Abu Dhabi regulators are embracing digital technologies to streamline doing business in the Emirate.
Last month, for example, the Abu Dhabi Department of Economic Development launched a digital platform connecting free zones known as the e-link in order to make doing business in the Emirate easier.
The platform, which provides a single digital portal for sharing and viewing economic licenses, will digitally link businesses in four free zones — KEZAD Group (made up of 12 economic zones), Abu Dhabi Airports Free Zone, the Media Free Zone- Abu Dhabi (twofour54) and Masdar City Free Zone.
With more than 40 spread throughout the United Arab Emirates (UAE), free zones are integral components of the country’s economy and are home to a major part of Emirate business activities.
Ranging from skyscraper-decked financial centers to sprawling industrial parks and ports, these free zones are intended to attract foreign businesses to set up shop in the Middle Eastern country and enjoy benefits such as a full exemption from import, export, corporate and personal taxes.
To make them even more attractive, the e-link will streamline business processes by creating a unified database of economic licenses in the Emirate of Abu Dhabi.
Platform users will also be able to view data of the beneficial owner of economic establishments, thanks to integration with the Ministry of Economy’s database and the National Economic Register.
Tapping AI to Digitize Processes
While the Department of Economic Development is moving to digitize the way businesses access and view licenses, the Emirate’s financial services regulator has mobilized artificial intelligence (AI) to help automate the license application process.
Dubbed the “RegBot,” the AI-powered licensing solution launched by the Abu Dhabi Global Market (ADGM) was built in collaboration with Nexus FrontierTech and uses natural language processing (NLP) to guide applicants in registering a new venture capital (VC) fund.
For instance, if the applicant doesn’t provide adequate information on its risk management systems in relation to a regulatory requirement, the RegBot will prompt them to provide additional data.
It also automates data extraction from uploaded documents, classifies the firm’s readiness for Abu Dhabi’s Financial Services Regulatory Authority (FSRA) approval and creates an assessment report for the regulator to review. Overall, this is expected to boost business efficiency and reduce the overall turnaround time for VC applications.
In a report into its use of RegTech published last November, the FSRA further outlined how it leverages a range of AI solutions to help businesses navigate the regulatory environment of the ADGM.
For example, the authority used the ClauseMatch AI platform to present information in a structured network graph by automatically tagging and interlinking concepts within the FSRA’s vast library of documentation.
Related: OCC Encourages Banks to Explore AI Solutions for RegTech
As per the FSRA, “a FinTech looking to provide a new service or product is able to instantly see what sections of regulation or rule is applicable across multiple legislation and in what manner they interlink.”
To reduce the reporting burden on FSRA-licensed firms such as asset managers, the authority will also use application program interfaces (APIs) to monitor client money held by firms with custodian banks on a real-time basis. These can then be reconciled with the firm’s internal records, helping to flag any irregularities to both the firm and the regulator.
With the UAE working to boost its knowledge economy by supporting and investing in digital sectors, digital platforms can create a more open, better connected business ecosystem, while AI can be used to automate routine business processes and increase companies’ efficiencies.
That seems to be the goal of the FSRA and the Department of Economic Development with this new initiative that is pioneering a digital-first approach to regulation and compliance to then serve as an example for other regulators to follow.
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