banks, insurers and dealers are expected to have more stringent measures to address such risks.

              Application to Branches and Groups

              2. As part of the flexible and proportionate application of corporate governance standards to firms, whether a firm is a BranchG or a subsidiary within a GroupG is also taken into account. As such, the considerations noted in Guidance items 8 – 9 under Rule 5.3.30 apply equally to the application of the remuneration related requirements for BranchesG and GroupsG . For example, where an Authorised PersonG is a member of a GroupG , its Governing BodyG should consider whether the Group wide policies, such as those relating to the EmployeesG covered under the remuneration strategy and the disclosure relating to remuneration made at the GroupG level are adequate to meet its obligations under Rule 5.3.31.

              Best practice relating to corporate governance

              3. In addition to the considerations noted above, best practice that an Authorised PersonG may adopt to promote sound remuneration structure and strategies within the firm is set out as Guidance at Appendix 3.2. Where such best practice or any aspects thereof are not suited to a particular Authorised Person'sG business or structure, it may deviate from such best practice. The DFSAG will expect the Authorised PersonG to demonstrate, upon request, what the deviations are and why such deviations are considered appropriate.

              Disclosure of information relating to remuneration structure and strategy

              4. The information which an Authorised PersonG provides to the DFSAG relating to its remuneration structure and strategies should be included in the annual report or accounting statements. The DFSAG expects the annual report of Authorised PersonsG to include, at a minimum, information relating to:
              a. the decision making process used to determine the firm-wide remuneration policy (such as by a remuneration committee or an external consultant if any, or by the Governing BodyG ):
              b. the most important elements of its remuneration structure (such as, in the case of performance based remuneration, the link between pay and performance and the relevant assessment criteria); and
              c. aggregate quantitative information on remuneration of its Governing Body, the senior management, Persons Undertaking Key Control FunctionsG and any major risk taking EmployeesG .
              5. The DFSAG may, pursuant to its supervisory powers, require additional information relating to the remuneration structure and strategy of an Authorised FirmG to assess whether the general elements relating to remuneration under Rule 5.3.31(1) are met by the firm. Any significant changes to the remuneration structure and strategy should also be notified to the DFSAG before being implemented. See Rule 11.10.20.
              6. The information included in the annual report is made available to the DFSAG and the shareholders, and in the case of a listed company, to the public. The Governing BodyG of the Authorised PersonG should also consider what additional information should be included in the annual report. In the case of banks, insurers and dealers, more detailed disclosure of remuneration structure and strategy and its impact on the financial soundness of the firm would be required. When providing disclosure relating to remuneration in its annual report, Authorised PersonsG should take account of the legal obligations that apply to the firm including the confidentiality of information obligations.
              [Added] DFSA RM95/2012 (Made 14th June 2012). [VER29/06-12]

    • GEN 6 General Provisions

      • GEN 6.1 Application

        • GEN 6.1.1

          (1) Sections GEN 6.1, GEN 6.2, GEN 6.3, GEN 6.9 and GEN 6.10 apply to every PersonG to whom any provision in the RulebookG applies.
          (2) GEN Section 6.4 applies to every Authorised PersonG .
          (3) Sections GEN 6.5 and GEN 6.6 apply to every Authorised FirmG , Authorised Market InstitutionG and PersonG who has submitted an application for authorisation to carry on one or more Financial ServicesG .
          (4) GEN Section 6.7 applies to any PersonG who has been affected by the activities of the DFSAG .
          (5) GEN Section 6.8 applies to the DFSAG .
          (6) Only sections 6.9 and 6.10 of this chapter apply to a Representative OfficeG .

          Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
          [Amended] DFSA RM19/2005 (as from 19th April 2005). [VER3/04-05]
          [Amended] DFSA RM68/2009 (Made 3rd January 2010). [VER24/01-10]
          [Amended] DFSA RM176/2016 (Made 19th June 2016) [VER37/08-16]

      • GEN 6.2 Interpreting the rulebook

        • GEN 6.2 Guidance

          Interpretation

          1. Every provision in the RulebookG must be interpreted in the light of its purpose. The purpose of any provision is to be gathered first and foremost from the text of the provision in question and its context among other relevant provisions.
          2. When this section refers to a provision, this means every type of provision, including RulesG and GuidanceG .
          3. Where reference is made in the RulebookG to another provision of the RulebookG or other DIFCG legislation, it is a reference to that provision as amended from time to time.
          4. Unless the contrary intention appears:
          a. words in the RulebookG importing the masculine gender include the feminine gender and words importing the feminine gender include the masculine; and
          b. words in the RulebookG in the singular include the plural and words in the plural include the singular.
          5. If a provision in the RulebookG refers to a communication, notice, agreement, or other document 'in writing' then, unless the contrary intention appears, it means in legible form and capable of being reproduced on paper, irrespective of the medium used. Expressions related to writing must be interpreted accordingly.
          6. Any reference to 'dollars' or '$' is a reference to United States Dollars unless the contrary intention appears.
          7. References to Articles made throughout the RulebookG are references to Articles in the Regulatory Law 2004 unless otherwise stated.
          8. Unless stated otherwise, a day means a calendar day. If an obligation falls on a calendar day which is either a Friday or Saturday or an official State holiday in the DIFC, the obligation must take place on the next calendar day which is a business day.

