Exchange Business Regulation

1 CBUAE Classification: Public Exchange Business Regulation

2 CONTENTS Page Subject مقدمة 4 Introduction Scope and Objectives 4 واألهداف النطاق المادة )1( تعريفات 5 Definitions) 1 (Article المادة )2( الترخيص 10 Licensing) 2 (Article License Categories and Permitted Activities Article (3) المادة )4( إجراءات الترخيص 16 Procedure Licensing) 4 (Article المادة )5( شروط الترخيص 16 Conditions Licensing) 5 (Article المادة )6( األشكال القانونية المقبولة 17 Forms Legal Acceptable) 6 (Article المادة )7( متطلبات الملكية 17 Requirements Ownership) 7 (Article المدفوع Article (8) Minimum Paid-up Capital 19 المادة )9( الحد األدنى للضمان البنكي 20 Guarantee Bank Minimum) 9 (Article Eligibility to be a Sole Proprietor, Partner or Shareholder Article (10) المادة )11( النسب المالية 23 Ratios Financial) 11 (Article Information Technology (IT) Infrastructure Article (12) Corporate Governance, Management and Oversight Article (13) المادة )14( الموارد البشرية 34 Resources Human) 14 (Article Article (15) Outsourcing of Functions 35 الوظائف تعهيد( 15 )المادة المادة )16( إطار مكافحة االحتيال 35 Framework Fraud-Anti) 16 (Article CBUAE Classification: Public

3 Continuity Business المادة )17( إدارة استمرارية األعمال 35 Management Article (17) Counterfeit Currency Reporting Article (18) Security General المادة )19( المتطلبات األمن ية العامة 36 Requirements Article (19) المادة )20( األموال غير المطالب بها 36 Funds Unclaimed) 20 (Article المادة )21( حماية المستهلك 37 Protection Consumer) 21 (Article Article (22) AML/CFT Compliance 37 الخارجي Article (23) Accounts and External Audit 37 المادة )24( المتطلبات التشغيلية 38 Requirements Operational) 24 (Article المادة )25( اإلقرار السنوي 49 Declaration Annual) 25 (Article Duty to Report to the Central Bank Article (26) المادة )27( التفتيش 52 Examination) 27 (Article المادة )28( صالحيات اإلنفاذ 52 Powers Enforcement) 28 (Article Compliance with Central Bank Regulations and Standards Article (29) the of Interpretation المادة )30( تفسير النظام 52 Regulation Article (30) Previous of Cancellation المادة )31( إلغاء النظام السابق 53 Regulation Article (31) المادة )32( النشر وتاريخ النفاذ 53 Date Effective & Publication) 32 (Article CBUAE Classification: Public

4 تعميم رقم: 2025/7 7/2025 .:No Circular التاريخ: 2025/6/16 16/6/2025 :Date إلى: منشآت أعمال الصرافة Houses Exchange :To الموضوع: نظام أعمال الصرافة Regulation Business Exchange :Subject مقدمــــة Introduction The Central Bank Law requires Exchange Business activities in the UAE to be subject to a licensing regime administered by the Central Bank, and provides the statutory basis for the powers of the Central Bank in relation to the licensing and ongoing supervision of Exchange Business. This Regulation is issued pursuant to the powers vested in the Central Bank under the Central Bank Law. Scope and objectives واألهــــداف النطـــاق Article (65) of the Central Bank Law lists the Licensed Financial Activities that are subject to Central Bank licensing and supervision, which include, inter alia, the provision of Currency Exchange and money transfer services. Accordingly, the scope of this Regulation includes the licensing and the ongoing supervisory and enforcement requirements on a Licensed Person conducting Exchange Business activities in the UAE. Under the framework, the Central Bank is empowered to (a) decide whether a License should be granted; (b) conduct ongoing supervision of Licensed Persons; and (c) conduct examination and impose sanctions and measures on Licensed Persons. Where this Regulation includes a requirement to provide information or to take certain measures, or to address certain items listed at a minimum, the Central Bank may impose requirements, which are additional to the list provided in this Regulation. The Standards shall be legally binding and shall supplement this Regulation elaborating the detailed regulatory obligations and the Central Bank’s supervisory requirements of with respect to Exchange Business. CBUAE Classification: Public

5 المـــادة )1(: تعريفـــــات Definitions :)1 (Article AML Laws: Decree Federal Law No. (20) of 2018 on Anti-Money Laundering and Combating the Financing of Terrorism and Illegal Organizations and Cabinet Decision No. (10) of 2019 Concerning the Implementing Regulation of Decree Federal Law No. (20) of 2018 on Anti-Money Laundering and Combating the Financing of Terrorism and Illegal Organizations, as amended, and any instructions, guidelines and notices issued relating to their implementation. 1.1 Applicant: a Person who fulfils the legal form requirements specified in Article (6) of this Regulation, applying to the Central Bank for the granting of a License for the provision of one or more of the activities of Exchange Business, or for the modification of the scope of a granted License. 1.2 Bank: any juridical person licensed in accordance with the provisions of the Central Bank Law, to primarily carry on the activity of taking deposits, and any other Licensed Financial Activities. 1.3 Banknotes Shipment: the exporting and/or importing of currencies (whether local or foreign including, coins and banknotes of legal tender) to/from foreign financial institutions by establishing business relationships. 1.4 Board of Directors: the board of directors, or board of managers, of the Licensed Person, as the case may be. 1.5 Central Bank: the Central Bank of the United Arab Emirates. 1.6 Central Bank Law: Decretal Federal Law No (14) of 2018 Regarding the Central Bank and Organization of Financial Institutions and Activities, and its amendments. 1.7 CBUAE Classification: Public

6 Chief Executive Officer: the most senior executive appointed by the Board of Directors (or by the owner in the case of a sole establishment). 1.8 Commercial Companies Law: Federal Decree Law No. (32) of 2021 Regarding Commercial Companies. 1.9 Control Rating: the rating awarded to a Licensed Person by the Central Bank based on the findings of an onsite/off-site examination or review. The control rating awarded may be effective/low risk, largely effective/medium risk, partially effective/medium high risk or non￾effective/high risk. 1.10 Currency Exchange: the service of buying and selling of currencies (whether local or foreign including, coins and banknotes of legal tender), from/to natural or Juridical Persons. 1.11 Designated Functions: as defined in the Central Bank’s Fitness and Propriety Regulation. 1.12 Exchange Business: conducting one or more of the following activities as per the relevant Articles of this Regulation: 1.13 1.13.1 Currency Exchange as per Article 1.11 of this Regulation; 1.13.2 Remittances as per Article 1.31 of this Regulation; 1.13.3 Salary Processing through the wages protection system (WPS) as per Article 1.33 of this Regulation; and 1.13.4 Special Products as per Article 1.35 of this Regulation, pre-approved by the Central Bank inclusive of Banknotes Shipment as per Article 1.4 of this Regulation. CBUAE Classification: Public

7 Financial Free Zones: free zones subject to the provisions of Federal Law No (8) of 2004, Regarding Financial Free Zones, as amended. 1.14 FIU: the Financial Information Unit of the United Arab Emirates. 1.15 Hedge Account: an account opened with a regulated financial institution, whether inside or outside the UAE, for hedging foreign exchange positions as part of mitigating the risk of exchange rate fluctuations. 1.16 Instant Money Transfer Service (IMTS) Provider: a money remitting institution licensed and regulated by an appropriate regulator in its home country who will have necessary proprietary software applications and infrastructure to transfer funds instantly from a Person in one country to another Person in the same country or in a foreign country via agent network. 1.17 © Juridical Person: any person that is not a natural Person and has legal personality. 1.18 License: a license issued to an Applicant to carry on one or more Exchange Business activities in the UAE. 1.19 Licensing Department: the Licensing Department at the Central Bank. 1.20 Licensed Financial Activities: the financial activities subject to Central Bank licensing and supervision, which are specified in Article (65) of the Central Bank Law. 1.21 Licensed Financial Institutions: Banks and other financial institutions licensed in accordance with the provisions of the Central Bank Law, to carry on a Licensed Financial Activity or more. 1.22 CBUAE Classification: Public

