Advisory Services Activity
In today’s fast-evolving digital landscape, the world of virtual assets is expanding rapidly. Virtual Asset Service Providers (VASPs) operating in the United Arab Emirates (UAE) are subject to a complex regulatory framework designed to ensure transparency, security, and investor protection. To help VASPs navigate these regulations, the UAE’s Virtual Asset Regulatory Authority (VARA) has issued the Advisory Services Rulebook. This guide explores key aspects of VARA’s rules and how VASPs can ensure compliance.
Understanding the Advisory Services Rulebook
The Advisory Services Rulebook, issued by VARA, applies to all VASPs engaged in offering Advisory Services within the Emirate of Dubai. Advisory Services, in this context, encompass offering personal recommendations to clients regarding actions or transactions involving virtual assets. These recommendations can be initiated by the VASP or at the request of the client.
Client Suitability
One of the central tenets of the Advisory Services Rulebook is ensuring client suitability. VASPs must have procedures in place to ensure that clients fully comprehend the risks associated with virtual asset investments. Moreover, VASPs must verify that clients are financially capable of meeting their obligations arising from following the advice provided by the VASP.
To ensure compliance with this rule, VASPs must consider several factors:
- Knowledge and Experience: Assess the client’s knowledge and experience in virtual asset investing.
- Investment Objectives: Evaluate the client’s investment objectives, including risk tolerance, time horizon, and preferred avenues for acquiring virtual assets.
- Financial Circumstances: Analyse the client’s financial circumstances, including their ability to bear potential losses and the proportion of their net worth invested in virtual assets.
Policies & Procedures
VASPs offering Advisory Services must establish internal controls, write internal policies and procedures that ensure the independence of their advice and the competency of their staff. These policies should outline how the VASP maintains knowledge, competence, and training among its personnel.
Any questions about on how to navigate regulatory compliance in Dubai? Our team is here to help you navigate the complex world of virtual assets and ensure you’re compliant with all the regulations. We’ll work with you to understand your specific needs and provide tailored solutions to meet your business goals.
Contact us to start your compliance journey today! With our help, you’ll be able to offer your clients the best possible advice and ensure a bright future for your business in Dubai.