          Defined Terms

          9. Defined terms are identified throughout the RulebookG by the capitalisation of the initial letter of a word or of each word in a phrase and are defined in the Glossary (GLO), however, where a word or phrase is used only in a prudential context in PIB then for convenience purposes it is only defined under PIB Rule 1.2.1 rather than in GLO. Unless the context otherwise requires, where capitalisation of the initial letter is not used, an expression has its natural meaning.

          Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
          [Amended][VER9/05-06]
          [Amended] DFSA RM42/2007 (Made 15th February 2007). [VER13/02-07]
          [Amended] DFSA RM112/2012 (Made 15th October 2012). [VER31/12-12]

      • GEN 6.3 Emergency

        • GEN 6.3.1

          (1) If an Authorised PersonG is unable to comply with a particular RuleG due to an emergency which is outside its or its Employees'G control and could not have been avoided by taking all reasonable steps, the Authorised PersonG will not be in contravention of that RuleG to the extent that, in consequence of the emergency, compliance with that RuleG is impractical.
          (2) This RuleG applies only for so long as the consequences of the emergency continue and the Authorised PersonG is able demonstrate that it is taking all practical steps to deal with those consequences, to comply with the RuleG , and to mitigate losses and potential losses to its customers or users.
          (3) An Authorised PersonG must notify the DFSAG as soon as practical of the emergency and of the steps it is taking and proposes to take to deal with the consequences of the emergency.
          Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

      • GEN 6.4 Disclosure of regulatory status

        • GEN 6.4.1

          An Authorised PersonG must not misrepresent its status expressly or by implication.


          Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

        • GEN 6.4.2

          (1) An Authorised PersonG must take reasonable care to ensure that every key business document which is in connection with the Authorised PersonG carrying on a Financial ServiceG in or from the DIFCG includes one of the disclosures under this RuleG .
          (2) A key business document includes letterhead whether issued by post, fax or electronic means, terms of business, client agreements, written promotional materials, business cards, prospectuses and websites but does not include compliment slips, account statements or text messages.
          (3) The disclosure required under this RuleG is:
          (a) 'Regulated by the Dubai Financial Services Authority'; or
          (b) 'Regulated by the DFSAG '.
          (4) The DFSAG logo must not be reproduced without express written permission from the DFSAG and in accordance with any conditions for use.
          (5) Rules GEN 6.4.2(1) to (4) also apply to the operation and administration of an Official List of SecuritiesG by an Authorised Market InstitutionG .
          Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
          [Amended] DFSA RM19/2005 (as from 19th April 2005). [VER3/04-05]
          Amended in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]

      • GEN 6.5 Location of offices

        • GEN 6.5.1

          (1) Where an Authorised PersonG is a Body CorporateG incorporated in the DIFCG , its head office and registered office must be in the DIFCG .
          (2) Where an Authorised PersonG is a partnership established under the Limited Partnership Law 2004 or the General Partnership Law 2006, its head office and registered office must be in the DIFCG .
          (3) Where an Authorised PersonG operates in the DIFCG through a BranchG :
          (a) it must have a place of business in the DIFCG that is the principal place where it carries on the activities for which it is authorised by the DFSAG ; and
          (b) that place of business must be its address in the DIFCG to which communications and notices may be addressed.
          (4) An applicant for authorisation to carry on one or more Financial ServicesG must satisfy the DFSAG that it will meet the requirements in this Rule when the authorisation is granted.
          (5) In this Rule:
          (a) "head office" means the principal place where an Authorised PersonG carries on:
          (i) the day-to-day management and control of its business, wherever that business may be conducted; and
          (ii) the activities for which it is authorised by the DFSAG ; and
          (b) "registered office" has the meaning given in the Companies Law 2009, Limited Partnership Law 2004 or General Partnership Law 2006, as applicable.
          Derived from DFSA RM01/2004 (Made 16th September 2004) [VER1/09-04]
          [Amended] DFSA RM105/2012 (Made 23rd December 2012). [VER32/12-12]
          [Amended] DFSA RM155/2015 (Made 9th December 2015) [VER35/02-16]

          • GEN 6.5.1 Guidance

            1. In considering the location of an Authorised Firm'sG or Authorised Market Institution'sG head office, the DFSAG will have regard to the location of its directors, partners and senior management and to the main location of its day-to-day operational, control, management and administrative arrangements and will judge matters on a case by case basis.
            2. An Authorised FirmG , Authorised Market InstitutionG or an applicant for authorisation which does not satisfy the DFSAG with respect to the location of its offices will, on this point alone not be considered fit and proper or able to satisfy the Licensing RequirementsG .
            3. The DFSAG expects all Authorised PersonsG to have a physical presence, including EmployeesG , in the DIFCG . The DFSAG does not permit 'brass plate' operations i.e. offices with the name of the entity but with no staff or where no meaningful activity takes place.
            4. The Companies Law, Limited Partnership Law and General Partnership Law of the DIFCG also require entities to which they apply, to have a registered office in the DIFCG , and to carry on their principal business activity in the DIFCG .
            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
            [Amended] DFSA RM155/2015 (Made 9th December 2015) [VER35/02-16]

      • GEN 6.6 Close links

        • GEN 6.6.1

          (1) Where an Authorised PersonG or a PersonG who has submitted an application for authorisation to carry on one or more Financial ServicesG has Close LinksG with another PersonG , the DFSAG must be satisfied that those Close LinksG are not likely to prevent the effective supervision by the DFSAG of the Authorised PersonG .
          (2) If requested by the DFSAG the Authorised PersonG must submit a Close LinksG report or notification, in a form specified by the DFSAG . This may be requested on an ad hoc or periodic basis.
          Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

          • GEN 6.6.1 Guidance

            1. Procedures for notification to the DFSAG are set out in GEN section 6.10.
            2. Under the fit and proper test for Authorised FirmsG and the Licensing RequirementsG for Authorised Market InstitutionsG , an Authorised FirmG or Authorised Market InstitutionG which does not satisfy the DFSAG with respect of its Close LinksG will, on this point alone, not be considered fit and proper or able to satisfy the Licensing RequirementsG .

