New Ownership Structures for Real Property in Dubai: DIFC's Revised Prescribed Company Regime

New Ownership Structures for Real Property in Dubai: DIFC's Revised Prescribed Company Regime

On July 15, 2024, the Dubai International Financial Centre (DIFC) implemented significant amendments to the Prescribed Company (“PC”) regime under the updated Prescribed Companies Regulations 2024 (“PC Regulations”). These changes simplify and broaden the criteria for establishing a PC, providing a more flexible and efficient structure for holding real estate assets within the Gulf Cooperation Council (GCC).

Under the revised PC Regulations, any party intending to acquire and hold title to or control over GCC registrable assets such as properties or property interests that require registration with a GCC authority can form a PC. This structure ensures legal ownership, secures rights or claims, and provides public notice of such interests.

The DIFC offers a six-month grace period to facilitate the formation of a PC before the acquisition of real estate. This period starts upon the formation of the PC and continues until the shareholder(s) submit documentation to the DIFC confirming the acquisition of the asset. This provision allows for a streamlined PC formation process, with the option to use a licensed Corporate Service Provider (CSP) to provide a registered office in the DIFC.

Compared to Foundations and trusts available in the UAE, the new PC regime offers greater convenience and flexibility for real property ownership. PCs benefit from the DIFC's common law framework, lower fees, and a simplified process, making them an attractive choice for real estate investors looking for a reliable and efficient structure within the GCC.