8 Licensed Person: an Applicant that has been granted a License from the Central Bank to carry on one or more of the activities of Exchange Business. 1.23 Letter of No Objection “LNO”: letter of no objection issued in writing (including in electronic format) by the Central Bank. 1.24 Paid-up Capital: the amount injected by the owner (in the case of a sole establishment), partners or shareholders in compliance with Article 8 of this Regulation. 1.25 Payee: a Person who is the intended recipient of money either in cash or to a Payment Account. 1.26 Payer: a Person who instructs the Licensed Person to transmit money to a Payee. 1.27 Payment Account: an account with a Licensed Financial Institution, including a Stored Value Facility being used for the execution of Remittances. 1.28 Person: a natural or Juridical Person, as the case may be. 1.29 Regulations: any resolution, regulation, circular, rule, standard or notice issued by the Central Bank. 1.30 Remittances: the service of accepting money from a Payer for the purpose of money transmission or receiving money on behalf of or to be made available to a Payee, whether in local or foreign currencies. Remittances include domestic and cross￾border money transfer, whether inward or outward transmission, with or without the use of a Payment Account. 1.31 CBUAE Classification: Public

9 Retail Payment Services: any business activity as set out under the Retail Payment Services and Card Schemes Regulation issued by the Central Bank. 1.32 Salary Processing through WPS: the service of processing and/or disbursing wages/salaries to employees on behalf of employers in the UAE by participating in the WPS in compliance with applicable laws, rules and regulations. 1.33 Senior Management: the executive management of the Licensed Person responsible and accountable to the Board of Directors (or to owner in the case of a sole establishment) for the sound and prudent day-to-day management of the Licensed Person, generally including, but not limited to, the Chief Executive Officer, chief financial officer, chief risk officer, heads of the compliance and internal audit functions, or their equivalents. 1.34 Special Products / Special Product Matrix: the offering of special products/services to customers, whether natural persons or juridical persons, as per the special product matrix issued by the Central Bank, after obtaining specific LNO from the Central Bank for each of these additional products/services. 1.35 Standards: the Standards for the Regulations Regarding Licensing and Monitoring of Exchange Business issued by the Central Bank on 1st March 2018 via Notice No. 35/2018 and any subsequent amendments thereto. 1.36 Stored Value Facility: as defined in the Stored Value Facilities Regulation issued by the Central Bank. 1.37 Subsidiary: an entity (the ‘first entity’) is a subsidiary of another entity (the ‘second entity’) if the second entity: 1.38 CBUAE Classification: Public

10 a. holds a majority of the voting rights in the first entity; b. is a shareholder of the first entity and has the right to appoint or remove a majority of the board of directors or managers of the first entity; c. is a shareholder of the first entity and controls alone, pursuant to an agreement with other shareholders, a majority of the voting rights in the first entity; Or; d. if the first entity is a subsidiary of another entity which is itself a subsidiary of the second entity. Unclaimed Funds: any funds handed over to a Licensed Person for onward delivery to a specific beneficiary, and which remain undelivered and the rightful owner of such funds cannot be contacted within a period of one year. 1.39 المـــادة )2(: الترخيــــص Licensing :)2 (Article In accordance with Article 65(1)(d) and (f) of the Central Bank Law, Exchange Business is a Licensed Financial Activity and is subject to the Central Bank’s licensing and supervision in accordance with the provisions of the Central Bank Law. 2.1 No Person may carry on or engage in Exchange Business in the UAE unless such Person is licensed by the Central Bank in accordance with the Central Bank Law and this Regulation and the Standards including any subsequent amendments thereto. 2.2 Banks licensed in accordance with the Central Bank Law are deemed licensed to engage in Exchange Business. The Central Bank in its sole discretion may deem additional entities or category of entities 2.3 CBUAE Classification: Public

11 licensed under this Regulation, provided that such entities comply with the requirements of this Regulation. A Person is deemed licensed by the Central Bank by virtue of the fact that they already hold a Central Bank license which, of its nature, is acceptable to the Central Bank, under which to conduct Exchange Business. Article (3): License Categories and Permitted Activities A Person that intends to carry on or engage in Exchange Business, must apply for one of the following categories of License: 3.1 1-1-3 ترخيص الفئة 1؛ ;License I Category 3.1.1 2-1-3 ترخيص الفئة 2؛ ;License II Category 3.1.2 3.1.3 Category III License; and ؛3 الفئة ترخيص 3-1-3 3.1.4 Category IV License. .4 الفئة ترخيص 4-1-3 Category I: An Applicant must apply for a Category I License where it intends to carry on or engage in the following Exchange Business activity(ies): 3.2 1-2-3 صرف العمالت ؛ ;Exchange Currency 3.2.1 2-2-3 التحويالت ؛ and; Remittances 3.2.2 3.2.3 Salary Processing through WPS, subject to obtaining separate LNO from the Central Bank prior to launching WPS payroll cards. Category II: An Applicant must apply for a Category II License where it intends to carry on or engage in the following Exchange Business activity(ies): 3.3 1-3-3 صرف العمالت ؛ and; Exchange Currency 3.3.1 2-3-3 والتحــويالت . .Remittances 3.3.2 CBUAE Classification: Public

12 Category III: An Applicant must apply for a Category III License where it intends to carry on or engage in the following Exchange Business activity: 3.4 1-4-3 صرف العمالت . .Exchange Currency 3.4.1 Category IV: An Applicant must apply for a Category IV License where it intends to carry on or engage in the following Exchange Business activity via digital channels acceptable to the Central Bank, such as mobile and/or web applications, without opening any physical service outlets: 3.5 3.5.1 Remittances via digital channels acceptable to the Central Bank. A Category IV License does not permit the Licensed Person to undertake any cash-in or cash-out activity, and can only convert currencies as part of the digital Remittance process. 3.6 The Central Bank may, at its sole discretion, issue LNOs to Retail Payment Services providers and Stored Value Facilities to conduct the activity in Article 3.5 of this Regulation on the condition that they comply with the requirements of this Regulation and subject to the capital and bank guarantee requirements herein. 3.7 Upon obtaining a Category I or II License, the Licensed Person at any point in time may apply for an LNO to offer the Special Products as per Article 1.35 of this Regulation noting the following: 3.8 3.8.1. The Licensed Person may separately apply for an LNO for each Special Product forming part of the Special Product Matrix issued by the Central Bank. CBUAE Classification: Public

13 3.8.2. A Licensed Person, possessing a Category I or II License, is only permitted to engage in Banknotes Shipment as per Article 1.4 of this Regulation subject to the following: (a) Separate LNO from the Central Bank must be obtained prior to entering into each of the Banknotes Shipment arrangement with foreign financial institutions; and (b) The Licensed Person must comply with the conditions regarding the higher Paid-up Capital and higher bank guarantee favouring the Central Bank (or higher amount of unconditional and irrevocable cash deposit as per Article 9.6 of this Regulation) as stipulated in the Special Product Matrix and/or the Standards. 3.8.3. Offering of Remittances and Special Products via digital channels acceptable to the Central Bank, such as mobile and/or web applications, by Licensed Persons possessing Category I or II License will be subject to fulfilling the conditions regarding the higher Paid-up Capital and higher bank guarantee favouring the Central Bank (or higher amount of unconditional and irrevocable cash deposit as per Article 9.6 of this Regulation) as stipulated in the Special Product Matrix and/or the Standards. The Licensed Person, possessing a Category I or II License, may apply for an LNO from the Central Bank at any time to be deemed licensed to offer to its customers Retail Payment Service(s) as per Article 1.32 of this Regulation and/or Stored Value Facilities as per Article 1.37 of this Regulation, subject to the conditions forming part of such LNO and 3.9 CBUAE Classification: Public

