Businesses wishing to participate in regulated marketing and promotional activities in the financial services sector must apply for a Category 5 license from the Securities and Commodities Authority (SCA), as the UAE continues to establish itself as a prominent global financial hub. Without offering investing or brokerage services directly, this specialized license is perfect for organizations looking to market or promote international financial products and services to clients in the United Arab Emirates. For instance, you can use your SCA-authorized business to market and advertise the foreign broker's services and then refer local clients to this foreign broker if your group already holds an Australian AFSL authorization, Mauritius Investment Dealer license, Seychelles Securities Dealer license, Cyprus CIF, or a comparable license.
For businesses looking for Category 5 SCA authorization in the United Arab Emirates, Equilex, a regulatory consulting organization, provides comprehensive support. The main features of this license are described here, along with how Equilex can help your company get approved.
#The SCA Category 5 License: What is it?
The SCA Category 5 license is intended exclusively for financial services and product marketing and promotion. This covers lead generation, customer referrals, and advertising for investment businesses, asset managers, and offshore brokers.
Crucially, companies with this license are not permitted to manage portfolios, make trades, or provide investment advice. Rather, they serve as regulated promoters in the financial system of the United Arab Emirates.
#Essential Conditions for Category 5 Permission
#Capital Needs
Base Capital: AED 500,000 plus a capital buffer (using a ratio)
#Incorporation of Local Businesses
Although formation can take place concurrently with the license process, a UAE company is necessary.
#Staffing and Governance
A successful application depends on having a well-organized local staff. The SCA anticipates that businesses would select a skilled and knowledgeable group that includes:
- Senior Executive Officer (SEO or Head of Category): Must be a resident of the United Arab Emirates and possess adequate regulatory experience (at least five years in the financial sector and passing SCA exams).
- Promotions Manager (passed SCA exams and has at least five years of experience in the financial sector)
- Compliance Officer (passed SCA exams and has at least five years of experience in the financial sector)
- Two directors are advised, including at least one non-executive director.
Be ready: there is a shortage of these prospects due to their great demand. Depending on expertise and credentials, you can either move your own employees, hire people who haven't passed the necessary tests and help them through the process, or be prepared to pay salaries ranging from USD 5,000 to USD 10,000+ per month. Finding competent applicants below the USD 5,000 barrier is nearly impossible.
Equilex may assist in locating, evaluating, and onboarding competent local employees who satisfy SCA's competency requirements.
#Timeline for Applications
- Depending on whether you have the key staff or not, the estimated licensing timeline is between six and twelve months.
- This covers preparing the document, submitting it, getting feedback from the SCA, conducting interviews, and getting final approval.
In order to reduce delays and regulatory friction, Equilex makes sure that the process runs smoothly by providing strategic direction at every stage.
#Limitations on Leverage and Activity
- No Limitations on Leverage: Since the company in the UAE does not offer order execution, leverage rules that apply to trading do not apply because the license only covers marketing and promotion.
- Absence of engagement with clients: License holders are not permitted to conduct trades, handle money (accept deposits), or offer investment advice.
For businesses looking to grow their clientele and brand recognition in the Middle East without running a full-fledged financial services company, this makes it a low-risk, high-potential license.
#Who Is Eligible to Apply?
If a company hires the appropriate local staff and exhibits sound financial standing, even those with little regulatory knowledge may be eligible. Even for newcomers to the UAE market, Equilex works with both established organizations and startups to achieve the SCA's licensing requirements.
Note that ultimate beneficial owners must submit a credit report from their home country's credit agency (or another, if relevant) and a non-criminal record. The approval of the application will be heavily influenced by the absence of any negative public entries and a strong credit report.
#Why Work With Equilex?
With a proven track record in providing SCA licensing advice, Equilex provides:
- Evaluations of regulatory viability
- Corporate incorporation and structure
- Solutions for staffing and assistance with local recruiting
- Creating internal policies and business plans
- Continuous compliance and assistance after licensure
SCA Category 5 authorization is now your best option if you're a global broker, asset management, or fintech organization seeking to enter the UAE through an economical and strategic regulatory gateway.
#Are You All Set to Enter the UAE?
To arrange a free consultation and learn how your company may use the SCA Category 5 license to lawfully market and promote financial goods in one of the most active financial markets in the world, get in touch with Equilex right now via contact@canadian-msb.com or WhatsApp +44 7350 387544.