Consultation Paper No 1 of 2020 – Proposals for revision of the regulatory framework for Providing Money Services in ADGM

CONSULTATION PAPER
NO. 1 OF 2020
25 June 2020
PROPOSALS FOR REVISION OF THE
REGULATORY FRAMEWORK FOR
PROVIDING MONEY SERVICES IN ADGM

PROPOSALS FOR REVISION OF THE REGULATORY
FRAMEWORK FOR PROVIDING MONEY SERVICES IN ADGM CONTENTS
INTRODUCTION ............................................................................................................3
Why are we issuing this paper?..................................................................................3
Who should read this paper?......................................................................................3
How to provide comments ..........................................................................................3
What happens next? ...................................................................................................3
BACKGROUND ..............................................................................................................5
UPDATING THE REGULATORY FRAMEWORK FOR MONEY SERVICES.............6
Revision of the Regulated Activity ..............................................................................6
Proposed Regulatory Framework...............................................................................6

PROPOSALS FOR REVISION OF THE REGULATORY
FRAMEWORK FOR PROVIDING MONEY SERVICES IN ADGM INTRODUCTION Why are we issuing this paper?

1. The Financial Services Regulatory Authority (“FSRA“) of Abu Dhabi Global Market
   (“ADGM“) has issued this consultation paper to consult on proposed amendments to the regulatory framework for Authorised Persons undertaking the Regulated Activity of Providing Money Services.
2. The proposals reflect the growing importance of money services, in terms of the use
   of both payment accounts and stored value mechanisms to undertake transactions, and will update the existing framework to reflect the emergence of new business models and methods for the transfer of funds.
3. Unless otherwise defined, capitalised terms used in this paper have the meanings
   attributed to such terms as contained in the Financial Services and Markets Regulations 2015 (“FSMR”) or the Glossary (“GLO”). Who should read this paper?
4. This Consultation Paper should be of particular interest to all entities undertaking,
   or aspiring to undertake, the Regulated Activity of Providing Money Services, their customers and professional advisers. How to provide comments
5. All comments should be made in writing and sent to the address or the email
   address specified below. If sending your comments by email, please use the Consultation Paper number in the subject line. If relevant, please identify the organisation you represent when providing your comments.
6. The FSRA reserves the right to publish, including on its website, any comments you
   provide, unless you expressly request otherwise at the time of submitting those comments. Comments supported by reasoning and evidence will be given more weight by the FSRA. What happens next?
7. The deadline for providing comments on the proposed framework is 26 July 2020.
   After receiving your comments, we shall consider whether any modifications are required to the proposals and the Board of ADGM and the FSRA will then proceed to enact the proposals in their final form.

PROPOSALS FOR REVISION OF THE REGULATORY
FRAMEWORK FOR PROVIDING MONEY SERVICES IN ADGM
8. You should not act on these proposals until final rules and guidance are issued by
the FSRA. We shall issue a notice on our website when this happens. Comments to be addressed to:
Consultation Paper No. 1 of 2020
Financial Services Regulatory Authority
Abu Dhabi Global Market Square
Al Maryah Island
PO Box 111999
Abu Dhabi, UAE
Email: consultation@adgm.com

PROPOSALS FOR REVISION OF THE REGULATORY
FRAMEWORK FOR PROVIDING MONEY SERVICES IN ADGM BACKGROUND

1. The emphasis in ADGM on encouraging FinTech solutions has led to an interest from
   firms in the financial services sector in broadening the scope of available money services to consumers in the UAE. Money services in this context encompasses currency exchange, money remittance, and the use of both payment accounts and stored value; these activities, across a large number of different business models, together comprise the Regulated Activity of Providing Money Services (“PMS”).
2. The services now available under money remittance, payment accounts and stored
   value, facilitating the efficient transfer of funds and the purchase of items, have evolved rapidly in the past few years and the regulatory requirements under PMS need to be updated to reflect those changes. The current requirements were designed with simple remittance businesses in mind and no longer reflect the complexity of evolving, technology-intensive business models for money services.
3. In particular, the provision of payment accounts that allow the purchase of goods or
   services raises the important matter of the safeguarding of client funds that are kept in such an account. The issuance of stored value has similar considerations in the form of the availability of funds to honour the requests for redemption from holders of stored value. These considerations are reflected in the proposals and the provision of payment accounts and stored value services are collectively termed, “Payment Services”.
4. The FSRA is therefore proposing to revise its regulatory framework for PMS to reflect
   more appropriately the risks arising from the activities undertaken by Authorised Persons offering Payment Services, termed “Payment Service Providers” (“PSPs”), and those providing money remittance. Currency exchange
5. It should be noted that the activities of currency exchange and money remittance, in
   the absence of the use of payment accounts or stored value, are excluded from these proposals and the current requirements will continue to apply, other than the proposals to remove the requirement to undertake client classification, which will apply across PMS. Where an Authorised Person undertakes currency exchange as an ancillary activity to its provision of the other money services, the proposals that relate to those other services are relevant. Benchmarking
6. In drawing up its proposals the FSRA has examined the regulatory frameworks for
   payment services adopted in other jurisdictions, including that in the European Union (“EU”). This has reinforced the need for amendment of the current regulatory framework for firms engaging in the offering/delivery of payment services. In addition, there have been recent updates to international regulatory frameworks for the delivery

PROPOSALS FOR REVISION OF THE REGULATORY
FRAMEWORK FOR PROVIDING MONEY SERVICES IN ADGM of payment services including the recent advent of EU and UK legislation concerning payment services. Customer funds
7. It is critical to note that funds lodged by a customer in a payment account provided by
an Authorised Person remain the property of the customer at all times, they must be segregated from the funds of the Authorised Person and are also subject to stringent safeguarding requirements. In the case of the sale or issuance of stored value, the customer has bought an instrument from the Authorised Person loaded with value that allows them to purchase goods or services. UPDATING THE REGULATORY FRAMEWORK FOR MONEY SERVICES Revision of the Regulated Activity
8. PMS currently encompasses the activities of currency exchange and Money
Transmission, the latter comprising the sale or issuance of payment instruments and stored value, plus the activity of “receiving money or monetary value for transmission, including electronic transmission, to a location within or outside the Abu Dhabi Global Market”. We are proposing that PMS be expanded to reflect explicitly the provision of payments accounts, a growing feature of the business models that we are seeing, and reorganised in order to better group together activities with similar characteristics.
9. Accordingly, we are proposing that the provision of payment accounts is considered
alongside the activities of selling or issuing payment instruments and stored value and considered collectively as “Payment Services” under PMS. The activity of Money Transmission would be re-badged as “Money Remittance” and left to cover ““receiving money or monetary value for transmission remittance, including electronic transmission remittance, to a location within or outside the Abu Dhabi Global Market, without the use of a Payment Account, Payment Instrument or stored value”. Proposed Regulatory Framework Conduct of Business Rulebook (“COBS”)
10. We are proposing the introduction of a new Chapter 19 in COBS (“COBS 19“), given
the proposed expansion of the regulatory framework to reflect the provision of payment accounts and to better reflect regulatory requirements for money remittance and stored value. Significant features of the proposed framework that are proposed in COBS 19, and their associated regulatory requirements, include the following defined terms.  “Framework Contract” – enables ongoing execution of multiple payment transactions.

PROPOSALS FOR REVISION OF THE REGULATORY
FRAMEWORK FOR PROVIDING MONEY SERVICES IN ADGM  “Low Value Payment Instrument” – a Framework Contract with reduced regulatory requirements available where there is:
o an upper limit on the amounts of individual transactions; o an aggregate spending cap; or o a maximum stored value.  “Single Payment Service Contracts” – governs a single transaction and where no payment account is set up by the payer.  “Relevant Money” - funds received from a user and held in either a payment account or in the form of redeemable stored value, to be placed in a segregated Client Account immediately upon receipt and subject to the proposals for COBS
Chapter 14.
11. A number of features are common to both Framework Contracts and Single Payment
Service Contracts, namely:
 the information to be provided to the user;  the safeguarding of payers’ funds;  operational standards, including those for the execution, authentication, revocation, refusal, timing and amount of payment transactions, the response of a PSP to late, unauthorised or incorrectly executed payment transactions, including complaints handling and dispute resolution measures; and  risk mitigation, including periodic assessments of operational and security risks, and reporting of major operational or security incidents.
12. In order to reduce the regulatory requirements for those PSPs that facilitate business
customer to business customer transactions, i.e. where there is no natural person involved, certain proposed rules in COBS 19 may not apply where both PSPs agree upon that. These would include those relating to fees and charges, authentication and execution, refunds and user liability.
13. We are also proposing that all Authorised Persons undertaking PMS would no longer
need to classify clients in accordance with Chapter 2 of COBS, given the nature of the business models in this sector and the underlying activities they encompass, as this would be consistent with practices in other, comparable jurisdictions. In the EU, for example, client classification is not required for money services business (in its broadest sense) covered by the Payment Services Directive (PSD 2). ISSUES FOR CONSIDERATION

1. The FSRA invites comments on the requirements outlined in COBS 19 and
   elsewhere in COBS for Authorised Persons engaged in Providing Money Services.

PROPOSALS FOR REVISION OF THE REGULATORY
FRAMEWORK FOR PROVIDING MONEY SERVICES IN ADGM Prudential – Investment, Insurance Intermediation and Banking Rules (“PRU”) Base Capital Requirement (“BCR”) and Expenditure Based Capital Minimum (“EBCM”)
14. PMS currently falls into prudential Category 3C with the BCR component set at $250k
for the calculation of the minimum capital requirement (“MCR”). The EBCM component is either 18/52nds or 13/52nds of Annual Audited Expenditure (“AAE”), the former where customer funds, in the form of what we now propose to define as Relevant Money, are held by an Authorised Person offering payments accounts, the latter where currency exchange, money remittance or stored value is offered.
15. The current prudential requirements will remain in place for Authorised Persons
offering currency exchange as a standalone activity under PMS, rather than an ancillary activity. However, the EBCM component will not apply in future for Authorised Persons offering either or both of payment accounts or stored value and where no currency exchange or money remittance is undertaken alongside one or both of those activities. Variable capital requirement (“VCR”)
16. We are proposing an additional component of the calculation of the MCR, i.e. a
variable capital requirement for all Authorised Persons other than those that provide currency exchange, on the basis that this would be more risk-sensitive than the BCR or the EBCM (where applicable). For Authorised Persons offering money remittance and payment accounts the proposed approach mirrors the tranched approach of PSD 2 in that the VCR is linked to the volume of payment transactions that the Authorised Person processes on a monthly basis.
17. Similarly, for Authorised Persons offering stored value the proposed approach
replicates that of PSD 2 in that the VCR is directly linked to the average outstanding balance that the Authorised Person holds.
18. For money remittance and payment accounts, the weighting for the first tranche of the
VCR that covers average monthly payment volumes up to $5m is set at a lower value than in PSD 2. Instead, we have set a higher BCR of $250k compared to the comparable initial capital requirements in PSD 2 (that approximate to $23k and $140k for money remittance and payment accounts respectively) to ensure a commitment of adequate financial resources when a firm commences those activities in ADGM. For stored value, the VCR would be calculated using a factor of 2.5% for the average outstanding stored value, which is in line with figure of 2% adopted in PSD 2.
19. For mixed business models, spanning two or more of money remittance, payment
accounts and stored value, the relevant components for the calculation of the minimum capital requirement are shown below, other than the BCR of $250k; the maximum value is taken as the binding minimum capital requirement.

PROPOSALS FOR REVISION OF THE REGULATORY
FRAMEWORK FOR PROVIDING MONEY SERVICES IN ADGM MCR = max ($250k, … ) Money Remittance Payment Accounts Stored Value Money Remittance EBCMMR, VCRMR Payment Accounts EBCMMR, 2VCRMR + VCRPA VCRPA Stored Value EBCMMR, VCRMR + VCRSV VCRPA + VCRSV VCRSV Note  Where all three activities are undertaken at the same time, the minimum capital requirement would be calculated as max ($250k, EBCMMR, [2VCRMR + VCRPA + VCRSV])
Table 1 – Minimum Capital Requirement
ISSUES FOR CONSIDERATION
2. The FSRA invites comments on the proposals for calculating the minimum capital
requirement for Authorised Persons engaged in Providing Money Services. Fees Rules (“FEES”)
20. We are proposing that the authorisation and annual supervision fees be increased for
Providing Money Services, to better reflect the level of resource that the FSRA expends in this area in relation to Applicants and Authorised Persons. There would be a differentiated approach, as outlined below, as the business models and ongoing activities of PSPs are more complex than those for entities providing solely currency exchange or money remittance. We are additionally proposing that the fees for activities that encompass both (i) currency exchange or money remittance and (ii) Payment Services are set at the level proposed for (ii). Activity Authorisation and Annual Supervision fees ($) (i) Currency exchange or Money Remittance 15,000 (ii) Payment Services 25,000 (iii) Both (i) and (ii) 25,000
Table 2 – Fees
ISSUES FOR CONSIDERATION
3. The FSRA invites comments on the proposals for authorisation and annual fees
for Authorised Persons engaged in Providing Money Services.
Implementation date and transitional period
21. We are proposing that all money remitters and PSPs currently operating in ADGM
would have a period of twelve months from the implementation date of the revised requirements to comply with them, and the same transitional period would also apply to Applicants having received as of that date an “in-principle approval” to operate as such in ADGM. Similarly, a transitional period would apply to Authorised Persons operating in the RegLab when converting that FSP into one to undertake Payment

PROPOSALS FOR REVISION OF THE REGULATORY
FRAMEWORK FOR PROVIDING MONEY SERVICES IN ADGM Services or money remittance, but the transitional period would apply only from the date that the FSP is granted up to a maximum of twelve months after the implementation date. ISSUES FOR CONSIDERATION
4. The FSRA invites comments on the proposal for a transitional period for the
revision of the regulatory requirements for Authorised Persons engaged in Providing Money Services. Anti-Money Laundering and Sanctions Rules and Guidance Rulebook (“AML”)
22. Recent Federal legislation concerning AML issues 1 has emphasised the general
obligation upon firms operating in the money services sector to take responsibility for the actions of the agents they employ when conducting their business, reflecting the relevant guidance in this area issued by Financial Action Task Force 2. Firms using agents should therefore use all available means at their disposal when considering the ability of potential agents to comply with all AML requirements; those requirements may originate from ADGM, the wider UAE or other, international bodies that develop and impose such requirements.
23. This overarching legislative imperative therefore requires amendments to be made to
AML, independent of the proposals that are the subject of this consultation exercise, to ensure that Authorised Persons engaged in PMS conduct appropriate AML oversight of all agents involved in their business activities, and train, oversee and assess the AML compliance of their agents on a continuing basis as is necessary and appropriate. Those amendments will also encompass the requirement of an Authorised Person to file a Suspicious Activity Report with the relevant authorities in the UAE and the jurisdiction(s) of any agent(s) operating overseas in the event that a suspicious transaction or activity is encountered.
24. A further safeguard that is being proposed in order to combat money laundering and
terrorist financing risk would prohibit an Authorised Person from accepting physical cash from any user of its services. Other considerations
25. There are a number of other, related considerations that will be features of the revised
regulatory framework.

1 Decree Law No. (20) of 2018 on Anti- Money Laundering and Combating the Financing of Terrorism and Illegal Organisations and Cabinet Resolution No. (10) of 2019 concerning the implementing regulation thereof “Guidance for a Risk -Based Approach for Money or Value Transfer Services”, FATF, (www.fatf￾gafi.org/publications/fatfrecommendations/documents/rba-money-or-value-transfer.html, Feb 2016)

PROPOSALS FOR REVISION OF THE REGULATORY
FRAMEWORK FOR PROVIDING MONEY SERVICES IN ADGM  Limits on aggregate funds and transaction volumes for individual customers - the imposition of such limits is not a feature in most other jurisdictions and we believe that any limits on aggregate funds and transaction volumes are better set by PSPs in the light of their business model(s) and risk appetite(s).  Guidance - the FSRA will draft and issue a guide to its authorisation of PSPs, highlighting the appropriate interpretation of the threshold conditions alongside other issues that would have to be addressed by applicants.  Supplementary application form - this will allow the FSRA to better gauge the readiness, willingness and ability of prospective PSPs to meet the threshold conditions and the ongoing requirements.  Annex A Financial Services and Markets Regulations 2015  Appendix 1 Fees Rules  Appendix 2 Prudential – Investment, Insurance Intermediation and Banking Rules  Appendix 3 Conduct of Business Rules  Appendix 4 Glossary  Appendix 5 Anti-Money Laundering and Sanctions Rules and Guidance PROPOSED AMENDMENTS

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Annex A
FINANCIAL SERVICES AND MARKETS
(AMENDMENT No X) REGULATIONS 2020

Annex A
FINANCIAL SERVICES AND MARKETS (AMENDMENT NO X) REGULATIONS 2020 Regulations to amend the Financial Services and Markets Regulations 2015. Date of Enactment: [] 2020 The Board of Directors of the Abu Dhabi Global Market, in exercise of its powers under Article 6(1) of Law No. 4 of 2013 concerning the Abu Dhabi Global Market issued by His Highness the Ruler of the Emirate of Abu Dhabi, hereby enactsthe following Regulations–
1. Amendments to the Financial Services and Markets Regulations 2015
258. Definitions
(1) In these Regulations, unless the context otherwise requires— Money Transmission Remittance means- (a) selling or issuing payment instruments; (b) selling or issuing stored value; or (c) receiving money or monetary value for transmission remittance, including electronic transmission remittance, to a location within or outside the Abu Dhabi Global Market, without the use of a Payment Account, Payment Instrument or stored value. Money Remitter means an Authorised Person with a Financial Services Permission enabling it to undertake Money Remittance. Payee means a Person who is the intended recipient of Money that has been the subject of a Payment Transaction. Payer means:
(a) a Person who holds a Payment Account and initiates or consents to the initiation of a Payment Transaction from that Payment Account; or (b) where there is no Payment Account, a Person who initiates a Payment Transaction. Payment Account means an account held in the name of one or more Payers or Payees that is used for the execution of Payment Transactions. Payment Account Provider means an Authorised Person providing Payment Accounts. Payment Instrument means any:
(a) personalised device; or