14 compliance with the requirements of the Retail Payment Services and Card Schemes Regulation as amended, and/or the Stored Value Facilities Regulation as amended, issued by the Central Bank. The Central Bank reserves the right to require any Licensed Person possessing a Category III License to upgrade its License to any of the other licensing categories under this Regulation and fulfil the applicable licensing conditions, inclusive of conditions regarding Paid-up Capital and bank guarantee favouring the Central Bank, within a specific period of time decided by the Central Bank. 3.10 Failure of a Category III Licensed Person to upgrade the License, as per the instruction of the Central Bank within the given grace period as per Article 3.10 of this Regulation shall result in the cancellation of the License granted by the Central Bank. 3.11 A Licensed Person must continuously provide to its customers all Exchange Business services that are within the scope of the License granted to the Licensed Person by the Central Bank. 3.12 The Licensed Person must, at all times, conduct its business strictly within the scope of the License granted by the Central Bank complying with all requirements of this Regulation and the Standards. 3.13 14-3 تسجيل مزودي خدمات التحويل الفوري لألموال Providers IMTS of Registration 3.14 3.14.1. IMTS Providers that wish to enter into an arrangement with a Licensed Person must first be registered with the Central Bank. The Central Bank will maintain a register for IMTS Providers. As a condition for registration, the IMTS provider must CBUAE Classification: Public

15 agree to be subject to the Central Bank’s examination and regulatory reporting, as deemed necessary, with respect to their IMTS activities with Licensed Persons. 3.14.2. IMTS Providers are accountable for any failure to report or for reporting false, misleading or inaccurate information/ data/ statistics/ records/ returns and supporting documents to the Central Bank. The Central Bank may withdraw the IMTS Providers registration in such cases. 3.14.3. IMTS Providers must comply with the AML Laws and Regulations and any other Regulations instructed by the Central Bank with respect to their business activities conducted within the UAE. 3.14.4. A Licensed Person that wishes to enter into an arrangement with an IMTS Provider must first obtain an LNO from the Central Bank. The Licensed Person must ensure that contracts with IMTS Providers include the legal right for the Central Bank to carry out supervisory examination on/off premises as necessary, obtain information and receive regular reporting with respect to the IMTS Provider’s business activities in the UAE. CBUAE Classification: Public

16 المــادة )4(: إجراءات الترخيص Procedure Licensing :)4 (Article Licensing is subject to the procedure contained in the Central Bank’s licensing guidelines. 4.1 The Applicant should meet with the Licensing Department before submitting a formal application. 4.2 المــادة )5(: شـــروط الترخيص Conditions Licensing :)5 (Article To be granted a License, an Applicant must, at the time of applying: 5.1 5.1.1 fulfil the legal form requirements specified in Article 6 of this Regulation; 5.1.2 fulfil the ownership requirements specified in Article 7 of this Regulation; 5.1.3 demonstrate that it will satisfy the respective initial Paid-up Capital and bank guarantee requirements for the license category applied for, specified in Articles 8 and 9 of this Regulation; and, 5.1.4 provide the duly completed application form, necessary supporting documents, undertaking letters committing to comply with the requirements of this Regulation including the Standards and information specified in the application form as provided by the Licensing Department. The Applicant must satisfy the eligibility criteria at the time of applying as per Article 10 of this Regulation. 5.2 CBUAE Classification: Public

17 المادة )6(: األشكال القانونية المقبولة Forms Legal Acceptable :)6 (Article The legal form of an Applicant and/or a Licensed Person must be acceptable to the Central Bank and may include (subject to Article 6.2) one of the following types, provided that Applicant and/or Licensed Person is incorporated in the UAE excluding in the Financial Free Zones: 6.1 1-1-6 م نشأة فردية؛ ;establishment Sole 6.1.1 6.1.2 Partnership company; شراكة؛ 2-1-6 3-1-6 شركة ذات مسؤولية محدودة؛ أو or; company liability Limited 6.1.3 6.1.4 Any other legal form, defined in the Commercial Companies Law, acceptable to the Central Bank. A Category IV License Applicant or Licensed Person must, at all times, be a limited liability company. 6.2 The acceptability of the legal form of an Applicant or Licensed Person where one or more of the partners is a Juridical Person with limited liability, will be decided by the Central Bank at its sole discretion. 6.3 The Licensed Person must not alter its legal form/legal status without obtaining an LNO from the Central Bank. 6.4 المادة )7(: متطلبات الملكية Requirements Ownership :)7 (Article A Licensed Person whose legal form is a sole establishment (or sole proprietorship) must always be fully (100%) owned by a UAE National who is a natural Person satisfying the eligibility criteria in accordance with Article 10 of this Regulation. 7.1 The ownership (or ultimate ownership) of partners or shareholders, who are non-UAE Nationals, must not exceed forty percent (40%) where the legal form is a partnership, limited liability company or any other legal 7.2 CBUAE Classification: Public

18 form acceptable to the Central Bank other than a sole establishment with an exception under Article 7.3 of this Regulation. In the case of Category IV License, the Central Bank may disapply, at its sole discretion, Article 7.2 of this Regulation and permit full (100%) ownership by non-UAE Nationals, where it deems appropriate. 7.3 In case the ownership of UAE National(s) is held through any intermediate and/or holding companies, such intermediate and/or holding companies must not be incorporated in a foreign jurisdiction or Financial Free Zone, unless the Licensed Person, and intermediate and holding companies that are incorporated in a Financial Free Zone, are 100% owned by the same UAE National(s). In all cases, intermediate and/or holding companies must not conduct any business other than investing in similar businesses. 7.4 Ownership by non-UAE Nationals, as per Article 7.2 of this Regulation, must be held directly by those who are natural persons or via intermediate and/or holding companies. However, such intermediate and holding companies must not conduct any business other than investing in similar businesses. 7.5 Where the non-UAE or local ownership held via intermediate and/or holding companies, the full ownership structure must be provided to the Central Bank. In all cases, the ultimate ownership by the UAE National(s) must not fall below 60% at any point in time with an exception under Article 7.3 of this Regulation. 7.6 It is not permitted for the Licensed Person, its owner (in the case of a sole establishment) or any of its partner(s)/ shareholder(s) to use 7.7 CBUAE Classification: Public

19 any type of legal or trustee arrangement, other than an arrangement for the actual transfer of ownership after obtaining an LNO from the Central Bank, to directly or indirectly transfer the ownership (or ultimate ownership) and control to any other party. The Licensed Person must not alter its ownership, including the ultimate beneficial owner and ownership structure, without obtaining an LNO from the Central Bank. 7.8 Additional ownership requirements, including, but not limited to, increasing the minimum ownership by the UAE National(s), may be imposed by the Central Bank, at its sole discretion, and notified to the Licensed Person. 7.9 المادة )8(: الحد األدنى من رأس المال المدفوع Capital up-Paid Minimum :)8 (Article The Applicant, upon being granted an in￾principle approval from the Central Bank to carry on or engage in Exchange Business, must inject Paid-up Capital as below, in case the legal form is either a sole establishment or a partnership, prior to receiving the final License from the Central Bank to commence business: 8.1 8.1.1 AED ten (10) million for Category I License; 8.1.2 AED five (5) million for Category II License; and 8.1.3 AED two (2) million for Category III .3 الفئة لرخصة إماراتي درهم ومليوني 3-1-8 License. Regardless of the licensing category applied for, an Applicant whose legal form is a limited liability company or any other legal form where the financial liability of all shareholders/ partners is limited to the Paid￾up Capital of the respective shareholders/ partners as per the relevant UAE law, must inject a minimum Paid-up Capital of AED twenty five (25) million, upon being granted an in-principle approval from the Central 8.2 CBUAE Classification: Public

20 Bank to carry on or engage in Exchange Business and prior to receiving the final License from the Central Bank to commence business. This requirement applies to all Category IV License applications. Additional capital requirements may be imposed by the Central Bank, at its sole discretion and notified to the Licensed Person, in consideration of factors including, but not limited to, the risk, size and/or complexity associated with the activities conducted by the Exchange Business. 8.3 The Licensed Person must not alter its Paid￾up Capital, whether increase or decrease, without obtaining an LNO from the Central Bank. 8.4 Upon commencing the Exchange Business, after receiving the final License from the Central Bank, the Licensed Person must comply with the Paid-up Capital requirements as provided in this Regulation on an ongoing basis, and must increase the Paid-up Capital only after obtaining an LNO from the Central Bank in order to comply with the provisions of Article 11 of this Regulation. 8.5 The Applicant or Licensed Person, when demanded, must provide the Central Bank with the full information and supporting documents which are required to evidence the source(s) of funds for the Paid-up Capital or additional Paid-up Capital injected as per the requirement of this Regulation. 8.6 المادة )9(: الحد األدنى للضمان البنكي Guarantee Bank Minimum :)9 (Article The Applicant, upon being granted in￾principle approval from Central Bank to carry on Exchange Business, must provide a bank guarantee favouring the Central Bank as below, in case the legal form is either a sole establishment or a partnership, prior to 9.1 CBUAE Classification: Public