            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]
            Amended in accordance with Notice of Amendments to Legislation April 2011 [VER27/02-11]
            [Amended] DFSA RM176/2016 (Made 19th June 2016) [VER37/08-16]

      • GEN 6.7 Complaints against the DFSA

        • GEN 6.7 Guidance

          1. A PersonG who feels he has been adversely affected by the manner in which the DFSAG has carried out its functions may make a complaint to the DFSAG about its conduct or the conduct of its EmployeesG .
          2. A complaint must be in writing and should be addressed to the Chief ExecutiveG of the DFSAG . The complaint will be dealt with by the DFSAG in a timely manner.

          Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

      • GEN 6.8 Public register

        • Maintenance and publication

          • GEN 6.8.1

            The registers required to be maintained and published by the DFSAG pursuant to Article 62 shall be published and maintained in either or both of the following manners:

            (a) by maintaining hard copy registers which are made available for inspection at the premises of the DFSAG during normal business hours; or
            (b) by maintaining an electronic version of the registers and making the information from those registers available through the DFSAG website.

            Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

      • GEN 6.9 Communication with the DFSA

        • GEN 6.9.1

          An Authorised PersonG must ensure that any communication with the DFSAG is conducted in the English language.


          Derived from DFSA RM01/2004 (Made 16th September 2004). [VER1/09-04]

      • GEN 6.10 Provision of information to the DFSA

        • GEN 6.10 Guidance

          1. This section sets out how certain information must be provided to the DFSAG . It applies to information in an AFNG form and in any other application, notification, report or return that must be provided to the DFSAG under a Rule. It does not apply to PIBG or PING returns, which are subject to a special system: the DFSAG Electronic Prudential Reporting System (EPRS).
          2. The DFSAG has enabled certain information to be submitted online using the electronic system on its website. If information can be submitted online, that online electronic system is to be used — see GEN Rule 6.10.2. In other cases, information must be provided to the DFSAG in accordance with GEN Rule 6.10.3.

          Derived from DFSA RM176/2016 (Made 19th June 2016) [VER37/08-16]

        • GEN 6.10.1

          (1) This section applies to a PersonG providing information to the DFSAG in:
          (a) an AFNG form; or
          (b) any other application, notification, report or return required to be provided or submitted to the DFSAG under a Rule.
          (2) This section does not apply to an Authorised PersonG providing a return under PIBG or PING .
          (3) In this section, a reference to information that can be submitted online is a reference to information that can be submitted to the DFSAG online using the appropriate electronic system on the DFSAG website.

          Derived from DFSA RM176/2016 (Made 19th June 2016) [VER37/08-16]

        • Method of Providing Information

          • GEN 6.10.2

            If information can be submitted online, a PersonG must submit the information to the DFSA using the online system.


            Derived from DFSA RM176/2016 (Made 19th June 2016) [VER37/08-16]

          • GEN 6.10.3

            If information cannot be submitted online then, unless a Rule states otherwise, a PersonG must ensure that information it provides to the DFSAG :

            (a) is provided to the DFSAG in writing;
            (b) sets out the Person'sG full name and, if applicable, its authorisation or registration number;
            (c) is addressed to the attention of:
            (i) the Markets Department if the information is being provided under AMIG , RECG , MKTG , PRSG or TKOG ; or
            (ii) the Supervision Department in any other case; and
            (d) is delivered to the DFSAG :
            (i) by post to the current address of the DFSAG ;
            (ii) by hand to the current address of the DFSAG ; or
            (iii) by electronic mail to an address provided by the DFSAG .

            Derived from DFSA RM176/2016 (Made 19th June 2016) [VER37/08-16]

        • Evidence that Information was Provided

          • GEN 6.10.4

            A PersonG who provides information to the DFSAG must retain sufficient evidence to be able to demonstrate to the DFSAG , upon request, that the information was submitted or delivered.


