UAE pensions and the end of end-of-service-gratuity
2021 will see the implementation of the merger of two of the regulatory bodies for the financial services sector in the United Arab Emirates – the Central Bank and the Insurance Authority that was announced last month.
We anticipate that the merger will result in a period of accelerated regulatory change with topics such as outsourcing, data protection and continuing professional development requirements for individuals in the sector being high on the regulatory agenda. We also expect to see the new regulator taking a much more proactive approach to enforcement. We will likely see greater use of powers previously granted to the Insurance Authority to audit and inspect insurance sector entities and to issue administrative fines for non-compliance.
It had previously been expected that the Insurance Authority would be merged with the Securities and Commodities Authority, which oversees capital markets, securities and investment activities. It was hoped that this would provide a single regulator dealing with both investment and insurance products and thereby bringing consistency in areas such as the remuneration and conduct of business of advisors. It is to be hoped that there will be greater coordination between the SCA and the Central Bank in 2021 in order to address these types of issues.