Can a UAE law firm rely on a third party for customer due diligence?
Yes, subject to the same conditions that apply to any regulated business, and responsibility stays with the firm. Reliance on a third party is permitted for identifying the client and beneficial owner and understanding the nature of the client’s business, provided the firm remains responsible for the accuracy of those measures.
Two conditions attach: the third party must be regulated and supervised and comply with the customer due diligence and record-keeping requirements of the Executive Regulations, and the firm must immediately obtain the identification data collected and be able to obtain copies of the underlying documents without delay on request. For a law firm one point deserves care. The professional secrecy exemption from suspicious transaction reporting is narrow and applies only to information obtained while assessing a client’s legal position, defending or representing them, or advising on judicial proceedings. It does not exempt the firm from customer due diligence, so reliance arrangements cannot be used to leave identification incomplete.
Legal Reference (UAE):
· Cabinet Resolution No. 134 of 2025, Article 20(1) and (2): third-party reliance, continuing responsibility for accuracy, and the conditions on the third party.
· Cabinet Resolution No. 134 of 2025, Article 18(2): the narrow professional secrecy exemption from reporting, which does not displace the customer due diligence obligations in Articles 6 to 10.
For your own circumstances, check your internal AML policy or speak to your compliance officer.