            Derived from DFSA RM176/2016 (Made 19th June 2016) [VER37/08-16]

    • GEN 7 Authorisation

      • GEN 7.1 Application

        • GEN 7.1.1

          (1) This chapter applies, subject to (2), to every PersonG who is:
          (a) an Authorised FirmG ;
          (b) an applicant for a LicenceG to be an Authorised FirmG ;
          (c) an Authorised IndividualG ;
          (d) an applicant for Authorised IndividualG status; or
          (e) a Controller of a Person referred to in (a) or (b).
          (2) This chapter does not apply to a PersonG intending to:
          (a) Operate an ExchangeG ;
          (b) Operate a Clearing HouseG ; or
          (c) Operate a Representative OfficeG .
          Derived from Notice of Amendments to Legislation April 2011 [VER27/02-11]
          [Amended] DFSA RM105/2012 (Made 23rd December 2012). [VER32/12-12]

          • GEN 7.1.1 Guidance

            1. This chapter outlines DFSA'sG authorisation requirements for an Authorised FirmG and Authorised IndividualG .
            2. The DFSA'sG requirements for authorisation of:
            a. Authorised Market InstitutionsG are covered by the AMIG module; and
            b. Representative OfficesG are covered by the REP module.
            3. The DFSA'sG requirements for registration of DNFBPsG are found in the AML module.
            4. This chapter should be read in conjunction with the RPP Sourcebook which sets out DFSA'sG general regulatory policy and processes. Some additional processes may be outlined in other chapters of this module.
            5. Chapter 2 of the RPP Sourcebook sets out DFSA'sG approach to the authorisation of undertakings and individuals to conduct Financial ServicesG or Licensed FunctionsG , as the case may be.
            Derived from Notice of Amendments to Legislation April 2011 [VER27/02-11]
            [Amended] DFSA RM119/2013 (Made 14th July 2013). [VER33/07-13]

      • GEN 7.2 Application for a Licence

        • GEN 7.2.1

          A PersonG , who intends to carry on one or more Financial ServicesG in or from the DIFCG must apply to the DFSAG for a LicenceG , in accordance with the RulesG in this section.

        • GEN 7.2.2

          (1) The DFSAG will only consider an application for a Licence from a PersonG who, subject to (2), (3), and (4), is:
          (a) a Body CorporateG ; or
          (b) a PartnershipG ;
          and who is not an Authorised Market InstitutionG .
          (2) If the application is in respect of either or both of the following Financial ServicesG :
          (a) Effecting Contracts of InsuranceG ;
          (b) Carrying Out Contracts of InsuranceG ,
          the applicant must be a Body CorporateG .
          (3) If the application is in respect of the Financial ServiceG of Accepting DepositsG , the applicant must be a Body CorporateG or a PartnershipG .
          (4) If the application is in respect of the Financial ServiceG of Managing a Collective Investment FundG or Acting as the Trustee of a FundG , the applicant must be a Body CorporateG .
          Derived from Notice of Amendments to Legislation April 2011 [VER27/02-11]
          [Amended] DFSA RM105/2012 (Made 23rd December 2012). [VER32/12-12]

          • GEN 7.2.2 Guidance

            Section 2.2.8 of the RPP Sourcebook sets out matters which the DFSA takes into consideration when making an assessment under Rule 7.2.2.

            [Added] DFSA RM105/2012 (Made 23rd December 2012). [VER32/12-12]

        • GEN 7.2.3

          A PersonG licensed by the Emirates Securities and Commodities Authority to trade on an U.A.E.G exchange will not be granted a LicenceG by the DFSAG unless that PersonG has the prior approval of the Emirates Securities and Commodities Authority.

        • GEN 7.2.4

          A PersonG applying for a LicenceG must complete and submit the appropriate form or forms in AFN.

          • GEN 7.2.4 Guidance

            A PersonG submitting an application under Rule 7.2.4 is required to:

            a. pay the appropriate application fee as set out in FER; and
            b. include information relating to its Controllers, completed by the relevant Controllers themselves, in the appropriate form in AFN.
            Derived from Notice of Amendments to Legislation April 2011 [VER27/02-11]
            [Amended] DFSA RM105/2012 (Made 23rd December 2012). [VER32/12-12]

        • Consideration and assessment of applications

          • GEN 7.2.5

            In order to become authorised to carry on one or more Financial Services, the applicant must demonstrate to the satisfaction of the DFSA that it:

            (a) has adequate resources, including financial resources;
            (b) is fit and proper; and
            (c) has adequate compliance arrangements, including policies and procedures, that will enable it to comply with all the applicable legal requirements, including the Rules.
            [Amended] DFSA RM105/2012 (Made 23rd December 2012). [VER32/12-12]

        • Adequate resources

          • GEN 7.2.6

            In assessing whether an applicant has adequate resources, the DFSAG will consider:

            (a) how the applicant will comply with the applicable provisions of PIB or PIN;
            (b) the provision the applicant makes in respect of any liabilities, including contingent and future liabilities;
            (c) the means by which the applicant and members of its Group manage risk in connection with their business; and
            (d) the rationale for, and basis of, the applicant's business plan.
            [Amended] DFSA RM105/2012 (Made 23rd December 2012). [VER32/12-12]

            • GEN 7.2.6 Guidance

              A Credit Rating AgencyG is not subject to any specific capital requirements in PIB. Instead, it is required, pursuant to Rules 4.2.4 and 7.2.6 to have and maintain adequate financial resources to manage its affairs prudently and soundly.

