The Dubai International Financial Centre (DIFC) is a world-renowned financial hub serving the Middle East, Africa, and South Asia (MEASA) region. Ranked among the top 10 global financial centres, DIFC hosts over 5K registered firms and approximately 41K professionals within a vibrant ecosystem. It offers a robust independent judicial system based on common law, a global financial exchange, cutting-edge infrastructure, and progressive business regulations. DIFC has been instrumental in facilitating investment and trade across the MEASA region for nearly two decades, representing a population of three billion and a combined nominal GDP of USD 8 trillion.

What Are DIFC Foundations?

DIFC Foundations are legal entities established under the Dubai International Financial Centre’s common law framework. They offer a modern alternative to trusts, allowing individuals and families to structure wealth for asset protection, succession planning, tax efficiency, and philanthropy. With their own legal personality, DIFC Foundations can hold assets, enter contracts, and operate globally. They provide confidentiality, flexibility, and long-term control, making them ideal for managing cross-border estates and generational wealth.

What are the benefits of setting up a Foundation in the DIFC?

Setting up a Foundation in the DIFC offers numerous benefits for individuals, families, and businesses seeking effective wealth and succession planning. Key advantages include robust asset protection, as foundation assets are legally separate from the Founder, shielding them from personal claims. Privacy is maintained, with no public disclosure of Founders or Beneficiaries. Foundations also enable efficient tax planning across jurisdictions and seamless generational wealth transfer. With the support of DIFC’s independent common law courts, a foundation provides legal certainty, flexibility in structuring, and long-term control. It can hold global assets, operate without a physical office, and does not require UAE residency.

Key Advantages of a DIFC Foundation

• Common Law Jurisdiction: Operates under DIFC’s independent legal system, with
• proceedings in English and based on familiar Common Law principles.
• Global Asset Holding: Foundations can hold diverse assets such as shares, bank accounts, real estate, and aviation assets anywhere in the world.
• Separate Legal Identity: As a standalone legal entity, the Foundation can enter into contracts and agreements directly.
• Redomiciliation Flexibility: Foundations can migrate in or out of the DIFC with ease.
• Adaptable Governance: Governance structures can be updated or amended after establishment.
• Low Capital Requirement: Foundations can be set up with an initial asset commitment as low as USD 100.
• No Physical Office Needed: A registered agent’s address in the DIFC suffices—no separate office is required.
• No UAE Residency Requirement: Founders and officers are not required to reside in the UAE.
• Flexible Roles: Council Members, Guardians, and other roles can be individuals or corporate bodies.
• High Confidentiality: No names of individuals are listed on public DIFC registers, ensuring privacy.

Can a DIFC Foundation Hold Property?

The DIFC Foundation is now permitted to hold freehold properties across Dubai. Thanks to a Memorandum of Understanding (MoU) signed between the DIFC Authority and the Dubai Land Department (DLD), the process has been streamlined to allow foundations to own real estate in prime areas such as Business Bay, Downtown Dubai, Dubai Marina, JBR, and other designated freehold zones.

To begin the process, the foundation must first be registered with the DLD. Once registered, properties can then be transferred into the foundation’s name.

If an individual wishes to transfer a property they personally own into their own DIFC Foundation—where the individual is the founder or sole owner of the foundation—the transfer can be done as a gift. In such cases, only a nominal DLD fee of 0.125% applies.

However, if the property is being transferred between unrelated parties or if the beneficiaries of the foundation differ from the original owner, the standard DLD transfer fee of 4% will apply.

Can a DIFC Foundation Own Shares in Companies?

Yes, it is possible for a foundation to hold shares in UAE entities. Both Free Zone and Mainland authorities allow foundations—such as those established under the DIFC (Dubai International Financial Centre)—to act as shareholders.

This is permitted in two scenarios:

1. New Company Incorporation: A DIFC foundation can be set up and used as the shareholder for a new company being incorporated in either a Free Zone or on the Mainland.
2. Transfer of Shares in an Existing Company: If there is already an established company in the Mainland or in a Free Zone, its existing ownership can be transferred to a DIFC foundation.

Both options are supported by the relevant authorities.

Documentation Process

In both cases, whether for a new entity or a share transfer, the process starts with a board resolution passed by the founder of the foundation. This resolution is crucial. Once it’s passed, the next step is to obtain a No Objection Certificate (NOC) from the DIFC Authority.

After obtaining the attested board resolution and NOC, all legal documents must be translated into Arabic. These documents include:

          •         The foundation’s license

          •         The foundation charter

          •         The NOC

          •         The board resolution

          •         The latest good standing certificate of the foundation

Once these documents are translated, the process of incorporating a new entity or transferring shares to the foundation can proceed.

Setting Up a DIFC Foundation

Establishing a DIFC Foundation involves collecting KYC documentation for the Founder, Council Members, and Guardian (if applicable). The legal structure is defined through a customized Foundation Charter and Bylaws. Corpin Consultant can provide a registered address in the DIFC, handle submission to the Registrar, and facilitate approvals.

Next, the legal documents, such as the Charter and By-Laws of the Foundation, are prepared. While standard templates are available, customization is highly recommended to suit the specific needs and goals of the client. Once the legal documentation is in place, a Registered Address is finalized. This can either be a physical address within the DIFC or provided by Consultants as a Registered Agent. The final steps involve submitting the documents to the DIFC Registrar of Companies for review, addressing any required clarifications, and securing the final approval. Once the Foundation is formed, the necessary steps for opening a bank account and obtaining visas, if applicable, can also be completed.

DIFC Foundation vs. Trust

Unlike a trust, a DIFC Foundation is a legal entity that can hold assets and contracts in its own name. It is governed by a Council, similar to company directors, while a trust is governed by trustees. A Foundation has the legal capacity to initiate or defend legal actions in its own name, unlike a trust, where any legal proceedings must be carried out by the trustees.

Roles Within a DIFC Foundation

• Founder: The individual or entity that sets up the Foundation and contributes the assets.
• Council Members: Responsible for managing the Foundation’s operations.
• Guardian: Oversees the Council’s actions (mandatory for charitable Foundations or upon the Founder’s death).
• Beneficiaries: Individuals or entities designated to receive benefits from the Foundation, as defined by the Founder.

Charitable and Philanthropic Use

DIFC Foundations can be structured for charitable or public interest purposes, provided they align with UAE legal requirements. They are a popular vehicle for philanthropic endowments and long-term legacy projects.

Registered Agent Requirement

All DIFC Foundations must have a registered office within the DIFC. This can be achieved through Corpin Consultant, which provides registered agent services including setup support, address provision, compliance administration, and ongoing foundation management.

How Corpin Consultant Can Help

As a licensed Company Service Provider in the DIFC, Corpin Consultant offers end-to-end solutions for DIFC Foundations:

• Tailored foundation structuring
• Drafting of Charter and By-Laws
• Registered agent services and DIFC address
• Nominee services for Council Members and Guardians
• Support for philanthropic and cross-border structuring

Ready to Establish Your DIFC Foundation

Contact Corpin Consultant today for expert guidance and a seamless setup process