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DFSA jumps onto the tokenisation bandwagon by offering an ITL-route to regulation. Existing DFSA-regulated firms are also eligible - will we see real estate crowdfunding platforms ‘crowding' up this space??Personally, we see this as a HUGE opportunity for Crowdfunding platforms and others seeking tokenisation of Real World Assets - get in touch!

You can also read the article here: https://10leaves.ae/publications/difc/difc-artificial-intelligence-and-web-3-0-licenses DIFC is building the world-class Campus spanning over 100,000 sq. ft. within the DIFC jurisdiction. Dubai AI & Web 3.0 Campus' will attract over US$ 300 million in collective funds, 500+ global AI and Web 3.0 start-ups, and create 3000+ jobs by 2028.  The Dubai AI & Web 3.0 Campus will provide world-class physical and digital infrastructure including R&D facilities, accelerator programs and collaborative workspaces, to attract, build and scale AI companies. The DIFC AI and Web 3.0 License is one of the cornerstones of the push towards making the DIFC, and the UAE, a hub of technological innovation and advancement.

Firms interested in managing funds from the ADGM are required to submit applications to the Financial Services Regulatory Authority, or FSRA.  The FSRA has a fast-track process for Fund Manager licenses, which come under Category 3C. The Fund Manager, if approved, can manage domestic professional (Exempt and Qualified Investor Funds) and Foreign Funds in other jurisdictions as well. In case the firm wishes to also engage in discretionary portfolio management services, it has to go through a full-fledged license process.

Did you know that in 2019 alone, criminals moved a whopping $2.8 billion in Bitcoin? Yes, you read that right! Cryptocurrency is now one of the preferred destinations for illicit funds by criminals worldwide. Surprisingly, more than half of this amount was transferred to just two exchange platforms - Binance and Huobi.

Click here to Subscribe now! Relevant links below: https://home.treasury.gov/news/press-releases/jy1391?utm_source=riffle.beehiiv.com&utm_medium=referral&utm_campaign=from-the-international-desk https://resources.hummingbird.co/product-updates-and-news/apps?utm_source=riffle.beehiiv.com&utm_medium=referral&utm_campaign=from-the-international-desk https://www.eba.europa.eu/calendar/consultation-draft-guidelines-amending-risk-based-supervision-guidelines?utm_source=riffle.beehiiv.com&utm_medium=referral&utm_campaign=from-the-international-desk https://www.gov.uk/government/news/changes-to-reporting-material-discrepancies-to-companies-house?utm_source=riffle.beehiiv.com&utm_medium=referral&utm_campaign=from-the-international-desk This episode is also available as a blog post: https://riffle.beehiiv.com/p/international-desk

Click here to Subscribe now! A Fixed Penalty Regime (FPN) is coming. Put very simply, it works as follows: Breach occurs DFSA issues an FPN. Pay the penalty (maximum US$ 50,000) and remedy the breach. If you do 3, DFSA doesn't sanction you. No public censure and no fine. If you don't do 3, DFSA can launch enforcement proceedings (i.e. not good news) Read more here. This episode is also available as a blog post: https://riffle.beehiiv.com/p/lets-talk-penalties

Click here to Subscribe now! The new consultation paper clarifies the DFSA's stance on Payment Accounts for corporate clients, which allows greater flexibility for money service businesses to offer multiple functionalities to their customers, including larger sums held in Payment Accounts, multi-currency virtual IBANs and issuance of pre-paid cards. Read the consultation paper here. And details on the EMI license here. This episode is also available as a blog post: https://riffle.beehiiv.com/p/money

Click here to Subscribe now! What kind of a name is Riffle? Is it Rifle? As in smoking gun? Err, actually that's a great alternative name by the way. But no, it's called Riffle - as in riffling through many pages, turning them over, having a quick look. AHA. So you don't go into detail - a casual look at things.  I wouldn't put it that way. More like giving you a gist of info, rather than a pile that no one cares to read. Nice. And why are we having a convo again? Isn't this serious stuff? Of course! Compliance and AML are mighty serious, and this is why we came out with the Riffle. To give you a channel to ACTUALLY read stuff that matters, rather than…for lack of a better word - riffle through it. And yes, a bit of bionic reading thrown in. You know, the bold bits that actually matter and make you read faster? This episode is also available as a blog post: https://riffle.beehiiv.com/c/about-riffle

This episode is also available as a blog post: https://10leaves.ae/publications/difc/hedge-funds-in-the-difc The DIFC is a leading financial hub in the region. Besides offering a wide range of financial service activities, the centre also provides an integrated environment and world-class standard of living. It is well regarded in the international community as well.   During 2022, a record number of hedge funds registered in the Centre, with more expected to open in 2023. It has been reported that over 60 hedge funds are in DIFC's pipeline.  The global hedge fund sector is still dominated by older, more established centres like London and New York, but the Middle East is a young market where Dubai offers all the necessary circumstances for expansion, especially in the aftermath of the Covid epidemic. Due to the government's successful management of the outbreak and the far less limitations there than in other centers, Dubai had a significant inflow of managers throughout the pandemic. This gave managers the chance to see firsthand the various benefits the emirate provides hedge funds contemplating establishing an office there.

This episode is also available as a blog post: https://10leaves.ae/publications/difc/difc-venture-studio-launchpad-license The DIFC has now announced the launch of the first global “Venture Studio Launchpad” to assist with the growth of the UAE's financial ecosystem, and to be a growth partner and business enabler to venture studios, allowing them to set up and scale from the DIFC. The Proposed Venture Studio Regulations provide the legal and regulatory framework under which venture studios, and similar arrangements, and any “spin-off” entities formed by venture studios, can establish and operate in the DIFC. This initiative complements the existing DIFC Venture Fund Manager Framework, and the DIFC Innovation licenseinitiatives, which together will serve to make the DIFC the leading destination for both innovators and their funding partners.