              Derived from Notice of Amendments to Legislation April 2011 [VER27/02-11]
              [Amended] DFSA RM105/2012 (Made 23rd December 2012). [VER32/12-12]

        • Fitness and propriety

          • GEN 7.2.7

            (1) In assessing whether an applicant is fit and proper, the DFSA will consider:
            (a) the fitness and propriety of the members of its Governing BodyG ;
            (b) the suitability of the applicant's Controllers or any other PersonG ;
            (c) the impact a ControllerG might have on the applicant's ability to comply with the applicable requirements;
            (d) the Financial ServicesG concerned;
            (e) the activities of the applicant and any associated risks that those activities pose to the DFSA's objectives described under Article 8(3) of the Regulatory Law 2004;
            (f) whether the applicant's affairs will be conducted and managed in a sound and prudent manner;
            (g) any matter which may harm or may have harmed the integrity or the reputation of the DFSA or DIFC; and
            (h) any other relevant matters.
            (2) The DFSA will, in assessing the matters in (1), consider the cumulative effect of factors which, if taken individually, may be regarded as insufficient to give reasonable cause to doubt the fitness and propriety of an applicant.
            [Amended] DFSA RM105/2012 (Made 23rd December 2012). [VER32/12-12]

            • GEN 7.2.7 Guidance

              Section 2.2 of the RPP Sourcebook sets out matters which the DFSA takes into consideration when making an assessment under Rule 7.2.7.

              [Added] DFSA RM105/2012 (Made 23rd December 2012). [VER32/12-12]

        • Compliance arrangements

          • GEN 7.2.8

            In assessing whether an applicant has adequate compliance arrangements, the DFSA will consider whether it has:

            (a) clear and comprehensive policies and procedures relating to compliance with all applicable legal requirements including the Rules;
            (b) adequate means to implement those policies and procedures and monitor that they are operating effectively and as intended.
            [Amended] DFSA RM105/2012 (Made 23rd December 2012). [VER32/12-12]

          • GEN 7.2.9

            In assessing an application for a LicenceG , the DFSA may:

            (a) make any enquiries which it considers appropriate, including enquiries independent of the applicant;
            (b) require the applicant to provide additional information;
            (c) require the applicant to have information on how it intends to ensure compliance with a particular Rule;
            (d) require any information provided by the applicant to be verified in any way that the DFSA specifies; and
            (e) take into account any information which it considers relevant.

          • GEN 7.2.10

            (1) In assessing an application for a LicenceG the DFSA may, by means of written notice, indicate the legal form that the applicant may adopt to enable authorisation to be granted.
            (2) Where the DFSA thinks it appropriate it may treat an application made by one legal form or PersonG as having been made by the new legal form or PersonG .

          • GEN 7.2.11

            In assessing an application for a LicenceG authorising the applicant to Operate an Alternative Trading SystemG , the DFSA will have regard to, but is not limited to, considering the following matters:

            (a) whether the establishment of an Alternative Trading SystemG is, or is likely to be, in the interests of the Financial Services and MarketsG industry;
            (b) whether the Alternative Trading SystemG will or is likely to lead to more efficient price discovery of, or deepen liquidity in, an InvestmentG ; and
            (c) whether there is any risk of market fragmentation, loss of liquidity or inefficiency in price discovery as a result of the proposed Alternative Trading SystemG operation.

      • GEN 7.3 Applications for endorsements

        Derived from Notice of Amendments to Legislation April 2011 [VER27/02-11]
        [Amended] DFSA RM131/2014 (Made 21st August 2014). [VER34/06-14]

        • Carrying on service with or for a Retail Client

          • GEN 7.3.1

            The following requirements must be met by an Authorised FirmG for the grant of an endorsement to carry on a Financial ServiceG with or for a Retail ClientG :

            (a) the applicant must have adequate systems and controls for carrying on Financial ServicesG with or for a Retail ClientG ;
            (b) the applicant must have adequate systems and controls (including policies and procedures) to ensure compliance with the requirements in COBG relevant to Retail ClientsG ;
            (c) the applicant must have adequate systems and controls to ensure that its EmployeesG remain competent and capable to perform the functions which are assigned to them, in particular, functions that involve dealing with Retail ClientsG ; and
            (d) the applicant must have adequate ComplaintG handling policies and procedures.
            Derived from Notice of Amendments to Legislation April 2011 [VER27/02-11]
            [Amended] DFSA RM131/2014 (Made 21st August 2014). [VER34/06-14]

        • Acting as a Trade Repository

          • GEN 7.3.2

            The requirements in App 5 must be met by an Authorised FirmG for the grant of an endorsement to act as a Trade RepositoryG .

            [Added] DFSA RM131/2014 (Made 21st August 2014). [VER34/06-14]

        • Endorsement to hold Client Assets or Insurance Monies

          • GEN 7.3.3

            An Authorised FirmG applying for an endorsement to hold or control Client AssetsG must satisfy the DFSA that it has in place adequate systems and controls to meet the applicable requirements in COB sections 6.11 to 6.14.

            Derived from DFSA RM166/2016 (Made 10th February 2016). [VER36/04-16]

          • GEN 7.3.4

            An Insurance IntermediaryG or Insurance ManagerG applying for an endorsement to hold Insurance MoniesG must satisfy the DFSAG that it has in place adequate systems and controls to meet the applicable requirements in COB section 7.12.

            Derived from DFSA RM166/2016 (Made 10th February 2016). [VER36/04-16]

        • Endorsement relating to Long-Term Insurance

          • GEN 7.3.5

            An Insurance IntermediaryG applying for an endorsement to conduct activities relating to contracts of Long-Term InsuranceG must satisfy the DFSA that it has adequate skills and knowledge relating to underlying investments of Long-Term InsuranceG .

