DIFC to open PC regime to all applicants as ADGM tightens AML + crypto rules

The UAE’s two financial hubs are making key regulatory changes that could attract new types of firms at a time when capital flight is a major concern as the country’s “safe haven” image is shaken in the wake of the Iran war.

Up first: DIFC is looking to open up its prescribed company (PC) regime to a wider pool of users, proposing in a new consultation paper (pdf) to scrap remaining eligibility restrictions and allow any applicant to set up a PC, according to a statement. The consultation is open for feedback until 2 June.

PC? The DIFC-specific structure is a low-cost and more lightly regulated type of holding company that can operate within the DIFC. Think of it as DIFC’s answer to the classic offshore SPV (like those in the Cayman Islands or BVI), but designed to keep activity anchored in the region. They are typically used to hold assets rather than run active businesses. They come with reduced fees, minimal operational requirements, and no need for employees or physical presence.

DIFC would be opening up to more people: The proposal removes qualifying requirements tied to ownership, purpose, or geographic nexus. Currently, you need to demonstrate a qualifying purpose (like a structured financing) or a nexus to DIFC (like being a GCC citizen or being controlled by a DIFC-registered entity). That’s changing, making a PC globally accessible.

What everyone would need to do, though: Most PCs would need to appoint a DFSA-regulated corporate service provider (CSP) to handle filings, maintain records, and act as the main compliance interface with the registrar. This adds a mandatory layer of cost and oversight for non-exempt entities.

The catch for existing players: PCs that don’t meet exemption criteria would have six months to appoint a CSP or face fines of up to USD 20k and potential loss of PC status, meaning conversion into a fully licensed DIFC entity with higher fees and office requirements.

The amendments would be a major boost for DIFC. They position the financial hub as a regional alternative to popular offshore jurisdictions, but with a regulated, tax-transparent framework. The move would streamline wealth and investment management for high-net-worth individuals and family offices at a time when the Iran war has threatened the UAE’s “safe haven” image, which had attracted many in recent years.

ADGM, meanwhile, is tightening its crypto and AML frameworks

ADGM is pushing ahead on crypto rulemaking: The FSRA has finalized a regulatory framework for the staking of virtual assets, according to a statement. The changes build on its 2025 consultation, which had set out the basic perimeter-limiting regulation for firms staking client assets, but tighten and expand a few of the rules.

Scope widens: The final rules go beyond the initial proof-of-stake focus to capture other staking models with similar characteristics, ensuring that newer DeFi mechanisms fall within scope.

Other hard rules for staking include:

• Rewards are now restricted to “accepted” virtual assets or fiat-referenced tokens;
• Disclosures setting out key terms including lock-ups, withdrawal mechanics, and risks like slashing, as well as updates on performance, including rewards earned, losses from slashing, uptime levels, fees, and when assets can be unstaked, are now mandatory;
• Firms now must assess track records in areas like downtime, withdrawal delays, and the ability to recover assets in stressed scenarios.

The FSRA has also clarified that a crypto firm engaged in staking would not be classified as a fund manager, effectively easing their compliance and avoiding a second layer of fund regulation for crypto players.

Why this matters: The FSRA is effectively de-risking staking for institutional players who have historically stayed on the sidelines due to “grey zone” legalities. It also makes ADGM one of very few jurisdictions with an explicit crypto staking framework,

AND IN THE WORKS- ADGM’s Financial Services Regulatory Authority (FSRA) is moving to tighten its anti-money laundering framework, it said in a statement. The authority launched a consultation (pdf) on rule changes aimed at aligning its regime with updated UAE AML laws and international standards. The consultation is open until 14 May, with final rules expected shortly after.

The FSRA is introducing more granular rules around virtual asset transfers, including:

• Travel rule compliance for crypto transactions;
• A USD 1k threshold that differentiates domestic and cross-border requirements;
• Separate obligations for originating vs beneficiary institutions;
• Specific due diligence and controls for transfers involving unhosted wallets.

Beyond crypto, the framework also tightens risk controls more broadly. These include mandatory high-risk classifications for foreign “politically exposed” individuals, high-risk jurisdictions, and unhosted wallet exposure, alongside clearer expectations for ongoing customer risk assessments and for when enhanced due diligence is required.

Governance and structure shift: New rules strengthen senior management accountability by requiring oversight of AML systems and allowing senior management to be treated as the ultimate beneficial owner when no natural person is identified. The FSRA is also moving designated non-financial businesses or persons (DNFBP) licensing into its Financial Services and Markets Regulations and creating a framework to delegate supervision to the ADGM Registration Authority.