This episode is also available as a blog post: https://10leaves.ae/publications/difc/difc-venture-studio-framework Last year, the DIFC announced the launch of the first global “Venture Studio Launchpad” to assist with the growth of the UAE's financial ecosystem, and to be a growth partner and business enabler to venture studios, allowing them to set up and scale from the DIFC. The Proposed Venture Studio Regulations provide the legal and regulatory framework under which venture studios, and similar arrangements, and any “spin-off” entities formed by venture studios, can establish and operate in the DIFC. This initiative complements the existing DIFC Venture Fund Manager Framework, and the DIFC Innovation license initiatives, which together will serve to make the DIFC the leading destination for both innovators and their funding partners. The proposed venture studio model enables venture studios to establish a company in the DIFC that acts as both a holding and operating vehicle (“Venture Studio”), licensed to incubate new business ideas (each a “Venture”) and, if they reach a minimum viable product (“MVP”) stage, to convert the Ventures to newly incorporated Venture Studio entities (each a “Venture Studio Company”).

This episode is part of the 10 Academy training series. Here is a bit about how we at 10 Leaves can help you. We provide turnkey services for getting authorised, and staying authorised. Our GRC team is at hand to help you with ongoing compliances, prudential reporting and risk management. We also assist you with maintaining good corporate governance in the Firm, one aspect that is much overlooked by most firms that we have consulted. In addition to this, we help with accounting and bookkeeping activities and filing of VAT returns on a regular basis. The newly-issued Tax Laws may also be relevant to the Firm and we will assist you in registering with the authorities and creating tax efficiencies for the business. Well, that's it for today. Thank you for listening, and do get in touch with us by writing in to us at connect@10leaves.ae. Do also visit our website at www.10leaves.ae. Do contact us for further details!

Wikipedia defines a holding company as “a company that owns other companies' outstanding stock.” In short, a holding company consolidates investments, be it shares in other companies or property, under a common umbrella, for ease of management and reporting. Such companies do not usually carry out a trade or service – they merely manage existing investments. The management team of the holding company also seeks to make new investments, based on certain pre-determined criteria, to expand their existing portfolios. The ADGM offers both passive and operational holding companies. ADGM SPVs can only act as passive holding companies, and so cannot avail visas or functional office space in the centre. The advantage is that where there is no operational requirement, an ADGM SPV can act as a holding structure for a relatively low cost, and offer flexibility at the same time. What assets can an ADGM SPV hold? The SPV in the ADGM can hold any types of securities, including bonds, listed or unlisted shares in downstream entities, stocks, real estate worldwide, cash and commodities, loans, and intangible assets such as Intellectual Property and Patents.

This episode is part of the 10 Academy training series. Here is a bit about how we at 10 Leaves can help you. We provide turnkey services for getting authorised, and staying authorised. Our GRC team is at hand to help you with ongoing compliances, prudential reporting and risk management. We also assist you with maintaining good corporate governance in the Firm, one aspect that is much overlooked by most firms that we have consulted. In addition to this, we help with accounting and bookkeeping activities and filing of VAT returns on a regular basis. The newly-issued Tax Laws may also be relevant to the Firm and we will assist you in registering with the authorities and creating tax efficiencies for the business. Well, that's it for today. Thank you for listening, and do get in touch with us by writing in to us at connect@10leaves.ae. Do also visit our website at www.10leaves.ae. Do contact us for further details!

This episode is part of the 10 Academy training series. Here is a bit about how we at 10 Leaves can help you. We provide turnkey services for getting authorised, and staying authorised. Our GRC team is at hand to help you with ongoing compliances, prudential reporting and risk management. We also assist you with maintaining good corporate governance in the Firm, one aspect that is much overlooked by most firms that we have consulted. In addition to this, we help with accounting and bookkeeping activities and filing of VAT returns on a regular basis. The newly-issued Tax Laws may also be relevant to the Firm and we will assist you in registering with the authorities and creating tax efficiencies for the business. Well, that's it for today. Thank you for listening, and do get in touch with us by writing in to us at connect@10leaves.ae. Do also visit our website at www.10leaves.ae. Do contact us for further details!

This episode is also available as a blog post: https://10leaves.wordpress.com/2022/07/10/emi-licenses-in-the-difc/ Firms interested in carrying out Money Service activities from the DIFC are required to submit applications to the Dubai Financial Services Authority, or DFSA. The DFSA, for the purposes of authorisation and supervision, categorises money services business activities based on the type of money services being carried out, and the minimum base capital required. The DFSA categorises the range of activities that comprise the Money Services Business into two groups: 1) Arranging and Advising on Money Services and 2) Providing Money Services. Providing Money Services (includes issuing payment instruments, providing money transmission, issuing stored value and providing or operating a payment account).

This episode is also available as a blog post: https://10leaves.ae/publications/difc/credit-funds-in-the-difc What is a credit fund? Credit funds are collective investment funds that use fund property (i.e., investors' money) either to originate, or to purchase, loans, or both. The limited options for borrowing from banks in certain markets have led to the increase in the opportunity for fund managers to provide private credit, through specialize credit funds. Fund managers have been able to obtain access to reliable deal flow directly from targeted market segments, making use of underlying collateral, as well as gaining access to lending transactions with banks and purchasing loan portfolios from banks and other loan originators. What does DFSA consider a Credit Fund? Credit Funds are a specialist class of funds in the DIFC, in which investor's money can be used for the direct purchase of loans or purchase of loan portfolios. To be a Credit Fund, at least 90% of the Fund Property should be used for either loan origination or loan portfolio acquisition. These funds can be Exempt Funds or Qualified Investor Funds, but not Retail Funds. They can be set up as Investment Companies or Limited Partnerships. The Investment Trust structure is not permissible for Credit Funds in the DIFC. Also, such funds would have to be closed-ended, with a maximum tenure of 10 years, and cannot have leverage of more than 10% of the Fund's Net Asset Value.

