The Dubai Financial Services Authority (DFSA) moves to accelerate Islamic Finance Sector Growth in DIFC

​​​​​Dubai, United Arab Emirates: The Dubai Financial Services Authority (DFSA), the independent banking, financial services, and markets regulator of Dubai International Financial Centre (DIFC), today launched a public consultation on proposed enhancements to its Islamic finance regulatory framework. The consultation, which seeks to provide greater clarity on endorsement requirements and disclosure standards, signals a regulatory development that aligns with broader national objectives, including the UAE Strategy for Islamic Finance and Halal Industry and Dubai's Economic Agenda (D33) to strengthen the UAE’s position as a global hub for international Islamic finance. Consultation paper No 172 (CP 172) proposes clearer guidance on when Authorised Persons (Authorised Firms or Authorised Market Institutions) require an endorsement to conduct Islamic financial business, strengthened disclosure requirements for Takaful (the Shari’a-compliant mutual insurance system where members share risk and support each other), and targeted technical amendments to the Islamic Finance Rules (IFR) module of the DFSA Rulebook. The proposals come as the Islamic finance sector continues its development. The UAE is a leading global market for Islamic finance, according to the Islamic Finance Development Indicator (IFDI)[1]. In 2024, it ranked fourth globally by assets and third based on financial performance and supporting ecosystem metrics. DIFC is currently one of the world’s largest global venues for the issuance of Sukuk, with more than USD 100 billion of outstanding Sukuk listings, including in relation to Environmental, Social, and Governance (ESG). Charlotte Robins, Managing Director, Policy & Legal, at the DFSA, said: “As the Islamic finance sector continues its strong growth trajectory within DIFC, the United Arab Emirates, and globally, we want to ensure that our regulatory framework provides the clarity and certainty that firms need to operate confidently within appropriate boundaries. These proposals reflect our ongoing engagement with the industry and our commitment to supporting the development of this strategically important sector.” The DFSA operates as a “Shari'a systems regulator” – not making determinations on the Shari'a aspects of financial products or services, but requiring that Authorised Persons set up systems and controls to support their Islamic financial business and associated risks. Key proposals on CP 172:

• Clarity on Islamic endorsement requirements: The proposes to specify circumstances in which Authorised Persons will be considered to be holding themselves out as conducting Islamic financial business, and therefore requiring an Islamic endorsement. This includes:

• Authorised Persons indicating that they conduct all or part of their business operations in accordance with Shari'a;
• Authorised Persons providing financial services in relation to products presented as Islamic or Shari'a-compliant; and
• Fund managers operating funds held out as Islamic or Shari'a-compliant.

The proposals also clarify that Authorised Persons simply providing access to or distributing Islamic financial products – without making representations about Shari'a compliance – would not require an endorsement, provided that they meet existing client protection obligations.

• Strengthened Takaful disclosures: To strengthen consumer protection, the DFSA proposes requiring all Takaful sales to include specific disclosures about contract features, fee calculations, surplus-sharing arrangements, and potential additional contributions, whether the Authorised Person has an Islamic endorsement or not.

Consultation process Authorised Firms and Authorised Market Institutions, and their employees, applicants, professional advisers, and other industry participants are invited to submit comments via the online response form by 19 June 2026. Following the consultation period, it will review all submissions and proceed to make changes to the DFSA Rulebook, reflecting industry input where appropriate.

The full Consultation Paper is available on the DFSA website.

For further information, please contact: Corporate Communications Dubai Financial Services Authority (DFSA) Level 13, The Gate, West Wing Dubai, UAE Email: DFSAcorpcomms@dfsa.ae www.dfsa.ae About: The Dubai Financial Services Authority (DFSA) is the independent regulator of financial services conducted in and from the Dubai International Financial Centre (DIFC), a purpose built financial free zone in Dubai. The DFSA's regulatory mandate covers asset management, banking and credit services, securities, collective investment funds, custody and trust services, commodities futures trading, Islamic finance, insurance, crowdfunding platforms, money services, an international equities exchange and an international commodities derivatives exchange. In addition to regulating financial and ancillary services, the DFSA is responsible for administering Anti-Money Laundering (AML) and Combating the Financing of Terrorism (CFT) legislation that applies to regulated firms and Designated Non-Financial Businesses and Professions in the DIFC. Please refer to the DFSA’s website for more information. Charlotte Robins joined the DFSA in May 2024 as Managing Director of Policy and Legal. She is responsible for leading the further development of the DFSA’s policy framework, managing legal risks, providing comprehensive legal advice and support across all DFSA functions, as well as drafting the administrative laws and rules that form the DFSA’s regulatory framework. Prior to joining the DFSA, Ms Robins accumulated more than 22 years of experience as a private practice lawyer in Hong Kong. She advised a diverse range of financial institutions – including investment and private banks, fund and wealth managers, and insurance companies on financial services regulation - covering conduct and prudential requirements, strategic business development, regulatory change and risk management. Ms Robins began her career at Linklaters in London and Hong Kong, and joined Clifford Chance Hong Kong in 2002, and became a partner at Norton Rose Fulbright in 2011. In 2016, she joined at A&O Shearman (formally Allen & Overy) as a partner. Ms Robins is qualified to practice law in England and Wales, as well as in Hong Kong SAR.

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[1] ICD – LSEG Islamic Finance Development Report 2025: https://www.lseg.com/content/dam/data-analytics/en_us/documents/reports/lseg-islamic-finance-development-indicator-2025.pdf