The debt finance market in the United Arab Emirates (UAE) has continued to develop steadily over the past 12 months, notwithstanding regional conflicts and macroeconomic pressures. Syndicated lending (both from regional and international banks) has remained prevalent against the backdrop of the increasing involvement of private credit and alternative capital providers.

Market performance has been strong across sectors, with real estate and hospitality, financial services, AI, data centres and digital infrastructure being a point of particular focus across the UAE. This continued level of development has been reflective of the UAE Central Bank’s most recent financial stability report, which forecast the UAE’s level of economic growth at 5.4% in 2026.

The UAE largely remains a bank-led market, with local and regional banks particularly dominant in the number and value of transactions within the UAE. Together with a number of international banks that have a UAE presence, the regional banks are typically seen as arrangers and underwriters on most corporate transactions.

The most notable shift over the past 12 months has been the increasing role of international and domestic private credit providers operating within the UAE market. While the UAE remains a largely bank-led market, increased co-operation between the regional and international banks with various private credit providers has highlighted the importance of the private credit market to the UAE. In addition, the ability of international alternative capital providers to lend and invest against different asset classes (and at different levels in the capital stack) has opened opportunities for UAE corporates to raise finance through means not traditionally available from the regional banks.

Recent changes to the UAE banking laws and regulations have also led to the increased importance of digital payment providers and operators within the UAE debt finance space. As the UAE continues to focus on AI and the digital economy, further involvement of tech-based financial institutions is expected.

As at the date of preparation of this report, the Iranian regional conflict had just commenced. It remains to be seen how the conflict will impact the debt finance market over both the short and longer term.

Market uncertainties in other jurisdictions have helped contribute to the continued growth of the UAE market. Increasingly viewed as a market offering regulatory and investment certainty, there has been a continued movement of capital towards the UAE from other geographical areas.

In addition to the increased level of interest and transactions within the UAE, international instability has led to an intensified focus on sanctions and KYC. This has been most noticeable in the real estate finance space, largely due to the number of high net worth individuals from other jurisdictions purchasing real estate within the UAE. This focus has not resulted in a reduction of transactions but rather has led to further diligence being undertaken by international creditors when structuring transactions. This focus on diligence is expected to continue, as more international banks and alternative capital providers look to deploy capital in the UAE.

The increased focus of international private credit providers on the region (in the context of global uncertainty) has also led to shifts in market practice in the UAE debt finance market. In particular, most transactions now involve the use of offshore jurisdictions (including the DIFC and ADGM) as part of the investment and enforcement strategy.

The main types of debt finance transactions in the UAE are set out below, each of which is typically structured either on a conventional or Sharia-compliant basis (or both).

• Corporate/general working capital finance – is the most common form of debt finance in the UAE, used traditionally to finance general corporate expenditure or business growth by way of capital expenditure or working capital expenditure. Generally provided by domestic banks and increasingly private capital providers, this takes the form of revolving credit facilities, overdrafts and term loans. The inclusion of ESG and sustainability-linked provisions is also relatively common, particularly where there is an international syndicate of lenders.
• Acquisition finance – is relatively common in the UAE; typically involving a combination of debt, equity or other hybrid practices to fund the acquisition of another entity or asset through a newly incorporated special purpose vehicle or alternative structure.
• Asset-based/asset-backed finance – is based on the value of certain types of the borrower’s business assets (such as accounts receivables, inventory, real estate, and plant and machinery), with these assets being used as collateral or as the benchmark for the financing amount. The recent updates to the UAE movables security and factoring laws have further increased focus on this product.
• Securitisation – can be considered to be complementary to the asset-based lending as described above, pursuant to which illiquid assets generating a consistent revenue stream (such as mortgages, credit cards or other commercial receivables) are packaged into tradable securities.
• Convertible and hybrid capital – there has been an increased prevalence of convertible financings entered into within the UAE over recent years. Under the relevant debt instrument, a facility is provided that is either repayable in cash or by way of conversion, as equity in the relevant borrower. In addition to convertible instruments, hybrid structures (often involving deeply subordinated debt with equity list risks and returns) are becoming increasingly prevalent. Given the potential limitations on the ability of certain UAE entities to enter into convertible instruments, careful structural consideration is always required on these transactions.
• Project finance – is a specialised financing technique used for large-scale, long-term infrastructure and industrial developments, where debt is repaid primarily from the cash flows generated by the project itself rather than the balance sheets of its sponsors. In the UAE, this model is widely used for strategically important projects, including conventional and renewable power generation (such as solar, wind and waste-to-energy), water and desalination facilities, district cooling, petrochemicals and downstream energy assets, transportation infrastructure (including ports, airports, rail and toll roads) and social infrastructure. The region is also seeing the growing use of project finance structures for energy transition and sustainability-linked projects. Project financings in the GCC typically involve carefully structured contracts that clearly allocate risk among sponsors, lenders, contractors, offtakers and public-sector counterparties, and often bring together syndicates of regional and international banks, export credit agencies, development finance institutions and institutional investors.