This episode is also available as a blog post: https://10leaves.ae/publications/blockchain-crypto/registering-and-licensing-defi-and-dapps-in-the-difc How to register a DeFi or DApp project in the DIFC The Middle East has seen a flurry of tech-related activity in the recent years. Tech companies are characterized by rapid ideation followed by implementation at an equally rapid pace. Another commonality is that most tech companies start small, and then ramp up quickly upon securing funding. However, managing costs at the onset is critical, especially in the first year, so as to ensure that the tech startup does not fold before it manages to attract its first round of seed/angel investments. A fledgling tech ecosystem needs good support from all quarters, and here is where the Dubai International Financial Centre has come to play an important part. Recognising the difficulties faced by early-stage technology companies, the DIFC made a lot of changes to create and accommodate a startup ecosystem in its award-winning onshore financial centre. What is the DIFC? The Dubai International Financial Centre, or DIFC, is a leading financial hub in the region for business, fintech, and lifestyle. Setup in 2004, the DIFC has grown to be one of the top 10 onshore financial centres in the world. It brought in a paradigm change in the region, by adopting a Common Law framework, with an independent regulator (DFSA) and an independent English language Common Law judiciary – DIFC Courts. Since then, the DIFC District has matured into more than just a place to work – it is now a lifestyle destination, with retail outlets, cafes and restaurants, art galleries, residential apartments, public green areas and hotels dotting the landscape.

This episode is also available as a blog post: https://10leaves.ae/publications/blockchain-crypto/setting-up-alternate-trading-system-ats-in-the-difc What is an Alternative Trading System? An ATS is a platform that is more loosely regulated than an exchange. It is used to match large orders mainly from institutional clients, and hence work as broker-dealers rather than exchange houses. They are also referred to as Multilateral Trading Facilities in Europe. The DFSA recognizes two types of ATS platforms – Multilateral Trading Facilities that operate on non-discretionary rules, and Organised Trading Facilities that operate on discretionary rules. MTF operators allow for trading of a wide variety of equity and non-equity securities, including shares, warrants, options, derivatives, futures, CFDs, fund units and crypto assets. Contracts between buyers and sellers are formed according to a set of transparent rules that do not discriminate between members or their clients (non-discretionary basis). Can an ATS operator conduct a Security Token Offering (STO)? Security Tokens can be listed and traded on DFSA-regulated exchanges or Alternate Trading Systems, with both facilities being able to host initial token offerings and secondary trading. The current admission criteria will also be applied to such Security Tokens, in a way that tokens trading elsewhere will also be tradable in such facilities. In cases where the ATS is exclusively dedicated to trading only in Security Tokens, it would be labeled a Security Token Market (or Derivative Token Market).

This episode is also available as a blog post: https://10leaves.ae/publications/blockchain-crypto/difc-digital-assets-regime The Dubai Financial Services Authority (DFSA) recently issued a consultation paper on the regulation of Security Tokens in the DIFC. This paper is one of the two consultation papers that will go on to make the base for the DIFC Digital Assets Regime, thus opening the gateway to a whole new world of exciting and cutting-edge fintech applications using the Distributed Ledger Technology (DLT). The DFSA then made the relevant amendments to it's legislation in the end of September, thus creating the framework for the regulation of Security Tokens in the centre. Part 1 of the DIFC Digital Assets Regime covers Security Tokens. Part 2 is expected to cover Utility Tokens, Exchange Tokens and Stablecoins. The DIFC Digital Assets Regime will be of interest to issuers of Security Tokens, Authorised Market Institutions that wish to admit Security Tokens to trading, or performing clearing and settlement services, operators of Alternate Trading Systems such as Multilateral Trading Facilities (MTF) and Organised Trading Facilities (OTF) that wish to trade Security Tokens, providers of Digital Wallets who provide custody and storage services for such tokens, technology providers and in general, any licensed firm that wishes to advise, arrange or manage crypto-assets.

This episode is also available as a blog post: https://10leaves.ae/publications/blockchain-crypto/difc-digital-assets-regime The Dubai Financial Services Authority (DFSA) recently issued a consultation paper on the regulation of Security Tokens in the DIFC. This paper is one of the two consultation papers that will go on to make the base for the DIFC Digital Assets Regime, thus opening the gateway to a whole new world of exciting and cutting-edge fintech applications using the Distributed Ledger Technology (DLT). The DFSA then made the relevant amendments to it's legislation in the end of September, thus creating the framework for the regulation of Security Tokens in the centre. Part 1 of the DIFC Digital Assets Regime covers Security Tokens. Part 2 is expected to cover Utility Tokens, Exchange Tokens and Stablecoins. The DIFC Digital Assets Regime will be of interest to issuers of Security Tokens, Authorised Market Institutions that wish to admit Security Tokens to trading, or performing clearing and settlement services, operators of Alternate Trading Systems such as Multilateral Trading Facilities (MTF) and Organised Trading Facilities (OTF) that wish to trade Security Tokens, providers of Digital Wallets who provide custody and storage services for such tokens, technology providers and in general, any licensed firm that wishes to advise, arrange or manage crypto-assets.