21 receiving the final License from the Central Bank to commence Exchange Business: 9.1.1 AED ten (10) million for Category I License; 9.1.2 AED five (5) million for Category II License; and 9.1.3 AED two (2) million for Category III .3 الفئة لرخصة إماراتي درهم ومليوني 3-1-9 License. Upon being granted an in-principle approval from the Central Bank to carry on or engage in Exchange Business and prior to receiving the final License from the Central Bank to commence business, the Applicant whose legal form is a limited liability company or any other legal form where the financial liability of all shareholders/ partners is limited to the Paid-up Capital of the respective shareholders/ partners as per the relevant UAE law, must provide a bank guarantee of AED fifty (50) million for a Category I, II or III License, or AED twenty￾five (25) million for a Category IV License, favouring the Central Bank. 9.2 The value of the bank guarantee, upon commencing the business operations of the Licensed Person, must not be less than the higher of the following in compliance with the requirements of the Standards: 9.3 a) The minimum value of the bank guarantee required for each category of license as per Articles 9.1 and 9.2 of this Regulation; or b) 5% of the average monthly inward and outward remittance value for the six months period calculated as at 30th June and 31st December of every financial year. The bank guarantee must be issued on behalf of the Licensed Person by a Bank licensed by the Central Bank in the prescribed format 9.4 CBUAE Classification: Public

22 favouring the Central Bank with an auto renewal clause incorporated into it. The bank guarantee must be unconditional and irrevocable and be payable to the Central Bank upon the first written demand without the right of objection from the Licensed Person or any other Person. 9.5 In case of any difficulties to obtain a bank guarantee from any Bank licensed by the Central Bank, the Applicant or Licensed Person must provide an unconditional and irrevocable interest-/profit-free cash deposit equivalent to the bank guarantee in a designated account to be held with the Central Bank. 9.6 Where cash is deposited with the Central Bank in lieu of a bank guarantee as per Article 9.6 of this Regulation, the Applicant or Licensed Person must provide a confirmation letter attested by a notary public in the UAE permitting the Central Bank to utilise such cash deposit unconditionally for the purpose of settling Licensed Person’s customer obligations and other liabilities at the sole discretion of the Central Bank at any point in time notwithstanding any objections from the Licensed Person or any other party. 9.7 The Applicant or Licensed Person, when demanded, must provide the Central Bank with the full information and documents which are required to evidence the source(s) of funds held as collateral security with the Bank for obtaining the bank guarantee and/or cash deposited with the Central Bank in lieu of bank guarantee as per Article 9.6 of this Regulation. 9.8 Upon receiving the final approval from the Central Bank and commencing the Exchange Business, the Licensed Person must comply with the bank guarantee requirements of this Regulation and the Standards on an ongoing basis. 9.9 CBUAE Classification: Public

23 The bank guarantee, or cash deposited at the Central Bank in lieu of a bank guarantee, as required under this Regulation, are in addition to the minimum Paid-up Capital requirements. Paid-up Capital must not be used for obtaining bank guarantee or for providing cash deposit at the Central Bank in lieu of a bank guarantee. 9.10 المادة )10(: أهلية المالك ال فردي أو الشريك أو المساهم ,Proprietor Sole a be to Eligibility :)10 (Article Partner or Shareholder In considering the fitness and propriety of the owner (in the case of a sole establishment), shareholder, partner, ultimate beneficial owner or similar of a Licensed Person, the Central Bank will consider factors including, among others, the integrity, willingness to uphold professional ethics and industry good practices, and competence of the person concerned. المادة )11(: النسب المالية Ratios Financial :)11 (Article -11 1 نسبة رأس المال المدفوع إلى حقوق الملكية Ratio Equity to Capital up-Paid 11.1 11.1.1 The ratio between the minimum Paid-up Capital and equity of the Licensed Person, at any point in time, must not be less than the ratio stipulated by the Central Bank from time to time. 11.1.2 Where the minimum Paid-up Capital to equity ratio falls below the ratio stipulated by the Central Bank, the Licensed Person must increase its Paid-up Capital to bring this ratio to the required level after obtaining an LNO from the Central Bank. 11.1.3 Any application for an LNO to inject additional Paid-up Capital, as per Article 11.1.2, must be submitted to the Central Bank CBUAE Classification: Public

24 within fifteen (15) calendar days from the date when this ratio falls below the stipulated level and the Licensed Person must inject such additional Paid-up Capital within a period of fifteen (15) calendar days from the date of receiving the required LNO. 11.1.4 The Licensed Person must consider all circumstances that may potentially deteriorate its equity during the following twelve (12) months, such as expected operating losses, while computing the amount of additional Paid-up Capital to be injected as per Article 11.1.2. 11.1.5 In the case of a newly established business, the Licensed Person is entitled to a grace period of twelve (12) months from the date of commencement of the business before being required to inject additional Paid-up Capital to comply with the requirements of Article 11.1.2 of this Regulation unless otherwise instructed by the Central Bank. -11 2 نسبة إجمالي األصول إلى رأس المال المدفوع Ratio Capital up-Paid to Assets Total 11.2 11.2.1 The total assets to Paid-up Capital ratio of the Licensed Person, at any point in time, must not exceed the ratio stipulated by the Central Bank from time to time. 11.2.2 Where the Licensed Person has Subsidiaries or other foreign offices, the Licensed Person must also comply with Article 11.2.1 of this Regulation based on the consolidated financial statements. CBUAE Classification: Public

25 11.2.3 The Licensed Person must approach the Central Bank for further instructions and guidance, in order to comply with total assets to Paid￾up Capital ratio, within seven (7) calendar days from the date when this ratio exceeds the maximum stipulated level. 11.2.4 The Licensed Person must comply with the instructions received from the Central Bank as per Article 11.2.3 of this Regulation within the given time limit in order to bring and maintain its total assets to Paid￾up Capital ratio within the stipulated range. -11 3 نسبة إجمالي األصول إلى حقوق الملكية Ratio Equity to Assets Total 11.3 11.3.1 The total assets and equity ratio of the Licensed Person, at any point in time, must not exceed the ratio stipulated by the Central Bank from time to time. 11.3.2 If the Licensed Person has Subsidiaries or other foreign offices, the Licensed Person must also comply with Article 11.3.1 of this Regulation based on the consolidated financial statements. 11.3.3 The Licensed Person must approach the Central Bank for further instructions and guidance, in order to comply with total assets to equity ratio within seven (7) calendar days from the date when this ratio exceeds the maximum stipulated level. CBUAE Classification: Public

26 11.3.4 The Licensed Person must comply with the instructions received from the Central Bank as per Article 11.3.3, within the given time limit in order to bring and maintain the total assets to equity ratio within the stipulated range. -11 4 نسبة السيولة Ratio Liquidity 11.4 11.4.1 The current assets to current liabilities ratio, also known as liquidity ratio, of the Licensed Person must not be less than the ratio stipulated by the Central Bank from time to time. 11.4.2 Where the liquidity ratio falls below the ratio stipulated by the Central Bank, the Licensed Person must increase its Paid-up Capital after obtaining an LNO from the Central Bank in order to bring this ratio to the required level when there are no other appropriate corrective action plans, acceptable to the Central Bank. 11.4.3 Any application for an LNO to inject additional Paid-up Capital, as per Article 11.4.2, must be submitted to the Central Bank within seven (7) calendar days from the date when this ratio falls below the stipulated level and the Licensed Person must inject such additional Paid-up Capital within a period of seven (7) calendar days from the date of receiving the LNO. 11.4.4 The Licensed Person must consider all circumstances that may potentially result in the deterioration of its liquidity ratio during the following twelve (12) months, such as expected operating losses, while computing the CBUAE Classification: Public

