When can DNFBPs apply simplified due diligence in the UAE?
A DNFBP can apply simplified due diligence only in cases of genuinely low crime risk, and even then it must still identify and verify the customer and beneficial owner. Simplification does not mean skipping due diligence; it means that, where the assessed risk is low, the firm may reduce the intensity of certain measures or defer completion of identity verification for a short period.
Where verification is deferred, it must be completed as soon as possible after the relationship starts, the deferral must be necessary so as not to disrupt normal business, and effective measures must be in place to control risk in the meantime. Simplified measures are never permitted where there is suspicion of a crime or doubt about customer information, and the firm must be able to justify its low-risk classification to the supervisor. Recent sector guidance has emphasised applying risk-based, simplified measures proportionately rather than as a blanket reduction of controls.
Legal Reference (UAE):
· Cabinet Resolution No. 134 of 2025 (Executive Regulations), Article 6 permits deferred verification in cases of low crime risk subject to conditions.
· Cabinet Resolution No. 134 of 2025, Article 7 sets out when customer due diligence must be applied.
For more details, consult the full text of Cabinet Resolution 134 of 2025 or seek guidance from your AML compliance officer.