Annex A
(b) personalised set of procedures agreed between a Payer or Payee and the Payment Service Provider, used by a Payer or Payee in order to initiate a Payment Transaction through a Payment Service Provider. Payment Service Provider means an Authorised Person with a Financial Services Permission allowing it to deliver Payment Services. Payment Services means:
(a) services enabling cash to be placed in, or withdrawn from, a Payment Account and all of the operations required for operating a Payment Account; (b) the execution of Payment Transactions, including transfers of Money to or from a Payment Account by the user’s Payment Service Provider, or by another Payment Service Provider, through:
(i) the execution of direct debits, including one￾off direct debits; (ii) the execution of Payment Transactions through a Payment Instrument; (iii) the execution of credit transfers between bank accounts, including standing orders; (c) issuing Payment Instruments; (d) selling or issuing stored value; (e) receiving money or monetary value for transmission by means of a Payment Instrument to a location within or outside the Abu Dhabi Global Market. Payment Transaction means an act initiated by the Payer or Payee, or on behalf of the Payer, of placing, transferring or withdrawing Money, irrespective of any underlying obligations between the Payer and Payee. Stored Value Provider means an Authorised Person selling or issuing stored value. …

Annex A
Schedule 1
Regulated Activities
…
Chapter 8 Money Services
The activity
52. Providing Money Services
Providing currency exchange, or Money Transmission Remittance or Payment Services is a specified kind of activity. Exclusions
53. Connected Services
An Authorised Person does not Provide Money Services if it does so in relation to the carrying on of another Regulated Activity where Providing Money Services is in connection with and a necessary
part of that other Regulated Activity.
53A. Other exclusions
The following do not constitute Payment Services— (a) Payment Transactions executed wholly in cash and directly between the Payer and the Payee, without any intermediary intervention; (b) Payment Transactions between the Payer and the Payee through a commercial agent authorised in an agreement to negotiate or conclude the sale or purchase of goods or services on behalf of either the Payer or the Payee but not both the Payer and the Payee; (c) the professional physical transport of banknotes and coins, including their collection, processing and delivery; (d) services where cash is provided by the Payee to the Payer as part of a Payment Transaction for the purchase of goods or services following an explicit request by the Payer immediately before the execution of the Payment Transaction; (e) cash-to-cash currency exchange operations where the Money is not held on a Payment Account; (f) Payment Transactions based on any of the following documents drawn on the Payment Service Provider with a view to placing Money at the disposal of the Payee:
(i) paper cheques of any kind, including travellers cheques; (ii) bankers’ drafts; (iii) paper-based vouchers; (g) Payment Transactions carried out within a payment or securities settlement system amongst Payment Service Providers, banks, settlement agents, central

Annex A
counterparties, clearing houses, and central banks, their respective agents or branches, or for their respective own accounts; (h) Payment Transactions related to securities asset servicing, including dividends, income or other distributions, or redemption or sale, carried out by persons referred to in subparagraph (g), or by investment firms, credit institutions, collective investment undertakings or asset management companies providing investment services or by any other entities allowed to have the custody of financial instruments; (i) services provided by technical service providers, which support the provision of Payment Services, without the provider entering at any time into possession of the Money to be transferred, including:
(i) the processing and storage of data;
(ii) trust and privacy protection services;
(iii) data and entity authentication;
(iv) information technology;
(v) communication network provision; and
(vi) the provision and maintenance of terminals and devices used for Payment Services; (j) services based on specific Payment Instruments that can be used only in a limited way and meet one of the following conditions:
(i) allow the holder to acquire goods or services only in the issuer’s premises; (ii) are issued by a professional issuer and allow the holder to acquire goods or services only within a limited network of service providers which have direct commercial agreements with the issuer; or (iii) may be used only to acquire a very limited range of goods or services; or (k) Payment Transactions and related services between members of the same Group, without any intermediary intervention by a Payment Service Provider other than an undertaking belonging to the same Group; (l) cash withdrawal services provided through automatic teller machines. …
2. Short title, extent and commencement
(1) These Regulations may be cited as the Financial Services and Markets (Amendment No X) Regulations 2020. (2) These Regulations shall apply in the Abu Dhabi Global Market. (3) These Regulations come into force on the date of their publication.

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Appendix 1
FeesRules(FEES)
*In this attachment underlining indicates new text and striking through indicates deleted text.

Appendix 1
3.14 Authorised Persons conducting a Regulated Activity in relation to Virtual Assets
…
3.15 Providing Money Services
3.15.1 (a) An Applicant for a Financial Services Permission to carry on the Regulated Activity of
Providing Money Services must pay to the Regulator an initial authorisation fee as detailed in the table below, in accordance with the activity that it will undertake. Activity Authorisation fee ($) Currency exchange or Money Remittance 15,000 Payment Services 25,000 (b) An Applicant for both of the activities detailed in (a) must pay to the Regulator an initial authorisation fee of $25,000.
3.15.2 (a) An Authorised Person with a Financial Services Permission to carry on the Regulated
Activity of Providing Money Services must pay to the Regulator an annual supervision fee as detailed in the table below, in accordance with the activity that it will undertake. Activity Annual supervision fee ($) Currency exchange or Money Remittance 15,000 Payment Services 25,000 (b) An Authorised Person with a Financial Services Permission to carry on the Regulated Activity of Providing Money Services and that undertakes both of the activities detailed in (a) must pay to the Regulator an annual supervision fee of $25,000. ….

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Appendix 2
Prudential – Investment, Insurance Intermediationand Banking Rules(PRU) *In this attachment underlining indicates new text and striking through indicates deleted text.

Appendix 2
…
3 CAPITAL AND LEVERAGE
…
3.6 Capital Requirements for Categories 3B, 3C and 4
3.6.1 This Section applies to an Authorised Person in Category 3B, 3C or 4.
3.6.2 Subject to 3.6A.1, Tthe Capital Requirement for such an Authorised Person is
calculated as the higher of:
(a) the applicable Base Capital Requirement as set out in Section 3.3; or (b) the Expenditure Based Capital Minimum as set out in Section 3.7. 3.6A Variable Capital Requirement for Money Remitters and Payment Service Providers 3.6A.1 An Authorised Person with a Financial Services Permission enabling it to carry on the activity of Providing Money Services as a Money Remitter or a Payment Service Provider must calculate its Capital Requirement as:
(a) for a Money Remitter,the highest of:
(i) the applicable Base Capital Requirement as set out in Section 3.3; (ii) the Expenditure Based Capital Minimum as set out in Section 3.7; (iii) the Variable Capital Requirement calculated in accordance with Rule 3.6A.2; (b) for a Payment Service Provider,the higher of:
(i) the applicable Base Capital Requirement as set out in Section 3.3; (ii) the Variable Capital Requirement calculated in accordance with Rule 3.6A.2 or Rule 3.6A.4, as appropriate; or (c) where it undertakes activities underboth (a) and (b),the highest of:
(i) the applicable Base Capital Requirement as set out in Section 3.3; (ii) the Expenditure Based Capital Minimum as set out in Section 3.7; (iii) the aggregate Variable Capital Requirement arising from the sum of the calculations performed under Rules 3.6A.2 and 3.6A.4, as appropriate for the activities undertaken. Guidance Payment Service Providers comprise both Payment Account Providers and Stored Value Providers.

Appendix 2
Money Remitters and Payment Account Providers 3.6A.2 A Money Remitter or a Payment Account Provider must calculate its Variable Capital Requirement as the sum of the following elements:
(a) for an Authorised Person acting only as a Money Remitter:
(i) 1.25% of the first $10 million of monthly payment volume; (ii) 0.5% of the next $90 million of monthly payment volume; (iii) 0.25% of the next $150 million of monthly payment volume; and (iv) 0.125% of any remaining monthly payment volume; or. (b) for an Authorised Person acting only as a Payment Account Provider or as both a Payment Account Provider and a Money Remitter:
(i) 2.5% of the first $10 million of monthly payment volume; (ii) 1% of the next $90 million of monthly payment volume; (iii) 0.5% of the next $150 million of monthly payment volume; and (iv) 0.25% of any remaining monthly payment volume. 3.6A.3 (1) In Rule 3.6A.2, monthly payment volume must be calculated by an Authorised Person as the total value of Payment Transactions executed by the Authorised Person in its preceding financial year divided by the number of months in that year. (2) Where the Authorised Person has not completed a full financial year following its authorisation, the monthly payment volume must be calculated using the projections contained in its business plan, subject to any adjustments required by the Regulator. Guidance

1. The monthly payment volume should be split into tranches, with the first
   $10mn being assigned to the first tranche, the next $90mn to the second tranche and so on.
2. The portion of the Variable Capital Requirement for each tranche is then
   calculated by multiplying the monthly payment volume in each tranche by the percentage factor associated with that tranche and then summing those portions to derive the overall Variable Capital Requirement.
3. Examples of the calculation of the Variable Capital Requirement follow, for
   Authorised Persons acting as a Money Remitter, a Payment Account Provider or both at the same time, with monthly payment volumes of $120mn.

Appendix 2
Tranche
Monthly payment volume ($mn)
Activity(ies)
Money Remitter
(i) Payment Account Provider or
(ii) Payment Account Provider and Money Remitter 0 < … ≤ 10 10 1.25% * 10 = 0.125 2.5% * 10 = 0.250 10 < … ≤ 100 90 0.5% * 90 = 0.450 1%* 90 = 0.900 100 < … ≤ 250 20 0.25% * 10 = 0.025 0.5%* 10 = 0.050 … > 250 - - - Total 120 Variable Capital Requirement($mn) 0.600 1.200 Stored Value Providers 3.6A.4 A Stored Value Provider must calculate its Variable Capital Requirement as 2.5% of the average outstanding stored value, calculated using the outstanding stored value at the end of each calendar day over the preceding financial year. 3.6A.5 Where the Authorised Person has not completed a full financial year following its authorisation, the average outstanding stored value must be calculated using the projections contained in its business plan, subject to any adjustments required by the Regulator. Expenditure Based Capital Minimum
3.7.1 An Authorised Person must calculate its Expenditure Based Capital Minimum as:
(a) in the case of an Authorised Person which holds Client Assets or Insurance Money, 18/52nds; (b) in the case of an Authorised Person in Category 3B or 3C which does not hold Client Assets or Relevant Money or Insurance Money, 13/52nds; or (c) in the case of an Authorised Person in Category 4, which does not hold Insurance Money, 6/52nds; of the Annual Audited Expenditure, calculated in accordance with Rule 3.7.2. Guidance For the purposes of Rule 3.7.1, Authorised Persons undertaking the Regulated Activity of Providing Money Services that offer only one of or both currency exchange and Money Remittance to their customers, but not Payment Services, are considered not to hold Client Assets, in the form of Client Money, or Relevant Money. …

Appendix 2
3.21 The Leverage Ratio
…
3.21.4 An Authorised Person must notify the Regulator immediately in writing if, at any time,
it does not hold, or is likely not to hold, an amount and quality of capital that is necessary to comply with Rule 3.1921.3. …

Appendix 2
A3.2 Capital Requirements
Guidance

1. This table summarises the minimum Capital Requirement that an Authorised Person is subject to and an Authorised Person should must hold sufficient Capital
   Resources at all times to meet the minimum Capital Requirement.
   Minimum Capital Requirement
   Category
   <-----------------------------------------------------------------------------------------maximum of----------------------------------------------------------------------------------------------> Base Capital Requirement 2 (USD) Expenditure Based Capital Minimum Risk Capital Requirement Holding Client Assets 4 or Relevant Money 3 or Insurance Money? No Yes 1 10mn Credit, Market, Operational and CVA (plus, where appropriate, Displaced Commercial) 2 2mn Credit, Market, Operational and CVA 3A 500k 3B 5 4mn 13/52nds of Annual Expenditure 18/52nds of Annual Expenditure 3C 5 250k or, where the Financial Services Permission permits only the Regulated Activity of Managing a Collective Investment Fund: (i) 150k for a Public Fund or one available to retail customers or (ii) 50k otherwise except where an Authorised Person has a Financial Services Permission only to carry out the Regulated Activity of Managing a Collective Investment Fund, in which case the Base Capital Requirement is the higher of:
   a) 150,000 if the Authorised Person manages a Public Fund or any other type of fund that is available to retail customers; or b) 50,000 otherwise.

Appendix 2
5, 6 10k
6/52nds of
Annual
Expenditure
5 10mn Credit, Market, Operational, CVA and
Displaced Commercial
2. An Authorised Person, whichever Category it is a member of, must hold a minimum amount of CET1 Capital at the time that it obtains authorisation and at all
times thereafter, in accordance with Rule 3.3.3, corresponding to the Base Capital Requirement.
3. An Authorised Person in Category 3C undertaking the Regulated Activity of Providing Money Services that offers only one of or both currency exchange and
Money Remittance to their customers, but not Payment Services, is considered not to hold Client Assets, in the form of Client Money, or Relevant Money.
34. Where the Risk Capital Requirement is the binding capital requirement for an Authorised Person in Category 1, 2 or 5 it must also hold a Capital Conservation
Buffer of CET1 Capital of 2.5% of the Total Risk Exposure Amount and, where applicable, a Countercyclical Capital Buffer of CET1 Capital, to be determined in accordance with Section 3.18.
45. An Authorised Person in Category 3B, 3C or 4 must notify the Regulator immediately if its Capital Resources fall below 120% of its minimum Capital
Requirement, in accordance with Rule 3.20.2.
56. An Authorised Person in Category 4 is only permitted to hold Insurance Monies.
…

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Appendix 3
Conduct of BusinessRulebook (COBS)
*In this attachment underlining indicates new text and striking through indicates deleted text.

Appendix 3
…
2. CLIENT CLASSIFICATION
2.1 Application
2.1.1 This chapter applies to an Authorised Person carrying on or intending to carry on any
Regulated Activity with or for a Person.
2.1.2 For the purposes of this chapter, a Person includes any organisation (including outside of the
Abu Dhabi Global Market) whether or not it has a separate legal personality.
2.1.3 This chapter does not apply to:
(a) a Credit Rating Agency in so far as it carries on, or intends to carry on, the Regulated Activity of Operating a Credit Rating Agency.; (b)2.1.4 This chapter does not apply to an Authorised ISPV.; or (c) an Authorised Person in so far as it carries on, or intends to carry on, the Regulated Activity of Providing Money Services. Guidance

1. The activity described in section 67 of Chapter 14 of Schedule 1 of FSMR refers to the
   marketing of Regulated Activities and Specified Investments which are offered in a jurisdiction outside the Abu Dhabi Global Market. Such marketing activities can be conducted by an Authorised Person that holds a Representative Office Financial Services Permission, provided the Regulated Activities or Specified Investments marketed by it are those offered by its head office, or a member of its Group.
2. As a Representative Office conducting marketing activities of the kind described in
   section 67 of Chapter 14 of Schedule 1 of FSMR does not have a client relationship
   with a Person to whom it markets a Specified Investment or engages with in relation to carrying on a Regulated Activity, the client classification requirements in this
   chapter do not apply to the Authorised Person with regard to its engagement with
   that Person.
3. Other Authorised Persons can also conduct marketing activities of the kind described
   in section 67 of Chapter 14 of Schedule 1 of FSMR under the exclusion in section 67(5) of Chapter 14 of Schedule 1 of FSMR.
4. An Authorised Person undertaking the Regulated Activity of Providing Money Services,
   as described in Chapter 8 of Schedule 1 of FSMR does not have a client relationship with a Person to whom it Provides Money Services, either as Payer or Payee, so the client classification requirements in this chapter do not apply to that Authorised Person.

Appendix 3
…
10.2 Rules applicable to CSDs
10.2.1 A CSD must comply with, and is subject to, the general requirements applicable to Authorised
Persons in COBS, GEN and elsewhere in the Rules, except for the following:
(a) Rule 14.2.14 (Segregation and portability); (b) Rules 14.2.15(b)(i)(B), (c) and (d) (Statutory Trust); (c) Rules 1314.4.3 (b), (e) and (h)-(n) (Pooling and Distribution); (d) Rule 14.4.6 (Failure of third parties: pooling and distribution); and (e) Rule 14.4.7 (Client Money received after the Failure of a third party). …
14. CLIENT MONEY AND RELEVANT MONEY PROVISIONS
14.1 Client Assets
14.1.1 Application
This section applies to an Authorised Person which:
(a) holds or controls Client Assets; or
(b) Provides Custody or Arranges Custody.; or (c) holds or controls Relevant Money.
14.1.2 [Deleted]
Guidance
1.(a) Principle 9 of the Principles for Authorised Persons (Customer assets and money) in GEN 2.2.9 requires an Authorised Person to arrange proper protection for Clients' Assets and Relevant Money wheren the Authorised Person is responsible for them. An essential part of that protection is that an Authorised Person must properly safeguard Client Assets held or controlled on behalf of a Client in the course of, or in connection with, the carrying on of Investment Business, or properly safeguard Relevant Money in the course of the delivery of Payment Services, in or from the Abu Dhabi Global Market. 2.(b) An Authorised Person must introduce adequate organisational arrangements to minimise the risk of the loss or diminution of Client Assets and Relevant Money, or of rights in connection with Client Assets and Relevant Money, as a result of, for example, the Authorised Person's or a third party's insolvency, fraud, poor administration, inadequate recordkeeping or negligence.

Appendix 3. For the purposes of interpretation of this Chapter by an Authorised Person engaging
in Payment Services as part of undertaking the Regulated Activity of Providing Money Services, only those Rules which apply to Relevant Money shall be applicable. References which require the safekeeping of Relevant Money in a Client Account do not result in a Payment Service User becoming a Client of a Payment Service Provider.
14.1.3 General Requirements
(a) An Authorised Person which holds or controls Client Money or Relevant Money must comply with the provisions of Rule 14.2 (the "Client Money Rules") in relation to that Client Money or Relevant Money, as applicable, and have systems and controls in place to be able to evidence compliance with the Client Money Rules. (b) An Authorised Person which also holds or controls Client Investments, Provides Custody or Arranges Custody must also comply with Chapter 15. (c) An Authorised Person must have systems and controls to ensure that Client Assets and Relevant Money are identifiable and secure at all times. (d) Where the Authorised Person holds a mandate, or similar authority over an account with a third party, in the Client's own name, its systems and controls must:
(i) include a current list of all such mandates and any conditions placed by the Client or by the Authorised Person on the use of the mandate; (ii) include the details of the procedures and authorities for the giving and receiving of instructions under the mandate; and (iii) ensure that all Transactions entered into using such a mandate are recorded and are within the scope of the authority of the Employee and the Authorised Person entering into such Transactions.
14.1.4 Holding or Controlling Client Assets or Relevant Money
Client Assets or Relevant Money are held or controlled by an Authorised Person if they are:
(a) directly held by the Authorised Person;
(b) held in an account in the name of the Authorised Person; or (c) held by a Person, or in an account in the name of a Person, controlled by the Authorised Person. Guidance

1. The Regulator would consider a Person to be controlled by an Authorised Person if
   that Person is inclined to act in accordance with the instructions of the Authorised Person.
2. The Regulator would consider an account to be controlled by an Authorised Person if
   that account is operated in accordance with the instructions of the Authorised Person.