27 .2 -4 -11 amount of additional Paid-up Capital to be injected as per Article 11.4.2. -11 5 نسبة الدين إلى حقوق الملكية Ratio Equity to Debt 11.5 11.5.1 The ratio between debts and equity of the Licensed Person, also known as debt-equity ratio, must not exceed the ratio stipulated by the Central Bank from time to time. 11.5.2 The Licensed Person must approach the Central Bank for further instructions and guidance, in order to comply with debt-equity ratio, within seven (7) calendar days from the date when this ratio exceeds the maximum stipulated level. 11.5.3 The Licensed Person must comply with the instructions from the Central Bank as per Article 11.5.2 within the given time limit in order to bring and maintain its debt-equity ratio within the stipulated level. Definitions, mode of computation and ideal values of financial ratios as per Articles 11.1 to 11.5 of this Regulation shall be provided by the Central Bank in the Standards or via separate Regulations and/or amendments to Regulations and/or the Standards, and may vary for different Licensed Persons or License Categories, at the discretion of the Central Bank. 11.6 المادة )12(: البنية التحتية لتقنية المعلومات (IT (Technology Information :)12 (Article Infrastructure The Licensed Person must implement appropriate IT infrastructure in accordance with the Operational Risk Management 12.1 CBUAE Classification: Public

28 Regulation issued by the Central Bank, and any amendments. The Licensed Person must ensure that its software applications and systems have capabilities (integrated or interfaced appropriately) for compliance with AML/CFT Laws, end to end processing of all transactions, financial accounting & reporting, reconciliation, financial management, treasury operations, management accounting & reporting, regulatory reporting, risk management, and other functions that are essential to operate its business efficiently. 12.2 The Licensed Person, whether directly or indirectly, must not implement or maintain any software application, point-of-sale system or books of accounts covertly which are held hidden from the Central Bank, in any manner or form, for processing customers’ transactions to circumvent the legal, regulatory and/or reporting obligations. 12.3 المادة )13(: الحوكمة المؤسسية واإلدارة واإلشراف ,Governance Corporate :)13 (Article Management and Oversight -13 1 المكتب الرئيسي Office Head 13.1 The Licensed Person must have a principal place of business (i.e., head office) where its leadership and full management team (i.e., Chief Executive Officer, heads of all functions, Board of Directors) must be based. -13 2 المكتب اإلداري Office Management 13.2 The Licensed Person, in accordance with the prevailing licensing procedures of the Central Bank, may opt to open a separate office for the management of its business (i.e., a management office other than head office) where its leadership and full management team (i.e. Chief Executive Officer, heads of all functions) must be based. CBUAE Classification: Public

29 -13 3 الهيكل التنظيمي والمناصب اإللزامية Mandatory and Structure Organisational Positions 13.3 13.3.1 A Licensed Person, where the legal form is not sole establishment, must appoint a Board of Directors to oversee its Senior Management (i.e., Chief Executive Officer and heads of functions) whereas sole establishments must comply with Article 13.3.2 of this Regulation. 13.3.2 In the case of a sole establishment, the owner of the Licensed Person must retain the full responsibility of overseeing the Senior Management and must form a management committee consisting of owner, Chief Executive Officer and all heads of functions in order to discuss and decide on critical matters concerning the business, such as corporate strategies including business plans and policies, compliance with applicable Laws and Regulations, external and internal audits, financial performance and accurate book keeping and presentation/reporting of financial information. 13.3.3 The organizational structure of the Licensed Person must be approved by its Board of Directors (or by the owner in the case of sole establishments). 13.3.4 The organisational structure of the Licensed Person must include the mandatory positions that the Central Bank determines in the Standards as amended from time to time. 13.3.5 The Central Bank reserves the right to remove a person appointed by the Licensed Person in a mandatory position or in a Designated Function CBUAE Classification: Public

30 at its sole discretion without communicating any reasons thereof. 13.3.6 The chairman, majority of the members of the Board of Directors, all mandatory positions and heads of functions must be either UAE Nationals or UAE residents and must be based in and available within the UAE. 13.3.7 The Licensed Person must comply with the requirements of the Fitness and Propriety Regulation and standards issued by the Central Bank in relation to the qualifications, experience, fitness and propriety, sending notifications to the Central Bank and/or obtaining LNOs from the Central Bank for relevant roles/positions, in addition to the requirements of the Standards. 13.3.8 The Licensed Person must implement appropriate delegation of authority clearly defining the approval/ decision making authority of various mandatory positions in the management structure for handling various business-related matters whether, financial and non-financial. Such delegation of authority must be defined and implemented at the discretion of the Board of Directors (or the owner in the case of sole establishments) in order to implement an effective governance and internal controls framework. -13 4 مسؤوليات مجلس اإلدارة/لجنة اإلدارة of Board the of Responsibilities Directors/Management Committee 13.4 13.4.1 The Board of Directors, appointed by the partners or shareholders, is responsible for the oversight of all activities of the Licensed Person and CBUAE Classification: Public

31 to monitor the performance of its Senior Management in addition to the following: (a) Forming appropriate corporate strategies including business plans and policies; )ب( تشكيل أطر فعّالة للحوكمة وإدارة المخاطر؛ and governance effective Forming) b( risk management frameworks; (c) Ensuring appropriate compliance program is in place to comply with all applicable Laws and Regulations; (d) Ensuring appropriate oversight programs via appropriate external and internal audits; (e) Reviewing the progress of remedial action plans in relation to the finding of gap analysis, internal audit, independent reviews and Central Bank examinations; and (f) Monitoring the financial performance of the business, book keeping and accurate presentation/ reporting of financial information to the Central Bank. 13.4.2 The Board of Directors must elect a chairman to chair all meetings of the Board of Directors and a vice chairman in order to cover the temporary absence of chairman. 13.4.3 Where the Licensed Person has a non-UAE National shareholder(s), control of the business must remain with the majority shareholders who are UAE Nationals having a minimum of 60% ownership and nomination of members to the Board of Directors must be made accordingly. 13.4.4 In the case of a sole establishment, the management committee formed as per Article 13.3.2 of this Regulation and chaired by the owner, CBUAE Classification: Public

32 must discuss and decide on the critical matters at a minimum concerning the business, such as: (a) Forming appropriate corporate strategies including business plans and policies; )ب( تشكيل أطر فعّالة للحوكمة وإدارة المخاطر؛ and governance effective Forming) b( risk management frameworks; (c) Ensuring appropriate/effective compliance program is in place to comply with all applicable Laws and Regulations, (d) Ensuring appropriate oversight programs via appropriate external and internal audits; (e) Reviewing the progress of remedial action plans in relation to the finding of gap analysis, internal audit, independent reviews and Central Bank examinations; and (f) Monitoring the financial performance of the business, book keeping and accurate presentation/ reporting of financial information to the Central Bank. -13 5 اللجان Committees 13.5 13.5.1 The Licensed Person must constitute at least the following three (3) committees as per any related requirements in the Standards: )أ( لجنة التدقيق؛ ;committee Audit) a( (b) Risk committee; and المخاطر؛ لجنة( ب) (c) Regulatory and financial crime compliance committee. Chief Executive Officer and Designated المحددة والوظائف التنفيذي الرئيس 6 -13 Functions 13.6 13.6.1 The Licensed Person must appoint a natural Person as its Chief Executive Officer reporting to the Board of CBUAE Classification: Public