The 10 Leaves Group, one of the region's leading bespoke consultancies, will now accept crypto payments for their blockchain-related services and solutions. With this, 10 Leaves becomes the first consultancy of it's kind in the region to accept cryptocurrency payments, thus opening up their services to a wider audience of pioneers in businesses that work with Distributed Ledger Technology applications. The UAE's recent focus on blockchain, coupled with the exciting announcements of DIFC implementing a Digital Assets Regime and DWTC signing up with Binance, is expected to bring in hundreds of startups that operate in the Defi (decentralised finance), DApps (decentralised applications) and NFT (Non Fungible Token) space. 10 Leaves, through it's technology arm Tenl Technologies, has built up excellent capabilities in these sectors. From fintech advisory, regulatory sandbox consulting to tokenization and legalities of smart contracts, the 10 Leaves Group is poised to advise it's clients on blockchain-related implementations and regulatory licensing across DIFC, ADGM, DWTC, DMCC, Bahrain and Europe (Luxembourg and Lithuania). “Dubai has demonstrated it's vision by focusing on new technologies, and as a consultancy with over 17 years in the business, we aim to complement the leadership's efforts in supporting entrepreneurs and visionaries who will shape our lives in the years and decades to come”, said Rohit Ghai, Founder of 10 Leaves. “Our crypto-related solutions will help startups and established players in this niche space to navigate nascent and complex regulatory requirements, while staying competitive and compliant.” “We aim to build an ecosystem of web3-related stakeholders”, added Soumen Ghosh, who has joined the 10 Leaves Group as Partner-Technology. “This includes everyone from early adopters, to startups, tech providers, investors and regulators…to encourage conversations that will lead to contributing towards making the UAE a hub in the blockchain and crypto space.”

The 10 Leaves Group, one of the region's leading bespoke consultancies, now launches solutions for blockchain and crypto fintechs! Our journey started with regulatory licensing services in 2005, one year after DIFC launched the first financial centre in the region. We built up a strong portfolio of clients in traditional finance, and then moved on to advising fintechs in establishing a base in the region and getting regulated. Today, the 23rdof January, marks a new milestone in our journey. We have become the first consultancy to launch in the metaverse, and with it, bring to the UAE a wide range of blockchain and crypto-related solutions. The UAE's recent focus on blockchain, coupled with the exciting announcements of DIFC implementing a Digital Assets Regime and DWTC signing up with Binance, is expected to bring in hundreds of startups that operate in the Defi (decentralised finance), DApps (decentralised applications) and NFT (Non Fungible Token) space. 10 Leaves, through it's technology arm Tenl Technologies, has built up excellent capabilities in these sectors. From fintech advisory, regulatory sandbox consulting to tokenization and legalities of smart contracts, the 10 Leaves Group is poised to advise it's clients on blockchain-related implementations and regulatory licensing across DIFC, ADGM, DWTC, DMCC, Bahrain and Europe (Luxembourg and Lithuania). The blockchain space is new, and ever evolving. These changing paradigms call for a new look dedicated site. Presenting DCENTRAL.AE. Your resource for all things decentralised. And yes, we are on IPFS as well (if you understand what that is!) – and if you know how to “BRAVE” your way there, do have a look at 10leaves.x. We didn't stop there. Today, 10 Leaves also becomes the first consultancy of it's kind in the region to accept cryptocurrency payments, thus opening up their services to a wider audience of pioneers in businesses that work with Distributed Ledger Technology applications. Dubai has demonstrated it's vision by focusing on new technologies, and as a consultancy with over seventeen years in the business, we aim to complement the leadership's efforts in supporting entrepreneurs and visionaries who will shape our lives in the years and decades to come…Our crypto-related solutions will help startups and established players in this niche space to navigate nascent and complex regulatory requirements, while staying competitive and compliant.

This episode is also available as a blog post: https://10leaves.ae/publications/difc/guide-to-the-difc-asset-manager-license Firms engaging in the activity of ‘Asset Management', can apply to the DFSA for a Cat 3C License. Asset management, in this context, means managing client portfolios on a discretionary basis, under a client mandate. Firms interested in managing client assets from the DIFC are required to submit applications to the Dubai Financial Services Authority, or DFSA. Asset Management activities are discretionary in nature, and can include: Managing Assets Managing Assets means managing on a discretionary basis assets belonging to another Person if the assets include any Investment or rights under a contract of Long-Term Insurance, not being a contract of reinsurance. Arranging Deals in Investments Arranging Deals in Investments means making arrangements with a view to another Person buying, selling, subscribing for or underwriting an Investment (whether that other Person is acting as principal or agent). Advising on Financial Products Advising on Financial Products means giving advice to a Person in his capacity as an investor or potential investor, or in his capacity as agent for an investor or a potential investor, on the merits of his buying, selling, holding, subscribing for or underwriting a particular financial product (whether as principal or agent). Arranging Credit and Advising on Credit Arranging Credit and Advising on Credit means: (a) making arrangements for another Person, whether as principal or agent, to borrow money by way of a Credit Facility; or (b) giving advice to a Person in his capacity as a borrower or potential borrower or as agent for a borrower or potential borrower on the merits of his entering into a particular Credit Facility. The DFSA has a fast-track process for Fund Manager licenses, which also come under Category 3C. The Fund Manager, if approved, can manage domestic (DIFC Public, DIFC Exempt Fund and DIFC Qualified Investor Fund) and Foreign Funds in other jurisdictions as well. In case the firm wishes to also engage in discretionary portfolio management services, it has to go through a full-fledged license process. Firms that wish to engage in non-discretionary investment advice, can opt for a DIFC Investment Advisory License instead. You can read more details here.