Appendix 3
14.2 Client Money and Relevant Money Rules
14.2.1 All Money held or controlled on behalf of a Client in the course of, or in connection with, the
carrying on of Investment Business in or from the Abu Dhabi Global Market is Client Money, except Money which is:
(a) held by the Authorised Person acting a Bank as a deposit on its own books, provided the Authorised Person notifies the Client in writing that the Client Money is held by it as a Bank and not as Client Money; (b) due and payable by the Client to the Authorised Person; (c) in an account in the Client's name over which the Authorised Person has a mandate or similar authority and who is in compliance with these Rules; (d) received in the form of a cheque, or other payable order, made payable to a third party other than a Person or account controlled by the Authorised Person, provided the cheque or other payable order is intended to be forwarded to the third party within one bBusiness dDay of receipt; or (e) Fund Property of a Fund. 14.2.1AAll Money held or controlled by a Payment Service Provider on behalf of a Payment Service User in the course of, or in connection with, the carrying on of Payment Services in or from the Abu Dhabi Global Market is Relevant Money from the time of its receipt, except Money which is due and payable to the Authorised Person from the Payment Service User, or held by a Payment Service Provider for a period of less than one day.
14.2.2 [Deleted]
Guidance
1.(a) The exemption in Rule 14.2.1(a) does not apply to Money which is held in a Client Aaccount with a third party i.e. not held in an account with the Authorised Person itself. 2.(b) Pursuant to Rule 14.2.1(b), examples of Money which isimmediately due and payable to an Authorised Person include Money which is:
(i) paid by the way of brokerage, fees and other charges to the Authorised Person or where the Authorised Person is entitled to deduct such remuneration from the Client Money held or controlled; (ii) paid by the Authorised Person in relation to a Client purchase or in settlement of a margin payment in advance of receiving a payment from the Client; or (iii) owed by the Client to the Authorised Person in respect of unpaid purchases by or for the Client if delivery of Investments has been made to the Client or credited to his account. 3.(c) The Fund Rules contain specific provisions relating to the handing of Fund Property and also provisions relating to a Fund Administrator holding or controlling monies or assets belonging to third parties.

Appendix 3
4. Chapter 19 also contains specific provisions relating to the handling of Relevant
Money by an Authorised Person conducting Payment Services.
14.2.3 Holding or Controlling Client Money or Relevant Money
(a) An Authorised Person in Category 4, other than an Authorised Person engaged in the Regulated Activity of Operating a Private Financing Platform, must not hold Client Money. (b) An Authorised Person which holds or controls Client Money for a Client or Relevant Money for a Payment Service User must comply with these Client Money Rules, and also the specific provisions in Chapter 19 relating to Relevant Money, as applicable. (c) Where the Client is a Market Counterparty, an Authorised Person engaging in Investment Business may exclude the application of the Client Money Rules but only where it has obtained the prior written consent of the Market Counterparty to do so. (d) An Authorised Person which holds or controls Client Money must arrange for a Client Money Auditor's Report to be submitted to the Regulator on an annual basis.
14.2.4 Payment of Client Money or Relevant Money into Client Accounts
(a) Subject to the requirements in Chapter 19 in relation to Payment Services, wWhere an Authorised Person holds or controls Client Money or Relevant Money it must ensure, except where otherwise provided in these Rules that the Client Money and Relevant Money is paid into one or more Client Accounts within one Business dDay of receipt. (b) An Authorised Person must not hold or deposit its own Money into a Client Account, except where:
(i) it is a minimum sum required to open the account, or to keep it open; (ii) the Money is received by way of mixed remittance, provided the Authorised Person transfers out that part of the payment which is not Client Money or Relevant Money within one Business dDay of the day on which the Authorised Person would normally expect the remittance to be cleared; (iii) interest credited to the account exceeds the amount payable to Clients or Payment Service Users, as applicable, provided that the Money is removed within twenty Businessthirty Ddays; or (iv) it is to meet a shortfall in Client Money or Relevant Money. (c) Where an Authorised Person deposits any Money into a Client Account, such Money is Client Money or Relevant Money, as applicable, until such time as the Money is withdrawn from the Client Account in accordance with the Client Money Rules or the requirements of Chapter 19 in the case of an Authorised Person conducting Payment Services. (d) An Authorised Person must maintain systems and controls for identifying Money which must not be in a Client Account and for transferring it out of the Client Account without delay.

Appendix 3
(e) Where an Authorised Person is aware that a Person may make a payment of Client Money or Relevant Money to the Authorised Person, it must take reasonable steps:
(i) to ensure that the Person has sufficient information of the relevant account details to be able to transfer Client Money or Relevant Money, as applicable, directly to a Client Account, or otherwise to enable the Authorised Person to identify the Client Money or Relevant Money, as applicable; and (ii) to ensure that the Authorised Person is notified by that Person of such payment as soon as reasonably practicable. (f) An Authorised Person must have procedures for identifying Client Money and Relevant Money received by the Authorised Person, and for promptly recording the receipt of the Money either in the books of account or a register for later posting to and recording in the Client Account, or as otherwise specified in Chapter 19 of these Rules. The procedures must cover Client Money or Relevant Money, as applicable, received by the Authorised Person through the mail, electronically or via agents of the Authorised Person or through any other means. Guidance An Authorised Person holding or controlling Relevant Money in connection with the conduct of Payment Services is expected to identify, record and reconcile such amounts in accordance with the requirements of Chapter 19.
14.2.5 Client Accounts
(a) A Client Account in relation to Client Money or Relevant Money, as applicable, is an account which:
(i) is held with a Third-Party Agent as banker, pursuant to Rules 14.2.7-14.2.8; (ii) is established to hold Client Money or Relevant Money, as applicable; (iii) is maintained in the name of:
(A) if a Domestic Firm, the Authorised Person; or (B) if a non-Domestic Firm, a Nominee Company controlled by the Authorised Person; and (iv) includes the words "Client Account" in its title. (b) An Authorised Person:
(i) mustcan hold Client Money in a Client Account, a Designated Client Account or a Designated Client Fund Account. Rule 14.2.5 appliesto each type of Client Account; and (ii) conducting Payment Services must hold Relevant Money in a Client Account. (c) An Authorised Person must maintain a master list of all Client Accounts. The master list must detail:

Appendix 3
(i) the name of the account;
(ii) the account number;
(iii) the location of the account;
(iv) the banker or custodian, its address and contact information; (v) the account terms and conditions; (vi) whether the account is currently open or closed; and (vii) the date of opening or closure. (d) The details of the master list must be documented and maintained for at least six years following the closure of an account. Guidance

1. An Authorised Person holds all Client Money or Relevant Money, as applicable in
   Client Accounts for its Clients as part of a common pool of money so those particular Clients or Payment Service Users, as applicable, do not have a claim against a specific sum in a specific account; they only have a pro rata claim to the Client Money or Relevant Money, as applicable, in generalto which a particular Statutory Trustrelates, as one of the beneficiaries of such Statutory Trust. The purpose of controlling or holding Client Money or Relevant Money, as applicable, in a Client Account is to ensure that Money belonging to Clients or Payment Service Users, as applicable is segregated and readily identifiable from Money belonging to the Authorised Person, such that, following a Pooling Event, Clients or Payment Service Users, as applicable, will have a joint property interest in the Client Money or Relevant Money, as applicable, in proportion to each Client's or Payment Service Users’ entitlement in the Statutory Trust.
2. Alternatively, an Authorised Person may hold or control Client Money belonging to a
   Client in a Client Account constituting a Statutory Trust solely for that Client i.e. a Designated Client Account or Designated Client Fund Account. An Authorised Person holds Client Money in Designated Client Accounts or Designated Client Fund Accounts for those Clients that requested their Client Money be part of a specific pool of money, so those particular Clients have a property interest in relation to a specific sum in a specific account constituting a Statutory Trust; they do not have a claim to the Client Money even if a Primary Pooling Event occurs (as described in Rule 14.4.2).
3. A Designated Client Fund Account may be used for a Client only where that Client has
   consented to the use of that account and all other Designated Client Fund accounts which may be pooled with it. For example, a Client who consents to the use of bank A and bank B should have Client Money related to it held in a different Designated Client Fund account at bank B from a Client who has consented to the use of banks B and C.
4. A Primary Pooling Event triggers a notional pooling of all the Client Money related to
   each Statutory Trust. The obligation to distribute Client Money or Relevant Money, as applicable, following a Pooling Event is described in the Client Money Distribution Rules.

Appendix 3
14.2.6 Exceptions to Holding Client Money in Client Accounts
(a) The requirement for an Authorised Person to hold Client Money in a Client Account does not, subject to Rule 14.2.6(b), apply with respect to such Client Money:
(i) received in the form of cheque, or other payable order, until the Authorised Person, or a Person or account controlled by the Authorised Person, is in receipt of the proceeds of that cheque; (ii) temporarily held by an Authorised Person before forwarding to a Person nominated by the Client; or (iii) in connection with a Delivery Versus Payment Transaction where:
(A) in respect of a Client purchase, Client Money from the Client will be due to the Authorised Person within one Business dDay upon the fulfilment of a delivery obligation; or (B) in respect of a Client sale, Client Money will be due to the Client within one Business dDay following the Client's fulfilment of a delivery obligation. (b) An Authorised Person must pay Client Money received by it of the type described in Rule 14.2.6(a)(ii)or Rule 14.2.6(a)(iii)into a Client Account where it has not fulfilled its delivery or payment obligation within three days of receipt of the Money or Investments, unless in the case of the type of Client Money referred to in Rule 14.2.6(a)(iii)(B), it instead safeguards Client Investments at least equal to the value of such Client Money. (c) An Authorised Person must maintain adequate records of all cheques and payment orders received in accordance with Rule 14.2.6(a)(i) including, in respect of each payment, the:
(i) date of receipt;
(ii) name of the Client for whom payment is to be credited; and (iii) date when the cheque or payment order was presented to the Authorised Person's Third-Party Agent. (d) The records must be kept for a minimum of six years. (e) Cash held by an Authorised Person that is a bank as a deposit in its capacity as a bank is not Client Money. (f) Cash received under a title transfer collateral arrangement from a Market Counterparty or Professional Client is not Client Money.
14.2.7 Appointment of a Third-Party Agent
(a) An Authorised Person may pay, or permit to be paid, Client Money or Relevant Money, as applicable, to a Third-Party Agent in accordance with Rule 14.2.8(a) only where it has undertaken a prior assessment of the suitability of that Third-Party agent and

Appendix 3
concluded on reasonable grounds that the Third-Party Agent is suitable to hold thatClient Money or Relevant Money, as applicable, in a Client Account. (i) When assessing the suitability of the Third-Party Agent, the Authorised Person must ensure that the Third-Party Agent will provide protections equivalent to the protections conferred by this section. (ii) An Authorised Person must have systems and controls in place to ensure that the Third-Party Agent remains suitable. (b) An Authorised Person must be able to demonstrate to the Regulator's satisfaction the grounds upon which the Authorised Person considers the Third-Party Agent to be suitable to hold that Client Money or Relevant Money, as applicable. (c) When assessing the suitability of a Third-Party Agent, an Authorised Person must have regardto:
(i) its credit rating;
(ii) its capital and financial resources in relation to the amount of Client Money or Relevant Money, as applicable, held; (iii) the insolvency regime of the jurisdiction in which it is located; (iv) its regulatory status and history; (v) its Group structure; and (vi) its use of agents and service providers.
14.2.8 Payment of Client Money or Relevant Money to a Third-Party Agent
(a) Subject to Rule 14.2.8(d), an Authorised Person may pass, or permit to be passed, a Segregated Client's Money to a Third-Party Agent only if:
(i) the Client Money is to be used in respect of a Transaction or series or Transactions for that Client; (ii) the Client Money is to be used to meet an obligation of that Client; or (iii) the Third-Party Agent is a Bank or an Authorised Person which is authorised to accept or take Deposits. (b) In respect of Rule 14.2.8(a)(i) and Rule 14.2.8(a)(ii), an Authorised Person must not hold any excess Client Money with the Third-Party Agent longer than necessary to effect a Transaction or satisfy the Client's obligation. (c) When an Authorised Person opens a Client Account with a Third-Party Agent it must obtain, within a thirty twenty Business Dday period, a written acknowledgement from the Third-Party Agent stating that:
(i) all Money standing to the credit of the account is held by the Authorised Person as agent and that the Third-Party Agent is not entitled to combine the

Appendix 3
account with any other account or to exercise any charge, mortgage, security, lien, right of set-off or combination or counterclaim against Money in that account in respect of any sum owed to it on any other account of the Authorised Person; and (ii) the title of the account includes the words "Client Account" as required under Rule 14.2.5(a)(iv). (d) If the Third-Party Agent does not provide the acknowledgement referred to in Rule 14.2.8(c)within a twenty Business D30-day period, the Authorised Person must refrain from making further deposits of Client Money or Relevant Money, as applicable, with that Third-Party Agent and withdraw any Client Money or Relevant Money, as applicable, standing to the credit of that Client Account. Guidance The Regulator would consider twenty Business dDays as being a reasonable period for an Authorised Person to receive a written acknowledgement from the Third-Party Agent.
14.2.9 Payment of Client Money or Relevant Money from Client Accounts
(a) An Authorised Person must have procedures for ensuring all withdrawals from a Client Account are authorised. (b) Subject to Rule 14.2.9(c), a Segregated Client's Client Money must remain in a Client Account until it is:
(i) due and payable to the Authorised Person; (ii) paid to the Client on whose behalf the Client Money is held; (iii) paid in accordance with a Client instruction on whose behalf the Client Money is held; (iv) required to meet the payment obligations of the Client on whose behalf the Client Money is held; (v) becomes held by the Authorised Person pursuant to a title transfer collateral arrangement; (vi) becomes held by the Authorised Person in its capacity as a banker as a deposit; or (vii) paid out in circumstances that are otherwise authorised by the Regulator. (c) Client Money paid out by way of cheque or other payable order under Rule 14.2.9(cb) must remain in a Client Account until the cheque or payable order is presented to the Client's bank and cleared by the paying agent. (d) An Authorised Person must not use Client Money belonging of one Client to satisfy an obligation of another Client.

Appendix 3
Guidance

1. The effect of Rule 14.2.9 (d) is that an Authorised Person would be required to deposit
   its own Money into a Client Account to remedy a shortfall arising from a Client debit balance.
2. An Authorised Person must have a system for ensuring no off-setting or debit balances
   occur on Client Accounts.
   14.2.10Client Disclosure
   (a) Before, or as soon as reasonably practicable after, an Authorised Person receives Client Money belonging to a Client, it must disclose to the Client on whose behalf the Client Money is held:
   (i) the basis and any terms governing the way in which the Client Money will be held; (ii) as required under Rule 14.2.14(e), the nature of any particular Client Money Statutory Trust in which the Client is interested, or if there is only one Statutory Trust, that fact; (iii) that the Client is subject to the protection conferred by the Client Money Rules and as a consequence:
   (A) this Money will be held separate from Money belonging to the Authorised Person; and (B) in the event of the Authorised Person's insolvency, winding up or other Pooling Event stipulated by the Regulator, the Client's Money will be subject to the Client Money Distribution Rules; (iv) whether interest is payable to the Client and, if so, on what terms; (v) if applicable, that the Client Money may be held in a jurisdiction outside the Abu Dhabi Global Market and the market practices, insolvency and legal regime applicable in that jurisdiction may differ from the regime applicable in the Abu Dhabi Global Market; (vi) if applicable, details about how any Client Money arising out of Islamic Financial Business is to be held; (vii) if applicable, that the Authorised Person holds or intends to hold the Client Money in a Client Account with a Third-Party Agent which is in the same Group as the Authorised Person; and (viii) details of any rights which the Authorised Person may have to realise Client Money held on behalf of the Client in satisfaction of a default by the Client or otherwise, and of any rights which the Authorised Person may have to close out or liquidate contracts or positions in respect of any of the Client's Investments.

Appendix 3
14.2.11Client Reporting
(a) In relation to a Client to whom the Client Money Rules are applicable, an Authorised Person conducting Investment Business must send a statement to a Retail Client at least monthly or in the case of a Professional Client or Market Counterparty, at other intervals as agreed in writing with the Professional Client or Market Counterparty. (b) The statement must include:
(i) the Client's total Client Money balances held by the Authorised Person reported in the currency in which the Client Money is held, or the relevant exchange rate if not reported in the currency in which the Money is held; (ii) the amount, date and value of each credit and debit paid into and out of the account since the previous statement; and (iii) any interest earned or charged on the Client Account since the previous statement. (c) The statement sent to the Client must be prepared within one calendar month of the statement date. Guidance Authorised Persons conducting Payment Services must report to Payment Service Users in accordance with Chapter 19. 14.2.12Reconciliation (a) An Authorised Person conducting Investment Business must maintain a system to ensure that accurate reconciliations of the Client Accounts are carried out as regularly as necessary but at least every calendar month. (b) The reconciliation must include:
(i) a full list of individual Segregated Client credit ledger balances, as recorded by the Authorised Person; (ii) a full list of individual Segregated Client debit ledger balances, as recorded by the Authorised Person; (iii) a full list of unpresented cheques and outstanding lodgements; (iv) a full list of Client Account cash book balances; and (v) formal statements from Third-Party Agents showing account balances as at the date of reconciliation. (c) An Authorised Person must:
(i) reconcile the individual credit ledger balances, Client Account cash book balances, and the Third-Party Agent Client Account balances;

Appendix 3
(ii) check that the balance in the Client Accounts as at the close of business on the previous Business Dday was at least equal to the aggregate balance of individual credit ledger balances as at the close of business on the previous day; and (iii) ensure that all shortfalls, excess balances and unresolved differences, other than differences arising solely as a result of timing differences between the accounting systems of the Third-Party Agent and the Authorised Person, are investigated and, where applicable, corrective action is taken as soon as possible. (d) An Authorised Person must perform the reconciliations in Rule 14.2.12(c) within ten Business Ddays of the date to which the reconciliation relates. (e) When performing the reconciliations, an Authorised Person must:
(i) include in the credit ledger balances:
(A) unallocated Client Money;
(B) dividends received and interest earned and allocated; (C) sale proceeds which have been received by the Authorised Person and the Client has delivered the Investments or the Authorised Person holds or controls the Investment; and (D) Money paid by the Client in respect of a purchase where the Authorised Person has not remitted the Money to the counterparty or delivered the Investment to the Client; and (ii) deduct from the credit ledger balances:
(A) Money owed by the Client in respect of unpaid purchases by or for the Client if delivery of those Investments has been made to the Client; and (B) Money remitted to the Client in respect of sales transactions by or for the Client if the Client has not delivered the Investments. (f) When performing reconciliations, an Authorised Person must maintain a clear separation of duties to ensure that an employee with responsibility for operating Client Accounts, or an employee that has the authority to make payments, does not perform the reconciliations under Rules 14.2.12(a)to 14.2.12(d). (g) Reconciliation performed in accordance with Rules 14.2.12(a)to 14.2.12 (d) must be reviewed by a member of the Authorised Person who has adequate seniority. (h) The individual referred to in Rule 14.2.12 (g) must provide a written statement confirming the reconciliation has been undertaken in accordance with the requirements of this section. (i) The Authorised Person must notify the Regulator where there has been a material discrepancy with the reconciliation which has not been rectified.