The most common form of loan facility in the UAE typically takes the form of a senior secured loan facility comprising a term loan and/or a revolving credit facility, structured either on a conventional and/or a Sharia-compliant basis. The repayment profile of the term loan may vary, with amortising and balloon payment profiles most frequently utilised on mid-market corporate transactions or bullet repayments on sovereign-related financings. Mezzanine structures are occasionally seen but are not as commonly utilised in the UAE.

In acquisition, project or other types of structured financing, ADGM and DIFC holdco structures are often utilised to enhance enforcement processes and streamline security packages. As the number of international banks and alternative capital finance providers active in the UAE market has continued to increase, so too has the prevalence of ADGM and DIFC transaction structures.

The investors that participate in bank loan financings are typically locally headquartered banks or international banks with a regional presence. In each case, such banks typically either act as sole lender (often holding the entire commitment on balance sheet for relationship purposes) or as an arranger as part of a wider club or syndicate. Financing on this basis can mean the borrowing entity is able to secure financing with competitive rates of interest and lower fees but with the trade-off of typically being required to provide share and all-asset security in addition to assignments of receivables in order to secure that financing. The use of debt securities remains common, with sukuk the most common security adopted. While the use of sukuk can provide for a wider investor basis and potentially more favourable economics, the flexibility and timeline related to syndicated loans are often favoured.

Over the course of the last two-to-five years, there has been an increase in the number of alternative financing providers entering the UAE market – often providing capital to those who have been traditionally unable to secure significant financing from the local market. These alternative credit providers – generally debt and private credit funds – can, if lending on a bilateral basis, offer the advantage of quicker decision-making processes when compared to “traditional banks”, given they are often not required to go through lengthy internal approval processes or solicit consents from other banks lending in a club or syndicate. In these transactions, these financiers may consider alternative structures and security packages when compared to the regional banks. However, interest rates and fees associated with this type of financing are typically higher, with payment-in-kind structures being common. In addition, these alternative capital providers may provide financing alongside equity investments into the company, which may influence the negotiation of loan documentation. In some instances, these capital providers may request the appointment of an observer on the board of the issuer.

Project financings in the UAE are typically structured through a combination of syndicated bank facilities, export credit agency (ECA) support and alternative capital, including private equity, green bonds and commodity-backed financing. Senior debt is provided by local and international banks and often incorporates Islamic finance instruments such as murabaha, ijara or sukuk, particularly in energy and infrastructure projects. ECAs play a key role in larger transactions, providing loans, guarantees and political risk coverage, frequently in parallel with commercial bank tranches.

Most project finance deals are limited recourse or non-recourse, relying on project cash flows and security over assets, accounts, shares and key contracts. Multi-tranche structures are common, with intercreditor arrangements governing priority, enforcement and voting rights. Alternative capital is increasingly common in project financed transactions, with private equity, infrastructure funds, and development finance institutions co-investing with senior lenders, while the nascent UAE project bond market is gaining traction for sovereign and quasi-sovereign issuers, particularly in green and sustainability-linked bonds.

The primary financing document for a conventional financing usually takes the form of a facilities agreement. Where a transaction is structured on a Sharia-compliant basis, the principal documentation will vary depending on the structure adopted, with the most frequent structures being a commodity murabaha or ijara.

Documentation is frequently based upon the Loan Market Association (LMA) standard form. While a number of syndicated loans are drafted on the basis of the LMA “emerging markets” template, the use of “covenant-lite” terms is becoming increasingly common.

In addition to the underlying facility agreement (or Islamic equivalent), intercreditor agreements, guarantees, security agreements and fee letters are entered into in a form largely consistent with those used in UK and European-based transactions.

Due to familiarity of terms and enforcement considerations (particularly for international creditors), finance transactions are often governed by English law agreements (other than security documents, which will be governed by the relevant law of the jurisdiction of the secured assets). Given the increased levels of certainty on matters of UAE enforcement, UAE law-governed financing agreements are also often used, particularly in relation to transactions involving sovereign-owned borrowers.

