Regulations regarding Family Ownership of Common Property
The Law regarding the regulation of Family Ownership of Common Property was introduced by Dubai Law Number 9 of 2020. As the name suggests, this law aims at laying down a comprehensive framework to regulate family ownership of property among successive generations. It further, enables members of the family to enter into a contract concerning collective ownership.
The members of the family may enter into a contract through a Family Property Contract. The purpose of this contract is to enable a member to manage, regulate and administer, jointly, all aspects of the property held, for the benefit of its members. This contract, therefore, aims to lay down certain governing principles that are to be followed by members and also remove any sort of ambiguity that may be related to the property concerned. The members of the family are to have a common interest and that interest is to be identified and consequently protected therein. The members may lay down any such terms and conditions as may be mutually agreed upon, provided it is legally valid. It is further, imperative to note that the contract must be signed by all members and notarized before a UAE public notary. Further, the term of validity of Family Property Contract is for 15 years, on the expiry of which it may be renewed by the members by unanimous consent.
Further, in case of any disputes arising out of a contract, the members may approach a special judicial committee, as established by the Law in force. This committee shall take into consideration all such matters as may be brought forth by the members and aim to dispose of the matter efficiently and effectively. During the period of hearing the matter, the committee must keep the interests of the members in mind and therefore, maintain confidentiality and privacy concerning the dispute.
The Law aims at creating a harmonious environment in the family business sphere and further aims to protect the interests of all members of the family concerning their capital and wealth. It further makes sure that, there is a continuity in the flow of wealth in the family across generations. Moreover, it also aims to simplify any complexities attached to family businesses.