Appendix 3
(j) A material discrepancy includes discrepancies which have the cumulative effect of being material, such as longstanding discrepancies. 14.2.13Auditor's Reporting Requirements An Authorised Person engaged in Investment Business which holds Client Money for Segregated Clients must arrange for a Client Money Auditor's Report to be submitted to the Regulator on an annual basis. 14.2.14Segregation and portability (a) Pursuant to section 4 of FSMR, an Authorised Person acts as trustee for all Client Money or Relevant Money, as applicable, received or held by it for the benefit of the Clients or Payment Service Users, as applicable for whom that Client Money or Relevant Money is held, according to their respective interests in the relevant Statutory Trust. (b) In line with MIR 4.12, an Authorised Person that is also a Clearing Member of a Recognised Clearing House or Remote Clearing House, shall offer Clients whose Client Money or Safe Custody Assets are rehypothecated or re-used to fund margin at a Recognised Clearing House or Remote Clearing House in relation to Client transactions, the choice to clear their positions through an Omnibus Client Account ("Omnibus Client Segregation") or an individually segregated Client Account ("Individual Client Segregation") maintained by the Authorised Person with that Recognised Clearing House. (c) When a Client chooses Individual Client Segregation, any margin in excess of the Client's requirement shall also be transferred to the Recognised Clearing House or Remote Clearing House and distinguished from the margins of other Clients of the Authorised Person and shall not be exposed to losses connected to positions recorded in another account. (d) To segregate Client Money (that would otherwise be held in a single Statutory Trust as the general pool of Client Money held for all Clients of the Authorised Person) for a specific Client or group of Clients clearing positions through a particular Client account at a Recognised Clearing House or Remote Clearing House, a Clearing Member firm may, in accordance with these rules, create a separate Statutory Trust for Client Money receivables relating to a particular Client Account at that Recognised Clearing House or Remote Clearing House (as in Rule 14.2.15 below). (e) An Authorised Person which creates a separate Statutory Trust as in Rule 13.2.14(d), must notify all its Clients that it operates more than one Statutory Trust and must inform each Client of which Statutory Trust their Client Money forms part of and how it is identified. (f) The principles of this Rule 14.2.14 will apply equally to any positions or margin at a Non-Abu Dhabi Global Market Clearing House subject to such derogations and waivers as the Regulator may prescribe. 14.2.15Statutory Trusts (a) An Authorised Person receives and holds Client Money or Relevant Money, as applicable, as trustee in accordance with the following requirements in Rule 14.2.15.

Appendix 3
(b) The requirements in (a) are:
(i) for the purposes of and on the terms of the Client Money Rrules and the Client Money Distribution Rules; (A) where an Authorised Person maintains only a single Statutory Trust as a general pool of Client Money or Relevant Money, as applicable, subject to (ii), for the Clients or Payment Service Users for whom that money is held, according to their respective interests in it; (B) where an Authorised Person has established one or more separate Statutory Trusts of Client Money, subject to (ii), each separate Statutory Trust is held for the Clients of the Authorised Person who are beneficiaries of that specific Statutory Trust according to their respective interests in it; (ii) for the payment of the costs properly attributable to the distribution of the Client Money or Relevant Money, as applicable, in accordance with (i), if such distribution takes place following the Failure of the Authorised Person; and (iii) after all valid claims and costs under (i) to (ii) have been met, for the Authorised Person itself. (c) In respect of Authorised Persons conducting Investment Business, tThe beneficiaries of each separate Statutory Trust are those Clients:
(i) tofromwhom the Authorised Person has deliveredreceiveda signed Statutory Trust disclosure document under Rule 14.2.14(e); (ii) for whom the Authorised Person maintains, previously maintained or is in the process of establishing a margined transaction(s) in the relevant Client Account at the relevant Recognised Clearing House or Remote Clearing House; (iii) who are interested in a Designated Client Fund Account or Designated Client Account; or (iv) to whom any Client Equity Balance or other Client Money is required to be segregated for the Client by the Authorised Person in respect of the margined transactions under (ii) from that separate Statutory Trust. (d) An Authorised Person which is subject to the Client Money Rules receives and holds Client Money or Relevant Money, as applicable as trustee on the terms in Rule 14.2.14(d), subject to its obligations to hold Client Money as trustee under the relevant instrument of trust. 14.2.16Primary Pooling Event Following a Primary Pooling Event, an Authorised Person must comply with the Rules in Rule
14.3.7 and all Client Money or Relevant Money, as applicable, will be subject to such Rules.

Appendix 3
14.2.17Client Disclosure
(a) If an Authorised Person holds or controls money for a Market Counterparty which is not subject to these Client Money Rules, it must disclose to that Market Counterparty in writing that:
(i) the protections conferred by the Client Money Rules do not apply to such money; (ii) such money may be mixed with money belonging to the Authorised Person, and may be used by the Authorised Person in the course of the Authorised Person's business; and (iii) following a Pooling Event, it will be an unsecured creditor. (b) The Authorised Person must obtain that Market Counterparty's written acknowledgement of the disclosures made prior to holding or controlling Client Money for that Market Counterparty. 14.2.18Record Keeping (a) An Authorised Person must maintain records:
(i) which enable the Authorised Person to demonstrate compliance with these Rules; (ii) which enable the Authorised Person to demonstrate and explain all entries of Client Money or Relevant Money, as applicable, held or controlled in accordance with these Rules; and (iii) of all cheques relating to Client Money received and forwarded. (b) Records must be kept for a minimum of six years. (c) An Authorised Person must maintain proper books and accounts based on the double￾entry booking principle. They must be legible, up to date and contain narratives with the entries which identify and provide adequate information about each transaction. Entries must be made in chronological order and the current balance must be shown on each of the Authorised Person's ledgers. 14.2.19Notification of Failure to Comply An Authorised Person must inform the Regulator in writing without delay if it has not complied with, or is unable, in any material respect, to comply with the requirements in this Rule 14.2.
14.3 Client Investments
14.3.1 Application
(a) An Authorised Person must treat all Investments held or controlled on behalf of a Client in the course of, or in connection with, the carrying on of Investment Business as Client Investments.

Appendix 3
(b) An Authorised Person which holds or controls Client Investments must have systems and controls in place to ensure the proper safeguarding of Client Investments. (c) Instead of safeguarding Client Investments, an Authorised Person may choose to safeguard Client Money equal to the value of the Client Investments. (d) An Authorised Person:
(i) holding or controlling Client Investments; (ii) Providing Custody; or (iii) Arranging Custody in or from the Abu Dhabi Global Market must do so in accordance with the Safe Custody Provisions in Chapter 15, except in relation to Client Investments held as Collateral (unless stated otherwise).
14.3.2 Holding Collateral
Before an Authorised Person holds Collateral from a Client it must disclose to that Client:
(a) the basis and any terms governing the way in which the Collateral will be held, including any rights which the Authorised Person may have to realise the Collateral; (b) if applicable, that the Collateral will not be registered in that Client's own name; (c) if applicable, that the Authorised Person proposes to return to the Client Collateral other than the original Collateral or original type of Collateral; and (d) that in the event of the Authorised Person's Failure:
(i) of an Abu Dhabi Global Market Firm, any excess Collateral will be sold and the resulting Client Money shall be distributed in accordance with the Client Money Distribution Rules; or (ii) of a nNon-Abu Dhabi Global Market Firm, that Collateral will be subject to a regime which may differ from the regime applicable in the Abu Dhabi Global Market. (e) Before an Authorised Person deposits Client's Collateral with a third party it must notify and obtain the agreement of the third party that:
(i) the Collateral does not belong to the Authorised Person and must therefore be held by the third party in a segregated Client Account in a name that clearly identifies it as belonging to the Authorised Person's Clients; and (ii) the third party is not entitled to claim any lien or right of retention or sale over the Collateral except to cover the obligations owed to the third party arising on the segregated Client Account and no other account.

Appendix 3
(f) An Authorised Person may permit Client's Collateral to be held by a third party only where it has reasonable grounds to believe that the third party is, and remains, suitable to hold that Collateral. (g) An Authorised Person must be able to demonstrate to the Regulator's satisfaction the grounds upon which it considers the third party to be suitable to hold Client's Collateral. (h) An Authorised Person must take reasonable steps to ensure that the Collateral is properly safeguarded. (i) An Authorised Person must withdraw the Collateral from the third party where the Collateral is not being properly safeguarded unless the Client has indicated otherwise in writing. (j) An Authorised Person holding Client's Collateral must send a statement every six months to the Client. (k) An Authorised Person must reconcile the Client's Collateral in accordance with Rule 15.9.
14.3.3 Information to prime brokerage Clients
(a) An Authorised Person must make available to each of its Clients to whom it provides prime brokerage services a statement in a durable medium:
(i) showing the value at the close of each bBusiness dDay of the items in Rule 14.3.4 below; and (ii) detailing any other matters which that Authorised Person considers are necessary to ensure that a Client has up-to-date and accurate information about the amount of Client Money and the value of Safe Custody Assets held by that Authorised Person for it. (b) The statement must be made available to those Clients not later than the close of the next bBusiness dDay to which it relates.
14.3.4 The statement must include:
(a) the total value of Safe Custody Assets and the total amount of Client Money held by that prime brokerage firm for a Client; (b) the cash value of each of the following:
(i) cash loans made to that Client and accrued interest; (ii) securities to be redelivered by that Client under open short positions entered into on behalf of that Client; (iii) current settlement amount to be paid by that Client under any futures contracts;

Appendix 3
(iv) short sale cash proceeds held by the Authorised Person in respect of short positions entered into on behalf of that Client; (v) cash margin held by the Authorised Person in respect of open futures contracts entered into on behalf of that Client; (vi) mark-to-market close-out exposure of any OTC transaction entered into on behalf of that Client secured by Safe Custody Assets or Client Money; (vii) total secured obligations of that Client against the prime brokerage firm; and (viii) all other Safe Custody Assets held for that Client. (c) total collateral held by the Authorised Person in respect of secured transactions entered into under a prime brokerage agreement, including where the Authorised Person has exercised a right of use in respect of that Client's Safe Custody Assets; (d) the location of all of a Client's Safe Custody Assets, including assets held with a sub-custodian; and (e) a list of all the institutions at which the Authorised Person holds or may hold Client Money, including money held in Client Accounts.
14.3.5 The reports under Rule 15.8 below must also be provided to each Client, to the extent that
this is required under this section.
14.3.6 Record Keeping
(a) An Authorised Person must maintain records which enable the Authorised Person to demonstrate compliance with this section; and which enable the Authorised Person to demonstrate and explain all entries of Client Investments and Collateral held or controlled in accordance with this chapter. (b) Records must be kept for a minimum of six years.
14.3.7 Notification of Failure to Comply
An Authorised Person must inform the Regulator in writing without delay if it has not complied with, or is unable, in any material respect, to comply with the requirements in this Rule 14.3.
14.4 Client Money and Relevant Money Distribution Rules
14.4.1 Application
(a) To the extent that the rules in this section ("the Client Money Distribution Rules") are inconsistent with section 233 of the Insolvency Regulations, these Rules will prevail. (b) This chapter section applies to an Authorised Person that holds Client Money or Relevant Money, as applicable, which is subject to the Client Money Rrules when a Pooling Event occurs.

Appendix 3
Guidance

1. This sectionchapterseeks to facilitate the timely return of Client Money to a Client or
   Relevant Money to Payment Service Users, as applicable, in the event of the Failure of an Authorised Person or third party at which the Authorised Person holds Client Money or Relevant Money, as applicable.
2. Following a Pooling Event, an Authorised Person must sell all non-cash assets
   representing the proceeds of, or directly traceable from, Client Money and use the proceeds of the sale to satisfy claims of Statutory Trust beneficiaries made in accordance with this chapter.
3. Relevant Money held by an Authorised Person conducting Payment Services is
   intended to be treated in the same manner as Client Money pursuant to the Client Money Distribution Rules, in terms of its segregation for the purposes of distribution to Payment Service Users following a Primary Pooling Event or a Secondary Pooling Event. Distribution of Relevant Money subject to a Statutory Trust is intended to occur either in accordance with the balances in the respective Payment Accounts of Payment Service Users, or alternatively to be used for the purpose of redemption of stored value held by Payment Service Users.
   14.4.2 Primary Pooling Events
   (a) If the Authorised Person becomes insolvent, and there is (for whatever reason) a shortfall in Client Money or Relevant Money, as applicable in a particular Statutory Trust, the available funds will be distributed in accordance with the Client Money Distribution Rules. (b) A Primary Pooling Event occurs:
   (i) on the Failure of an Authorised Person;
   (ii) on the vesting of assets in a trustee in accordance with an Assets Requirement imposed under section 38 of FSMR; (iii) if the Regulator makes an order or decision to this effect under FSMR; or (iv) when the Authorised Person notifies, or is in breach of its duty to notify, the Regulator, in accordance with Rules 14.2.12(i), 14.2.19, 14.3.7, 15.9.5 and
   16.2.15 that it is unable correctly to identify and allocate in its records all valid
   claims arising as a result of a Secondary Pooling Event.
   (c) Rule (b)(iv) does not apply so long as:
   (i) the Authorised Person is taking steps, in consultation with the Regulator, to establish those records; and (ii) there are reasonable grounds to conclude that the records will be capable of rectification within a reasonable period.

Appendix 3
Guidance
A Primary Pooling Event triggers a notional pooling of all the Client Money or Relevant Money, as applicable, in every type of Client Money aAccount, and the obligation to distribute it.
14.4.3 Pooling and distribution of Client Money
(a) If a Primary Pooling Event occurs, an Authorised Person must comply with (b) to -(g) below. (b) The following Client Money is included in a separate Statutory Trust under Rule 14.2.14(d):
(i) the Authorised Person's receivables in respect of any Client Money held in a Client Account of the Authorised Person relating to that separate Statutory Trust; and (ii) the Authorised Person's receivables in respect of any Client Money held in a Client Account of the Authorised Person relating to that separate Statutory Trust, except in respect of Client Money held in a Client Account at a Recognised Clearing House, a Remote Clearing House or a Clearing Member which is, in either case, held as part of a Clearing Member Client Contract under FSMR; (c) In respect of the general Statutory Trust (i.e., the Statutory Trust in respect of the general pool of Client Money held for all Clients of the Authorised Person or held for residual Clients not interested in a Designated Client Account, Designated Client Fund Account or specific Statutory Trust under Rule 14.2.14), the following is treated as a single notional pool of Client Money for the beneficiaries of the general pool:
(i) the Authorised Person's receivables in respect of any Client Money held in any Client Account of the Authorised Person; (ii) the Authorised Person's receivables in respect of any Client Money held in a Client Account of the Authorised Person, except for Client Money held in a Client Account at a Recognised Clearing House or Remote Clearing House, or a Clearing House which is, in either case, held as part of a Clearing Member Client Contract under FSMR; and (iii) the Authorised Person's receivables in respect of any Client Money identifiable in any other account held by the Authorised Person into which Client Money has been received; except, in each case, for Client Money relating to a separate Statutory Trust which falls under (b)(i) or (ii). (d) The Authorised Person must:
(i) distribute Client Money in accordance with Rule 14.2.15, so that each Client who is a beneficiary of each separate Statutory Trust receives a sum which is rateable to the Client Money entitlement and calculated in accordance with Rule 143.4.3(i)relating to each Client's Client Equity Balance; or

Appendix 3
(ii) (where applicable) transfer Client Money held at a Recognised Clearing House, Remote Clearing House or Non-ADGM Clearing House to effect or facilitate porting of positions held for the Clients who are beneficiaries of that separate Statutory Trust.; and (e) If, in connection with a Clearing Member Client Contract, Client Money is remitted directly to the Authorised Person from a Recognised Clearing House, a Remote Clearing House or from a Clearing Memberthereof, then:
(i) any such remittance in respect of a Client Account constituting a separate Statutory Trust under Rule 143.2.135 must be distributed to the relevant Client interested in such Client Account subject to Rule 14.2.15(d); and (ii) subject to (e)(i), any such remittance in respect of any other Client Account must form part of the relevant Statutory Trust under (b) and be subject to distribution accordingly. (f) Where any Asset is valued by a Recognised Clearing House, the close-out price or valuation of the Recognised Clearing House shall apply on a Pooling Event, regardless of the actual time of close-out, provided that the Recognised Clearing House or Remote Clearing House has acted in accordance with its Default Rules. (g) [Deleted]For the avoidance of doubt, 'relevant Clients' in the case of (e) includes any entitlement of a Client held by it for a Person who is an indirect client. (h) Where an Authorised Person that is a Clearing Member of a Recognised Clearing House or Remote Clearing House defaults, the Recognised Clearing House or Remote Clearing House may:
(i) port Client positions and related collateral (including proceeds of Client Money or Safe Custody Assets) where possible; and (ii) after the completion of the default management process:
(A) return any balance due directly to those Clients for whom the positions are held, if they are known to the Recognised Clearing House or Remote Clearing House; or (B) remit any balance to the Authorised Person for the account of its Clients if the Clients are not known to the Recognised Clearing House or Remote Clearing House. (i) Where an Authorised Person acting in connection with a Clearing Member Client Contract for a Client (who is also an indirect Client) defaults, the Clearing Member with whom the Authorised Person has placed Client Moneyof the indirect Client, may:
(i) transfer the positions and assets either to another Clearing Member of the relevant Recognised Clearing House or Remote Clearing House, or to another Authorised Person willing to act for the indirect Client; or (ii) liquidate the Assets and positions of the indirect Clients and remit all monies due to the indirect Clients.