33 Directors (owner in the case of a sole establishment), and is responsible for the effective management of the Licensed Person and its activities. 13.6.2 The Licensed Person must appoint natural Persons in all mandatory positions and Designated Functions in accordance with the provisions of and requirements of the Fitness and Propriety Regulation and standards, issued by the Central Bank. The role of a Designated Function must at no time be combined with any other function/role and the possibility of any conflict of interest between roles must be eliminated with selective exceptions granted by the Central Bank on a case-by-case basis and as may be set out in the Standards. -13 7 التدقيق الداخلي Audit Internal 13.7 13.7.1 The Licensed Person must establish an appropriate internal audit function reporting directly to the Board of Directors (or to the owner in the case of sole establishments). 13.7.2 All business activities of the Licensed Person, core functions, non-core functions, branches/service outlets, head office, management office (if any), reconciliation process, unreconciled items, Unclaimed Funds, financial ratios, etc. must be covered under the scope of internal audit in addition to AML/CFT and regulatory compliance. -13 8 إدارة المخاطر Management Risk 13.8 13.8.1 The Board of Directors (or the owner in the case of sole establishments) of the Licensed Person must be CBUAE Classification: Public

34 responsible for the establishment of an appropriate risk management function in order to identify, mitigate, monitor and report the range of risks associated with its business subject to the relevant requirements provided for in the Standards. 13.8.2 The risk management function must include policies, procedures, systems and controls in order to identify, register, monitor and report risks, and to ensure that risk exposures are aligned with the Licensed Person’s strategy and business plan. The risk management policy and procedures, requiring periodical review, must be appropriate to the nature, size and complexity of the business and must be approved by its Board of Directors (or by the owner in the case of sole establishments). -13 9 الهيكل اإلداري للمجموعة Structure Management Group 13.9 Where a Licensed Person is part of a group of multiple entities and the group level management is directly or indirectly involved in the management of the Licensed Person, then the group level management structure must fulfil the requirements that the Central Bank may determine in the Standards. المادة )14(: الموارد البشرية Resources Human :)14 (Article The Licensed Person must implement an appropriate human resources management function in order to hire and maintain suitable employees to operate the business. 14.1 The Licensed Person must implement a human resource policy and procedures approved by the Board of Directors (or by the owner in the case of sole establishments) in line with all applicable Laws and Rules of the UAE. The human resource policy and 14.2 CBUAE Classification: Public

35 procedures must cover the minimum requirements as set out in the Standards. The Licensed Person must design and implement relevant and appropriate training programs for all employees in line with the requirements of the Standards . 14.3 Article (15): Outsourcing of Functions الوظائف تعهيد :(15 )المادة Unless granted an LNO by the Central Bank according to the conditions and exceptions provided for in the Standards, the Licensed Person must not outsource any function. 15.1 The Licensed Person must not outsource any permitted activity as per the License granted by the Central Bank to carry on Exchange Business (for example, buying and selling of foreign currencies, acceptance/ disbursement of money transfers, etc.) under any circumstances. 15.2 المادة )16(: إطار مكافحة االحتيال Framework Fraud-Anti :)16 (Article The Chief Executive Officer and the Board of Directors (or the owner in the case of sole establishments) of the Licensed Person are responsible for implementing an appropriate anti￾fraud framework, in accordance with the requirements of the Standards, to prevent, detect, investigate and respond to fraud incidents. المادة )17(: إدارة استمرارية األعمال Management Continuity Business :)17 (Article The Licensed Person must identify, define and analyse all types of risk that may result in a business disruption in order to assess the impact thereof and implement an adequate business continuity management framework that includes an appropriate business continuity plan (BCP), to ensure continuation, timely recovery or in extreme situations orderly scale-down of critical operations in the event of major disruptions caused by different contingent scenarios. 17.1 CBUAE Classification: Public

36 The Licensed Person must conduct testing of its BCP annually at a minimum. The Senior Management and responsible personnel must be part of the annual testing to understand their responsibilities related to business resumption during a disruption. 17.2 المادة )18(: اإلبالغ عن العمالت المزيفة Reporting Currency Counterfeit :)18 (Article The Licensed Person must implement appropriate policies and procedures to detect counterfeit currencies and report such incidents to the competent authorities in accordance with the prevailing UAE laws and the Standards, as amended from time to time. المادة )19(: المتطلبات األمنية العامة Requirements Security General :)19 (Article The Licensed Person must comply with all security requirements in the Standards and those of the police, civil defence or other competent authorities in the respective Emirate where the Exchange Business is conducted. المادة )20(: األموال غير المطالب بها Funds Unclaimed :)20 (Article The Licensed Person must comply with Central Bank’s Dormant Accounts and Unclaimed Funds Regulation, as amended, and implement policies and procedures to assess, document, disclose and monitor unclaimed funds until it is paid to the respective customer(s) or transferred to the Central Bank. 20.1 Policies and procedures related to unclaimed funds must be approved by the Board of Directors (or by the owner in the case of sole establishments) and must define the roles and responsibilities in relation to the management of unclaimed funds. 20.2 CBUAE Classification: Public

37 المادة )21(: حماية المستهلك Protection Consumer :)21 (Article The Licensed Person must comply with the Central Bank’s Consumer Protection Regulation and standards, and implement effective consumer protection policies and procedures. Article (22): AML/CFT Compliance The Licensed Person must comply with AML Laws and Regulations, as amended from time to time, and must have comprehensive and effective internal AML/CFT policies, procedures and controls in place to ensure such compliance. Article (23): Accounts and External Audit الخارجي والتدقيق الحسابات :(23 )المادة The Licensed Person must maintain comprehensive and accurate books of accounts reflecting its financial position at all times. 23.1 The Licensed Person’s books of accounts and other records must be available within the UAE at all times. 23.2 The Licensed Person must appoint an external auditor, in accordance with the requirements of the Standards, after obtaining an LNO from the Central Bank for each financial year to audit its books of accounts and annual financial statements. 23.3 The Licensed Person must submit the draft of the external auditor's report and the financial statements to the Central Bank for an LNO prior to finalizing for publication or issuance, as per the requirements detailed in the Standards. 23.4 The Licensed Person must submit its auditors’ report and financial statements for each financial year (and auditors’ report and consolidated financial statements where the Licensed Person has Subsidiaries inside or 23.5 CBUAE Classification: Public

38 outside the UAE) to the Central Bank in accordance with the requirements of the Standards. Where the Licensed Person is owned, whether fully or otherwise, by a holding company that owns multiple entities, such holding company’s auditors’ report and consolidated financial statements for each financial year must be submitted to the Central Bank in accordance with the requirements of the Standards. 23.6 المادة )24(: المتطلبات التشغيلية Requirements Operational :)24 (Article 24.1 Policies and Procedures واإلجراءات السياسات 1 -24 24.1.1 The Licensed Person must develop and implement appropriate policies and procedures for all aspects of its business such as governance, risk management, oversight, accounting, finance, operations, internal audit, external audit, human resources, anti￾fraud management, counterfeit currency identification/reporting, general/IT security, AML/CFT etc. These policies must be approved by the Board of Directors (or by the owner in the case of sole establishments) whereas the procedures must be approved by the Chief Executive Officer and the heads of relevant functions. 24.1.2 All policies and procedures must be reviewed, updated and approved as per the requirements of the Standards. -24 2 إثقال األصول Encumbrance Asset 24.2 The Licensed Person must not encumber any of its assets (including any cash deposit placed under lien), regardless of the purpose of such encumbrance, without obtaining an LNO from the Central Bank. The Licensed CBUAE Classification: Public

39 Person must not act as a guarantor or a facilitator to any party, natural or juridical, including its owner (in the case of sole establishments), partners or shareholders in order for the other party to avail any credit facility. -24 3 توزيع األرباح Distribution Profit 24.3 24.3.1 The Licensed Person must obtain an LNO from the Central Bank, as per the requirements of the Standards, in order to distribute dividends including the retained earnings pertaining to the previous financial years to the owner (in the case of a sole establishment), partners or shareholders. 24.3.2 The Licensed Person must distribute dividends including retained earnings to partners or shareholders strictly in accordance with the ownership ratio as per the records of the Central Bank, unless exempted by the Central Bank on a case-by-case basis. Borrowing, Lending and Maintaining Current Accounts 24.4 24.4.1 The Licensed Person must, to the extent possible, utilise only its own cash resources or by increasing the Paid-up Capital to fund its operations and expansion of its business. 24.4.2 The Licensed Person must obtain an LNO from the Central Bank before the Licensed Person, its Subsidiary(ies) or any of its holding companies, regardless of the country of incorporation or location, borrows from any party, whether inside or outside the UAE, and such borrowing CBUAE Classification: Public

