In fulfilling its mandate as the sole independent financial services regulator for the DIFC, the DFSA performs a number of functions.
• Policy and Rulemaking
• International Co-operation
The DFSA’s stated approach is: “To be a risk-based regulator and to avoid unnecessary regulatory burden”. We believe regulation should be directed to the mitigation of risks that would otherwise be unacceptable. We also believe that compliance obligations should be proportionate to the mitigation of those risks within a framework that enables regulated entities to effectively and efficiently meet their compliance obligations.
Under this model, we set priorities for the use of our resources and have adopted a continuous risk management cycle which identifies, assesses, prioritises and mitigates unacceptable risks to our regulatory objectives or a particular sector of our financial services industry. We recognise that these risks may arise from within or outside the DIFC so we regularly monitor regional and international financial markets and trends. This systematic assessment of risk allows us to identify common issues across our regulated community and to undertake necessary thematic work in response.
Our risk-based philosophy applies to all divisions of the DFSA and all our dealings with regulated entities. We believe that focusing more on outcomes rather than the way they should be achieved, results in more effective and efficient risk-based regulation.
The DFSA believes that it is appropriate to clearly and regularly state our approach to regulation to ensure it is clearly understood by all external and internal stakeholders. Our Approach to Regulation together with the DFSA’s Vision, Mission and Values form the foundation upon which we do our work.