When must a UAE law firm apply customer due diligence?
A UAE law firm must apply customer due diligence (CDD) before it starts an in-scope engagement or executes a transaction for a client, not afterwards. CDD is also required when there is a suspicion of money laundering or terrorist financing regardless of any exemption, and when the firm doubts the accuracy of identification data previously obtained.
For legal professionals, the trigger points typically include buying or selling real estate for a client, managing client funds or accounts, and creating, operating or administering companies or legal arrangements. At minimum the firm must identify and verify the client and any beneficial owner, understand the purpose of the relationship, and apply ongoing monitoring for as long as the retainer lasts. Higher risk clients require enhanced measures and closer scrutiny of source of funds.
Legal Reference (UAE):
· Federal Decree-Law No. 10 of 2025, Article 19(1)(b) - requires DNFBPs to implement CDD and continuous monitoring, with the Executive Regulations specifying when the measures apply.
· Cabinet Resolution No. 134 of 2025 (Executive Regulations) - sets the timing, scope and conditions of CDD.
For more details, consult the full text of Federal Decree-Law No. 10 of 2025 or seek guidance from your AML compliance officer.