Project financings in the UAE are documented through a comprehensive suite of agreements aligned with international practice but tailored to local regulatory and structural requirements. Senior debt is typically based on LMA-standard documentation, adapted to the project’s risk allocation, and includes the facility agreement, common terms agreement (where relevant), intercreditor arrangements, security packages, direct agreements with key counterparties, and account bank and hedging documentation.

Where Islamic tranches are incorporated, murabaha and ijara are the most commonly used structures, typically integrated alongside conventional debt in parallel facilities. Less frequently, other Sharia-compliant instruments may appear in niche transactions, but they are not standard in mainstream project finance (eg, istisna’a, or wakala).

Equity contributions are generally made under equity contribution agreements, with funding certainty often supported by equity bridge loans. Facility and intercreditor agreements are usually governed by English law, while onshore security is governed by UAE law, with intercreditor arrangements co-ordinating enforcement, priority, voting and cash flow waterfalls in limited recourse or non-recourse structures.

The identity of the relevant creditor or investor will have a substantial impact on the nature of the relevant documentation. The starkest contrast can be seen between bilateral facility agreements entered into by UAE-licensed banks and those that are entered into by international direct lending funds. Where a UAE regional bank may take personal guarantees from founders and credit mitigants in the form of promissory notes and security, private credit providers will often include specific contractual protections including board observer rights, non-call provisions, cash flow sweeps, free transferability and additional covenants.

In addition, certain forms of security in the UAE (notably real estate mortgages and pledges over onshore entities) are only able to be held by UAE financial institutions that are licensed with the UAE Central Bank. As a result, if a transaction is being entered into by a foreign investor, a local bank may be required to be engaged to act as a security agent within the UAE.

Similarly, for project financings, the identity of the lenders has a direct impact on how the facility is structured and documented. Commercial banks generally expect a full security package, tested financial covenants (including DSCR and LLCR), cash sweep arrangements, reserve accounts and tightly controlled distribution mechanics. Where ECAs or development finance institutions are involved, longer tenors, sculpted amortisation profiles and detailed environmental and social undertakings are typical, together with more extensive conditions precedent and reporting requirements. Islamic financiers require Sharia-compliant structures, which affect the profit mechanics and underlying asset arrangements. The participation of institutional investors or private credit funds can also influence pricing, covenant flexibility and voting and enforcement thresholds under the intercreditor framework.

General consideration should be given to the type of transaction which is being concluded, with Islamic financing transactions requiring certain market-specific terms essential for the structure to work. In general, the following should be noted.

• Parallel debt – must be included in finance documentation (which generally follows the LMA-recommended form of parallel debt language) to allow for security to be properly held in favour of the secured parties.
• Security agency considerations – certain categories of security can only be granted in favour of locally headquartered banks that are licensed by the Central Bank. These include pledges over shares of companies incorporated “onshore” in the UAE and mortgages over land located “onshore” in the UAE. These restrictions may, or may not, apply to Free Zones in the UAE – depending on the Free Zone in question. As a result, a local bank is required to be engaged to act as a security agent where such security is taken in favour of an international creditor or group of creditors.
• Interest/penalty clauses – in the context of commercial loans, the charging of interest is permitted as per the contractual agreement between the relevant parties. However, certain limitations around the rate of such interest (and treatment of compound interest) must be carefully considered. In particular, restrictions on local licensed institutions charging compound interest and caps on the level of effective interest may be applicable on any transaction. Any transaction structured in a Sharia-compliant manner cannot include Riba (or interest).
• Guarantees – limitation periods apply in respect of guarantees in certain circumstances in the UAE. As a result, it is standard to disapply such limitations (which could otherwise potentially result in a guarantee ceasing to be enforceable if a claim is not initiated within six months from the original due date of payment of the underlying obligation).
• Murabaha structures – given the adoption of AAOIFI standard 59 by the UAE Central Bank, Murabaha transactions are required to be structured in a form that complies with that standard, with long/short Murabaha structures most commonly used. Where international Islamic participants are involved, this may lead to a need to have multiple facilities linked by intercreditor or common terms agreement.

In the majority of general corporate financing transactions, all asset security is able to be taken, with security over shares, real estate interests and movables (which in the UAE includes bank account balances and receivables). Corporate financings will generally have share security as a “single point of enforcement” (often over the shares of an ADGM or DIFC holding company) while asset-backed transactions will look to the relevant underlying assets.