            Derived from DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

      • GEN 7.4 Licensed Functions and Authorised individuals

        • GEN 7.4.1

          (1) Pursuant to Article 43 of the Regulatory LawG 2004, the functions specified in Rules 7.4.2 to 7.4.9 are Licensed FunctionsG .
          (2) A Licensed FunctionG shall not include a function performed by a registered insolvency practitioner (subject to the restrictions defined within Article 88 of the Insolvency Law 2009) if the practitioner is:
          (a) acting as a nominee in relation to a company voluntary arrangement within the meaning of Article 8 of the Insolvency Law 2009;
          (b) appointed as a receiver or administrative receiver within the meaning of Article 14 of the Insolvency Law 2009;
          (c) appointed as a liquidator in relation to a members' voluntary winding up within the meaning of Article 32 of the Insolvency Law 2009;
          (d) appointed as a liquidator in relation to a creditors' voluntary winding up within the meaning of Article 32 of the Insolvency Law 2009; or
          (e) appointed as a liquidator or provisional liquidator in relation to a compulsory winding up within the meanings of Article 58 and 59 of the Insolvency Law 2009.
          (3) A Licensed FunctionG shall not include a function performed by an individual appointed to act as manager of the business of an Authorised FirmG or Authorised Market InstitutionG as directed by the DFSAG under Article 88 of the Regulatory Law 2004.
          Derived from Notice of Amendments to Legislation April 2011 [VER27/02-11]
          [Amended] DFSA RM105/2012 (Made 23rd December 2012). [VER32/12-12]
          [Amended] DFSA RM131/2014 (Made 21st August 2014). [VER34/06-14]

        • Senior Executive Officer

          • GEN 7.4.2

            The Senior Executive OfficerG function is carried out by an individual who:

            (a) has, either alone or jointly with other Authorised IndividualsG , ultimate responsibility for the day-to-day management, supervision and control of one or more (or all) parts of an Authorised Firm'sG Financial ServicesG carried on in or from the DIFCG ; and
            (b) is a DirectorG , PartnerG or Senior ManagerG of the Authorised FirmG .

        • Licensed Director

        • Licensed Partner

          • GEN 7.4.4

            The Licensed PartnerG function is carried out, in the case of an Authorised FirmG which is a PartnershipG or Limited Liability PartnershipG , by an individual specified in Rule 7.5.5.

            Derived from Notice of Amendments to Legislation April 2011 [VER27/02-11]
            [Amended] DFSA RM105/2012 (Made 23rd December 2012). [VER32/12-12]

        • Finance Officer

          • GEN 7.4.5

            The Finance OfficerG function is carried out by an individual who is a DirectorG , PartnerG or Senior ManagerG of an Authorised FirmG who has responsibility for the Authorised Firm'sG compliance with the applicable RulesG in PING or PIBG .

        • Compliance Officer

          • GEN 7.4.6

            The Compliance OfficerG function is carried out by an individual who is a DirectorG , PartnerG or Senior ManagerG of an Authorised FirmG who has responsibility for compliance matters in relation to the Authorised Firm'sG Financial ServicesG .

        • Senior Manager

          • GEN 7.4.7

            The Senior ManagerG function is carried out by an individual who is responsible either alone or jointly with other individuals for the management, supervision or control of one or more parts of an Authorised Firm'sG Financial ServicesG who is:

            (a) an EmployeeG of the Authorised FirmG ; and
            (b) not a DirectorG or PartnerG of the Authorised FirmG .

            • GEN 7.4.7 Guidance

              In respect of a FundG , the DFSAG would expect the Fund ManagerG to appoint at least one individual other than the Senior Executive OfficerG to carry out Senior ManagerG functions in relation to the FundG such as managing operational risk and other internal controls.

        • Money Laundering Reporting Officer

          • GEN 7.4.8

            The Money Laundering Reporting OfficerG function is carried out by an individual who is a DirectorG , PartnerG or Senior ManagerG of an Authorised FirmG and who has responsibility for the implementation of an Authorised Firm'sG anti money laundering policies, procedures, systems and controls and day to day oversight of its compliance with the RulesG in AMLG and any relevant anti money laundering legislation applicable in the DIFCG .

            Derived from Notice of Amendments to Legislation April 2011 [VER27/02-11]
            [Amended] DFSA RM119/2013 (Made 14th July 2013). [VER33/07-13]

        • Responsible Officer

          • GEN 7.4.9

            The Responsible OfficerG function is carried out by an individual who:

            (a) has significant responsibility for the management of one or more aspects of an Authorised Firm'sG affairs;
            (b) exercises a significant influence on the firm as a result of (a); and
            (c) is not an EmployeeG of the Authorised FirmG .

            • GEN 7.4.9 Guidance

              1. The Licensed FunctionG of Responsible OfficerG applies to an individual employed by a ControllerG or other GroupG company who is not an EmployeeG of the Authorised FirmG , but who has significant responsibility for, or for exercising a significant influence on, the management of one or more aspects of the Authorised Firm'sG business.
              2. Examples of a Responsible OfficerG might include an individual responsible for the overall strategic direction of an Authorised FirmG or a regional manager to whom a Senior Executive OfficerG reports and from whom he takes direction.

          • GEN 7.4.10

            An Authorised IndividualG may perform one or more Licensed FunctionsG for one or more Authorised FirmsG .

