UAE Announces New Rules For Family Businesses In DIFC Family Arrangements Regulations
As per the new enactments of the Dubai International Financial Center (DIFC), new Family Arrangements Regulations will be made into effect following a thirty-day public consultation period. These newly created regulations will provide clarity to the strong foundation of the new DIFC Family Wealth Center. It will also provide a framework and a platform for family businesses, private wealth, and ultra-high-net-worth individuals that are set up regionally and globally.
Jacques Visser, Chief Legal Officer of DIFC said that DIFC has always been serving businesses and ultra-high net worth individuals for almost twenty successful years.
The center could provide a supportive and dynamic environment for these business concerns and individuals. The new regulations will mark an entirely new chapter for setting up a whole set of standards for excellence in the industry.
These new regulations will focus on transparency, accountability, and stability for the clients
The clients who are availing of these services will be able to operate with maximum efficiency and confidence. The comprehensive framework will also prove to be a safety feature as their goals and interests will be guarded with the highest level of regulatory and legal measures.
He also said that DIFC is really excited and proud to introduce these new changes to its service structure so that it helps the family businesses to contribute more to the UAE economy.
Some of the major points of the new regulations are based on the UAE Decree Law No:37 of 2022 which is also known as the UAE Family Business Law.
The new regulations allow the recognition of family business structures in free zones and the family business can be registered under this to avail of new benefits and requirements.
This will replace the previous Single-Family Office Regulations and DIFC Single Family Office regime with a new kind of regulation that can serve more than one family and it also doesn’t require a family office to be registered as a designated non-financial business or profession (DNFBP).
Usually, this process has to be done through the Dubai Financial Services Authority (DFSA) which is considered to be an independent regulator of financial services carried out in or from DIFC.
There is an exception in these new regulations where multi-family offices will need to acquire authorization and licensing from the DFSA if services have been provided to multiple families that carry out business.
The de-registration process of Single-Family offices as a DNFBP under DFSA can be done in the future when the DFSA will release the necessary regulation.
Under the new regime and regulations, the families will be able to manage their businesses and preserve their assets and wealth through the concept of succession and legacy planning inside the DIFC. Also, this will further create a benchmark for good conduct that will be enforced throughout the UAE and other neighboring nations.
It will also bring in new methods of certifications and accreditation programs for running family businesses. Benefits and other incentives will be meted out to the family business which is registered in the UAE under the UAE Family Business Law.
The certifications are mainly intended to create good conduct among the family business and to encourage them to follow the principles of proper governance. The accreditation ensures that the advisors who are responsible for advising families for their business ventures shall also keep a high level of quality and diligence in their activities.
Last December, DIFC courts also announced the launch of a new set of rules for the Digital Economy Court division. Following these, there will be new appointments of judicial experts who are from international communities to ensure that the new court’s digital infrastructure and services can be implemented with maximum efficiency.
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DIFC has also launched a new Metaverse Platform that aligns with the metaverse strategy of the Dubai administration. This new initiative aims to create around $4 billion worth of value to the GDP of Dubai and also create around 40,000 virtual jobs by the year 2030.
This will also attract more than a thousand companies that specialize in the metaverse and blockchain tech.
This new metaverse platform consists of three main initiatives. The first one is a program that creates a physical studio aimed at promoting the development of a creator community and venture building inside the metaverse.
This sort of studio will also help us address the matters of legislation on open data, digital identity, company law frameworks, and metaverse policy development. The third major advantage of the initiative is that it will help foster a new metaverse community that will be focusing on ways to enhance the metaverse experience for customers and create immersive services inside the metaverse.
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