Appendix 3
(j) Where any balance remitted from a Recognised Clearing House or Remote Clearing House (or in the case of the Authorised Person being an indirect Client, a Clearing Member) to an Authorised Person is Client Money, Rule 13.4.3(k) provides for the distribution of remittances from either an Individual Client Account or an Omnibus Client Account. (k) Remittances received by the Authorised Person falling within Rules 13.4.3(e)(i) and (ii) should not be pooled with Client Money held in any Client Account operated by the Authorised Person at the time of the Primary Pooling Event. Those remittances should be segregated and promptly distributed to each Client on whose behalf the remittance was received. (l) [Deleted]For the avoidance of doubt, in respect of a Clearing Member Client Contract, any Client Money remitted by the Recognised Clearing House or Remote Clearing House (or in the case of the Authorised Person being an indirect Client, a Clearing Member) to the Authorised Person pursuant to Rule 13.4.3(e) should not be treated as Client Money received after the Failure of the Authorised Person under Rule 14.4.4. (m) [Deleted]The Authorised Person's obligation to its Client in respect of Client Money relating to a particular Statutory Trust is discharged where the Authorised Person, to facilitate porting transfers or the transfer of that Client Money to a Clearing Member in connection with a Clearing Member Client Contract and the Clearing Member, remits payment to another Authorised Person or to another Clearing Member where the Client Money is paid to the Client or a duly authorised representative of the Client. (n) Each Client's Client Equity Balance must be reduced by:
(i) any amount paid by:
(A) a Clearing House to a Clearing Member other than the Authorised Person in connection with a porting arrangement where Client Money is ported by the Recognised Clearing House or Remote Clearing House as part of the default management process of that Recognised Clearing House or Remote Clearing House; (B) a Clearing Member to another Clearing Member or Authorised Person (other than the Authorised Person) in connection with a Clearing Member Client Contract where Client Money is paid to the Client or a duly authorised representative of the Client; (ii) any amount paid by:
(A) a Recognised Clearing House or Remote Clearing House directly to that Client, where the amount comprises the balance owed by the Recognised Clearing House or Remote Clearing House after the completion of the Clearing Member's default management process by the Recognised Clearing House or Remote Clearing House; and (B) a Clearing Member directly to an indirect Client in accordance with default management procedures adopted by the Clearing Member. (iii) any amount that must be distributed to that Client by the Authorised Person in accordance withRule 13.4.3(e)(i) and (ii).

Appendix 3
(o) When, in respect of a Client who is a beneficiary of a Statutory Trust, there is a positive individual Client balance and a negative Client Equity Balance in relation to that Statutory Trust, the credit for that Statutory Trust must be offset against the debit reducing the individual Client balance for that Client. (p) When, in respect of a Client who is a beneficiary of a Statutory Trust, there is a negative individual Client Equity Balance and a positive Client Equity Balance in relation to that Statutory Trust, the credit for that Statutory Trust must be offset against the debit for that Statutory Trust reducing the Client Equity Balance for that Client. Guidance

1. For the avoidance of doubt, 'relevant Clients' in the case of (e) includes any
   entitlement of a Client held by it for a Person who is an indirect client.
2. For the avoidance of doubt, in respect of a Clearing Member Client Contract, any
   Client Money remitted by the Recognised Clearing House or Remote Clearing House (or in the case of the Authorised Person being an indirect Client, a Clearing Member) to the Authorised Person pursuant to (e) should not be treated as Client Money received after the Failure of the Authorised Person under Rule 14.4.4.
3. The Authorised Person's obligation to its Client in respect of Client Money relating to
   a particular Statutory Trust is discharged where the Authorised Person, to facilitate porting transfers, or the transfer of that Client Money to a Clearing Member in connection with a Clearing Member Client Contract and the Clearing Member, remits payment to another Authorised Person or to another Clearing Member where the Client Money is paid to the Client or a duly authorised representative of the Client.
   14.4.4 Client Mmoney received after the Failure of the Authorised Person
   (a) Subject to Rule 14.4.3, Client Money received by the Authorised Person after a Primary Pooling Event in respect of a Statutory Trust must not be pooled with Client Money held in any Client Account operated by the Authorised Person either in respect of that Statutory Trust or any other Statutory Trust at the time of the Primary Pooling Event. Such Client Money must instead be placed in a Client Account that has been opened after that event and must be handled in accordance with the requirements in Rule 14.2, and returned to the relevant Client(s) without delay, except to the extent that:
   (i) it is Client Money relating to a transaction that has not settled at the time of the Primary Pooling Event; or (ii) it is Client Money relating to a Client, for whom the Client Equity Balance, calculated in accordance with Rules 14.4.3(n), 14.4.3(o) and 14.4.3(p), shows that Money is due from the Client to the Authorised Person at the time of the Primary Pooling Event. (b) [Deleted]Client Money received after the Primary Pooling Event relating to an unsettled transaction should be used to settle that transaction. Examples of such transactions include:

Appendix 3
(i) an equity transaction with a trade date before the date of the Primary Pooling Event and a settlement date after the date of the Primary Pooling Event; or (ii) a contingent liability investment that is 'open' at the time of the Primary Pooling Event and is due to settle after the Primary Pooling Event. (c) If an Authorised Person receives a mixed remittance after a Primary Pooling Event, it must:
(i) pay the full sum into the separate Client Account opened in accordance with (a); and (ii) pay the money that is not Client Money out of that Client Account into an Authorised Person's own account within one bBusiness dDay of the day on which the Authorised Person would normally expect the remittance to be cleared. (d) Whenever possible the Authorised Person should seek to split a mixed remittance before the relevant accounts are credited. (e) If both a Primary Pooling Event and a Secondary Pooling Event occur, the provisions of this section relating to a Primary Pooling Event apply. Guidance Client Money received after the Primary Pooling Event relating to an unsettled transaction should be used to settle that transaction. Examples of such transactions include:
(i) an equity transaction with a trade date before the date of the Primary Pooling Event and a settlement date after the date of the Primary Pooling Event; or (ii) a contingent liability investment that is 'open' at the time of the Primary Pooling Event and is due to settle after the Primary Pooling Event.
14.4.5 Secondary Pooling Events
(a) A Secondary Pooling Event occurs on Failure of a third party to which Client Money or Relevant Money, as applicable, held by the Authorised Person has been transferred under Rule 14.2.5(a) or Rule 14.2.9 and the Authorised Person has not repaid to its Clients or Payment Service Users, or paid into a Client Account at an unaffected bank, an amount equivalent to the shortfall in the amount of Client Money or Relevant Money, as applicable, held by the third party. (b) The Authorised Person would be expected to reflect the shortfall in (a) in its records of the entitlement of Clients and of Client Money, or Payment Service Users and Relevant Money, as applicable, held with third parties under Rules 14.2.18, 14.3.6, and 14.3.7. Guidance

1. These rRules in relation to Secondary Pooling Events seek to ensure that Clients who
   have previously specified that their Client Money be placed in a Designated Client

Appendix 3
Account at a different bank should not suffer the loss of a different bank that has Failed.
2. When Client Money is transferred to a third party, an Authorised Person continues to
owe fiduciary duties to the Client. Whether an Authorised Person is liable for a shortfall in Client Money caused by the Failure of a third party will depend on whether it has complied with its duty of care as agent or trustee.
14.4.6 Failure of third parties: pooling and distribution
(a) This section applies to third parties, which includes:
(i) a bank (where one or more general Client Accounts are held under one or more Statutory Trusts or separate Statutory Trusts); and (ii) an intermediate broker, settlement agent or OTC counterparty. (b) If a Secondary Pooling Event occurs as a result of the Failure of such a third party where one or more Client Accounts are held under different Statutory Trusts, then:
(i) in relation to every Client Account of the Authorised Person maintained in respect of a particular Statutory Trust, Rule 14.4.7will apply. (c) Money held in each general Client Account of the Authorised Person under a Statutory Trust or separate Statutory Trusts must be treated as pooled into a single Statutory Trust ("the relevant pool") and:
(i) any shortfall in Client Money or Relevant Money held, or which should have been held in the general Client Accounts for the relevant pool, that has arisen as a result of the Failure of the third party, must be borne by all the Clients, or Payment Service Users, as applicable, of that relevant pool, rateably in accordance with their entitlements; (ii) a new Client Money or Relevant Money entitlement, as applicable, must be calculated for each Client or Payment Service User, as applicable, of the relevant pool to reflect the requirements in (i), and the Authorised Person's records must be amended to reflect the reduced Client Money or Relevant Money entitlement; (iii) the Authorised Person must make and retain a record of each Client's or Payment Service User’sshare of the Client Money shortfall of Client Money or Relevant Money, as applicable, at the Failed third party until the Client or Payment Service User, as applicable, is repaid; and (iv) the Authorised Person must use the new Client Money or Relevant Money entitlements, calculated in accordance with (ii), for the purposes of reconciliations pursuant to Rules 14.2.12(a) to 14.2.12(d) for the relevant Clients in (ii). (d) The term "which should have been held" is a reference to the Failed third party's Failure to hold the Client Money or Relevant Money, as applicable, at the time of the Pooling Event.

Appendix 3
(e) Any Client Money held under a particular Statutory Trust, in relation to a Designated Client Account at a third party (other than the Failed third party) is not pooled with any other Client Money held in that particular Statutory Trust or any other Statutory Trusts. (f) Any Client Money held under a Statutory Trust, no part of which is at the Failed third party, is not pooled with any Client Money of other affected Statutory Trusts. (g) [Deleted] is not pooled with any Client Money of other affected Statutory Trusts. (h) Any shortfall in Client Money or Relevant Money held under a particular Statutory Trust affected by a Secondary Pooling Event must be borne by all the Clients or Payment Service Users whose Client Money or Relevant Money, as applicable, is held in such a Statutory Trust, rateably in accordance with their Client Money or Relevant Money entitlements. (i) A new Client Money or Relevant Money entitlement, as applicable, must be accordingly and the Authorised Person's records must be amended to reflect each Client's or Payment Service User’s new Client Money or Relevant Money entitlement, as applicable. (j) the Authorised Person must make and retain a record of each Client's or Payment Service User’s share of the Client Money or Relevant Money shortfall at the Failed third party until the Client or Payment Service User is repaid; and (k) the Authorised Person must use the new Client Money or Relevant Money entitlements, calculated in accordance with (h), for the purposes of reconciliations pursuant to Rules 14.2.12(a)to 14.2.12(d) for the relevant Statutory Trust(s). (l) A Client whose Money was held, or which should have been held, in a Designated Client Account or Designated Client Fund with a Failed third party is not entitled to claim in respect of that Money against any other Client Account of the Authorised Person.;
14.4.7 Client Money or Relevant Money received after the Failure of a third party
(a) Client Money or Relevant Money received by the Authorised Person after the Failure of a third party, that would otherwise have been paid into a Client Account at that Failed third party:
(i) Mmust, if Client Money, not be transferred to the Failed third party unless specifically instructed by the Client in order to settle an obligation of that Client to the Failed third party; and (ii) must, if Client Money, be, subject to (i), placed in a separate Client Accountrelevant affected Statutory Trust(s):
(A) on the written instruction of the Client, transferred to a third party other than the one that has Failed; or (B) returned to the Client as soon as possible;.

Appendix 3
(iii) must, if Relevant Money, be placed in a separate Client Account maintained with a third party other than the one which has Failed. (b) If an Authorised Person receives a mixed remittance after the Secondary Pooling Event which consists of Client Money that would have been paid into a Client Account, a Designated Client Account or a Designated Client Fund Account maintained at the third party that has Failed, it must:
(i) pay the full sum into a Client Account other than one operated at the Failed third party; and (ii) pay the money that is not Client Money out of that Client Account within one bBusiness dDay of the day on which the Authorised Person would normally expect the remittance to be cleared. (c) Whenever possible the Authorised Person should seek to split a mixed remittance before the relevant accounts are credited.
14.4.8 Notification to the Regulator
(a) On the Failure of a Third Party with which Client Money or Relevant Money is held, the Authorised Person must notify the Regulator:
(i) as soon as it becomes aware of the Failure of any bank, intermediate broker, settlement agent, OTC counterparty or other entity with which it has placed, or to which it has passed, Client Money or Relevant Money; and (ii) as soon as reasonably practical, whether it intends to make good any shortfall that has arisen or may arise and of the amounts involved.
15. SAFE CUSTODY PROVISIONS
15.1 Application
15.1.1 Subject to Rule 15.1.2, this chapter applies to an Authorised Person in accordance with
Rule 14.3.1(d).
15.1.2 This chapter does not apply to Fund Managers, who are subject to the provisions of Chapter
15.3 of the Fund Rules.
15.1.3 This chapter does not apply to Authorised Persons who provide Payment Services, who are
subject to Chapter 19.
…
15.5 Holding or Arranging Custody with Third-Party Agents
15.5.1 (a) Before an Authorised Person holds a Safe Custody Investment with a Third-Party
Agent or Arranges Custody through a Third-Party Agent, it must undertake an assessment of that Third-Party Agent and have concluded on reasonable grounds that the Third-Party Agent is suitable to hold those Safe Custody Investments.

Appendix 3
(b) An Authorised Person must have systems and controls in place to ensure that the Third-Party Agent remains suitable. (c) When assessing the suitability of the Third-Party Agent, the Authorised Person must ensure that the Third-Party Agent will provide protections equivalent to the protections conferred in this sectionin this appendix.

Appendix 3
16. RECOVERY AND RESOLUTION PLANNING FOR CLIENT MONEY, RELEVANT MONEY AND SAFE
CUSTODY ASSETS
16.1 Application and purpose
16.1.1 This chapter contains rules which ensure that an Authorised Person maintains and is able to
retrieve information that would, in the event of its insolvency, assist an insolvency practitioner in achieving a timely return of Client Money, Relevant Money and Safe Custody Assets (Chapters 14 and 15) held by the Authorised Person to Clients or Payment Service Users, as applicable.
16.1.2 This chapter applies to an Authorised Person when it:
(a) holds, safeguards or administers Financial Instruments, acts as trustee or depository or manager of an Alternative Investment Fund or is acting as trustee or depository of a Collective Investment Fund; and (b) holds Client Money or Relevant Money in accordance with Chapter 1514.
16.2 General provisions
16.2.1 An Authorised Person falling within Rule 16.1.2 must maintain at all times and be able to
retrieve, in the manner described in this chapter, the documents and records specified in Rule 16.3.1 and Rule 16.4.1 (the "Resolution Pack").
16.2.2 An Authorised Person falling within Rule 16.1.2 should maintain the component documents
of the Resolution Pack in order for them to be retrieved in accordance with Rule 16.2.6, and should not use the retrieval period to start producing these documents.[Deleted]
16.2.3 The contents of the documents that constitute the Resolution Pack are likely to change from
time to time (for example, because regular reconciliations must be included in the pack)[Deleted] Guidance

1. An Authorised Person falling within Rule 16.1.2 should maintain the component
   documents of the Resolution Pack in order for them to be retrieved in accordance with Rule 16.2.6, and should not use the retrieval period to start producing or revising these documents.
2. The contents of the documents that constitute the Resolution Pack are likely to change
   from time to time (for example, because regular reconciliations must be included in the pack).
   16.2.4 An Authorised Person is required to retrieve the Resolution Pack only in the circumstances
   prescribed in Rule 16.2.6.
   16.2.5 For the purpose of this chapter, an Authorised Person will be treated as satisfying Rule 16.2.1
   in this chapter requiring it to include a document in its Resolution Pack if a member of that Authorised Person's Group includes that document in its own Resolution Pack, provided that:
   (a) that Group member is also subject to Rule 16.2.6; and

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(b) the Authorised Person is still able to comply with Rule 16.2.6.
16.2.6 In relation to each document in an Authorised Person's Resolution Pack an Authorised Person
must:
(a) put in place adequate arrangements to ensure that an administrator, receiver, trustee, liquidator or analogous officer appointed in respect of it or any material part of its property is able to retrieve each document as soon as practicable and in any event within forty-eight48 hours of that officer's appointment; and (b) ensure that it is able to retrieve each document as soon as practicable, and in any event within forty-eight hours, where it has taken a decision to do so or as a result of a request by the Regulator.
16.2.7 Where documents are held by members of an Authorised Person's Group in accordance with
Rule 16.2.5, the Authorised Person must have adequate arrangements in place with its Group members which allow for delivery of the documents within the timeframe referred to in Rule 16.2.6.
16.2.8 For the purpose of Rule 16.2.6, the following documents and records mustshould be
retrievable immediately:
(a) the document identifying the institutions referred to in Rule 16.3.1(b); (b) the document identifying individuals pursuant to Rule 16.3.1(d); and (c) the most recent internal and external reconciliations relating to Safe Custody Assets and Client Money referred to in Rule 15.9.1(a) and Rules 15.9.1(b)-15.9.1(c) respectively.
16.2.9 Where an Authorised Person is reliant on the continued operation of certain systems for the
provision of component documents in its Resolution Pack, it mustshould have arrangements in place to ensure that these systems will remain operational and accessible to it after its insolvency. 16.2.10Contravention of either Rules 16.2.8 or 16.2.9 may be relied upon as tending to establish contravention of Rule 16.2.6.[Deleted] 16.2.11Where an Authorised Person anticipates that it might be the subject of an insolvency order, it is likely to have sought advice from an external adviser. The Authorised Person should make the Resolution Pack available promptly, on request, to such an adviser. [Deleted] Guidance

1. Contravention of either Rule 16.2.8 or 16.2.9 may be relied upon as tending to
   establish contravention of Rule 16.2.6.
2. Where an Authorised Person anticipates that it might be the subject of an insolvency
   order, it is likely to have sought advice from an external adviser. The Authorised Person should make the Resolution Pack available promptly, on request, to such an adviser.