            • GEN 7.4.10 Guidance

              1. In considering whether to grant an individual Authorised IndividualG status with respect to more than one Authorised FirmG , the DFSAG will consider each Licensed FunctionG to be carried out and the allocation of responsibility for that individual among the Authorised FirmsG .
              2. In the above situation the DFSAG will need to be satisfied that the individual will be able to carry out his role effectively, is fit and proper to do so, and that there are no conflicts of interest or that any actual or potential conflicts of interest are appropriately managed.

      • GEN 7.5 Mandatory appointments

        • GEN 7.5.1

          (1) An Authorised FirmG must, subject to (2), make the following appointments and ensure that they are held by one or more Authorised IndividualsG at all times:
          (a) Senior Executive OfficerG ;
          (b) Finance OfficerG ;
          (c) Compliance OfficerG ; and
          (d) Money Laundering Reporting OfficerG .
          (2) An Authorised FirmG which is a Credit Rating AgencyG :
          (a) need not make the appointment referred to in (1)(b) and (d); and
          (b) must ensure that the appointments referred to in 1(a) and (c) are held by separate Authorised IndividualsG at all times.
          Derived from Notice of Amendments to Legislation April 2011 [VER27/02-11]
          [Amended] DFSA RM96/2012 (Made 24th July 2012) [VER30/07-12]

          • GEN 7.5.1 Guidance

            1. This GuidanceG addresses a range of circumstances:
            a. one individual performing more than one function in a single firm, as contemplated in Rule 7.5.1;
            b. more than one individual performing one function in a single firm, not addressed by that RuleG ;
            c. one individual performing a single function in more than one firm, also not addressed by that RuleG .
            2. The DFSAG will only authorise an individual to perform more than one Licensed FunctionG or combine Licensed FunctionsG with other functions where it is satisfied that the individual is fit and proper to perform each Licensed FunctionG or combination of Licensed FunctionsG .
            3. In the above situation the DFSAG will need to be satisfied that the individual will be able to carry out his role effectively, is fit and proper to do so, and that there are no conflicts of interest or that any actual or potential conflicts of interest are appropriately managed.
            4. Notwithstanding this RuleG , an Authorised FirmG would generally be expected to separate the roles of Compliance OfficerG and Senior Executive OfficerG . In addition, the roles of Compliance OfficerG , Finance OfficerG and Money Laundering Reporting OfficerG would not be expected to be combined with any other functions unless appropriate monitoring and control arrangements independent of the individual concerned will be implemented by the Authorised FirmG . This may be possible in the case of a BranchG , where monitoring and controlling of the individual (carrying out more than one role in the BranchG ) is conducted from the firm's home state by an appropriate individual for each of the relevant Licenced FunctionsG . However, it is recognised that, on a case by case basis, there may be exceptional circumstances in which this may not always be practical or possible.
            5. In what it considers to be exceptional circumstances, the DFSAG may register more than one individual to perform the Licensed FunctionG of Compliance OfficerG in respect of different internal business divisions within a large Authorised FirmG . In this regard the DFSAG may consider, amongst other things, the nature, scale and complexity of the activities of the firm, the clarity of demarcation between areas of responsibility, the potential for gaps in responsibility, and processes of communication with the DFSAG .
            6. The DFSAG may also register an individual as the Compliance OfficerG for more than one Authorised FirmG . The DFSAG will only do this where it is satisfied that the individual is able to carry out his functions effectively in each firm taking into consideration factors such as the amount and nature of business conducted by the firms. Each Authorised FirmG has a duty under GEN 5 to monitor its compliance arrangements to ensure, as far as reasonably practicable, that it complies with all legislation applicable in the DIFCG .

        • GEN 7.5.2

          The Authorised IndividualsG referred to in Rule 7.5.1(1)(a), (c) and (d) must be resident in the U.A.E.G

          Derived from Notice of Amendments to Legislation April 2011 [VER27/02-11]
          [Amended] DFSA RM184/2016 (Made 7th December 2016). [VER38/02-17]

          • GEN 7.5.2 Guidance

            1. In appropriate circumstances, the DFSAG may waive the requirement for a Compliance OfficerG or MLROG to be resident in the UAEG . In determining whether to grant a waiver, the DFSAG will consider a range of factors on a case by case basis focused on whether the firm can demonstrate that it has appropriate compliance arrangements (see GEN section 5.3). These factors may include, but are not limited to: the nature, scale and complexity of the activities of the firm; the ability of a remote officer to carry out his functions in differing time zones and a differing working week; the size, resourcing and capabilities of a remote compliance function; the ability of a remote officer to liaise and communicate readily with the DFSAG ; and the competency and capability of a remote officer and whether the remote officer is able effectively to undertake or supervise regular compliance monitoring and keep up to date with applicable RulesG .
            2. The DFSAG will also take into account factors such as the relevant regulatory experience of the proposed Authorised IndividualG and whether the applicant firm has previously been subject to financial services regulation.

        • GEN 7.5.3

          In the case of a Trust Service ProviderG , the Authorised IndividualsG referred to in Rule 7.5.1 (c) and (d) must not act also as trustees on behalf of the Trust Service ProviderG .

        • GEN 7.5.4

          An Authorised FirmG which is a Body CorporateG (other than a Limited Liability PartnershipG ) whose head office and registered office are located in the DIFCG , must register with the DFSAG all of its DirectorsG as Licensed DirectorsG .

