Dubai's International Financial Centre (DIFC), known as the city’s tech and finance hub, has set its sights on updating key laws that govern the district.
Home to Dubai’s stock exchange, various different businesses and the Museum of the Future, DIFC is the urban district of the city that most business folks build their offices within and foreign investors choose to expand their businesses here too.
DIFC has announced new laws in line with global practices. These proposed changes encompass several areas, including Employment Law, Trust Law, Foundations Law, and Operating Law at DIFC.
The primary objective behind these proposed legislative changes is to ensure that the laws governing Dubai International Financial Centre remain in harmony with international best practices and OECD (Organisation for Economic Co-operation and Development) requirements.
Among the proposed changes is an enhancement of the Registrar of Companies' (RoC) powers to oversee entities operating outside standard business hours. These changes are aimed at fortifying regulatory oversight.
In the realm of Employment Law, amendments to Part 10 will mandate Dubai International Financial Centre employers of eligible GCC (Gulf Cooperation Council) nationals to make additional "top-up" payments into a Qualifying Scheme, on top of the GPSSA (General Pension and Social Security Authority) contributions.
Essentially, this requirement ensures that employers bridge the gap between what would have been payable into a scheme if the individual were not a GCC national and what is paid under GPSSA.
To provide clarity, monthly payments are subject to a de minimis threshold of AED1,000 ($272). The amendments also address scenarios where a Qualifying Scheme cannot accept contributions from an employer or an employee due to sanctions prohibitions.
In an effort to align with international best practices, changes to Trust Law and Foundations Law grant the Dubai International Financial Centre Courts exclusive jurisdiction over the administration of DIFC Trusts, excluding foreign courts from this jurisdiction.
Furthermore, adjustments to the Foundations Law expand the role of Registered Agents, permitting them to partner with the RoC to provide specific compliance functions on behalf of a Foundation.
Proposed changes to the Operating Law address OECD requirements pertaining to record retention following the winding up of an entity. Additionally, there is an update to the definition of "Privileged Communication."
The Operating Regulations may also see revisions, empowering the RoC with specific authority to deal with late-night bars and restaurants that may disrupt other Dubai International Financial Centre tenants through noise or antisocial behaviour.
Jacques Visser, Chief Legal Officer at DIFC, highlighted the district's dedication to maintaining a legal and regulatory framework aligned with international standards. He stressed that these proposed amendments aim to ensure that DIFC's laws continue to meet global best practices while accommodating the region's unique requirements.
The proposed regulations have been made available for a 30-day public consultation period, with comments accepted until September 29, 2023. These changes reflect DIFC's unwavering commitment to fostering a transparent and robust legal and regulatory framework in accordance with global best practices.
Dubai DIFC remains poised to evolve and adapt, affirming its status as a leading global financial centre.
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