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16.2.12An Authorised Person must ensure that it reviews the content of its Resolution Pack on an ongoing basis to ensure that it remains accurate. In relation to any change of circumstances that has the effect of rendering inaccurate, in any material respect, the content of a document specified in Rule 16.2.1, an Authorised Person must ensure that any inaccuracy is corrected promptly and in any event no more than five bBusiness dDays after the change of circumstances arose. 16.2.13For the purpose of Rule 16.2.12, an example of a change that would render a document inaccurate in a material respect is a change of institution identified pursuant to Rule 16.3.1(b). [Deleted] Guidance For the purpose of Rule 16.2.12, an example of a change that would render a document inaccurate in a material respect is a change of institution identified pursuant to Rule 16.3.1(b). 16.2.14An Authorised Person may hold in electronic form any document in its Resolution Pack provided that it continues to be able to comply with Rule 16.2.6 and Rule 16.2.11 in respect of that document. 16.2.15An Authorised Person must notify the Regulator in writing immediately if it has not complied with or is unable to comply with Rule 16.2.1.
16.3 Core Content Requirements
16.3.1 An Authorised Person must include within its Resolution Pack:
(a) a master document containing information sufficient to retrieve each document in the Authorised Person's Resolution Pack; (b) a document which identifies the institutions the Authorised Person has appointed (including through a tied agent, field representative or other agent):
(i) in the case of Client Money, for the placement of money in accordance with Rule 14.2.3 or to hold or control Client Money in accordance with Rule 14.2.5(c); and (ii) in the case of Safe Custody Assets, for the deposit of those assets in accordance with Rule 15.5.1; (c) a document which identifies each tied agent, field representative or other agent of the Authorised Person which receives Client Money or Safe Custody Assets in its capacity as the Authorised Person's agent in accordance with Rule 15.5.1 and Rule
15.6 ;
(d) a document which identifies each senior manager, director and any other individual, and the nature of their responsibility within the Authorised Person, who is critical or important to the performance of operational functions related to any of the obligations imposed on the Authorised Person by this chapter; (e) for each institution identified in Rule 14.3.1(b) a copy of each executed agreement, including any side letters or other agreements used to clarify or modify the terms of

Appendix 3
the executed agreement, between that institution and the Authorised Person that relates to the holding of Client Money, Relevant Money or Safe Custody Assets; (f) a document which:
(i) identifies each member of the Authorised Person's Group involved in operational functions related to any obligations imposed on the Authorised Person under this chapter, including, in the case of a member that is a nominee company, identification as such; and (ii) identifies each third party which the Authorised Person uses for the performance of operational functions related to any of the obligations imposed on the Authorised Person by this chapter; (g) for each Group member identified in Rule 14.3.1(f)(i), the type of entity (such as branch, subsidiary and/or nominee company) the Group member is, its jurisdiction of incorporation if applicable, and a description of its related operational functions; (h) a copy of each executed agreement, including any side letters or other agreements used to clarify or modify the terms of the executed agreement, between the Authorised Person and each third party identified in Rule 14.3.1(f)(ii); (i) where the Authorised Person relies on a third party identified in Rule 14.3.1(f)(i), a document which describes how to:
(i) gain access to relevant information held by that third party; and (ii) effect a transfer of any of the Client Money, Relevant Money or Safe Custody Assets held by the Authorised Person, but controlled by that third party; and (j) a copy of the Authorised Person's manual which records its procedures for the management, recording and transfer of the Client Money, Relevant Money orand Safe Custody Assets that it holds.
16.3.2 [Deleted]
Guidance
For the purpose of Rule 16.3.1(d), examples of individuals within the Authorised Person who are critical or important to the performance of operational functions include:
(a) those necessary to carry out both internal and external Client Money, Relevant Money and Safe Custody asset reconciliations; and (b) those in charge of client documentation for business involving Client Money, Relevant Money and Safe Custody Assets.
16.3.3 For the purpose of Rule 16.3.1(b)the document must record:
(a) the full name of the individual institution in question; (b) the postal and email address and telephone number of that institution; and

Appendix 3
(c) the numbers of all accounts opened by that Authorised Person with that institution.
16.4 Existing records to be included in the Resolution Pack
16.4.1 The following records must be included in the Resolution Pack of an Authorised Person
conducting Investment Business:
(a) Rules 2.7.1 and 3.7.1(d) (records of Client classification and Client agreements); (b) Rule 15.4.3 (master list of all Client Accounts); (c) Rule 15.4.4 and Rule 15.4.5 (adequate records and Client's written permission); (d) Rule 15.4.5(b) and 0-0 (records and register of a Client's Investments); (e) Rule 15.5.1(a) (assessment of appropriateness of Third-Party Agent); and (f) Rule 15.9.1 (reconciliation).
16.4.2 Rule 16.4.1 does not change the record keeping requirements of the Rules referred to therein.
…..

Appendix 3
19. PAYMENT SERVICES
19.1 Application
19.1.1 Chapter 19 of these Rules applies to Payment Service Providers.
Guidance

1. Payment Service Providers are distinct from other Authorised Persons undertaking the
   Regulated Activity of Providing Money Services as they offer to their customers one or more of Payment Accounts, Payment Instruments and stored value.
2. Payment Service Users are not considered to be Clients of Payment Service Providers insofar
   as Chapter 19 does not distinguish between Retail Clients and Professional Clients in relation to the conduct of Payment Services so Chapter 2 does not therefore apply to Payment Services Providers.
3. Chapters 14 and 16 are applicable to the safekeeping of Relevant Money by Payment Service
   Providers, being either Money retained in the Payment Account of the Payment Service User, or Money held in a segregated manner by the Payment Service Provider for the purpose of funding the redemption of stored value issued to the Payment Service User in connection with the conduct of Payment Services.
4. Other Authorised Persons undertaking the Regulated Activity of Providing Money Services that
   offer only one or more of currency exchange and Money Remittance to their customers, but not Payment Services, and are considered not to hold [Client Assets in the form of] Client Money or Relevant Money.
   19.2 Framework Contracts
   Guidance
   Framework Contracts are contracts between Payment Service Providers and Payment Service Users enabling future execution of individual and successive Payment Transactions, using the payment service platform offered by the Payment Service Provider. Such contracts are often used to establish Payment Accounts or the terms upon which stored value will be issued and redeemed, and typically govern the operation of the payment service, including the rights and obligations of Payment Service Providers and their respective Payment Service Users. General information to be included in Framework Contracts
   19.2.1 Unless otherwise agreed in writing by a Payment Service Provider and a Payment Service User
   which is not a Natural Person in accordance with Rule 19.6.1, a FrameworkContract between a Payment Service Provider and a Payment Service User must include the following information – (a) about the Payment Service Provider:
   (i) the name of the Payment Service Provider; (ii) the address and contact details of the Payment Service Provider’s office in ADGM;

Appendix 3
(iii) the name of the Regulator of the Payment Service Provider, anddetails of the Payment Service Provider’s Financial Service Permission; (b) about the Payment Service:
(i) a description of the main characteristics of the Payment Service to be provided; (ii) the information or unique identifier that must be provided by the Payment Service User in order for a Payment Order to be properly initiated and executed; (iii) the form and procedure for giving consent to the initiation of a Payment Order or execution of a Payment Transaction and for the withdrawal of consent in accordance with Rule 19.10.1(3); (iv) the time of receipt of a Payment Order, in accordance with Rule 19.14.1, and the cut-off time for the processing of a Payment Order, if any, established by the Payment Service Provider; (v) the maximum execution time for the Payment Services to be provided; and (vi) any spending limits for the use of a Payment Instrument as agreed in accordance with Rule 19.10.2(1); (c) about charges and exchange rates:
(i) details of all charges payable by the Payment Service User to the Payment Service Provider, including those connected to information which is provided or made available and, where applicable, a breakdown of the amounts of all charges; (ii) where relevant, details of the exchange rates to be applied or, if Reference Exchange Rates are to be used, the method of calculating the relevant date for determining such Reference Exchange Rates; (iii) where relevant and if agreed, the application of changes in Reference Exchange Rates and information requirements relating to any such changes, in accordance with Rule 19.2.5; (d) about communication:
(i) the means of communication agreed between the parties for the transmission of information or notifications including, where relevant, any technical requirements for the Payment Service User’s equipment and software for receipt of the information or notifications; (ii) the manner in which and frequency with which information under Chapter 19 is to be provided or made available;

Appendix 3
(iii) the Payment Service User’s right to receive the revised terms of the Framework Contract and any other information in accordance with Rule 19.2.4; (e) about safeguards and corrective measures:
(i) where relevant, a description of the steps that the Payment Service User must to take in order to keep safe a Payment Instrument and how to notify the Payment Service Provider of loss of the Payment Instrument for the purposes of Rule 19.11.1(3); (ii) how and within what period of time the Payment Service User must notify the Payment Service Provider of any unauthorised or incorrectly initiated or executed Payment Transaction under Rule 19.17.1; (iii) the secure procedure by which the Payment Service Provider will contact the Payment Service User in the event of suspected or actual fraud or security threats; (iv) where relevant, the conditions under which the Payment Service Provider proposes to reserve the right to stop or prevent the use of a Payment Instrument in accordance with Rule 19.14.2; (v) the Payer’s liability under Rule 19.20.1 including details of any limits on such liability; (vi) the Payment Service Provider’s liability for unauthorised Payment Transactions under Rule 19.20.1; (vii) the Payment Service Provider’s liability for the initiation or execution of Payment Transactions under Rule 19.21.2 or Rule 19.21.3; and (viii) the conditions for the payment of any refund to the Payment Service User under this Chapter (f) about changes to and termination of the Framework Contract:
(i) where relevant, the proposed terms under which the Payment Service User will be deemed to have accepted changes to the Framework Contract in accordance with Rule 19.2.5, unless they notify the Payment Service Provider that they do not accept such changes before the proposed date of their entry into force; (ii) the duration of the Framework Contract; (iii) where relevant, the right of the Payment Service User to terminate the Framework Contract and any agreements relating to termination in accordance with Rule 19.2.8. (g) about redress:

Appendix 3
(i) any contractual clauses on the law applicable to the Framework Contract and the competent courts; and (ii) the availability of any alternative dispute resolution procedures, if applicable, for the Payment Service User and the methods for having access to them. (h) if the Payment Service involves the issuance of stored value, about the redemption of stored value, including the conditions of redemption and any related fees.
19.2.2 A Payment Service Provider must provide to a Payment Service User the information specified
in Rule 19.2.1 before the Payment Service User is bound by the Framework Contract. Information provision during period of the Framework Contract
19.2.3 If the Payment Service User so requests at any time during the term of the Framework
Contract, the Payment Service Provider must provide the information specified in Rule 19.2.1 as well as any other terms of the Framework Contract. Changes in contractual information
19.2.4 Subject to Rule 19.2.7, any proposed changes to:
(a) the existing terms of the Framework Contract; or (b) the information specified in Rule 19.2.1, must be provided by the Payment Service Provider to the Payment Service User no later than two months before the date on which they are to take effect.
19.2.5 Where the Framework Contract allows for any proposed changes to be made unilaterally by
the Payment Service Provider in the event that the Payment Service User does not, before the proposed date of entry into force of the changes, notify the Payment Service Provider to the contrary, the Payment Service Provider must inform the Payment Service User that:
(a) the Payment Service User will be deemed to have accepted the changes comunicated to it under Rule 19.2.4; and (b) the Payment Service User has the right to terminate the Framework Contract without charge at any time before the proposed date of their entry into force.
19.2.6 Changes in exchange rates may be applied immediately and without notice where:
(a) such a right is agreed under the Framework Contract and any such changes in exchange rates are based on the Reference Exchange Rate information which has been provided to the Payment Service User in accordance with Rule 19.2.1; or (b) the changes are more favourable to the Payment Service User.
19.2.7 Any change in the exchange rate used in Payment Transactions must be implemented and
calculated in a neutral manner that does not discriminate collectively against Payment Service Users.

Appendix 3
Termination of a Framework Contract
19.2.8 The Payment Service User may terminate the Framework Contract at any time unless the
parties have agreed on a period of notice not exceeding one month.
19.2.9 Any charges for the termination of the Framework Contract must not exceed the actual costs
to the Payment Service Provider of termination.
19.2.10The Payment Service Provider may not charge the Payment Service User for the termination of a Framework Contract after the Framework Contract has been in force for six months. 19.2.11The Payment Service Provider may terminate a Framework Contract concluded for an indefinite period by giving at least two months’ notice, if the Framework Contract so provides. Information prior to execution of individual Payment Transaction under a Framework Contract 19.2.12Where an individual Payment Transaction under a Framework Contract is initiated by the Payer, at the Payer’s request the Payer’s Payment Service Provider must provide the Payer with a breakdown of all charges payable by the Payer in respect of the Payment Transaction. Information for the Payer on individual Payment Transactions under a Framework Contract 19.2.13The Payer’s Payment Service Provider under a Framework Contract must provide to the Payer the following information in respect of each Payment Transaction at least once per month free of charge:
(a) a reference enabling the Payer to identify the Payment Transaction and, where appropriate, information relating to the Payee; (b) the amount of the Payment Transaction in the currency in which the Payer’s Payment Account is debited or in the currency used for the Payment Order; (c) the amount of any charges for the Payment Transaction and, where applicable, a breakdown of the amounts of such charges, or the interest payable by the Payer; (d) where applicable, the exchange rate used in the Payment Transaction by the Payer’s Payment Service Provider and the amount of the Payment Transaction after that currency conversion; and (e) the Debit Value Date or the date of receipt of the Payment Order. Information for the Payee on individual Payment Transactions under a Framework Contract 19.2.14The Payee’s Payment Service Provider under a Framework Contract must provide to the Payee the following information in respect of each Payment Transaction at least once per month free of charge:
(a) a reference enabling the Payee to identify the Payment Transaction and the Payer, and any information transferred with the Payment Transaction;

Appendix 3
(b) the amount of the Payment Transaction in the currency in which the Payee’s Payment Account is credited; (c) the amount of any charges for the Payment Transaction and, where applicable, a breakdown of the amounts of such charges; (d) where applicable, the exchange rate used in the Payment Transaction by the Payee’s Payment Service Provider, and the amount of the Payment Transaction before that currency conversion; and (e) the Credit Value Date. Charges for information under a Framework Contract 19.2.15A Payment Service Provider may not charge for providing or making available information which is required to be provided or made available under the provisions of Section 19.2. 19.2.16The Payment Service Provider and the Payment Service User may agree on charges for any information which is provided at the request of the Payment Service User where such information is:
(a) additional to the information required to be provided or made available by Section 19.2; (b) provided more frequently than is specified in Section 19.2; or (c) transmittedby means of communication other than those specified in the Framework Contract. 19.2.17Any charges imposed under Rule 19.2.16 must not exceed the Payment Service Provider’s actual costs of providing such information. Common provisions: communication of information 19.2.18Any information provided or made available by a Payment Service Provider in accordance with
Section 19.2 must be provided or made available in English, using easily understandable
language, and in a clear and comprehensible form.
19.3 Low-Value Payment Instruments governed by a Framework Contract
19.3.1 In respect of Low-value Payment Instruments governed by a Framework Contract:
(a) Section 19.2 compelling disclosure under the terms of a Framework Contract of general information concerning the Payment Service Provider and the relevant Payment Service does not apply and the Payment Service Provider is only required to provide the Payer with information about the main characteristics of the Payment Service, including but not limited to:
(i) the way in which the Payment Instrument can be used; (ii) the liability of the Payer, as set out in Rule 19.20.1;

Appendix 3
(iii) charges levied;
(iv) any other material information the Payer might need to make an informed decision; and (v) an indication of where the general information concerning the Framework Contract specified in Rule 19.2.1 is made available in an easily accessible manner; (b) the parties may agree that information to be provided to a Payer or Payee concerning individual Payment Transactions as specified in Rules 19.2.14 and 19.2.15 do not apply and instead:
(i) the Payment Service Provider must provide or make available a reference enabling the Payment Service User to identify the Payment Transaction, the amount of the Payment Transaction and any charges payable in respect of the Payment Transaction; (ii) in the case of several Payment Transactions of the same kind made to the same Payee, the Payment Service Provider must provide or make available to the Payment Service User information about the total amount of the Payment Transactions and any charges for those Payment Transactions; or (iii) where the Payment Instrument is used anonymously or the Payment Service Provider is not otherwise technically able to provide or make available the information specified in (i) or (ii), the Payment Service Provider must enable the Payer to verify the amount of Money stored.
19.4 Single Payment Service Contracts
Guidance
A Single Payment Service Contract is a contract between a Payment Service Provider and a user of the Payment Service Provider’s platform formed at the time of usage of the platform, which governs a single transaction and are thus not governed by a Framework Contract and no Payment Account has been established. Information required prior to the conclusion of a Single Payment Service Contract
19.4.1 A Payment Service Provider must provide or make available to a Payment Service User the
following information in relation to the Payment Service, whether by supplying a copy of the draft Single Payment Service Contract or a copy of the draft Payment Order or otherwise, before the Payment Service User is bound by the Single Payment Service Contract:
(a) the information or unique identifier that has to be provided by the Payment Service User in order for a Payment Order to be properly initiated or executed; (b) the maximum time in which the Payment Service will be executed; (c) the charges payable by the Payment Service User to the its Payment Service Provider and, where applicable, a breakdown of such charges;

Appendix 3
(d) where applicable, the actual or Reference Exchange Rate to be applied to the Payment Transaction; and (e) such of the information specified in Rule 19.2.1 as is relevant to the Single Payment Service Contract in question.
19.5 Information requirementsrequired after the initiation of a Payment Order
Guidance
This information is required whether a Payment Order is initiated under a Framework Contract or a Single Payment Service Contract, or through a Payment Initiation Service Provider, whether it is a Low Value Payment Instrument or not.
19.5.1 Subject to Rule 19.5.3, A Payment Service Provider must provide or make available to the
Payer and, where applicable, to the Payee, immediately after the initiation of a Payment Order:
(a) confirmation of the successful initiation of the Payment Order with the Payer’s Payment Service Provider; (b) a reference enabling the Payer and the Payee to identify the Payment Transaction, including the Payer and Payee, and, where appropriate, any information transferred with the Payment Order; (c) the amount of the Payment Transaction, in the currency used in the Payment Order; (d) the amount of any charges payable in relation to the Payment Transaction and, where applicable, a breakdown of the amounts of such charges expressed in the currency of the Payment Order; (e) where an exchange rate is used in the Payment Transaction the actual rate used or a reference to it, and the amount of the Payment Transaction after that currency conversion; (f) the date on which the Payment Service Provider received the Payment Order; and (g) the Credit Value Date.
19.5.2 Where a Payment Order is initiated through a Payment Initiation Service Provider, the
Payment Service Provider must obtain and disclose the reference for the Payment Transaction from the Payment Initiation Service Provider in order to fulfil its obligations under Rule 19.5.1, unless otherwise excluded by Rule 19.6.2. Avoidance of duplication of information under a Framework Contract
19.5.3 Where a Payment Order for a single Payment Transaction is transmitted by way of a Payment
Instrument issued under a Framework Contract, the Payment Service Provider in respect of that single Payment Transaction need not provide or make available under Rule 19.5.1 the general information which has been provided or will be provided under Section 19.2 by another Payment Service Provider in respect of a Framework Contract.

