A new registry in Dubai which allows non-Muslims to handle wealth transfer under English Common Law has already generated strong take-up, and is a sign of how Dubai can build its status as a major financial centre, a conference has heard.
The launch of the Dubai International Financial Centre Wills and Probate Registry, allowing non-Muslims to handle wealth transfer under English Common Law, has enjoyed a “tremendous response” and bolsters Dubai’s standing as an international financial centre, a conference has heard. (To see another report on this conference, see here.)
The registry, which opened at the start of May this year, has already seen a large number of wills being set up in the first few weeks of operation, Yann Mrazek, managing partner at M / Advocates of Law and vice chair of STEP Arabia, told the WealthBriefing GCC Region Summit in Dubai.
“I think the wills and probate registry constitutes an almost `unfair’ advantage for Dubai as a structuring and wealth hub and I absolutely love it!” Mrazek told delegates in his speech. “This is fantastic for Dubai as a financial centre...it is a game changer,” he continued.
In the past, before the registry was established, non-Muslims in Dubai faced a challenge in structuring their wealth. “You had a flawed system which had worked but you really had to push for it. That is now over. Rather than use local courts, you can opt in, appoint a private executor and have everything run how you like...you now have testatory freedom,” he continued.
Although the registry’s managers have not published data on how many wills have been lodged, word-of-mouth evidence suggest that about 70 wills had been registered in the first few weeks of its going live, he said. “The response of people to it has been tremendous,” he said.
As far as the kind of person using the registry is concerned, Mrazek said: “It is someone who comes from every type of country that the UAE plays host to.”
The move by Dubai to grant such will-producing freedom to non-Muslims is an example of how international financial centres worldwide are seeking to compete with one another in offering structures that meet specific client requirements. As a reciprocal point, it is increasingly possible for Muslims living in the West, for example, to undertake Shariah-compliant transactions and a number of banks see this client segment as an opportunity.
According to the rules of the registry, the testator must not be a Muslim and must be aged 21 or above. Wills can only cover assets situated in the Emirate of Dubai and the will must be in writing and signed in front of, and witnessed by, the DIFC registrar or an authorised office.
Mrazek said the registry allows “mirror wills” for husbands and wives and said that a third of such wills are of this “mirror” variety. They also provide for guardianship, he told delegates.
One third of those using the registry are located abroad, suggesting this move will boost Dubai’s international appeal, he said. He expects to see a move by persons in other parts of the GCC to use the Dubai registry and some “destructuring” of existing real estate and offshore structures and transfer to the Dubai model instead. “People will move to simpler, cheaper ways of doing things,” he said.
The conference was held at the Mina A'Salam Hotel, Dubai and sponsors were Advent, ProFundCom, smartKYC, Dominion and Jersey Finance.
WealthBriefing will be holding its third GCC Region Summit on 10 November at the Mina A'Salam Hotel in Dubai. Please click here for the full agenda and to register your attendance.