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  • Part III – Fit and Proper Requirements

    • A. General Principles

      1. A Fit and Proper Person must—
       
        a. possess the necessary academic qualifications and in all cases, have relevant professional knowledge and/or industry qualifications, in each case, having regard to the nature of the functions to be performed;
        b. be honest, reputable, have integrity and uphold the ethical standards reasonably expected of their role;
        c. possess adequate relevant global Virtual Asset sector and management experience, or such experience in another relevant sector;
        d. possess a good understanding of the regulatory framework which governs the nature of the job or role and the market; and
        e. be financially sound.
       
      2. In assessing whether an individual is a Fit and Proper Person, VASPs should consider—
       
        a. the nature, scale and complexity of their business, including all VA Activities, and the nature and range of activities undertaken by such individual in the ordinary course of business; and
        b. whether such individual has the knowledge, skills, and experience to perform the specific role that the individual is intended to perform.
       
      3. In assessing an individual for a position within the Board, VASPs should ensure that, if such individual is appointed to the Board, the Board as a whole will at all times possess adequate knowledge, skills and experience to undertake the business activities of the VASP.
      4. In assessing whether an individual is a Fit and Proper Person, VARA will—
       
        a. consider all relevant factors in assessing the application of the fit and proper principles contained herein on a case-by-case basis, taking into account—
       
          i. the conditions of the Licence held by the VASP;
          ii. the business model of the VASP;
          iii. the market within which the VASP operates;
          iv. the governance structure, the internal control systems and the competence of the VASP’s Staff;
          v. decisions made by a relevant authority or regulatory body in respect of that individual, whether in the Emirate or in other jurisdictions;
          vi. the state of affairs of any other business which that the individual carries on or proposes to carry on; and
       
        b. look to the substance of the requirements and the materiality of any failure to meet such requirements.
       
      5. VARA will not grant approval if it is not satisfied that the individual is a Fit and Proper Person.
      6. If an individual does not meet any individual elements set out in Part III of this Company Rulebook, VARA may nonetheless be satisfied that such individual is a Fit and Proper Person taking into account all relevant factors.
       

    • B. Qualification

      1. In assessing whether an individual is a Fit and Proper Person and qualified for the role for which the individual is being considered, the following factors shall be considered—
       
        a. whether the individual possesses a degree in the field relevant to the role. For the avoidance of doubt, this does not prevent someone who does not possess a degree in the relevant field to be employed for the role if such individual has relevant professional or industry qualification[s] and/or experience; and
        b. whether the individual has industry qualifications directly relevant to the activities to be performed by such individual in the role and it is demonstrable that such individual generally understands—
       
          i. the structure of the regulatory framework that applies to the job activities;
          ii. the particular Regulations, Rules, Directives and Guidance that apply to the functions that the individual would perform;
          iii. the fiduciary obligations owed to clients by the individual or the VASP;
          iv. the VA Activities which the individual helps the VASP to undertake; and
          v. the market in which the individual’s services are provided.
       

    • C. Industry Experience

      1. Relevant industry experience refers to hands-on working experience acquired through the carrying on of VA Activities in the Emirate or activities of a similar nature in other industries and/or jurisdictions.
      2. In assessing the relevance of an individual’s experience, VASPs must consider whether the substance of the experience is directly relevant or crucial to the VA Activities to be carried out by such individual.
      3. In assessing whether an individual has sufficient relevant industry experience, VASPs may consider such individual’s overall career history accumulated as a whole.
       

    • D. Management Experience

      1. In assessing whether an individual has management experience suitable for a role in the Board or the Senior Management, VASPs must consider whether such individual has hands-on working experience in supervising and managing essential VA Activities and staff in a business setting. To this end, management experience which is purely administrative would be less relevant.
       

    • E. Financial Status or Solvency

      1. An individual will not be considered to be a Fit and Proper Person if such individual—
       
        a. is an undischarged bankrupt, currently subject to bankruptcy proceedings or a bankrupt who has recently been discharged;
        b. is subject to receivership or other similar proceedings; and
        c. has failed to meet any judgment debt, having regard to the circumstances of such failure and the recency of such failure.
       

    • F. Honesty, Integrity and Reputation

      1. In assessing an individual’s honesty, integrity and reputation, VARA will have regard to all matters it deems relevant, including, but not limited to, the following which may have occurred in the Emirate or in other jurisdictions—
       
        a. whether the individual has been convicted of any criminal offence, with particular consideration given to offences of dishonesty, fraud, financial crime or an offence under laws relating to companies, banking, insolvency, money laundering and insider dealing;
        b. whether the individual has been the subject of any adverse finding or any settlement in civil proceedings, with particular consideration given to investment or other financial business, misconduct, fraud or the formation or management of a body corporate;
        c. whether the individual has been the subject of any existing or previous investigation or disciplinary proceedings or has been notified of any potential disciplinary proceedings or any investigation which might lead to those proceedings;
        d. whether the individual is or has been in breach of any regulatory requirements;
        e. whether the individual has been the subject of any justified complaint relating to VA Activities or similar business activities in any jurisdiction;
        f. whether the individual has been a director or a member of the senior management of a business that has gone into insolvency, liquidation or administration while the individual has been connected with that business or within one [1] year of that connection;
        g. whether the individual has been a party to a scheme of arrangement or entered into any form of compromise with a creditor involving any amount greater than AED 50,000;
        h. whether the individual has been dismissed for cause from employment or from a position of trust, fiduciary appointment, or otherwise found to be deficient in discharging their duties;
        i. whether the individual has been disqualified from acting as a director or in any managerial capacity; and
        j. whether, in the past, the individual has been candid and truthful in all dealings with any regulatory body and whether the individual demonstrates a readiness and willingness to comply with the requirements and standards of the regulatory system and all other applicable laws and regulatory requirements.
       
      2. For the avoidance of doubt, conviction for a criminal offence would not automatically bar an individual from being a Fit and Proper Person. VARA may consider the seriousness of the prior conviction and the circumstances surrounding the offence, including the explanation offered by such individual, the relevance of the offence to the individual’s role, the passage of time since the offence was committed and evidence of such individual’s rehabilitation.
      3. In considering the reputation of an individual, VARA shall consider whether the individual’s reputation has or might have an adverse impact upon the performance or perception in the market of the VASP.
       

    • G. Continuing Requirements

      1. When VASPs assess whether an individual remains a Fit and Proper Person, they shall assess the role such individual is actually performing at the time the assessment is done.
      2. If VARA is of the view that an individual is no longer a Fit and Proper Person, it may—
       
        a. revoke or suspend the approval granted to such individual or the Licence of the relevant VASP;
        b. publicly or privately reprimand such individual;
        c. prohibit such individual from applying again; and
        d. impose a fine or other non-financial penalties in the event of a material breach of this Part III of this Company Rulebook.