Appendix 3
19.6 Disapplication of requirements for non-Natural Persons
19.6.1 Where the Payment Service User is not a Natural Person, the Payment Service User and the
Payment Service Provider may agree in writing the following Rules do not apply:
(a) Rules 19.2.17 and 19.2.18 (charges for information); (b) Rule 19.10.1 (3) and (4) (withdrawal of consent); (c) Rule 19.18.1 (evidence on authentication and execution); (d) Rule 19.20.1 (Payer or Payee’s liability for unauthorised transactions); (e) Rules 19.17.1 and 19.17.2 (requests for refund); (f) Rule 19.14.3 (revocation of a Payment Order); (g) Rule 19.21.2 (defective execution of Payer-initiated transactions); (h) Rule 19.21.3 (defective execution of Payee-initiated transactions); (i) Rule 19.21.5 (liability for charges); and the parties may agree that a different time period applies concerning unauthorised or incorrectly executed Payment Transactions for the purposes of Rule 19.17.1. Disapplication of certain Rules in the case of Low Value Payment Instruments
19.6.2 (1) The parties may agree that the following Rules do not apply where a Low Value
Payment Instrument does not allow for the stopping or prevention of its use:
(a) Rule 19.11.1 (3) (notification of loss of Payment Instrument); and (b) Rule 19.20.1(4) (Payer not liable for certain losses). (2) Where a Low Value Payment Instrument is used anonymously or the Payment Service Provider is not in a position, for other reasons concerning the Low Value Payment Instrument, to prove that a Payment Transaction was authorised, the following Rules do not apply:
(a) Rule 19.18.1 (evidence on authentication and execution); (b) Rule 19.19.1 (Payment Service Provider’s liability for unauthorised transactions); and (c) Rule 19.20.1 (Payer’s liability for unauthorised transactions). (3) In the case of a Payment Order relating to a Low Value Payment Instrument:
(a) a Payment Service Provider is not required to notify the Payment Service User of the refusal of a Payment Order relating to such Low Value Payment Instrument and the reasons for such refusal in accordance with Rule 19.14.2(1) if the non-execution is apparent from the context;

Appendix 3
(b) the Payer may not revoke the Payment Order under Rule 19.14.3 after transmitting the Payment Order or giving its consent to execute the Payment Transaction to the Payee; (c) execution periods other than those provided by Rules 19.15.2 and 19.15.3 may apply.
19.7 Safeguarding requirements
19.7.1 A Payment Service Provider is prohibited from accepting physical cash from any Payment
Service User and must safeguard Relevant Money placed in one or more Payment Accounts, as necessary. Guidance A Payment Service Provider must safeguard Money which they may be responsible for the transmission of, as well as any Money which they may hold or control on behalf of a Payment Service User, or which may be required to fund the redemption of stored value issued to a Payment Service User.
19.7.2 A Payment Account in which Relevant Money is held, must:
(a) be designated in such a way as to demonstrate that it is an account which is held for the purpose of safeguarding Relevant Money in accordance with Chapter 14 of these Rules; (b) must be used only in relation to Payment Transactions; and (c) be used only for holding Relevant Money.
19.7.3 No person other than the Payment Service Provider may have any interest in or right over the
Relevant Money placed in a Payment Account in accordance with Rule 19.7.2, except as provided by these Rules.
19.7.4 The Payment Service Provider must keep records of all Relevant Money segregated in
accordance with Rule 19.7.2.
19.7.5 A Payment Service Provider must maintain organisational arrangements sufficient to minimise
the risk of any loss of Relevant Money through fraud, misuse, negligence or poor administration.
19.8 Record keeping
19.8.1 A Payment Service Provider must maintain relevant records of all transactions and keep them
for at least six years from the date on which the record was created, including all records of agreements with Payment Service Users.
19.9 Payment Accounts and outsourcing of Operational Functions
19.9.1 Where a Payment Service Provider relies on a third party for the performance of operational
functions it must take all reasonable steps to ensure that these Rules are complied with.

Appendix 3
Guidance
GEN 3.3.31 and 3.3.32 and PRU 6.8 also govern outsourcing of functions and activities by an Authorised Person. A Payment Service Provider is required to comply with those Rules.
19.10 Authorisation of Payment Transactions
Consent and withdrawal of consent
19.10.1(1) A Payment Transaction is to be regarded as having been authorised by the Payer for the purposes of this Rule only if the Payer has given its consent to:
(a) the execution of the Payment Transaction; or (b) the execution of a series of Payment Transactions of which that Payment Transaction forms part. (2) Such consent:
(a) may be given before or, if agreed between the Payer and its Payment Service Provider, after the execution of the Payment Transaction; (b) must be given in the form, and in accordance with the procedure, agreed between the Payer and its Payment Service Provider; and (c) may be given via the Payee or a Payment Initiation Service Provider. (3) The Payer may withdraw its consent to an individual Payment Transaction at any time before the point at which the Payment Order can no longer be revoked under Rule 19.14.3. (4) Subject to Rule 19.14.3(2) and (3) concerning time limits, the Payer may withdraw consent to the execution of a series of Payment Transactions at any time with the effect that any future Payment Transactions previously consented to are not regarded as authorised for the purposes of this Chapter. Limits on the use of Payment Instruments and access to Payment Accounts 19.10.2(1) Where a specific Payment Instrument is used for the purpose of giving consent to the execution of a Payment Transaction, the Payer and its Payment Service Provider may agree on spending limits for any Payment Transactions executed through that Payment Instrument. (2) A Framework Contract may provide for the Payment Service Provider to have the right to stop the use of a Payment Instrument on reasonable grounds relating to the security of the Payment Instrument or the suspected unauthorised or fraudulent use of the Payment Instrument. (3) The Payment Service Provider must inform the Payer that it intends to stop the use of the Payment Instrument and provide its reasons for doing so, in the manner agreed between the Payment Service Provider and the Payer, before carrying out any

Appendix 3
measures to stop the use of the Payment Instrument, or, if not possible, as soon as reasonably possible thereafter. (4) The Payment Service Provider must immediately report any incident arising under (2) to the Regulator in such form as the Regulator may direct, and such report must include the details of the case and the reasons for taking action. (5) The Payment Service Provider must restore access to the Payment Account once the reasons for denying access no longer justify such denial of access.
19.11 Obligations of the Payment Service Provider in relation to Payment Instruments
19.11.1(1) A Payment Service Provider issuing a Payment Instrument must ensure that the Personalised Security Credentials are not accessible to persons other than the Payment Service User to whom the Payment Instrument has been issued. (2) The Payment Service Provider bears the risk of sending to the Payment Service User a Payment Instrument or any Personalised Security Credentials relating to it. (3) The Payment Service Provider must ensure that appropriate means are available at all times to enable a Payment Service User to notify the Payment Service Provider of the loss, theft, misappropriation or unauthorised use of the Payment Instrument.
19.12 Payment Transactions where the transaction amount is not known in advance
19.12.1Where a card-based Payment Transaction is initiated by or through the Payee and the amount of the transaction is not known when the Payer authorises the Payment Transaction:
(a) the Payer’s Payment Service Provider may not block Money on the Payer’s Payment Account unless the Payer has authorised the exact amount of the Money to be blocked; and (b) the Payer’s Payment Service Provider must release the blocked Money without undue delay after becoming aware of the amount of the Payment Transaction, and in any event immediately after receipt of the Payment Order.
19.13 Requests for refunds of Money for Payment Transactions initiated by or through a Payee
19.13.1(1) The Payer is entitled to a refund from its Payment Service Provider of the full amount of any authorised Payment Transaction initiated by or through the Payee if requested within eight weeks from the date on which the Money was debited, if:
(a) the authorisation did not specify the exact amount of the Payment Transaction when the authorisation was given in accordance with Rule 19.10.1; and (b) the amount of the Payment Transaction exceeded the amount that the Payer could reasonably have expected taking into account the pattern of the Payer’s previous transactions, the conditions of the Framework Contract and the circumstances of the case.

Appendix 3
(2) The Payment Service Provider may require the Payer to provide such information as is reasonably necessary to prove that the conditions in (1) are satisfied. (3) When crediting a Payment Account under (1), a Payment Service Provider must ensure that the Credit Value Date is no later than the date on which the amount of the unauthorised payment transaction was debited. (4) The Payer and Payment Service Provider may agree in the Framework Contract that the right to a refund does not apply where:
(a) the Payer has given consent directly to the Payment Service Provider for the Payment Transaction to be executed; and (b) if applicable, information on the Payment Transaction was provided or made available in an agreed manner to the Payer at least four weeks before the due date by the Payment Service Provider or by the Payee. Guidance A Payment Service Provider is expected to engage in risk analysis when considering whether a transaction is legitimate. Consideration should be given to all relevant factors, identifying and investigating where any of the following characteristics are atypical of the previous pattern of transactions of the Payer:
(i) whether this is the first instance of a Payment Transaction with the Payee; (ii) the location(s) of the Payer and the Payee, where these are identifiable, and whether they are in high-risk jurisdictions; and (iii) in the case of a Payment Account, the means of access to it and authentication of the transaction by the Payer. 19.13.2(1) Upon receipt of a request for a refund in accordance with Rule 19.13.1 the Payment Service Provider must either:
(a) refund the full amount of the Payment Transaction; or (b) provide justification for refusing to refund the Payment Transaction, indicating the dispute settlement forum to which the Payer may refer the matter if the Payer does not accept the justification provided. (2) Any refund or justification for refusing a refund must be provided within ten Business Days of receiving a request for a refund or, where applicable, within ten Business Days of receiving any further information requested under Rule 19.13.1(2). (3) If the Payment Service Provider requires further information under Rule 19.13.1(2), it must not dismiss the request for a refund until it has received further information from the Payer.
19.14 Execution of Payment Transactions
Receipt of Payment Orders

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19.14.1(1) A Payer’s Payment Service Provider must not debit the Payment Account before receipt of a Payment Order. (2) If the time of receipt of a Payment Order specified in the Framework Contract or the Single Payment Service Contract does not fall on a Business Day, the Payment Order is deemed to have been received on the first Business Day thereafter. (3) The Payment Service Provider may set a cut-off time towards the end of a Business Day after which any Payment Order received will be deemed to have been received on the following Business Day. Refusal of Payment Orders
19.14.2 (1) Where a Payment Service Provider refuses to execute a Payment Order or to initiate
a Payment Transaction, it must notify the Payment Service User at the earliest opportunity in the agreed manner of the refusal, and, if possible, the reasons for such refusal, including, if applicable, the procedure for rectifying any factual errors that led to the refusal. (2) For the purposes of Rules 19.21.2 and 19.21.3 a Payment Order of which execution has been refused is deemed not to have been received. Revocation of a Payment Order 19.14.3(1) Subject to (2) to (4), a Payment Service User may not revoke a Payment Order after it has been received by the Payer’s Payment Service Provider. (2) In the case of a Payment Transaction initiated by a Payment Initiation Service Provider, or by or through the Payee, the Payer may not revoke the Payment Order after giving consent to the Payment Initiation Service Provider to initiate the Payment Transaction or giving consent to execute the Payment Transaction to the Payee. (3) In the case of a Direct Debit, the Payer may not revoke the Payment Order after the end of the Business Daypreceding the day agreed for debiting the Money. (4) At any time after the time limits for revocation set out in Rules 19.14.3(1) to (3), the Payment Order may only be revoked if the revocation is:
(a) agreed between the Payment Service User and the relevant Payment Service Provider(s); and (b) in the case of a Payment Transaction initiated by or through the Payee, including in the case of a Direct Debit, also agreed with the Payee. Amounts transferred and amounts received 19.14.4(1) Subject to (2), the Payment Service Providers of the Payer and Payee must ensure that the full amount of the Payment Transaction is transferred and that no charges are deducted from the amount transferred. (2) The Payee and its Payment Service Provider may agree for the relevant Payment Service Provider to deduct its charges from the amount transferred before crediting

Appendix 3
it to the Payee provided that the full amount of the Payment Transaction and the amount of the charges are clearly stated in the information provided to the Payee.
19.15 Execution time and Credit Value Date
19.15.1(1) Rules 19.15.2 and 19.15.3 apply where a Payment Transaction:
(a) is in U.S. Dollars;
(b) is executed wholly within the UAE in UAE Dirham; or (c) involves only one currency conversion between the UAE Dirham and U.S. Dollars, where the currency conversion is carried out in the UAE. (2) In respect of any Payment Transaction not described in (1), the Payment Service User may agree with the Payment Service Provider that Rules 19.15.2 and 19.15.3 do not apply. Payment Transactions to a Payment Account 19.15.2(1) The Payer’s Payment Service Provider must ensure that the amount of the Payment Transaction is credited to the Payee’s Payment Service Provider’s account no later than the end of the Business Day following the time of receipt of the Payment Order by the Payer’s Payment Service Provider. (2) The Payee’s Payment Service Provider must value date and credit the amount of the Payment Transaction to the Payee’s Payment Account following its receipt of the Money. (3) The Payee’s Payment Service Provider must transmit a Payment Order initiated by or through the Payee to the Payer’s Payment Service Provider within the time limits agreed between the Payee and its Payment Service Provider, enabling settlement in respect of a Direct Debit to occur on the agreed due date. Absence of Payee’s Payment Account with the Payment Service Provider 19.15.3Where a Payment Service Provider accepts Money on behalf of a Payee who does not have a Payment Account with that Payment Service Provider, the Payment Service Provider must make the Money available to the Payee immediately after the Money has been credited to that Payment Service Provider’s account. Cash placed on a Payment Account 19.15.4Where a Payment Service User transfers Money to its Payment Account with a Payment Service Provider in the same currency as that Payment Account, the Payment Service Provider must:
(a) if the user is a Natural Person, ensure that the amount is made available and value dated immediately after the receipt of the Money; (b) in any other case, ensure that the amount is made available and value dated no later than the end of the next Business Day after the receipt of the Money.

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Value date and availability of Money
19.15.5(1) The Credit Value Date for the Payee’s Payment Account must be no later than the day on which the amount of the Payment Transaction is credited to the account of the Payee’s Payment Service Provider. (2) Where:
(a) the transaction does not involve a currency conversion; (b) the transaction involves only a currency conversion between the UAE Dirham and U.S. Dollars; or (c) the transaction involves only one Payment Service Provider; the Payee’s Payment Service Provider must ensure that the full amount of the Payment Transaction is at the Payee’s disposal immediately after that amount has been credited to that Payment Service Provider’s account. (3) The Debit Value Date for the Payer’s Payment Account must be no earlier than the time at which the amount of the Payment Transaction is debited from that Payment Account. Stored Value 19.15.6(1) A Payment Service Provider which issues stored value must:
(a) on receipt of Money from a Payment Service User issue without delay stored value at par value; and (b) at the request of the Payment Service User, redeem:
(i) at any time; and
(ii) at par value; the monetary value of the stored value held.
(2) Redemption of stored value may be subject to a fee which is proportionate and commensurate with the costs actually incurred by the Payment Service Provider, only where:
(a) the fee is stated in the Framework Contract; (b) redemption is requested before the termination of the Framework Contract; (c) the Framework Contract provides for a termination date and the Payment Service User has terminated the Framework Contract before that date; or (d) redemption is requested more than twelve months after the date of termination of the Framework Contract.

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(3) Where before the termination of the Framework Contract a Payment Service User that is a Natural Person makes a request for redemption of stored value, the Payment Service User may request redemption of the monetary value of the stored value in whole or in part, and the Payment Service Provider must redeem the amount so requested, subject to any fee imposed in accordance with Rule 19.15.6(2). (4) Where a Payment Service User makes a request for redemption of stored value on, or up to one year after the date of the termination of the Framework Contract, the Payment Service Provider must redeem the total monetary value of the stored value held. (5) Rules 19.15.6(3) and (4) shall not apply in the case of Payment Service User which is not a Natural Person, and, in such a case, the redemption rights of that Payment Service User shall be subject to the Framework Contract between that Payment Service User and the Payment Service Provider. (6) A Payment Service Provider is not required to redeem the monetary value of stored value where the Payment Service User makes a request for redemption more than six years after the date of termination of the Framework Contract. (7) A Payment Service Provider which issues stored value must not award:
(a) interest in respect of the holding of stored value; or (b) any other benefit, monetary or otherwise, related to the length of time during which an Payment Service User holds stored value. (8) For the purposes of this Rule, a Framework Contract between a Payment Service Provider and a Payment Service User terminates when the right to use stored value for the purpose of making Payment Transactions ceases.
19.16 Authentication
19.16.1(1) A Payment Service Provider must employ Strong Customer Authentication where a Payment Service User:
(a) accesses its Payment Account online, whether directly or through an Account Information Service Provider; (b) initiates an Electronic Remote Payment Transaction; or (c) carries out any action through a remote means of communication which may permit a risk of payment fraud or other abuses. (2) Where a Payer initiates an Electronic Remote Payment Transaction directly or through a Payment Initiation Service Provider, the Payer’s Payment Service Provider must apply Strong Customer Authentication that includes elements that dynamically link the transaction to a specific amount and a specific Payee. (3) A Payment Service Provider must maintain adequate security measures to protect the confidentiality and integrity of Payment Service Users’ Personalised Security Credentials.

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19.17 Notification and rectification of unauthorised or incorrectly executed Payment Transactions
19.17.1A Payment Service User is entitled to redress under this Chapter only if it notifies its Payment Service Provider without undue delay, and in any event no later than twelve months after the debit date, on becoming aware of any unauthorised or incorrectly executed Payment Transaction. 19.17.2Where the Payment Service Provider has failed to provide or make available information concerning the Payment Transaction in accordance with Section 19.5, the Payment Service User is entitled to redress under the Rules referred to in Rule 19.17.1 notwithstanding that the Payment Service User has failed to notify the Payment Service Provider within the time period stated in Rule 19.17.1.
19.18 Evidence on authentication and execution of Payment Transactions
19.18.1(1) Where a Payment Service User:
(a) denies having authorised an executed Payment Transaction; or (b) claims that a Payment Transaction has not been correctly executed; it is for the Payment Service Provider to prove that the Payment Transaction was authenticated, accurately recorded, entered in the Payment Service Provider’s accounts and not affected by a technical breakdown or some other deficiency in the service provided by the Payment Service Provider or any third party it relies upon for the performance of operational functions. (2) Where a Payment Service User denies having authorised an executed Payment Transaction, the use of a Payment Instrument recorded by the Payment Service Provider, including a Payment Initiation Service Provider where appropriate, is not in itself necessarily sufficient to prove either that:
(a) the Payment Transaction was authorised by the Payer; or (b) the Payer acted fraudulently or failed with intent or gross negligence to take all reasonable steps to keep safe Personalized Security Credentials relating to a Payment Instrument. (3) If a Payment Service Provider, including a Payment Initiation Service Provider where appropriate, alleges that a Payer acted fraudulently or failed with intent or gross negligence to take all reasonable steps to keep safe Personalized Security Credentials relating to a Payment Instrument, the Payment Service Provider must provide supporting evidence to the Payer.
19.19 Payment Service Provider’s liability for unauthorised Payment Transactions
19.19.1(1) Subject to Rules 19.17.1, 19.17.2 and 19.18.1, where an executed Payment Transaction was not authorised in accordance with Rule 19.10.1, the Payment Service Provider must:
(a) refund the amount of the unauthorised Payment Transaction to the Payer; and

