Compliance Handbook

TGRAF Implementation Guide

How to Build the Technology Governance and Risk Assessment Framework Required by VARA Rulebook 2.0

Published February 16, 2026 · UAE Tokenization Regulations Editorial Team

VARA's Technology Governance and Risk Assessment Framework requirement represents one of the most demanding technology compliance obligations in global virtual asset regulation, mandating comprehensive documentation of governance structures, risk assessment methodologies, and security controls.

This implementation guide provides step-by-step instructions for practitioners navigating this aspect of UAE virtual asset compliance. Designed for compliance officers, in-house legal teams, VASP founders, and regulatory consultants, the guide translates regulatory requirements into actionable operational procedures that can be implemented within existing compliance workflows. All regulatory citations reference official publications from the relevant UAE regulatory authorities, with guidance current as of February 2026.

Regulatory Framework Context

The UAE's virtual asset regulatory architecture encompasses five distinct authorities: VARA governing Dubai mainland and free zones (excluding DIFC), ADGM FSRA operating as an independent international financial center in Abu Dhabi, DIFC DFSA functioning as a separate common-law jurisdiction within Dubai, the SCA/CMA providing federal-level securities oversight, and the CBUAE retaining exclusive authority over payment tokens and AED-denominated stablecoins. Each regulator maintains distinct requirements, and practitioners must identify the applicable regulatory authority before implementing compliance measures. All guidance in this handbook reflects the regulatory framework as of February 2026, incorporating VARA Rulebook 2.0 (effective June 2025), ADGM FRT framework (effective January 2026), and DIFC Consultation Paper 168 proposals.

Implementation Considerations

Compliance implementation in the UAE requires navigating jurisdictional complexity that goes beyond simply meeting a single regulator's requirements. Multi-jurisdictional operators — holding licenses in both VARA and ADGM, for example — must maintain parallel compliance programs tailored to each regulator's specific rulebook requirements. The August 2025 CMA-VARA mutual recognition agreement is reducing some of this burden through shared frameworks, but operational compliance teams should continue to treat each jurisdiction's requirements independently until formal harmonization is confirmed. Technology compliance, AML/CFT programs, and governance structures must be documented separately for each licensing jurisdiction, even where underlying systems are shared across entities.

Practical Recommendations

Engage specialist UAE virtual asset legal counsel before committing to a regulatory pathway — the choice of jurisdiction has cascading implications for licensing costs, capital requirements, operational structure, and client access. Begin banking engagement immediately upon receiving initial VARA or ADGM approval, as account opening typically takes 3-6 months and can delay operational launch. Build OECD CARF-compliant data collection infrastructure from inception rather than retrofitting existing systems. Invest in technology compliance from day one — the cost of implementing TGRAF, penetration testing, and custody standards increases significantly when bolted onto existing infrastructure versus being designed into the platform architecture from the ground up. For the latest regulatory guidance, consult official sources: VARA Regulations, ADGM Digital Assets, and DFSA. This guide is for informational purposes only and does not constitute legal, financial, or regulatory advice.

TGRAF Document Structure

Build your Technology Governance and Risk Assessment Framework as a comprehensive document covering: technology governance structure defining roles, responsibilities, and reporting lines from IT operations through CISO to board level; risk assessment methodology including threat modeling, vulnerability classification, impact analysis, and risk acceptance criteria; technology architecture documentation covering network topology, data flows, API security, and third-party integrations; change management procedures ensuring controlled deployment with rollback capabilities; incident response workflows with escalation timelines and VARA notification triggers; and disaster recovery plans with tested recovery time objectives and recovery point objectives for all critical systems.

Penetration Testing and Security Audits

VARA mandates annual Threat-Led Penetration Testing by qualified third-party assessors. TLPT simulates real-world attack scenarios targeting your specific infrastructure, business logic, and operational processes — going far beyond standard vulnerability scanning. Engage CREST or OSCP-certified testers with virtual asset platform experience. Reports must document findings, risk ratings, and remediation recommendations. VARA may request reports during inspections. Remediate critical and high-severity findings within 30 days; medium findings within 90 days. Maintain evidence of remediation including retesting results confirming vulnerability closure.

Developer Environment Controls

VARA Rulebook 2.0 introduced specific requirements for controlling developer environments — ensuring that production systems handling client assets are segregated from development and testing environments. Implement strict separation between production, staging, and development environments with access controls preventing unauthorized code deployment. Establish code review procedures requiring multiple approvals before production deployment. Maintain audit trails of all code changes affecting transaction processing, wallet management, and client asset handling. Implement automated testing pipelines that validate security controls before any release reaches production. These controls prevent the category of incidents where development-stage vulnerabilities propagate to live systems handling real client assets — a failure pattern that has caused significant losses across the global virtual asset industry.

Incident Response and VARA Notification

Build incident response procedures covering the complete lifecycle from detection through containment, eradication, recovery, and post-incident review. Define severity classifications that trigger different response levels — from routine operational incidents handled by the technology team through critical incidents requiring MLRO notification and board-level escalation. VARA notification triggers include any incident affecting client asset security, availability of trading services, integrity of transaction records, or potential unauthorized access to customer data. Establish communication templates and contact procedures enabling rapid regulatory notification within prescribed timeframes. Document all incident response activities in detail — post-incident reports serve as evidence of operational resilience during subsequent VARA inspections.

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