The Dubai Financial Services Authority (DFSA) recently issued a consultation paper on the regulation of Security Tokens in the DIFC. This paper is one of the two consultation papers that will go on to make the base for the DIFC Digital Assets Regime, thus opening the gateway to a whole new world of exciting and cutting-edge fintech applications using the Distributed Ledger Technology (DLT). The DFSA then made the relevant amendments to it's legislation in the end of September, thus creating the framework for the regulation of Security Tokens in the centre. Part 1 of the DIFC Digital Assets Regime covers Security Tokens. Part 2 is expected to cover Utility Tokens, Exchange Tokens and Stablecoins. The DIFC Digital Assets Regime will be of interest to issuers of Security Tokens, Authorised Market Institutions that wish to admit Security Tokens to trading, or performing clearing and settlement services, operators of Alternate Trading Systems such as Multilateral Trading Facilities (MTF) and Organised Trading Facilities (OTF) that wish to trade Security Tokens, providers of Digital Wallets who provide custody and storage services for such tokens, technology providers and in general, any licensed firm that wishes to advise, arrange or manage crypto-assets.

This episode is also available as a blog post: https://10leaves.ae/publications/difc/difc-innovation-testing-license-dfsa-innovation-testing-license The Innovation Testing License is a regulatory sandbox offered by the Dubai Financial Services Authority (or DFSA), which is the independent regulator of all financial services companies that seek authorisation or are currently authorised in the DIFC. The objective of the DFSA ITL is to provide a controlled environment where startups can test innovative products and services. The ITL does not eliminate regulation, rather, it provides a gateway to innovative firms, especially startups, to test their products with live clients.

Part4 of 4 Join us for an engaging discussion with Sameer Sortur, Regional Director, Founder Institute and Sathish Jeyakumar, Founder - Veehive.ai. We speak on the Blockchain Trilemma, and how to address the relationship between decentralization, scalability and security while designing blockchain models. You can also watch this episode here. Read up more on DIFC Innovation Licenses, and get in touch to be part of the UAE's premium tech ecosystem. For More Details, Mail us at: connect@10leaves.ae or Call us at: +97142778349 or Visit us at: https://10leaves.ae/ or chat with us!

Part 3 of 4 Join us for an engaging discussion with Sameer Sortur, Regional Director, Founder Institute and Sathish Jeyakumar, Founder - Veehive.ai. We speak on the Blockchain Trilemma, and how to address the relationship between decentralization, scalability and security while designing blockchain models. You can also watch this episode here. Read up more on DIFC Innovation Licenses, and get in touch to be part of the UAE's premium tech ecosystem. For More Details, Mail us at: connect@10leaves.ae or Call us at: +97142778349 or Visit us at: https://10leaves.ae/ or chat with us!

Part 2 of 4 Join us for an engaging discussion with Sameer Sortur, Regional Director, Founder Institute and Sathish Jeyakumar, Founder - Veehive.ai. We speak on the Blockchain Trilemma, and how to address the relationship between decentralization, scalability and security while designing blockchain models. You can also watch this episode here. Read up more on DIFC Innovation Licenses, and get in touch to be part of the UAE's premium tech ecosystem. For More Details, Mail us at: connect@10leaves.ae or Call us at: +97142778349 or Visit us at: https://10leaves.ae/ or chat with us!

Part 1 of 4 Join us for an engaging discussion with Sameer Sortur, Regional Director, Founder Institute and Sathish Jeyakumar, Founder - Veehive.ai. We speak on the Blockchain Trilemma, and how to address the relationship between decentralization, scalability and security while designing blockchain models. Read up more on DIFC Innovation Licenses, and get in touch to be part of the UAE's premium tech ecosystem. For More Details, Mail us at: connect@10leaves.ae or Call us at: +97142778349 or Visit us at: https://10leaves.ae/ or chat with us!

This episode is also available as a blog post: https://10leaves.ae/publications/difc/vc-fund-marketing-and-distribution The UAE has three jurisdictions of consequence, when it comes to marketing and promotion of investment funds. There are two financial free zones – the Dubai International Financial Centre (DIFC), which is regulated by the Dubai Financial Services Authority (DFSA) and the Abu Dhabi Global Market (ADGM), which is regulated by the Financial Services Regulatory Authority (FSRA). The rest of the UAE is considered the mainland and the Securities and Commodities Authority (SCA) is the relevant regulator. Both the DIFC and the ADGM have domestic fund regimes, and so does the SCA. In addition to this, a vast majority of funds distributed in the UAE are foreign funds, mainly Luxembourg and Cayman-registered funds.

This episode is also available as a blog post: https://10leaves.ae/publications/difc/economics-of-a-vc-fund Of course, it is about the money! The economics of venture capital funds differ, based on a variety of factors. The most important one being the expertise and track record of the fund manager, based on the number and quality of the deals that have been closed and exited. It also depends on the overall fee structure of the fund, with factors such as carried interest and catch up, the preferred return of the investors, management fees and other fund-level fees involved, including offsets, and the portfolio company fees paid to the fund manager on a deal-by-deal basis. The investment investment purpose and structure of the fund, and general market dynamics also play a part to a large extent. Although the specific vary, there are some basic elements of the economics of a fund common to all VC funds, including: Investor capital commitments; Allocations of profits and losses of the fund; Applicable distributions; Fees paid to the fund's investment advisors; and Expenses of the fund.

This episode is also available as a blog post: https://10leaves.ae/publications/difc/venture-capital-fund-lifecycle Venture capital funds typically have long tenures, beginning the first closing and running for 8-10 years. Fund managers usually seek pre-determined extension periods (2-3 years for example) to allow them for a smooth exit from all investments. Early termination is also possible, based on certain trigger events. The lifecycle of a venture capital fund comprises: Fundraising. Investment period; and Divestment period.

