Global Statutory Law & Standards Insights

The purpose of this circular is to inform about :

• Updates the lists of:
  • High-Risk Countries (subject to call for action)
  • Countries under Increased Monitoring
• Aligns UAE framework with international AML/CFT standards (FATF)
• Aims to strengthen controls against money laundering, terrorism financing, and proliferation financing 

The provisions of this circular shall apply to all relevant departments and entities mentioned below :

• Applies to:
  • Financial Institutions (FIs)
  • Designated Non-Financial Businesses and Professions (DNFBPs)
  • Other regulated entities in UAE
  • Corporate services providers.
• Includes sectors like:
  • Real estate brokers
  • auditors, lawyers, dealers in precious metals, etc.

The circular categorizes jurisdictions into:

a) High-Risk Countries

• Jurisdictions with serious strategic AML/CFT deficiencies
• Subject to counter-measures or enhanced restrictions

b) Countries under Increased Monitoring

• Countries working with FATF but still having identified weaknesses.

The following section sets out the key compliance requirements for high-risk countries and those under increased monitoring

For High-Risk Countries:

• Apply Enhanced Due Diligence (EDD):
  • Detailed customer verification
  • Source of funds/wealth checks
• Increase transaction monitoring
• Obtain senior management approval before business relationships
• Consider risk mitigation measures or restrictions

           In extreme cases:

• Limit or terminate business relationships

       For Increased Monitoring Countries:

• Apply additional scrutiny, but less strict than high-risk:
  • Enhanced monitoring of transactions
  • Risk-based due diligence

The following outlines the risk-based approach guiding compliance with these requirements.

• Entities must:
  • Continuously assess customer and country risk
  • Update internal risk assessment frameworks
• Must integrate updated country lists into:
  • AML policies
  • Customer onboarding systems

Organisations must implement ongoing screening and monitoring to detect and manage risks associated with high-risk and increased-monitoring countries.

• Mandatory:
  • Screening customers against updated lists
  • Ongoing monitoring of business relationships
• Use systems to detect:
  • Suspicious transactions
  • Unusual patterns

Entities are required to promptly report any suspicious or non-compliant activities related to high-risk and increased-monitoring countries.

• Suspicious transactions must be reported via:
  • goAML platform goaml@uaefiu.gov.ae (UAE FIU system) 
• Failure to report → penalties
• Administrative fine: Typically AED 100,000 – AED 500,000 for failing to submit suspicious transactions or activity reports timely.
• Criminal liability: Under UAE federal AML laws, failing to report suspicious activity can be treated as a criminal offence, attracting fines of AED 100,000 – AED 1,000,000 and/or imprisonment for responsible persons.

The following outlines the internal controls and governance measures required to ensure effective compliance and risk management.

Entities must:

• Update:
  • AML/CFT policies
  • Internal controls
• Ensure:
  • Staff training
  • Proper documentation
  • Audit trails

The following highlights the regulatory enforcement mechanisms and consequences for non-compliance.

• Non-compliance may lead to:
  • Heavy fines
  • License suspension
  • Criminal liability in severe cases  

The following explains how Circular 1 aligns with the UAE AML Law (2025 Framework) to ensure consistent anti-money laundering compliance.

• Circular supports:
  • Federal Decree Law No. (10) of 2025
  • Cabinet Resolution No. (134) of 2025
• Reinforces UAE’s commitment to global financial crime prevention standards

The following lists of the countries classified as Grey Countries. 

• Algeria
• Angola
• Bolivia
• Bulgaria
• Cameroon
• Cote D’Ivoire
• Democratic Republic of the Congo
• Haiti
• Kenya
• Kuwait
• Lao PDR
• Lebanon
• Monaco
• Namibia
• Nepal
• Papua New Guinea
• South Sudan
• Syria
• Venezuela
• Vietnam
• Virgin Island (UK)
• Yemen

The following lists of the countries classified as Black Countries. 

• Iran
• Myanmar
• Democratic People’s Republic of Korea