        • GEN 7.5.5

          (1) In the case of an Authorised FirmG which is a partnership established under either the DIFC General Partnership Law or Limited Liability Partnership Law, the Licensed PartnerG function must be carried out by:
          (a) each individual Partner who must be registered as a Licensed PartnerG ; and
          (b) in the case of a PartnerG which is a Body CorporateG , by an individual nominated by that Body CorporateG and registered as a Licensed PartnerG to act on its behalf.
          (2) In the case of an Authorised FirmG which is a partnership established under the DIFC Limited Partnership Law, the Licensed PartnerG function must be carried out by:
          (a) each individual General Partner who must be registered as a Licensed PartnerG ; and
          (b) in the case of a General Partner which is a Body CorporateG , by an individual nominated by that Body CorporateG and registered as a Licensed PartnerG to act on its behalf.
          Derived from Notice of Amendments to Legislation April 2011 [VER27/02-11]
          [Amended] DFSA RM105/2012 (Made 23rd December 2012). [VER32/12-12]

          • GEN 7.5.5 Guidance

            An Authorised FirmG that is a BranchG is not required to register its Directors as Licensed Directors under Rule 7.5.4 or its Partners as a Licensed PartnerG under Rule 7.5.5.

            [Added] DFSA RM105/2012 (Made 23rd December 2012). [VER32/12-12]

      • GEN 7.6 Application for Authorised Individual status

        • GEN 7.6.1

          In submitting applications for Authorised IndividualG status, both the individual and Authorised FirmG must complete and submit the appropriate form in AFN.

        • GEN 7.6.2

          When an individual and an Authorised FirmG apply to the DFSAG for that individual to be an Authorised IndividualG , the individual must satisfy the DFSAG that he is a fit and proper person to carry out the role.

        • Consideration and assessment of applications

          • GEN 7.6.3

            An individual will only be authorised to carry on one or more Licensed FunctionsG if the DFSAG is satisfied that the individual is fit and proper to be an Authorised IndividualG . In making this assessment, the DFSAG will consider:

            (a) the individual's integrity;
            (b) the individual's competence and capability;
            (c) the individual's financial soundness;
            (d) the individual's proposed role within the Authorised FirmG ; and
            (e) any other relevant matters.

          • GEN 7.6.4

            In Rule 7.6.3, an individual may not be considered as fit and proper where:

            (a) he is bankrupt;
            (b) he has been convicted of a serious criminal offence; or
            (c) he is incapable, through mental or physical incapacity, of managing his affairs.

          • GEN 7.6.5

            In assessing an application for Authorised IndividualG status, the DFSAG may:

            (a) make any enquiries which it considers appropriate, including enquiries independent of the applicant;
            (b) require the individual or Authorised FirmG to provide additional information;
            (c) require any information provided by the individual or Authorised FirmG to be verified in any way specified by the DFSAG ; and
            (d) take into account any information which it considers appropriate.

          • GEN 7.6.6

            An Authorised FirmG must not permit an individual to perform a Licensed FunctionG on its behalf, except as permitted by section 11.6, unless that individual is an Authorised IndividualG who has been assessed by the Authorised FirmG as competent to perform that Licensed FunctionG in accordance with Rule 7.6.7.

          • GEN 7.6.7

            In assessing the competence of an individual, an Authorised FirmG must:

            (a) obtain details of the knowledge and skills of the individual in relation to the knowledge and skills required for the role;
            (b) take reasonable steps to verify the relevance, accuracy and authenticity of any information acquired;
            (c) determine whether the individual holds any relevant qualifications with respect to the Licensed FunctionG or Licensed FunctionsG performed, or proposed to be to performed, within the Authorised FirmG ;
            (d) determine the individual's relevant experience; and
            (e) determine the individual's knowledge of the Authorised Firm'sG relevant systems and procedures with respect to the type of business that is to be, or is being, conducted by the individual on behalf of the Authorised FirmG .

          • GEN 7.6.8

            An Authorised FirmG must be satisfied that an Authorised IndividualG :

            (a) continues to be competent in his proposed role;
            (b) has kept abreast of relevant market, product, technology, legislative and regulatory developments; and
            (c) is able to apply his knowledge.

          • GEN 7.6.9

            The Authorised FirmG is responsible for the conduct of its Authorised IndividualsG and for ensuring that they remain fit and proper to carry out their role.

          • GEN 7.6.10

            Before lodging an application with the DFSAG , an Authorised FirmG must make reasonable enquiries as to an individual's fitness and propriety to carry out a Licensed FunctionG .

          • GEN 7.6.11

            An Authorised FirmG must not lodge an application if it has reasonable grounds to believe that the individual is not fit and proper to carry out the Licensed FunctionG .

        • Systems and controls

          • GEN 7.6.12

            An Authorised FirmG must have appropriate arrangements in place to ensure that an individual assessed as being competent under Rule 7.6.6 maintains his competence.

          • GEN 7.6.13

            An Authorised FirmG must ensure, in the case of individuals seeking to perform the Licensed FunctionsG of Senior Executive OfficerG , Money Laundering Reporting OfficerG or Compliance OfficerG , that such individuals are able to demonstrate sufficient knowledge of relevant anti money laundering requirements.

            • GEN 7.6.13 Guidance

              In considering whether individuals have sufficient knowledge of relevant anti money laundering requirements, the DFSA