This episode is also available as a blog post: https://10leaves.ae/publications/difc/vc-fund-structures-in-uae-vc-fund-formation-vehicles C funds are typically structured as closed-end investment vehicles. The fund's prospectus permits it to raise capital commitments during a limited period, that usually ranges from 6 to 18 months. The fund then ‘closes', that is, does not accept any further investor commitments once this period is completed. Normally, the commitments are not funded all at once, but are ‘called' in by the fund manager on an ‘as-needed' basis, so that investments can be made during the ‘investment period'. These are called ‘drawdowns', and typically done in 3-4 tranches. Drawdowns should also accommodate the fees and expenses of the fund. Most funds call for at least 25% of the capital commitments during the time of subscription, with further drawdowns being made in a maximum of 3-4 tranches. In many countries, venture capital funds are formed as Limited Liability Partnerships, with a General Partner managing the investments – akin to a fund manager in an investment company structure. Commonly known as the GP/LP structure, they are advantageous since they are ‘pass-through' entities for tax purposes and not subject to corporate income tax. In these cases, all income, profits and deductions are taxed once at the investor level only. Also, the liability of Limited Partners is limited to their capital commitments and share of the fund's assets.

This episode is also available as a blog post: https://10leaves.ae/publications/difc/private-venture-capital-funds Private funds are collective investment schemes, formed by investment professionals (called fund managers), who seek to raise capital to make multiple investments in a specified industry sector or geographic region. These funds are marketed to qualified or professional investors – mostly High Net Worth Individuals, family offices and institutions. Private funds are essentially “blind pools”. Passive qualified investors make commitments to invest a certain amount of capital over time, as per the fund's commitment schedule, entrusting the fund manager to source, acquire, manage and exit the fund's investments over a set period of time. Some VC funds can also be setup to invest on a “deal-by-deal” basis. In these cases, the Fund Manager solicits investments from a pool of potentials, for each specific deal that they source. Multiple investors can invest in multiple deals, and there can be some deals that have no common investors. Such structures are usually seen in very small VC Funds and can get cumbersome to manage once the number of deals increases.

This episode is also available as a blog post: https://10leaves.ae/publications/difc/vc-fund-formation-in-the-uae-vc-fund-formation-introduction Venture Capital is a relatively new term in the GCC region. While the past five years have seen accelerated progress, generally speaking, access to alternate sources of capital – be it angel, seed, VC or Private Equity, has proved to be more difficult than in more robust ecosystems such as Silicon Valley or Bengaluru. Nevertheless, the region has seen an uptick in the number of deals that are being closed across the spectrum, and many players are now entering the smaller end of the market – the sub-US$ 5 million deals. Taking note of this increased activity, the two financial free zones of the United Arab Emirates – the DIFC and the ADGM, have made carve-outs in their existing regulations to accommodate smaller VC players and give them access to a well-regulated ecosystem, at a lower entry price point. We at 10 Leaves have been excited about these initiatives and have offered competitive advice and legal assistance to startup fund managers who wish to establish a presence in these financial centers.

This episode is also available as a blog post: https://10leaves.ae/publications/difc/difc-compliance-officer-and-work-from-home-considerations The concept of working from home (WFH) is not a new. Prior to the pandemic, nearly 40% of businesses in the United States and Europe offered some sort of remote work schedules to employees. However, these schedules were more an incentive, rather than the norm. Once or twice a month was ok, unlike in the post-pandemic world where some functions have been allowed to work from home permanently. So how does this play out in the United Arab Emirates, especially for financial firms in the DIFC? Does the DFSA have any rules or regulations around work-from-home (WFH)? The short answer is no. While the DFSA does not have any specific rules on work-from-home, financial firms are expected to comply with the DFSA Rules and the internal rules of the firm. Here is where the compliance function takes the lead. Today's technology is advanced enough to enable high-speed audio and video connectivity from anywhere in the UAE. However, a compliance officer must review all WFH arrangements to ensure that the requirements as set in the Compliance Policies and Procedures, as well as Business Continuity, Data Protection and IT and Cyber Security Policies are met and complied with on an ongoing basis. When employees work from home, they are no longer in a corporate controlled environment that is overseen by managers, team leaders, corporate cameras, and area access controls. So, what should A DIFC Compliance Officer keep in mind for WFH workers?

This episode is also available as a blog post: https://10leaves.ae/publications/difc/compliance-support-services-for-difc-authorised-firms What are compliance support services? The Dubai Financial Services Authority (DFSA) is the regulator of DIFC financial service firms. It authorizes and supervises financial entities that conduct activities across five licensed categories. The DFSA mandates three (and in some cases, four) mandatory appointments for all firms that wish to carry out financial services from the DIFC. The Compliance function is one of them. Financial firms in the DIFC must appoint a Compliance Officer and a Money Laundering Reporting Officer (CO/MLRO) at the time of application to the DFSA. These functions are usually combined for smaller firms and so one individual can be proposed as the CO/MLRO. The DFSA expects an application from an individual with sufficient knowledge, experience, and seniority to perform the role effectively. Also, the Compliance Officer is expected to be resident in the UAE once licensed. The Compliance Officer thus forms an integral part of the core team that the DFSA reviews and considers when making a authorisation decision. The DFSA does allow outsourcing of core functions such as Compliance, MLRO and Finance. However, the DFSA does consider the type of financial service, the projected volume of business, additional endorsements (such as endorsements enabling firms to deal with Retail Clients), and the overall team composition before issuing approvals to outsource these functions. For Category 4 firms and Restricted Fund Managers, this should normally be a straightforward process. However, the DFSA does not allow for compliance outsourcing in the case of firms that carry out financial activities with higher risks, such as asset management, brokerage or provision of credit. An in-house resource must be hired in these cases. However, as seen above, in-house compliance functions can have some drawbacks, and here is where compliance support services can help bridge gaps.

