The starting point for VARA licensing is the function a business performs for its clients. A personal recommendation, involvement in orders or transactions, and responsibility for managing virtual assets can fall within different regulated activities.
For a business planning its UAE market entry, the practical task is to describe each service precisely. A single client journey may involve more than one activity, so the assessment should cover the whole model before the business selects a licence route.
This article compares Advisory Services, Broker-Dealer Services and VA Management and Investment Services under VARA. It is a focused comparison of those three categories, rather than a complete assessment of every activity a virtual asset business might perform.
What brings a service within Advisory Services?
Advisory Services centres on a personal recommendation to a client about an action or transaction involving virtual assets. The definition covers offering or agreeing to provide that recommendation as well as actually providing it. It applies whether the client requests the recommendation or the business initiates it. (Schedule 1)
The recommendation therefore needs to be assessed in its client context. The Advisory Services Rulebook requires advice to be suitable, given in good faith and in the client’s best interests. Relevant factors include the client’s investment experience, objectives, risk tolerance and financial circumstances. (Advisory Rulebook, II.A)
For an operating model, this means documenting what staff or the service actually recommend, how recommendations reach clients and what client information informs them. That record helps distinguish the advisory function from other steps in the service.
Which functions fall within Broker-Dealer Services?
Broker-Dealer Services covers several specified activities. Schedule 1 includes arranging purchases and sales between entities, facilitating matches between buyers and sellers, and market-making using client assets. It also covers placement, distribution and other issuance-related services for clients issuing virtual assets. (Schedule 1)
The detail of each limb matters. The order-solicitation or acceptance limb includes accepting fiat currency or other virtual assets for those orders. The dealing limb addresses virtual asset transactions entered into as a dealer on the entity’s own account. A short description such as “handling orders” needs to be tested against the full wording. (Schedule 1)
The useful business record is a transaction map: who receives the instruction, who arranges or enters the transaction, and which entity receives funds or assets. These details allow the legal analysis to follow the actual service.
When does responsibility for assets point to management?
VA Management and Investment Services concerns acting for an entity as agent or fiduciary, or otherwise assuming responsibility for managing, administering or disposing of its virtual assets. The distinction described in Schedule 1 is the responsibility undertaken for those assets. (Schedule 1)
The management rulebook makes that responsibility operational. A VASP providing these services must act in clients’ best interests and follow their specific instructions. (Management Rulebook, II.H)
Client agreements must, where applicable, describe the assets in scope, the parties’ respective rights and the relevant risks. A clear mandate should therefore identify the decisions and actions the business will take for the client. The contractual description should be checked alongside the practical workflow, including which assets are involved and how the client’s instructions are implemented. (Management Rulebook, II.K)
Can a broker-dealer also provide personal recommendations?
Yes. Part II.C.1 of the Broker-Dealer Services Rulebook expressly permits VASPs providing Broker-Dealer Services to carry out Advisory Services in the Emirate, subject to three conditions. (Broker-Dealer Rulebook, II.C.1)
- They must continue to hold their Broker-Dealer Services licence and comply with all its requirements.
- They must meet the Company Rulebook’s capital and prudential requirements for Advisory Services in addition to those for Broker-Dealer Services.
- They must comply with the Advisory Services Rulebook for all Advisory Services they provide.
This provision addresses a specific combination. It should not be treated as a general permission to combine any activities or as a reason to disregard the rules governing the recommendation itself.
What should the business document before choosing its licence route?
A regulatory perimeter assessment should connect the proposed client experience to the activities being performed. The following is a practical preparation checklist, rather than a substitute for the regulatory definitions.
Recommendations
Record whether the service offers personal recommendations and who produces them. Identify the client information used and the point at which the recommendation is delivered.
Orders and transactions
Trace instructions, funds and virtual assets through the service. Identify each entity’s role in arranging, matching, accepting or entering transactions.
Management responsibility
Describe the mandate and the decisions the business takes on the client’s behalf. Align that description with the relevant commercial contracts and operating procedures.
Overlapping functions
Identify every function within the same journey. Where the broker-dealer and advisory combination is proposed, assess its specific conditions and the resulting compliance frameworks and policies before preparing the licence application.
Key takeaway
The distinction starts with the work performed for the client.
- Personal recommendations, transaction functions and management responsibility each require a precise description.
- Where functions overlap, assess the relevant combination and its conditions before settling the licensing model.
Frequently asked questions
Does VARA Advisory Services cover recommendations initiated by the business?
Yes. Schedule 1 covers personal recommendations initiated by the provider as well as recommendations requested by the client.
Is arranging a virtual asset order a Broker-Dealer Service?
Arranging orders for the purchase and sale of virtual assets between two entities is expressly included in VARA’s Broker-Dealer Services definition.
Does calling a service advisory determine its VARA category?
The assessment should examine what the service actually does against the relevant definitions. Document any order-handling or management functions alongside the recommendations.
Can a VARA broker-dealer provide Advisory Services?
Yes, subject to Part II.C.1 of the Broker-Dealer Services Rulebook. The broker-dealer must retain and comply with its licence, meet the additional advisory capital and prudential requirements, and follow the Advisory Services Rulebook.
What distinguishes VA Management and Investment Services?
The definition focuses on acting as agent or fiduciary, or otherwise taking responsibility for managing, administering or disposing of an entity’s virtual assets.
Should the licensing assessment cover the whole client journey?
Yes. Mapping each function is a practical way to identify overlaps and assess the relevant licence route before preparing the application.
Official sources
VARA Regulations
VARA Rulebooks
- Advisory Services Rulebook, including Part II.A — Client Suitability.
- Broker-Dealer Services Rulebook, Part II.C.1 — Advisory Services.
- VA Management and Investment Services Rulebook, including Part II.H — Management Practices and Part II.K — Client Agreements.
How can BLegal help assess your VARA licensing model?
We advise on regulatory perimeter assessment, VARA licensing and the legal structure of virtual asset business models. Our work connects the proposed services with the relevant licensing requirements and supporting documentation.
If you are assessing an advisory, broker-dealer or management model, contact us to discuss its functions and the scope of licence application support you need.
Last reviewed: 25 September 2026
Disclaimer. This article is provided for general information only and does not constitute legal or regulatory advice. The applicable framework depends on the specific token, activities, entity structure and jurisdictions involved. Regulatory requirements and interpretations may change. Businesses should obtain advice based on their particular circumstances before making structuring, licensing or commercial decisions.