The law, which is aligned with the international rules on combating illicit money flows, includes the establishment of an independent financial information unit within the UAE’s central bank to receive and investigate reports of money laundering.

The unit will also supervise and inspect financial institutions and other businesses and non-profit organisations to check their compliance levels.

Sheikh Hamdan bin Rashid Al Maktoum, deputy ruler of Dubai and minister of finance, said the law would “boost confidence in the national economy” and “enhance the performance of monetary policy”.

International rules for fighting illicit finance are set under the Financial Action Task Force, an inter-governmental body that meets three times a year.

The UAE’s Ministry of Finance is also working to develop “sound fiscal policies and clear procedures for management of public funds”, the government added.

“The ministry shall also continue its efforts to improve fiscal performance and to enhance levels of compliance and revenue diversification,” a statement said.

The UAE has been working on tightening its financial regulations to close loopholes for money laundering.

The Dubai International Financial Centre, which is the UAE’s financial services hub, also updated its anti-money laundering and counter-terror financing rules earlier this month.

The DIFC is a special economic zone within Dubai, which has its own laws and regulations distinct from the UAE.