2. 2. Regulatory Powers To Obtain Confidential Information
2.1 2.1 Background
The Regulator may be provided with information which is confidential in two ways:(a) voluntarily (that is, information obtained on a voluntary basis); and(b) under compulsion, including through:i. the exercise of the Regulator's supervisory and investigative powers (see section 2.2 below); andii. the exercise of the Regulator's information gathering powers at the request, and on behalf, of Non-ADGM Regulators (see section 2.3 below).
2.2 2.2 Regulator's Supervisory and Investigative Powers
The Regulator has comprehensive powers under the FSMR to carry out its duties and responsibilities. These include the power to require reports, conduct on-site inspections of business premises of authorised entities within the ADGM, interview individuals, as well as compel the production of documents, testimony and other information — see, for example, sections 201 and 206 of the FSMR.
The Regulator has in place internal procedures to monitor and manage access to and the use of Confidential Information and documents obtained during the course of its regulatory activities. These procedures include the use of manual and electronic document storage and retrieval systems.
For example, the Regulator limits access to confidential documents obtained to those members of the Regulator's staff engaged with the relevant matter to which the documents are related by use of secure filing of physical documents and restricted computer drives containing confidential documents in electronic form.
The Regulator may obtain information relating to regulated entities from third parties including intermediaries and companies that perform outsourced functions for regulated entities.
As the Regulator's mandate is to regulate all financial services provided in and from the ADGM, the Regulator has broad access to compel the disclosure of Confidential Information from individuals and firms participating in or connected to the provision of financial services in or from the ADGM. This includes, without limitation, all market participants, listed companies, reporting entities and their respective officers and directors.
For example, an ADGM-based fund manager which manages a fund organized in and sold to investors in a foreign jurisdiction will be subject to the jurisdiction of the Regulator and all books and records relating to the fund and its unitholders will be subject to examination by the Regulator upon request.
2.3 2.3 Powers to cooperate with, assist and support Non-ADGM Regulators
The Regulator may also exercise its information gathering powers at the request, and on behalf, of regulators and authorities in other jurisdictions, solely to assist them in performing their regulatory or enforcement functions.
Amended on (18 April, 2019).
The following sections of the FSMR give the Regulator specific authority to exercise some of its specific powers on behalf of other authorities:(a) section 215 enables the Regulator to co-operate with other persons (in ADGM or elsewhere) who have functions (i) similar to those of the Regulator or (ii) in relation to the prevention or detection of Financial Crime. Co-operation may include the sharing of information which the Regulator is not prevented from lawfully disclosing;(b) section 216 gives the Regulator specific authority to exercise its Own-Initiative Powers at the request, or on behalf, of Non-ADGM Regulators; and(c) section 217 gives the Regulator specific authority to exercise its Investigative Powers at the request of Non-ADGM Regulators. In deciding whether or not to exercise its Investigative Powers, section 217(2) sets out a non-exhaustive list of factors that the Regulator may take into account.
If the Regulator decides to exercise its powers at the request, or on behalf, of a Non-ADGM Regulator, Confidential Information gathered as result of the Regulator exercising its powers under sections 215, 216 or 217 can only be disclosed to that Non-ADGM Regulator in accordance with the provisions of sections 198 or section 199 of the FSMR.
Amended on (18 April, 2019).