Security and guarantee packages vary on transactions in the UAE depending on the nature of the borrower, the identity of the wider group, and their respective assets. The scope will ultimately vary depending on whether the relevant UAE security/guarantee provider is located onshore or in a free zone (such as the ADGM or DIFC). The most common forms of security are the following.

• Movable assets – Federal Law No 4 of 2020 (the “Movables Security Law”) governs how security may be taken over specific classes of movable property (eg, bank accounts, goods and other tangible assets). Security taken under the Movables Security Law are subject to certain formalities required in order to be valid, including having the relevant security agreement set out in writing, with the description of the secured assets and secured liabilities sufficiently clear. In order to perfect a valid security, the relevant agreement is required to be registered with the Emirates Integrated Registries Company or by way of the secured party having possession or control of the secured asset. Priority of competing security interests is established by the date and time of perfection.
• Shares – UAE law allows security to be taken over the shares of a public joint stock company or over the ownership interest of a limited liability company incorporated pursuant to the relevant UAE companies law. In order to be valid, a share pledge must be registered in the commercial register of the relevant Emirate in which the company is incorporated (which in turn requires that the share pledge is in writing and executed before a UAE notary public). Where the share pledge relates to shares registered on a stock exchange, formalities specific to the requirements of the relevant exchange must also be met.
• Property – security over immovable or real property is commonly taken by way of a registered mortgage, with the form of the mortgage depending on the nature of the real estate interest and the location of the physical property. Registration of the mortgage will be required with the specific formalities proscribed by the relevant land department where the property is located.

Other less common forms of security (such as a commercial mortgage or possessory pledge) are possible but now rarely taken given the wide nature of the Movables Security Law.

Where security is taken over shares or assets located in a free zone, the relevant requirements as to registration and perfection may differ from those onshore in the UAE. Formality and perfection requirements should therefore be considered on a case-by-case basis.

In project finance transactions, lenders typically rely on the project’s assets and cash flows rather than direct recourse to the sponsors. The security package generally builds on the same principles as corporate financings, with additional protections specific to the project.

• Bank accounts and cash flows – project accounts are usually blocked or pledged to the security agent. Priority and control are established through control agreements or direct debit arrangements, ensuring that cash is applied according to the financing waterfall.
• Project assets and equipment – movable assets and equipment are typically secured through pledges or mortgages, while real estate is secured through registered mortgages with the relevant land department. Movable assets may also be delivered to or placed under the control of the security agent to perfect the security under UAE law.
• Contracts and receivables – key project contracts, such as off-take, supply and service agreements, are usually assigned or subject to step-in rights, allowing lenders to collect payments or assume performance if the project defaults.
• Insurance policies – project insurance is assigned to the security agent so that any proceeds flow directly to lenders, protecting the value of the project.

This structure follows the general corporate security framework but is tailored for limited recourse or non-recourse financing, giving lenders certainty over cash flows, assets and contractual rights, while reflecting UAE legal requirements.

There are a number of key considerations for security and guarantees on all transactions, in particular as follows.

• Parallel debt – finance documentation on club and syndicate transactions should include parallel debt (which generally follows the LMA recommended form of parallel debt language) to allow for security to be properly held in favour of the secured parties.
• Security agency considerations – certain categories of security can only be granted in favour of locally headquartered banks that are licensed by the Central Bank.
• Corporate benefit – guarantees are commonly used in debt finance transactions in the UAE. There are no restrictions on parent companies providing downstream guarantees to subsidiaries (subject to obtaining customary board (and if required, shareholder) approvals and subject to the terms of its constitutional documents). Similarly, upstream guarantees are generally permissible (provided the same customary approvals are obtained and there is sufficient corporate benefit). While their use has become less common in recent years, personal guarantees are also able to be taken (and are most often seen as part of the guarantee package on transactions involving UAE banks).
• Nature of guarantees – under UAE Law, guarantees are secondary obligations and as such their enforceability is dependent on the validity and enforceability of the underlying principal obligations, however UAE courts will recognise guarantees provided they are in writing and signed by the guarantor.
• Guarantee time limits – apply in respect of guarantees in certain circumstances in the UAE. As a result, it is standard to disapply such limitations (which could otherwise potentially result in a guarantee ceasing to be enforceable if a claim is not initiated within six months from the original due date of payment of the underlying obligation).
• Requirement for “adequate” guarantees and security – there has been some recent uncertainty within the UAE as to the requirement for “sufficient” or “adequate” guarantees/security to be provided on all UAE-based loans, due to certain legislative updates. Notwithstanding this uncertainty, the general market view is that unsecured lending is likely acceptable within the UAE in commercial circumstances and investment-grade transactions.
• Financial assistance – there are limitations on the provision of financial assistance for public joint stock companies, which limit their ability to provide guarantees and security in respect of the acquisition of their (and potentially, their parents’) shares.