40 will be subject to conditions of Article 11.5 of this Regulation. 24.4.3 The Licensed Person must not lend money, directly or indirectly in any form, to any party (inclusive of customers, owner (in the case of sole establishments), Board of Directors, partners and shareholders) or maintain current account(s) on their behalf. Acquisition, Merger, Joint Venture, Subsidiaries and Divestment 24.5 24.5.1 The Licensed Person must obtain an LNO from the Central Bank in order to acquire another Licensed Person or any other Person, whether licensed by the Central Bank or otherwise. 24.5.2 The Licensed Person must obtain an LNO from the Central Bank in order to merge or enter into a joint venture with another Licensed Person or any other Person, whether licensed by the Central Bank or otherwise. 24.5.3 The Licensed Person must obtain an LNO from the Central Bank in order to invest in or open Subsidiaries outside or inside the UAE or to open an office of any nature outside the UAE. 24.5.4 The Licensed Person must obtain an LNO from the Central Bank prior to selling (partially or fully), closing or CBUAE Classification: Public

41 winding up the business of a Subsidiary or transferring the Subsidiary’s ownership, partially or fully, to another Person. -24 6 الموقعون المعتمدون Signatories Authorized 24.6 24.6.1 All communications with the Central Bank must be signed either by the owner (in the case of sole establishments) or by a person authorized to do so (i.e., by an authorized signatory) by virtue of a legally valid power of attorney granted (or as per a specific clause in the memorandum of association of the Licensed Person) to sign on behalf of the Licensed Person. The Central Bank will not act on or respond to any correspondence signed by parties other than an authorized signatory of the Licensed Person. 24.6.2 The Licensed Person or its Board of Directors (or the owner in the case of sole establishments) must not grant a power of attorney of any type to any party other than Chief Executive Officer, member of the Board of Directors, member of the Senior Management, partner or a shareholder of the Licensed Person. 24.6.3 The Licensed Person or its Board of Directors (or the owner in the case of sole establishments) must not authorize any party other than a full￾time employee, member of the Board of Directors, owner, partner or a shareholder of the Licensed Person to act as an authorized signatory of its local or foreign bank account. CBUAE Classification: Public

42 24.7 Renting out Exchange Business License الصرافة أعمال رخصة تأجير 7 -24 The Licensed Person must not directly or indirectly rent out or relinquish its License or transfer its control to any other Person for a remuneration or otherwise. -24 8 اتفاقيات إلدارة الشخص المرخص له Agreement Management 24.8 The Licensed Person must not enter into an agreement to manage or to be managed by any other Person or third party. -24 9 اإليصاالت الرسمية Receipts Official 24.9 The Licensed Person must provide official receipts, whether in electronic form or a hard copy, to customers for all transactions, in accordance with the requirements of the Standards. 24.10 Notifications to Customers للعمالء اإلشعارات 10 -24 The Licensed Person must implement necessary systems to notify its customers of the status of various stages of their remittance transactions. -24 11 الحساب الوسيط للتحويالت 2 Account Intermediate Remittances 24.11 24.11.1 The Licensed Person who conducts Remittance business must deposit the funds received from its Remittance customers directly into one or more designated remittance intermediate account(s), opened with Bank(s) licensed by the Central Bank, on a daily basis or, at the latest, before the end of banking hours on the next business day following the day on which the funds were received. CBUAE Classification: Public

43 24.11.2 The Licensed Person must use the funds available in designated remittance intermediate account(s) solely for the purpose of settling the customers’ Remittances with the foreign correspondents (i.e., correspondent banks, exchange houses, financial institutions or IMTS providers) and not for any other purposes. 24.11.3 The Licensed Person must engage an external auditor who must perform an agreed-upon procedures on the remittance intermediate account as set out in the Standards, and any other accounts designated by the Central Bank, and report their findings on a monthly basis to the Board of Directors (or to the owner in the case of sole establishments). Results of such agreed-upon procedures conducted by the external auditor must be kept in the records of the Licensed Person, for review by the Central Bank. -24 12 تغييرات التسعير 2 Changes Pricing 24.12 24.12.1 The Licensed Person may adopt a pricing strategy and increase or decrease fees for services according to the prevailing market conditions provided that any pricing changes are notified to the Central Bank within the timeframes that the Central Bank determines in the Standards. 24.12.2 The Central Bank reserves the right to intervene into the pricing strategy of a Licensed Person inclusive of restricting or prohibiting a decision, temporarily or permanently, to increase or decrease the fees for services offered to customers at any point in time. CBUAE Classification: Public

44 24.12.3 The Licensed Person must not enter into an agreement or an arrangement, whether in writing or any other manner, with other Licensed Persons or with any industry group which restricts or prohibits its right to apply fees or foreign exchange rates at own discretion. -24 13 التسوية بالدرهم اإلماراتي AED in Settlement 24.13 The Licensed Person must settle all transactions in AED taking place within the UAE via appropriate payment systems of the Central Bank. -24 14 أماكن األعمال المعتمدة 2 Premises Licensed 24.14 24.14.1 The Licensed Person must not carry out its Exchange Business activities from any place outside the premises approved by the Central Bank (i.e., head office and other service outlets/branches) . 24.14.2 The Licensed Person must not alter the location of the licensed premises without obtaining an LNO from the Central Bank. 24.15 Renewal of License الترخيص تجديد 15 -24 24.15.1 Application for the renewal of a License issued by the Central Bank must be submitted to the Central Bank in accordance with the requirements of the Standards. 24.15.2 The Central Bank reserves the right to decline the renewal of the License, stating the reasons thereof. CBUAE Classification: Public

45 24.16 Legal Name and Trade Name التجاري واالسم القانوني االسم 16 -24 24.16.1 The legal name and/or trade name must be approved by the Central Bank and must not contain any word(s) that may mislead the customers about the nature of business activities of the Licensed Person. 24.16.2 The Licensed Person must not alter its legal name and/or trade name without obtaining an LNO from the Central Bank. 24.17 Display of Currency Rates and Fees والرسوم العمالت أسعار عرض 17 -24 Rates offered by the Licensed Person with respect to Currency Exchange and Remittances and service fee charged to customers must be displayed in a prominent place of all licensed premises, the Licensed Person’s website and other digital channels in accordance with the requirements of the Standards. 24.18 Commencement of Business األعمال بدء 18 -24 The License issued by the Central Bank to carry out the Exchange Business shall be considered cancelled in case a Licensed Person fails to commence the business, upon receiving such License, before the expiry of the specific deadline set by the Central Bank. 24.19 Temporary Closure of Business لألعمال المؤقت اإلغالق 19 -24 24.19.1 The Licensed Person is permitted to close one, more or all of its licensed premises or offices due to unforeseen events or specific reasons for a period of not more than one (1) month from the date of closure provided that a prior notification has been sent to the Central Bank in accordance with the requirements of the Standards. CBUAE Classification: Public

46 24.19.2 The Licensed Person must obtain an LNO from the Central Bank, in accordance with the requirements of the Standards, to close one, more or all of its licensed premises or offices temporarily for a period exceeding one (1) month. 24.19.3 A License granted to the Licensed Person for conducting Exchange Business shall be considered as cancelled and the business can neither be re-opened nor the respective License can be renewed/re-activated thereafter in case the Licensed Person closes the Exchange Business completely (i.e., all of its licensed premises and offices) for a period exceeding one (1) month without obtaining an LNO from the Central Bank or exceeding the period approved by the Central Bank as per Article 24.19.2 of this Regulation. -24 20 التواصل مع موظفي المصرف المركزي Bank Central with Communication Employees 24.20 The Licensed Person or any other Person, on behalf of the Licensed Person, must not offer gifts (whether in cash or in kind) and entertainments to, nor attempt to inappropriately influence/threaten/bully, employees of the Central Bank in any manner. UAE National Employment Programs or التوطين 21 -24 Emiratization 24.21 The Licensed Person must comply with the strategies and targets set by the Central Bank on UAE National Employment Programs on Emiratization, announced from time to time, and the requirements of the Standards. CBUAE Classification: Public

