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DIFC Company SetupLicensing and compliance

Dubai Financial Services Authority

DFSA authorisation, explained by someone who has read the Rulebook

In short

Carrying on a Financial Service in or from the DIFC requires a DFSA Licence. The prudential category follows from your activities and sets base capital, reporting and supervisory intensity. Three to six months is normal. Most applications that take nine months do so because the Compliance Officer was not identified early enough or the business model changed during review.

Prudential categories

Five categories, and the capital each one demands

Base capital is a floor. Every Authorised Firm also holds an expenditure based capital minimum, calculated in weeks of annual audited expenditure, and the higher of the two applies.

CategoryBase capitalExpenditure testTypical firm
Category 1US$10,000,00013 weeksBanks and deposit-taking institutions
Category 2US$2,000,00013 weeksProprietary trading firms and principal dealers
Category 3AUS$500,00018 weeksBrokers and execution-only intermediaries
Category 3BUS$4,000,00018 weeksFund custodians and trustees
Category 3CUS$500,00018 weeks, or 6 weeks where no client assets are heldAsset managers, fund managers and discretionary portfolio managers
Category 3DUS$200,00018 weeksPayment service providers and money transfer businesses
Category 4US$10,0006 weeksCorporate finance advisers, insurance brokers and arrangers
Category 5US$10,000,00013 weeksIslamic financial institutions operating the entire business in accordance with Shari'a
Full category breakdown with permitted activities →

The application

Five stages, and where they actually stall

The regulator is rarely the bottleneck. People and document consistency are.

The process in detail
  1. 1

    Pre-application meeting

    2 to 4 weeks to arrange

    Present the model, confirm the category and surface anything novel before a word is drafted.

  2. 2

    Build the pack

    4 to 8 weeks

    Regulatory Business Plan, compliance and AML manuals, financial model and Authorised Individual applications, written as one consistent set.

  3. 3

    Submission and queries

    8 to 16 weeks

    Two to three rounds of written questions from the case officer. Specific answers close them, restated business plans do not.

  4. 4

    In-principle approval

    4 to 8 weeks

    Fund the capital, complete incorporation, sign the lease, confirm the key people are in place and insured.

  5. 5

    Licence granted

    1 to 2 weeks

    The DFSA issues the Licence and the firm appears on the public register. Regulated activity can begin.

Guides

Everything else the application depends on

The DFSA authorisation processA DFSA application runs through five stages: pre-application engagement, formal submission, written query rounds, in-principle app...Read moreWriting a Regulatory Business PlanThe Regulatory Business Plan is the document the DFSA reads first and returns to throughout. It has to describe what the firm does...Read moreAuthorised Individuals and licensed functionsCertain functions can only be performed by individuals the DFSA has approved by name. The core roles are the Senior Executive Offi...Read moreDFSA capital requirementsAn Authorised Firm must hold the higher of its base capital requirement, set by prudential category, and its expenditure based cap...Read moreInnovation Testing LicenceThe Innovation Testing Licence is a restricted DFSA authorisation that allows a firm to test an innovative financial product or se...Read moreLicence routeThe regulated licence routeWhat a DFSA Licence costs, what it requires and how it sits alongside incorporation.Read moreServiceAuthorisation supportWe write the Regulatory Business Plan, build the compliance framework and run the application.Read more

Planning a DFSA application?

The first conversation settles the category, the capital and whether your Compliance Officer search needs to start this month. It costs nothing.

Talk to usRead the processOr call +971 56 349 8888