Today we attended a very interesting presentation on estate planning in the UAE. The training session was especially valuable as many of our existing clients are concerned about succession planning. I thought it would be helpful to provide an overview of the areas discussed, should you require a more detailed explanation of this digest then please contact us at firstname.lastname@example.org
Even though heavily advertised by the likes of Holborn Assets and many other ‘wealth managers’ there is no such thing as a Shariah Compliant Will in the UAE.
- In Common Law, two witness are required, however notarising a will in Dubai only requires one witness immediately voiding the will in accordance with article 242
- Please also note only lawyers can produce Wills under their trade license and have indemnity insurance to compensate you in the event of incorrect advice.
Article 17 (1) states that ‘inheritance shall be governed by the law of the deceased at the time of his death’ and Article 17 (5) ‘The law of the UAE shall apply to will made by aliens disposing of their real property located in the state’
- Hence any assets in the deceased name (bank accounts, real estate etc) in the UAE are immediately frozen until probate is granted regardless if you have a Will from your home country.
Muslims who wish to distribute personal assets as per their wishes (not standard Shariah Law distribution) should use Power of Attorney to achieve the desired inheritance outcome.
UAE Expat company owners should hold company shares in an offshore company (BVI or equivalent) for estate planning and hold all personal bank accounts in an offshore banking destination (Isle of Man, Jersey or Guernsey)
DIFC Wills which protect Dubai assets are now available. (Assets owned in the individuals country or other country should be covered by a Will in that country). DIFC Wills apply to non Muslims only and is not in conflict with Shariah law.
If an LLC is owned a security agreement should be put in place with the local partner/sponsor to protect the company’s shares.
- Board structure is very important in an LLC.
- A POA (power of attorney) should be put in place for the spouse of the company owner to ensure succession takes place immediately.
We hope you find the information obtained useful, if you have a company structure and you are unsure if the structure protects you and your family in the event of death. Then please do not hesitate to contact us.
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