Intercreditor agreements are a key feature of multi-lender financings, providing a framework to co-ordinate rights and obligations among different classes of lenders. As the debt finance market has evolved in recent years, so too has the relevant complexity and negotiation levels of intercreditor agreements. In particular, negotiations around the interaction between private credit direct lenders and bank RCF providers are generally detailed, as are the negotiations between first- and second-ranking creditors.

Intercreditor agreement negotiations in the UAE generally focus on priority among lenders, waterfall allocations, standstill obligations and enforcement rights. While corporate finance transactions often follow the approaches taken under English law transactions, local law considerations (around parallel debt and enforcement requirements) are required to be taken into account.

There are also additional considerations required for project finance transactions. In particular:

• co-ordinating enforcement rights to prevent conflicting lender actions and ensure orderly recovery from project cash flows and assets;
• defining priority and cash flow waterfalls, allocating proceeds among senior, subordinated and alternative tranches;
• integration with project agreements, including step-in rights, cure periods and direct agreements with off-takers, contractors or concession authorities; and
• managing security and cross-border risks, ensuring enforceability of onshore and offshore collateral, regulatory approvals and recognition of foreign judgments or arbitral awards.

Contractual subordination is recognised in the UAE, with the LMA form of intercreditor agreement frequently used on super senior/senior/second lien structures. As separately noted, given the general limitation on the recognition of trusts, standard turnover language is often required to be updated to allow for amounts to be held as agent for the relevant senior party.

Depending on the nature of the transaction, it is relatively common for transactions to be structured to allow for structural subordination to be obtained where there are multiple creditors financing different levels of a corporate group.

In accordance with the terms of the UAE Bankruptcy Law, legal subordination will occur on an insolvency, in accordance with the following order of priority.

• Secured creditors are paid first from the proceeds of the secured asset, up to the value of their security. It should be noted that while secured lenders retain priority over collateral proceeds, enforcement may be delayed and subject to judicial supervision, particularly where the asset is essential to the debtor’s operations.
• Preferential creditors (including judicial fees, government fees and employee wages), are paid second.
• Unsecured creditors fall third in the order of priority and will share pro rata any remaining assets following the previous distributions.
• Subordinated creditors and shareholders – any distributions to subordinated lenders or shareholders are made only after all higher-ranking claims are satisfied in full.

Security is governed by the nature of the underlying asset. However, it is important that creditors are aware that a UAE court order is required to authorise most forms of enforcement, which then occurs by way of a court-mandated auction process. There are exceptions to this general rule, including where security is taken under the Movables Security Law or Factoring Law, or if an attachment procedure is agreed in respect of security over UAE shares. Where a court-mandated auction process is required, this can lead to additional delays and give rise to certain practical considerations. As a result, a share pledge as a single point of enforcement in the ADGM or DIFC is often seen as the “first avenue” for security enforcement structures.

In the UAE, a secured creditor may enforce its secured rights following the occurrence of the relevant enforcement trigger (typically an event of default that is continuing).

Given the role of the UAE courts for enforcement of certain security documents, it is advisable for finance and security documents to be translated into Arabic by official licensed translators in order to be enforceable or admissible in evidence (and this is a requirement for any mortgage or share pledges over an onshore entity to be able to be validly taken and registered).

Federal Decree Law No 42 of 2022 (the “Civil Procedure Law”) set outs the regime under which a judgment or order of a foreign court may be enforced in the UAE. Article 222 of the Civil Procedure Law details the relevant considerations that a UAE court will have when considering recognising a foreign judgment, including:

• whether there is reciprocity of enforcement and orders between the UAE and the relevant foreign jurisdiction;
• that the foreign judgment or order does not conflict with any order issued in the UAE and contains nothing that would breach UAE public order and morals;
• the parties involved had been required to appear and were properly represented;
• the UAE did not have exclusive jurisdiction over the dispute; and
• the judgment was properly issued by a court in accordance with its laws and was duly certified.

In practice, UAE courts typically apply these considerations restrictively to judgments and orders of foreign courts. In 2022, the UAE Ministry of Justice issued a directive on the principle of reciprocity in the enforcement of judgments rendered by English courts, which confirmed that judgments issued by English courts can be enforced by UAE courts under the principal of reciprocity. While the directive confirmed that the principle of reciprocity has been established between UAE and English courts, any judgment issued by an English court must still comply with the remaining provisions of Article 222 of the Civil Procedure Law (as set out above).