47 24.22 Products and Services والخدمات المنتجات 22 -24 24.22.1 The Licensed Person must conduct its business strictly within the scope of the License granted by the Central Bank complying with all requirements of this Regulation and the Standards, including the following: a) The Licensed Person must not import and/or export currencies (whether local or foreign, including coins and banknotes of legal tender) from/to any party outside the UAE without obtaining an LNO from the Central Bank for each party separately. Such LNO shall only be issued for a maximum period of three (3) years at the discretion of the Central Bank, the renewal of which shall be based on the Control Rating awarded to the Licensed Person by the Central Bank after an onsite or offsite examination or review; b) Hedge accounts, whether inside or outside the UAE, must only be opened for hedging its foreign exchange positions after obtaining an LNO from the Central Bank; c) The Licensed Person must not establish relationships with financial institutions (local or foreign) and IMTS providers or open a nostro account with a foreign bank for executing remittances, without obtaining an LNO from the Central Bank; CBUAE Classification: Public

48 d) The Licensed Person must not be involved in or assist its customers or any other party for opening bank accounts with local or foreign banks; e) The Licensed Person must not offer any Special Products without obtaining an LNO from the Central Bank; and f) The Central Bank reserves the right to retract any LNO issued by the Central Bank or to alter the conditions therein if any of its conditions are breached or should other concerns arise during an onsite or offsite examination or review conducted by the Central Bank. 24.22.2 The Licensed Person is not permitted to incorporate the following clauses in any of its contracts/agreements for offering products and services, whether it is a contract/agreement to offer Remittance, Banknotes Shipment or other Special Products: a) A clause regarding exclusivity that restricts the right of the Licensed Person to associate with or enter into an agreement with any other party to offer a product or service of similar nature; b) A clause regarding any amount of penalties to be paid by the Licensed Person upon the termination of the contract/agreement although the Licensed Person will remain responsible for settling any outstanding dues/balances in relation to business as usual; and CBUAE Classification: Public

49 c) A clause regarding any blackout period or cooling period whereby the Licensed Person is prohibited from associating with or entering into an agreement with any other party, for a specific period of time, to offer a product or service of similar nature. 24.22.3 A Licensed Person having clauses similar to those stated under Article 24.22.2 (a) to (c) in its existing contracts/agreements must provide the full details to the Central Bank and replace or amend such existing contracts/agreements in order to comply with Article 24.22.2 within a period of six (6) months from the date of issuance of this Regulation. المادة )25(: اإلقرار السنوي Declaration Annual :)25 (Article The Licensed Person must submit an “Annual Declaration” jointly signed by the Chief Executive Officer and the chairman of the Board of Directors (or by the owner in the case of sole establishments) on or before 31st January of every financial year, confirming compliance with the requirements set out in the Standards. Article (26): Duty to Report to the Central Bank المركزي المصرف إلى التقارير رفع وجوب :(26 )المادة The owner (or partners or shareholders as the case may be), members of the Board of Directors, Chief Executive Officer and other heads of functions of the Licensed Person must attend meetings (inclusive of workshops or training) when required by the Central Bank to do so. 26.1 The Licensed Person must implement appropriate governance procedures and controls including periodical quality checks and review by internal audit in order to ensure the timely submission of all 26.2 CBUAE Classification: Public

50 compulsory returns/reports to the Central Bank. Licensed Persons (including those temporarily closed) must submit all periodical compulsory returns/reports (for example Exchange House Return Forms (ERFs) submitted via the Integrated Regulatory Reporting System (IRR system)) through appropriate reporting systems, as directed by the Central Bank from time to time, on or before the reporting deadlines. 26.3 The Licensed Person must, prior to the commencement of its business operations, ensure it has access to, and operationalise, all relevant Central Bank portals, such as remittances reporting system, IRR system, or any other reporting systems introduced by the Central Bank from time to time for the submission of periodical compulsory returns/reports or other applications. 26.4 The Licensed Person must obtain access to, and operationalise, suspicious transaction reporting systems provided by the FIU, such as go-AML system, prior to the commencement of its business operations. 26.5 The Licensed Person must introduce appropriate procedures, systems and tools to enable responses to enquiries, including, but not limited to, ‘Search’ or ‘Search and Freeze’ notices, from the Central Bank or any other competent authority, within the time frame provided in such notices. 26.6 The Licensed Person must provide accurate information, data, statistics (including supporting documents) and any records related to their activities, upon the Central Bank’s request, within the deadlines specified in such requests. 26.7 CBUAE Classification: Public

51 The Licensed Person must immediately inform the Central Bank if it becomes aware that: 26.8 a) The Licensed Person is a party to any litigation whether civil or criminal in nature; and b) The Licensed Person or its owner (or partners or shareholders including holding and intermediate companies as the case may be), members of the Board of Directors, employees or Subsidiaries is/are the subject of an investigation of criminal nature by a local or a foreign investigating agency. Heads of regulatory compliance, financial crime compliance, and/or internal audit functions must promptly report to the Central Bank, any concealed violations of the Central Bank Law, Regulations, instructions and any matter(s) noted during the course of their work that would have a significant impact on the activities or financial position of the Exchange Business (examples of such matters include failure to comply with the licensing criteria or breaches of laws, significant deficiencies and control weaknesses in the Exchange Business’ operations or financial reporting process or other matters that are likely to be of significance to the function of the Central Bank as regulator). Heads of regulatory compliance, financial crime compliance, and/or internal audit functions making such reports in good faith shall not be considered (by the Licensed Person) to have breached any of their contractual confidentiality obligations. 26.9 The Licensed Person and its Senior Management are accountable for any failure to report or for reporting false, misleading or inaccurate information/ data/ statistics/ records/ returns and supporting documents to the Central Bank. 26.10 CBUAE Classification: Public

52 المادة )27(: التفتيش Examination :)27 (Article The Central Bank reserves the right to undertake announced and unannounced onsite or offsite examinations at a Licensed Person at any time as it deems appropriate. المادة )28(: صالحيات اإلنفاذ Powers Enforcement :)28 (Article Violation of any provision of this Regulation and the Standards may subject the Licensed Person to supervisory action, administrative action and/or financial sanctions as deemed appropriate by the Central Bank. 28.1 Without prejudice to the provisions of the Central Bank Law, supervisory action and sanctions by the Central Bank may include withdrawing, replacing or restricting the powers of Senior Management or members of the Board of Directors, providing for the interim management of the Licensed Person, or barring individuals from the UAE financial sector. 28.2 المادة )29(: االمتثال ألنظمة ومعايير المصرف المركزي Bank Central with Compliance :)29 (Article Regulations and Standards If there is any conflict between the provisions of this Regulation and any provisions in the Standards, the provisions of this Regulation shall prevail. 29.1 This Regulation, the Standards and any Regulations issued by the Central Bank regarding Exchange Business activities or that apply to Licensed Persons, including subsequent amendments to all these, are binding on the Licensed Person at all times. 29.2 Article (30): Interpretation of the Regulation النظام تفسير :(30 )المادة The Regulatory Development Department of the Central Bank shall be the reference for interpretation of the provisions of this Regulation. CBUAE Classification: Public

53 Article (31): Cancellation of Previous Regulation السابق النظام إلغاء :(31 )المادة This Regulation repeals and replaces the following Central Bank Regulation and its amendments: .2014 /1 /6 Regulations re Licensing and Monitoring of Exchange Business, via Notice No. 1/2014, dated 6/1/2014. 31.1 المادة )32(: النشر وتاريخ النفاذ Date Effective & Publication :)32 (Article This Regulation shall be published in the Official Gazette in both Arabic and English and shall come into effect upon its publication. 32.1 The Central Bank may, at its sole discretion, and on a case-by-case basis, approve transitional arrangements not exceeding ninety (90) calendar days from the effective date of this Regulation, for entities to come into full compliance with the Regulation. 32.2 Khaled Mohamed Balama Governor of the Central Bank of the UAE CBUAE Classification: Public