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(b) where applicable, restore the debited Payment Account to the state it would have been in had the unauthorised Payment Transaction not taken place. (2) The Payment Service Provider must provide a refund under (1) as soon as practicable, and in any event no later than the end of the Business Day following the day on which it becomes aware of the unauthorised Payment Transaction. (3) The requirement to provide a refund in accordance with (2) does not apply where the Payment Service Provider has reasonable grounds to suspect fraudulent behaviour by the Payment Service User. (4) When crediting a Payment Account under (1), a Payment Service Provider must ensure that the Credit Value Date is no later than the date on which the amount of the unauthorised Payment Transaction was debited. (5) Where an unauthorised Payment Transaction was initiated through a Payment Initiation Service Provider, the account servicing Payment Service Provider must comply with (1).
19.20 Liability
Payer or Payee’s liability for unauthorised Payment Transactions
19.20.1 (1) A Payment Service Provider which is liable under Rule 19.19.1 may require that the
Payer be liable up to a maximum of $50 for any losses incurred in respect of unauthorised Payment Transactions arising from the use of a lost or stolen Payment Instrument, or from the misappropriation of a Payment Instrument. (2) The liability in (1) does not apply if:
(a) the loss, theft or misappropriation of the Payment Instrument was not detectable by the Payer prior to the unauthorised Payment Transaction; or (b) the loss was caused by acts or omissions of an employee, agent or branch of a Payment Service Provider or of an entity which carried out activities on behalf of the Payment Service Provider. (3) The Payment Service Provider is not liable for any losses incurred by the Payer in respect of an unauthorised Payment Transaction where the Payer:
(a) has acted fraudulently; or
(b) has with intent or gross negligence failed to ensure that the Personalised Security Credentials are not accessible to persons other than the Payer to whom the Payment Instrument has been issued. (4) Subject to (1), except where the Payer has acted fraudulently, the Payer is not liable for any losses incurred in respect of an unauthorised Payment Transaction:
(a) arising after notification to the Payment Service Provider in the agreed manner on becoming aware of the loss, theft, misappropriation or unauthorised use of the Payment Instrument;

Appendix 3
(b) where the Payment Service Provider has failed at any time to provide, in accordance with Rule 19.11.1(3), appropriate means for notification; (c) where the Payer’s Payment Service Provider has failed to apply Strong Customer Authentication; or (d) where the Payment Instrument has been used in connection with an Electronic Remote Payment Transaction. (5) Where Rule 19.16.1 requires the application of Strong Customer Authentication, but the Payee or the Payee’s Payment Service Provider does not use Strong Customer Authentication, the Payee or the Payee’s Payment Service Provider, or both (on a joint and several basis, as the case may be), must compensate the Payer’s Payment Service Provider for the losses incurred or sums paid as a result of complying with Rule 19.19.1.
19.21 Non-execution or defective or late execution of Payment Transactions
Incorrect Unique Identifiers
19.21.1(1) Where a Payment Order is executed using a Unique Identifier provided by the Payment Service User, the Payment Order is deemed to have been correctly executed by each Payment Service Provider involved in executing the Payment Order with respect to the Payee specified by the Unique Identifier. (2) Where the Unique Identifier provided by the Payment Service User is incorrect, the Payment Service Provider is not liable under Rule 19.21.2 or 19.21.3 for non-execution or defective execution of the Payment Transaction, but the Payment Service Provider:
(a) must make reasonable efforts to recover the Money involved in the Payment Transaction; and (b) may, if agreed in the Framework Contract, charge the Payment Service User for any such recovery. (3) The Payee’s Payment Service Provider must co-operate with the Payer’s Payment Service Provider in its efforts to recover the Money, in particular by providing to the Payer’s Payment Service Provider all relevant information for the collection of the Money. (4) If the Payer’s Payment Service Provider is unable to recover the Money it must, on receipt of a written request, provide to the Payer all available relevant information in order for the Payer to claim repayment of the Money. Non-execution or defective or late execution of Payment Transactions initiated by the Payer 19.21.2(1) This Rule applies where a Payment Order is initiated directly by the Payer. (2) The Payer’s Payment Service Provider is liable to the Payer for the correct execution of the Payment Transaction unless it can prove to the Payer and, where relevant, to the Payee’s Payment Service Provider, that the Payee’s Payment Service Provider

Appendix 3
received the amount of the Payment Transaction in accordance with Rule 19.15.2(1) and (2). (3) Where the Payer’s Payment Service Provider is liable under (2), it must without undue delay refund to the Payer the amount of the non-executed or defective Payment Transaction and, where applicable, restore the debited Payment Account to the state in which it would have been had the defective Payment Transaction not taken place. (4) The Credit Value Date for a credit under (3) must be no later than the date on which the amount was debited. (5) If the Payer’s Payment Service Provider proves that the Payee’s Payment Service Provider received the amount of the Payment Transaction in accordance with Rule 19.15.2, the Payee’s Payment Service Provider is liable to the Payee for the correct execution of the Payment Transaction and must:
(a) immediately make available the amount of the Payment Transaction to the Payee; and (b) where applicable, credit the corresponding amount to the Payee’s Payment Account. (6) The Credit Value Date for a credit under (5)(b) must be no later than the date on which the amount would have been value dated if the Payment Transaction had been executed correctly. (7) Where a Payment Transaction is executed late, the Payee’s Payment Service Provider must, on receipt of a request from the Payer’s Payment Service provider on behalf of the Payer, ensure that the Credit Value Date for the Payee’s Payment Account is no later than the date the amount would have been value dated if the Payment Transaction had been executed correctly. (8) Regardless of liability under this Rule, the Payer’s Payment Service Provider must, on request by the Payer, immediately and without charge:
(a) make efforts to trace any non-executed or defectively executed Payment Transaction; and (b) notify the Payer of the outcome. Non-execution or defective or late execution of Payment Transactions initiated by the Payee
19.21.3 (1) This Rule applies where a Payment Order is initiated by the Payee.
(2) The Payee’s Payment Service Provider is liable to the Payee for the correct transmission of the Payment Order to the Payer’s Payment Service Provider in accordance with Rule 19.15.2(4). (3) Where the Payee’s Payment Service Provider is liable under (2), it must immediately re-transmit the Payment Order in question to the Payer’s Payment Service Provider.

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(4) The Payee’s Payment Service Provider must also ensure that the Payment Transaction is handled in accordance with Rule 19.15.5, such that the amount of the Payment Transaction:
(a) is at the Payee’s disposal immediately after it is credited to the Payee’s Payment Service Provider’s account; and (b) is value dated on the Payee’s Payment Account no later than the date the amount would have been value dated if the Payment Transaction had been executed correctly. (5) The Payee’s Payment Service Provider must, on request by the Payee and free of charge, make immediate efforts to trace the Payment Transaction and notify the Payee of the outcome. (6) Subject to (8), if the Payee’s Payment Service Provider proves to the Payee and, where relevant, to the Payer’s Payment Service Provider, that it is not liable under (2) in respect of a non-executed or defectively executed Payment Transaction, the Payer’s Payment Service Provider is liable to the Payer and must, as appropriate and immediately:
(a) refund to the Payer the amount of the Payment Transaction; and (b) restore the debited Payment Account to the state in which it would have been had the defective Payment Transaction not taken place. (7) The Credit Value Date for a credit under (6)(b) must be no later than the date on which the amount was debited. (8) If the Payer’s Payment Service Provider proves that the Payee’s Payment Service Provider has received the amount of the Payment Transaction, (6) does not apply and the Payee’s Payment Service Provider must value date the amount on the Payee’s Payment Account no later than the date the amount would have been value dated if the Payment Transaction had been executed correctly. Non-execution or defective execution of Payment Transactions initiated through a Payment Initiation Service Provider
19.21.4 (1) Where a Payment Order is initiated by the Payer through a Payment Initiation Service
Provider, the account servicing Payment Service Provider must refund to the Payer the amount of a non-executed or defective Payment Transaction and, where applicable, restore the debited Payment Account to the state in which it would have been had the defective Payment Transaction not taken place. (2) Where the Payment Initiation Service Provider suffers a technical breakdown or other deficiency linked to the non-execution, defective or late execution of the Payment Transaction, (1) does not prevent the account servicing Payment Service Provider from seeking compensation from the Payment Initiation Service Provider for the losses incurred or sums paid as a result of the refund to the Payer.

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Liability of Payment Service Provider for charges and interest 19.21.5A Payment Service Provider is liable to its Payment Service User for any charges for which the Payment Service User is responsible and any interest which the Payment Service User must pay as a consequence of the non-execution, defective or late execution of a Payment Transaction by the Payment Service Provider.
19.22 Dispute resolution
19.22.1(1) A Payment Service Provider must put in place and utilise adequate and effective complaint resolution procedures for the settlement of complaints from Payment Service Users about the rights and obligations arising under this Chapter. (2) All complaints must be recorded, investigated and resolved within an adequate timeframe and at the latest fifteen Business Days after the day on which the Payment Service Provider received the complaint. (3) A Payment Service Provider must make available to the Payment Service User the details of the dispute resolution services able to deal with disputes concerning the rights and obligations arising under this Chapter in a clear, comprehensive and easily accessible form. (4) The information to be made available under (3) must be made available:
(a) on the website of the Payment Service Provider; (b) at the main office and any branches of the Payment Service Provider; and (c) in the general terms and conditions of the Framework Contract between the Payment Service Provider and the Payment Service User.
19.23 Reporting and Risk mitigation
Management of operational and security risks
19.23.1(1) A Payment Service Provider must establish a framework with appropriate mitigation measures and control mechanisms to manage the operational and security risks relating to the Payment Services it provides. (2) As part of that framework, the Payment Service Provider must establish and maintain effective incident management procedures, including for the detection and classification of major operational and security incidents. (3) A comprehensive assessment of operational and security risks must be undertaken by the Payment Service Provider relating to the Payment Services it provides, at least annually or more frequently if requested by the Regulator, and provided to the Regulator on request. (4) The assessment must address the adequacy of the mitigation measures and control mechanisms implemented in response to those risks in such form and manner, and contain such information, as the Regulator may direct.

Appendix 3
Guidance
1. The FSRA may require a Payment Service Provider to engage technical experts to
generate an audit report addressed to the FSRA, in order to provide independent assurance that the systems and controls employed by the Payment Service Provider comply with the requirements imposed by this Chapter.
2. Payment Service Providers are expected to provide a summary of the information
required by Rule 19.23.1 as part of the periodic IRAP assessments undertaken in accordance with PRU 10.3. Incident reporting 19.23.2(1) If a Payment Service Provider becomes aware of a major operational or security incident, the Payment Service Provider must, without undue delay, notify the Regulator. (2) A notification under (1) must be in such form and manner, and contain such information, as the Regulator may direct. (3) If the incident has or may have an impact on the financial interests of its Payment Service Users, the Payment Service Provider must, without undue delay, inform its Payment Service Users of the incident and of all measures that they can take to mitigate the adverse effects of the incident. Guidance
1. Upon receipt of the notification referred to in 19.2.1(1), the Regulator may notify any
other relevant authorities in the U.A.E.
2. If the Regulator receives notification of an incident from any relevant regulatorin the
U.A.E. or internationally, it may direct the Payment Service Provider to take appropriate measures to protect the immediate safety of their Payment Service Users and the financial system.

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Appendix 4
Glossary (GLO)
*In this attachment underlining indicates new text and striking through indicates deleted text.

Appendix 4
1.2 Defined Terms
1.2.1 In the Rulebook:
(1) a word or phrase which is defined in this module is a defined term and has the meaning given in GLO; and (2) a word or phrase which relates to a defined term must be interpreted accordingly. … Defined Terms Definitions Abu Dhabi Global Market Financial System or ADGM Financial System Has the meaning given in section 258 of FSMR. Acting as a Central Securities Depository Has the meaning given in section 258 of FSMR. Applicant Has the meaning given in section 258 of FSMR. Client Account In relation to:
(a) Client Money and Relevant Money, means an account as described in COBS 14.2.5(a); and (b) a Safe Custody Investment, means an account specified in COBS 15.4.2. Client Money Distribution Rules Means the Rules in COBS 14.4 relating to the distribution of Client Money following a Pooling Event. Has the meaning given in COBS 14.4.1. Credit Value Date Means the date upon which Money placed in a Payment Account may be accessed by the holder of the Payment Account following a Payment Transaction. Debit Value Date Means the date upon which Money is debited from the Payment Account of the Payer. Default Rules Has the meaning given in section 258 of FSMR. Designated Non-Member Has the meaning given in section 258 of FSMR. Direct Debit Means a Payment Service for debiting the Payer’s Payment Account where a Payment Transaction is initiated by the payee on the basis of consent given by the Payer to the Payee, to the Payee’s Payment Service Provider or to the Payer’s own Payment Service Provider. Electronic Remote Payment Transaction Means a Payment Transaction initiated by a Payer to pay for goods or services using electronic means without the

Appendix 4
simultaneous physical presence of the Payer and the Payee to the Payment Transaction. Exempt Person Has the meaning given in section 258 of FSMR. Financial Instrument Has the meaning given in section 258 of FSMR. Framework Contract Means a contract for the performance of Payment Services that governs the future execution of individual and successive Payment Transactions and which may contain the obligation and conditions for setting up a Payment Account. General Prohibition Has the meaning given in section 258 of FSMR. Low-Value Payment Instrument Means any Payment Instrument that:
(a) can be used only to execute individual payment transactions of 25 US Dollars (or its equivalent) or less; (b) has a spending limit of 100 US Dollars(or its equivalent); or (c) stores Money that does not exceed 500 US Dollars (or its equivalent) at any time. Market Contract Has the meaning given in section 258 of FSMR. Money Means any form of money, including banknotes, coins, cheques, electronic money and any other non-cash form, such as and other payable orders. Money Remitter Has the meaning given in section 258 of FSMR. Non-ADGM Clearing House Has the meaning given in section 258 of FSMR. Non-ADGM Regulator Has the meaning given in section 258 of FSMR. Payee Has the meaning given in section 258 of FSMR. Payer Has the meaning given in section 258 of FSMR. Payment Account Has the meaning given in section 258 of FSMR. Payment Account Provider Has the meaning given in section 258 of FSMR. Payment Initiation Service Provider Means a person that initiates a Payment Order at the request of a Payment Service User with respect to a Payment Account held at another Payment Service Provider. Payment Instrument Has the meaning given in section 258 of FSMR. Payment Order Means any instruction by a Payer or a Payee to their respective Payment Service Provider requesting the execution of a Payment Transaction. Payment Service Provider Has the meaning given in section 258 of FSMR.

Appendix 4
Payment Service User Means a Person who makes use of Payment Services in the capacity of Payer, Payee, or both. Payment Services Has the meaning given in section 258 of FSMR. Payment Transaction Means an act initiated by the Payer or Payee, or on behalf of the Payer, of placing, transferring or withdrawing Money, irrespective of any underlying obligations between the Payer and Payee. Personalised Security Credentials Means personalised features provided by a Payment Service Provider to a Payment Service User for the purposes of authentication of the identity of the Payment Service User. Price Stabilising Rules Has the meaning given in section 258 of FSMR. Private Financing Platform (PFP) Has the meaning given in section 258 of FSMR. Recognition Order Has the meaning given in section 258 of FSMR. Reference Exchange Rate Means the exchange rate that is used as the basis to calculate any currency exchange and that is made available by the Payment Service Provider or comes from a publicly available source. Relevant Money Means sums received from or for the benefit of a Payment Service User in the course of the execution of a Payment Transaction, whether held on behalf of a Payment Service User in a Payment Account or exchanged for a Payment Instrument or stored value, or sums received from a Payment Service Provider for the execution of a Payment Transaction on behalf of a Payment Service User. Relevant Office Holder Has the meaning given to that termin section 258 of FSMR. Secondary Pooling Event Has the meaning given in COBS 14.4.5. Single Payment Service Contract Means a contract for a single Payment Transaction not covered by a Framework Contract. Strong Customer Authentication Means authentication based on the use of two or more elements that are independent, in that the breach of one element does not compromise the reliability of any other element, and designed in such a way as to protect the confidentiality of the authentication data, with the elements falling into two or more of the following categories:
(a) something known only by the Payment Service User (“knowledge”); (b) something held only by the Payment Service User (“possession”);

Appendix 4
(c) something inherent to the Payment Service User (“inherence”).
Stored Value Provider Has the meaning given in section 258 of FSMR. Unique Identifier Means a combination of letters, numbers or symbols specified to the Payment Service User by the Payment Service Provider and to be provided by the Payment Service User in relation to a Payment Transaction in order to identify unambiguously one or both of:
(a) another Payment Service User who is a party to the Payment Transaction; (b) the other Payment Service User’s Payment Account.

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Appendix 5
Anti-Money Laundering and SanctionsRules and Guidance (AML) *In this attachment underlining indicates new text and striking through indicates deleted text.

Appendix 5
TABLE OF CONTENTS
The contents of the AML Rulebook are divided into the following Chapters and sections:
…
9. RELIANCE AND OUTSOURCING OF ANTI-MONEY LAUNDERING COMPLIANCE AND
THIRD-PARTIES.................................................................................................49
9.1 Reliance on a third party .........................................................................49
9.2 Business partner identification .................................................................52
9.3 Outsourcing and agents..........................................................................54
…
9.2 Business partner identification
9.2.1 …
(2) In the context of this Rule, a 'business partner' includes:
(a) a qualified professional as specified in Rule 9.1.1(1); (b) a member of the Relevant Person's Group; (c) a Correspondent Bank; or (d) any other service provider. (3) A Relevant Person that establishes, operates or maintains a Correspondent Account for a Correspondent Banking Client must ensure that it has arrangements to:
(a) conduct due diligence in respect of the opening of a Correspondent Account for a Correspondent Banking Client, including measures to identify:
(i) its ownership and management structure;
(ii) its major business activities and customer base; (iii) its location; and (iv) the intended purpose of the Correspondent Account; (b) identify all third parties that will use the Correspondent Account; and

Appendix 5
(c) monitor Transactions processed through a Correspondent Account that has been opened by a Correspondent Banking Client, in order to detect and report any suspicion of Money Laundering. Guidance Under (2)(d), service providers include agents that facilitate directly the activities of Authorised Persons in servicing their clients, as distinct from other service providers that provide purely ancillary services, such as IT, facilities management etc. to an Authorised Person. …
9.3 Outsourcing and agents
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9.3.2 Authorised Persons Providing Money Services
(1) An Authorised Person that is engaged in Providing Money Services must:
(a) maintain a complete, current and accurate register of all agents it uses to conduct its operations and make that register available to the Regulator upon request; (b) include all agents identified in (a) as part of its AML compliance programme and monitor the compliance of such agents with the requirements of its AML programme; (c) comply with all AML requirements imposed in all jurisdictions within which it or its agents operates; (d) when executing a Payment Transaction, assess and consider all relevant information, including information about the Payer and the Payee, including any beneficiary as may be applicable, to determine whether a Suspicious Activity Reportshould be filed; and (e) where appropriate, file a Suspicious Activity Report in all jurisdictions related to a suspicious Payment Transaction and make available to all authorities responsible for AML compliance all transaction information related to the Suspicious Activity Report. (2) An Authorised Person making an assessment under (1) must rely upon current sources of information when making such assessment and must keep adequate records concerning such assessments, including all sources and materials considered. Guidance Agents facilitate directly the activities of Authorised Persons in servicing their clients, as distinct from other service providers that provide purely ancillary services, such as IT, facilities management etc. to an Authorised Person. …