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WorksheetsThe Financial Free Zone Law
Total questions: 25
Worksheet time: 13mins
1. Following is not covered in financial activities in the financial free zone definition under Federal Law No. 8 of 2004:
Insurance and reinsurance
Currency brokerage services
Exports and imports
financial markets
Financial free zones shall not be subject to following laws of the United Arab Emirates:
Civil and commercial federal laws
Criminalisation of money laundering
UAE Vat Added Tax
Economic Substance Regulations
Financial Markets Tribunal was established by :
The Dubai Financial Services Authority (DFSA)
The Dubai International Financial Centre Authority (DIFCA)
Regulatory Appeals Committee
The DFSA board of directors
DIFC courts can hear civil or commercial dispute of any transaction carried outside the DIFC Centre
where the parties expressly agree to submit their dispute to the DIFC court
where the parties disagree to submit their dispute to the DIFC court
if they are financially strong enough and professionally managed by qualified and experienced lawyers
If the relevant DIFC authorities are satisfied that a company meets their entry criteria
Brokers of the UAE stock market may not be licensed to carry out their activities in any financial free zone unless:
They have Approval of DFSA
They have gained prior approval from the Securities and Commodities Authority (SCA).
They are approved by central Bank of UAE
They are approved by CISI
Each financial free zone must publish a report and confirm that the financial free zone has complied with the provisions of the Federal law
Annually
Every six months
Bi annually
Quarterly
The DIFCA is responsible for the laws and regulations that regulate the non-financial activities within the DIFC, excluding
Employment law,
Companies Law
Commercial law and real estate law
Anti Money Laundering Law
DIFC laws are issued by
The Ruler of Dubai
DIFCA
DFSA
ISCA
Offering an activity by way of business excludes:
the firm holding itself out as willing to engage in that activity.
regularly solicits other persons to engage in that activity.
the firm holds itself out as able to engage in that activity.
sale or purchase of a commercial property on adhoc basis.
An exchange house or a clearing house can be operated by:
Representative offices
Authorised market institutions (AMIs)
Collective investment funds
Alternative trading system (ATS)
A deposit is a sum of money paid under the understanding that it will be repaid to the depositor:
Advance or part payment in a contract for sale
Either on demand or at a date agreed
security for undertaking a service
sums of money received by lawyers, accountants or authorised firms licensed to manage investments
Securities does not include the following:
Shares in a company
Warrants
Structured products
Gold
A derivative is generally defined as a security :
whose price is dependent on, or derived from, one or more underlying assets
Units in or shares representing the rights or interest of a unitholder in a fund
a certificate confers rights over existing shares debentures
the right to receive a cash settlement
A futures contract is a derivative instrument which gives the buyer:
the right to buy or sell a security
the right to receive a cash settlement which is based on the value of a pre-agreed underlying instrument
the right to buy a preagreed asset for a set price.
the right to buy or sell investment, currency.
an option is an instrument that confers either one of the following rights to the holder
the right to buy or sell a security
the right to receive a commodity which is based on the value of a pre-agreed underlying instrument
the right to buy a preagreed asset for a set price.
the right to sell investment, currency.
Following is not true about futures:
The transaction is usually settled in cash
The asset is typically not physically delivered.
Futures contracts are not subject to margin requirements
the right to buy or sell any other option
Regulated activity of Providing credit does not excludes:
Providing money services
Trade credit
giving someone a credit facility in their capacity as a borrower
underwriting any investment
A person does not deal in investments as agent if the activity is carried on in the course of providing:
legal or accountancy services and such activity is not separately remunerated.
legal or accountancy services and such activity is separately remunerated.
buying, selling, subscribing for or underwriting an investment
by accepting an instrument that creates financial accommodation
Managing assets excludes the following :
management of another person’s assets on a discretionary basis
any investment or right under a contract of long-term insurance
person formally appointed in writing by the owner of the assets to manage the assets in question
contract of long-term insurance which is not for reinsurance.
A person manages assets if:
he is appointed by a fund manager of a fund to provide the financial service of managing assets to the fund
person formally appointed in writing by the owner of the assets to manage the assets in question.
all day-to-day decisions relating to the investments which are included in those assets are taken by an authorized firm
remains legally accountable to the unitholders of the fund
Advising on financial products or credit excludes:
a statement, opinion or report where the intention is to influence a person in making a decision
to select a particular financial product or an interest in a particular financial product
advice given in publications such as newspapers, journals, or other media
to enter into a particular credit facility;
Managing a collective investment fund excludes:
Fund manager who is legally accountable to the unitholders for fund management.
Person is acting as an agent, employee or delegate of the fund manager.
establishing, operating or winding up a collective investment fund
providing fund administration, the buying and selling of assets
Providing custody excludes:
settling any trades, collecting dividends
safeguarding and administering investments on behalf of others
holding any documents of title
provision of valuations, currency conversions
Operating an exchange, like Dubai International Financial Exchange (DIFX) do not cover following activity:
offers to buy or sell investments are made or accepted
contracts can be entered into for the transfer of ownership
Carrying out insurance contracts as principal
the prices of investments, price movements, and price and size of the most recent trades are displayed and updated.
In the course of providing services, a clearing house does not:
acts on his own behalf or on behalf of only one party to the transaction
becomes the legal counterparty to transactions
becomes the guarantor of the performance of contracts
acts as registrar to a market by recording details of matched trade
