DIFC enacts new DIFC Family Arrangements Regulations

Dubai International Financial Centre has enacted the DIFC Family Arrangements Regulations, following a 30-day public consultation period.

The new regulations provide a firm foundation for the new DIFC Family Wealth Centre. The new regulations offer a framework and hub for global and regional family-owned businesses, ultra-high net worth individuals and private wealth, and further differentiate DIFC as a global hub for leading financial institutions and businesses.

The Family Arrangements Regulations provide comprehensive guidelines for family businesses holding assets and operating in or from DIFC, in support of their succession and legacy planning for future generations. The regulations were drafted to take advantage of the recognition of family business structures in free zones, such as DIFC, and the authority provided in the newly enacted UAE Decree-Law No. 37 of 2022 (UAE Family Business Law) to keep a special family business register to opt into the requirements and benefits that will be provided for family businesses under the UAE Family Business Law.

The regulations replace the previous Single-Family Office Regulations and DIFC Single Family Office regime with a new Family Office regime that can serve one or more families, eliminating the requirement for a Family Office to register as a Designated Non-Financial Business or Profession (DNFBP) with the DFSA. Multi-family offices will, however, require authorisation and licensing by the DFSA if they provide financial services to multiple families by way of business. Single Family Offices currently registered as a DNFBP with the DFSA will only be able to de-register with the DFSA in a manner to be prescribed by the DFSA in due course.

The new regime enables families to manage their businesses and preserve wealth through succession and legacy planning within DIFC, setting a benchmark for good conduct with enforceability across the UAE and beyond. The regulations also establish certification and accreditation programmes for family businesses and their advisors in DIFC to support benefits and incentives planned for family businesses in the UAE under the UAE Family Business Law. The primary objective with the certification regime is for family businesses to adhere to principles of good conduct and governance, and for the accreditation regime to ensure that advisors adhere to high levels of quality and expertise when advising families.