This episode is also available as a blog post: https://10leaves.ae/publications/difc/difc-compliance-services-outsourcing-benefits What are the benefits of outsourcing the compliance function? The comparison between in-house and outsourced compliance options follows the same reasoning as for any outsourcing option. Here are some factors that can help you decide. Cost: The cost of hiring a full-time compliance officer in the DIFC can be high, especially for startup financial firms. Salaries range upwards of US$ 8,500 per month for a suitably qualified compliance officer, who has been previously licensed by the DFSA. Other direct costs include medical benefits, DEWS (end-of-service) registrations, and visa costs. Also add to that the costs of recruiting and the delay in joining due to notice periods from previous companies. Outsourcing, on the other hand, entails a fixed and lumpsum monthly fee, that is easy to budget for and manage. These costs increase as the firm grows, and at some point it will become more advantageous to hire someone in-house. In our experience, we have seen this to be at least 2-3 years for firms that clock an above-average rate of growth. Another key factor of consideration is investment in tools that they Compliance Officer requires to discharge his/her duties. Financial services firms must continuously invest in new technologies and infrastructure to address evolving compliance needs. These costs are not borne by the firm in case of outsourcing the function. Availability of talent: One of the main reasons for outsourcing the compliance function in the DIFC is a lack of locally available resources. The supply of compliance specialists is small relative to the demand in the market. Listen to know more!

This episode is also available as a blog post: https://10leaves.ae/publications/difc/outsourcing-compliance-services-in-difc Does the DFSA allow compliance outsourcing? Yes, the DFSA does allow outsourcing of core functions such as Compliance, MLRO and Finance. However, the DFSA does consider the type of financial service, the projected volume of business, additional endorsements (such as endorsements enabling firms to deal with Retail Clients), and the overall team composition before issuing approvals to outsource these functions. For Category 4 firms and Restricted Fund Managers, this should normally be a straightforward process. You can read more about the benefits of compliance outsourcing here. For higher categories, especially for Asset Managers and Brokerage houses, outsourcing may not be an option. In these cases, we recommend that the firm opt for our compliance support services. Do I hire a compliance officer before, or after authorisations? Firms that apply for authorisation to the DFSA have to, at the time of application, identify the individuals that will carry out the Authorised Functions, including Compliance and Money-Laundering Reporting. While these individuals do not have to be employed by the firm yet, it would be unusual for a compliance officer to commit to carrying out the function while being in employment with another firm. In such cases, the compliance officer would usually resign from their current employment, and come on board the new firm once it is authorised. However, in many instances, the authorisation process itself can take 4-6 months or even more. Hence the applicant firm can also request to make the identification of the compliance officer an In-Principle condition. The third, and most-often opted for route is to outsource the compliance function. Here, the compliance outsourcing provider would second a competent (and mostly already authorised) individual to act as the Compliance and Money Laundering Reporting Officer at the time of application itself, thus speeding up the process.

This episode is also available as a blog post: https://10leaves.ae/publications/difc/difc-compliance How important is the compliance function? The Dubai Financial Services Authority (DFSA) is the regulator of DIFC financial service firms. It authorizes and supervises financial entities that conduct activities across five licensed categories. The DFSA mandates three (and in some cases, four) mandatory appointments for all firms that wish to carry out financial services from the DIFC. The Compliance function is one of them. The DIFC is a well-regulated jurisdiction and hence the Compliance function is critical to the authorisation and ongoing operation of all financial firms registered in the centre. The DFSA places a lot of emphasis on Compliance with it's extensive rules and regulations, including Conduct of Business, Prudential, Investment and Data Protection Rules. A licensed firm is expected to develop and maintain a culture of compliance, starting with the senior management and across all employees and stakeholders. The repercussions of non-compliance can be severe, ranging from financial penalties to loss of reputation and even closing of the business. While compliance does not generate revenues for the firm, it forms the cornerstone of a successful financial business. In fact, robust compliance processes can result in increased efficiencies and lead to indirect revenue-generation for the firm. Financial firms in the DIFC must appoint a Compliance Officer and a Money Laundering Reporting Officer (CO/MLRO) at the time of application to the DFSA. These functions are usually combined for smaller firms and so one individual can be proposed as the CO/MLRO. The DFSA expects an application from an individual with sufficient knowledge, experience, and seniority to perform the role effectively. Also, the Compliance Officer is expected to be resident in the UAE once licensed. The Compliance Officer thus forms an integral part of the core team that the DFSA reviews and considers when making a authorisation decision.

Part 5 of 5 Join us for an engaging discussion with Derek Watson from N2 Technology, and Bishr Shiblaq, LLM, CIFD. We speak on being investment-ready and preparing for the due-diligence questions that investors usually ask. Also featured is a panel discussion with Egor Romanyuk, an early-stage investor, in which he speaks about how he decides which startups to invest in. For startups, and VCs, and everything in between! Read up more on DIFC Innovation Licenses, and get in touch to be part of the UAE's premium tech ecosystem. For More Details, Mail us at: connect@10leaves.ae or Call us at: +97142778349 or Visit us at: https://10leaves.ae/ or chat with us!

Part 4 of 5 Join us for an engaging discussion with Derek Watson from N2 Technology, and Bishr Shiblaq, LLM, CIFD. We speak on being investment-ready and preparing for the due-diligence questions that investors usually ask. Also featured is a panel discussion with Egor Romanyuk, an early-stage investor, in which he speaks about how he decides which startups to invest in. For startups, and VCs, and everything in between! Read up more on DIFC Innovation Licenses, and get in touch to be part of the UAE's premium tech ecosystem. For More Details, Mail us at: connect@10leaves.ae or Call us at: +97142778349 or Visit us at: https://10leaves.ae/ or chat with us!

