CMI Talks: UAE Newsletter November 2025

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Central Bank of the UAE (“CBUAE”) Introduces Criminal Penalties for Unlicensed Financial Activity

The UAE has introduced Federal-Decree Law No. 6 of 2025 regarding the CBUAE’s Regulation of Financial Institutions and Activities and Insurance Business is the UAE’s financial regulatory framework, consolidating the regulation of banks, payment service providers and insurers.

Key Takeaways:

  1. Under Article 170, any person or entity carrying out a regulated financial activity without a valid CBUAE license may face imprisonment and/or a fine ranging between AED 50,000 and AED 500 million.
  2. A single framework applies across banking, insurance, payments and digital-asset services.
  3. Article 62 explicitly brings technology service providers, platforms, and decentralized infrastructure facilitating payments, exchanges, lending, or investment under CBUAE supervision.
  4. The law covers not just provision of financial services, but also advertising, promotion or offer of such services even if done from outside the UAE.
  5. The regulatory perimeter is extended to emerging technologies and Decentralized Finance (DeFi) models, explicitly capturing the facilitation of licensed activities by technology providers.
  6. Entities captured under the new law have one year from the effective date of 16.09.2025, to ensure their operations comply with the new requirements.

UAE Ministry of Finance (“MoF”) commits to implement Common Reporting Standard 2.0 (“CRS 2.0”)

The MoF has announced the UAE’s commitment to implement the CRS 2.0, effective from 01.01.2027, with the first automatic exchange of financial-account information scheduled for 2028.

Key Takeaways:

  1. The UAE will begin applying the update standard in January 2027, with the initial automatic exchange of information expected in 2028.
  2. CRS 2.0 represents a major update to the previous framework broadening the scope of reportable assets and financial activities to include electronic money, central-bank digital currencies (“CBDCs”), and certain crypto-asset related activities, in recognition of the evolving digital finance landscape.
  3. CRS 2.0 brings stricter obligations for financial institutions and reporting entities: more detailed account holder data, broader transaction metadata, and expanded auditing/reporting duties.
  4. By adopting CRS 2.0 (and coordinating with the related Crypto‑Asset Reporting Framework – CARF), UAE reinforces its commitment to global tax transparency, compliance with OECD guidelines, and governance best practices.
  5. The move aims to ensure financial innovation does not affect global tax transparency, strengthening the UAE’s position as a leading financial hub and key factor for attracting foreign investments.

UAE’s new fostering law lets expat residents and single women sponsor children

On 25.11.2025, the Federal Decree Law No. 12 of 2025 came into effect, amending the prior law governing care of children of unknown parentage. Under the revised legislation, the eligibility to foster children is now expanded beyond Emirati citizens to include resident expatriates (non-Emiratis), married couples of any nationality, and single women over a certain age.

Key Takeaways:

  1. Under the new law, married couples residing in the UAE irrespective of nationality or religion can apply to foster children.
  2. Single women aged 30 or above (with no upper age limit now) are also eligible to become foster carers.
  3. The amendments grant fostered children legal identity and documentation, aiming to reduce abandonment or instances of unregistered children.
  4. The revision aligns with broader social reforms aimed at inclusivity and addressing real societal needs, especially for children without known parents.
  5. The law enhances oversight mechanisms: previous “immediate removal” for issues has been replaced by a system allowing remedial measures, unless violations are serious.
  6. By widening eligibility beyond Emiratis and removing prior religious/nationality restrictions, the UAE’s law reflects its increasingly diverse, expatriate-heavy population.

UAE Ministry of Finance (“MoF”) and Abu Dhabi Islamic Bank (“ADIB”) Launch First-Ever Retail Sukuk for Individual Investors

The UAE MoF signed a cooperation agreement with Abu Dhabi Islamic Bank (ADIB), making ADIB the first bank to participate in the newly launched Retail Sukuk Initiative.

Key Takeaways:

  1. Through ADIB’s “Smart Sukuk” digital platform, individual investors can invest in government-issued T-Sukuk with a minimum investment of AED 4,000.
  2. Investments can be made in increments of AED 4,000, up to AED 28,000 per transaction and investors can make multiple transactions.
  3. Investors (UAE residents or citizens) can register online using Emirates ID or UAE PASS, complete KYC formalities, set up a risk profile, and view sukuk terms/transaction details – all via the ADIB app.
  4. It marks a structural shift in how sovereign debt instruments are distributed extending ownership beyond traditional large investors.
  5. The initiative aligns with the UAE’s broader goals of financial inclusion, encouraging residents to save and invest in secure and compliant instruments rather than speculative or high-risk alternatives.
  6. The “Smart Sukuk” platform reduces barriers to entry and simplifies investment, potentially setting a precedent for other banks to join and replicate the model across the UAE.
  7. The agreement between MoF and ADIB illustrates effective public-private collaboration, leveraging banking infrastructure and digital finance platforms to deliver sovereign investment instruments directly to retail clients.