The UAE’s insolvency framework is governed by Federal Decree Law No 51 of 2023 on Financial Restructuring and Bankruptcy, which came into effect on 1 May 2024 (the “UAE Bankruptcy Law”). The UAE Bankruptcy Law applies to commercial companies, civil companies with professional licences and individual traders, but excludes entities regulated by the UAE Central Bank, as well as DIFC and ADGM entities for which a separate process applies – briefly detailed below.

The UAE Bankruptcy Law has multiple notable facets, such as the establishment of a specialised Bankruptcy Court to oversee proceedings and provisions allowing for the invalidation of preferential, undervalued or fraudulent transactions made prior to the insolvency. In addition, the UAE Bankruptcy Law provides for certain proceedings – which may be taken pre- or post-insolvency – that may impact the rights of creditors, being the following.

• Preventive settlement – allows debtors who are facing financial difficulties but are not yet insolvent to restructure debts via a court-supervised process. Debtor-in-possession control is retained, and creditor enforcement actions are typically stayed during this process, subject to limited exceptions with court approval.
• Restructuring proceedings – are available where the debtor is insolvent but restructuring remains viable, and a court-appointed trustee oversees the process, including preparation of a restructuring plan, negotiation with creditors, and potential asset sales. A moratorium applies, and enforcement by secured creditors may be restricted, depending on the asset’s role in the reorganisation. Lenders should note that preventive settlements and restructuring proceedings trigger automatic stays on creditor enforcement, including secured claims, unless otherwise authorised by the court.
• Liquidation – may be ordered by the court, if restructuring is not possible. A trustee is appointed to dispose of the debtor’s assets and distribute proceeds to creditors in accordance with statutory priorities. While secured creditors have priority over the proceeds of their collateral, enforcement generally occurs through the liquidation estate rather than direct action.

There are a number of UAE-specific insolvency considerations that are required to be taken into account in structuring debt finance transactions.

It is important that creditors are aware that a UAE court order is required to authorise any enforcement action, as noted in 7.1 Process of Enforcement of Security.

Creditors should also be conscious of the impact of any insolvency proceeding on their ability to take enforcement action, with a moratorium on creditor actions (including enforcing security) being automatically implemented on a preventative settlement (for a period of three months, extendable for one-month periods up to six months) and on commencement of any restructuring proceeding.

The UAE Bankruptcy Law allows for repayments in the order of priority set out in 6.2 Contractual v Legal Subordination.

The tax regime in the UAE continues to evolve, with substantial reforms over the past ten years.

While the UAE has enacted a withholding tax regime, withholding tax is currently levied at 0%. VAT is applied at a standard rate of 5% and whilst most financial services are exempt, VAT may be applicable to certain transaction fees for products and services offered by a creditor in connection with a loan. Creditors should consider the applicability of VAT on each transaction and LMA tax-style language will typically be included in all financing transactions.

While not strictly a form of taxation, registration fees may also apply where security is taken over certain assets, depending on the nature, value and location of the relevant secured asset.

The UAE Central Bank and the Securities and Commodities Authority are the main regulatory bodies for financial services onshore in the UAE.

Pursuant to Federal Decree Law No 6 of 2025 (the “Central Bank Law”), the Central Bank is the body responsible for regulating and licensing any institutions that provide a “licensed financial activity”. Licensed financial activities include the provision of credit facilities of all types and financial promotions in respect of licensed financial activities carried on “in or from within” the UAE. It is a generally held view that such licensing requirements and restrictions apply to businesses actually operating in or from the UAE and are not intended to apply to foreign businesses (including businesses providing credit) operating from abroad. Notwithstanding this, it is important to understand that entities engaging in licensed activities in the UAE without a licence may face fines or criminal sanctions. As such, consideration should be taken on a case-by-case basis as to whether the marketing, negotiating or entering into of a debt finance transaction could constitute a “licensed financial activity”.

Regulatory requirements in the ADGM and DIFC differ from those onshore, with the Financial Services Regulatory Authority and the Dubai Financial Services Authority being the respective regulatory bodies in each jurisdiction.

While this article is intended to provide an overview of specific considerations for UAE debt finance and project finance transactions, varying additional considerations may be relevant for any given transaction. As such, careful structural planning should be taken prior to entering into any transaction.