Part 3 of 5 Join us for an engaging discussion with Derek Watson from N2 Technology, and Bishr Shiblaq, LLM, CIFD. We speak on being investment-ready and preparing for the due-diligence questions that investors usually ask. Also featured is a panel discussion with Egor Romanyuk, an early-stage investor, in which he speaks about how he decides which startups to invest in. For startups, and VCs, and everything in between! Read up more on DIFC Innovation Licenses, and get in touch to be part of the UAE's premium tech ecosystem. For More Details, Mail us at: connect@10leaves.ae or Call us at: +97142778349 or Visit us at: https://10leaves.ae/ or chat with us!

Part 2 of 5 Join us for an engaging discussion with Derek Watson from N2 Technology, and Bishr Shiblaq, LLM, CIFD. We speak on being investment-ready and preparing for the due-diligence questions that investors usually ask. Also featured is a panel discussion with Egor Romanyuk, an early-stage investor, in which he speaks about how he decides which startups to invest in. For startups, and VCs, and everything in between! Read up more on DIFC Innovation Licenses, and get in touch to be part of the UAE's premium tech ecosystem. For More Details, Mail us at: connect@10leaves.ae or Call us at: +97142778349 or Visit us at: https://10leaves.ae/ or chat with us!

Part 1 of 5 Join us for an engaging discussion with Derek Watson from N2 Technology, and Bishr Shiblaq, LLM, CIFD. We speak on being investment-ready and preparing for the due-diligence questions that investors usually ask. Also featured is a panel discussion with Egor Romanyuk, an early-stage investor, in which he speaks about how he decides which startups to invest in. For startups, and VCs, and everything in between! Read up more on DIFC Innovation Licenses, and get in touch to be part of the UAE's premium tech ecosystem. For More Details, Mail us at: connect@10leaves.ae or Call us at: +97142778349 or Visit us at: https://10leaves.ae/ or chat with us!

Part 4 of 4 You can also view this episode on You Tube - https://youtu.be/PKSwMsWVzt4 Join me for an engaging discussion with Bishr Shiblaq, LLM, CIFD and Derek Watson from the pioneering N2 Technology on setting up in the DIFC Innovation Hub and being part of an ecosystem that does so much more than just provide a license and a fantastic place to do business... For startups, and VCs, and everything in between! For More Details, Mail us at: connect@10leaves.ae or Call us at: +97142778349 Do also tune in to our podcasts on the DIFC Innovation License and the DIFC VC Fund Manager Regime. Happy listening!

Part 3 of 4 You can also view this episode on You Tube - https://youtu.be/PKSwMsWVzt4 Join me for an engaging discussion with Bishr Shiblaq, LLM, CIFD and Derek Watson from the pioneering N2 Technology on setting up in the DIFC Innovation Hub and being part of an ecosystem that does so much more than just provide a license and a fantastic place to do business... For startups, and VCs, and everything in between! For More Details, Mail us at: connect@10leaves.ae or Call us at: +97142778349 Do also tune in to our podcasts on the DIFC Innovation License and the DIFC VC Fund Manager Regime. Happy listening!

Part 2 of 4 You can also view this episode on You Tube - https://youtu.be/PKSwMsWVzt4 Join me for an engaging discussion with Bishr Shiblaq, LLM, CIFD and Derek Watson from the pioneering N2 Technology on setting up in the DIFC Innovation Hub and being part of an ecosystem that does so much more than just provide a license and a fantastic place to do business... For startups, and VCs, and everything in between! For More Details, Mail us at: connect@10leaves.ae or Call us at: +97142778349 Do also tune in to our podcasts on the DIFC Innovation License and the DIFC VC Fund Manager Regime. Happy listening!

Part 1 of 4 You can also view this episode on You Tube - https://youtu.be/PKSwMsWVzt4 Join me for an engaging discussion with Bishr Shiblaq, LLM, CIFD and Derek Watson from the pioneering N2 Technology on setting up in the DIFC Innovation Hub and being part of an ecosystem that does so much more than just provide a license and a fantastic place to do business... For startups, and VCs, and everything in between! For More Details, Mail us at: connect@10leaves.ae or Call us at: +97142778349 Do also tune in to our podcasts on the DIFC Innovation License and the DIFC VC Fund Manager Regime. Happy listening!

This episode is also available as a blog post: https://10leaves.ae/publications/difc/difc-digital-investment-management-robo-advisory-license The DIFC has provisions for both regulated and non-regulated fintech in the Innovation Hub. While they have issued detailed guidelines on Money Services Businesses, there is no such explicit guidance on Robo Advisory licenses. What are Robo-Advisors? Robo-advisors are a class of financial adviser that provide financial advice or Investment management online with moderate to minimal human intervention. They provide digital financial advice based on mathematical rules or algorithms, and use technology to interact with more tech-savvy clients, as opposed to the traditional method of relationship-based advisory. This technology allows investment managers to provide tailored investment management services to clients in a cost-effective and scalable manner. Why Use a Robo-Advisor? There are many reasons why investors may choose to use robo-advisors as opposed to a traditional portfolio manager or financial advisor including: Low fees and no conflict of interest: Many Digital Investment Managers charge significantly lower fees compared to traditional financial advisors. Conflicts of interest are minimized, since there is no bias or pressure to push a certain set of products or solutions. Low minimum requirements: Most financial advisory firms have higher requirements of initial commitments – usually a minimum in excess of US$ 100,000. Robo advisors have much lower entry requirements (some as low as US$ 1,000) and work on volumes. Availability: Digital Investment Managers are automated and hence available 24/7. Prominent robo-advisory firms include https://www.betterment.com, https://www.personalcapital.com, and https://intelligent.schwab.com. The Dubai Financial Services Authority, or DFSA, reviews applications from firms who wish to carry out financial services from the DIFC. In the absence of explicit guidance, based on our experience with DIFC Robo-advisory applications, the following activities may be applicable, depending on the business model, whether fully-digital, or hybrid. Firms that sell white-labeled technology solutions to wealth managers are not covered since they do not require financial services permissions.