The European Union plans to remove the UAE from its list of countries that pose a high risk for money laundering, amid growing efforts by the Emirates to boost its regulatory framework.
The European Commission, the EU's main executive body, said that the list was updated after taking into account the work of the Financial Action Task Force (FATF) and in particular its list of “Jurisdictions under Increased Monitoring”.
“The UAE welcomes the commission’s updated list of high-risk countries to strengthen the international fight against financial crime, and is fully committed to deepening its robust and strategic partnership with the European Union,” a UAE official said in a statement.
“We continue to work closely with the relevant authorities and each EU member state."
The FATF, the global body that combats money laundering and terrorism financing, removed the UAE from its “grey list” in February last year after significant progress on reforms. The Emirates was placed on the grey list in 2022.
“As a founding member of FATF, the commission is closely involved in monitoring the progress of the listed jurisdictions, helping them to fully implement their respective action plans agreed with FATF,” the European Commission said.
The commission added 10 countries to the high-risk list: Algeria, Angola, Côte d’Ivoire, Kenya, Laos, Lebanon, Monaco, Namibia, Nepal and Venezuela.
As well as the UAE, Barbados, Gibraltar, Jamaica, Panama, the Philippines, Senegal and Uganda were removed.
However, the updated list will come into force only after it receives “no‑objection” from the European Parliament and the council within one month (which can be extended for another month).
At that point, the regulation is published in the Official Journal of the EU, where all laws and decisions are published, and comes into effect 20 days after publication. This could happen approximately three weeks after the decision-making process ends.
The commission said it had “carefully considered the concerns expressed regarding its previous proposal and conducted a thorough technical assessment, based on specific criteria and a well‑defined methodology, incorporating information collected through the FATF, bilateral dialogues and on‑site visits to the jurisdictions in question”.
The UAE has made significant progress in combating money laundering and the financing of terrorism over the past few years, passing strict laws and issuing regulations to clamp down on financial crime.
In September last year, the UAE set out a nationwide action plan aimed at combating terrorism financing and money laundering. The 2024-27 National Strategy for Anti-Money Laundering, Countering the Financing of Terrorism and Proliferation Financing has 11 goals focused on risk-based compliance, effectiveness and sustainability.
The enhanced framework, overseen by the Higher Committee and led by an expanded National Committee, includes the former Executive Office of Anti-Money Laundering and Counter Terrorism Financing, which now serves as the General Secretariat.
In August, the government also amended its laws against money laundering and the financing of terrorism and crime groups and formed a national committee on these crimes.
As part of its reforms, the UAE is adding measures to assist with investigations, imposing sanctions in cases of non-compliance at financial institutions and increasing the number of prosecutions to combat money laundering.
The UAE Central Bank has been imposing a growing number of fines and penalties in recent months to clamp down on violators.
On Tuesday, the regulator imposed financial sanctions on six exchange houses in the UAE, amounting to Dh12.3 million ($3.3 million), due to “violations and failures” to comply with the anti-money laundering/countering the financing of terrorism framework and related regulations.
In May, it fined one exchange house Dh3.5 million, and imposed a Dh100 million levy on another for “significant failures” in its AML/CFT framework and related regulations.
Last month it also fined another exchange house Dh200 million for the same offence. A Dh500,000 fine was imposed on a branch manager, who was also banned from working in any licensed financial institutions in the UAE.
The Central Bank has also recently fined two branches of foreign banks operating in the country a total of Dh18.1 million for breaching anti-money laundering regulations.
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Global state-owned investor ranking by size
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China
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Canada
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Australia
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Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
The biog
Name: Sari Al Zubaidi
Occupation: co-founder of Cafe di Rosati
Age: 42
Marital status: single
Favourite drink: drip coffee V60
Favourite destination: Bali, Indonesia
Favourite book: 100 Years of Solitude
GOLF’S RAHMBO
- 5 wins in 22 months as pro
- Three wins in past 10 starts
- 45 pro starts worldwide: 5 wins, 17 top 5s
- Ranked 551th in world on debut, now No 4 (was No 2 earlier this year)
- 5th player in last 30 years to win 3 European Tour and 2 PGA Tour titles before age 24 (Woods, Garcia, McIlroy, Spieth)
ENGLAND SQUAD
Team: 15 Mike Brown, 14 Anthony Watson, 13 Ben Te'o, 12 Owen Farrell, 11 Jonny May, 10 George Ford, 9 Ben Youngs, 1 Mako Vunipola, 2 Dylan Hartley, 3 Dan Cole, 4 Joe Launchbury, 5 Maro Itoje, 6 Courtney Lawes, 7 Chris Robshaw, 8 Sam Simmonds
Replacements 16 Jamie George, 17 Alec Hepburn, 18 Harry Williams, 19 George Kruis, 20 Sam Underhill, 21 Danny Care, 22 Jonathan Joseph, 23 Jack Nowell
Key Points
- Protests against President Omar Al Bashir enter their sixth day
- Reports of President Bashir's resignation and arrests of senior government officials
Various Artists
Habibi Funk: An Eclectic Selection Of Music From The Arab World (Habibi Funk)
