1. law, govt and politics

May 2015
DUBAI’S DIFC REGISTRY OF WILLS AND PROBATE
The long-awaited DIFC Wills and Probate Registry (“DIFC WPR”) is now live. The DIFC WPR aims at
addressing with certainty succession and inheritance matters of non-Muslims with assets in Dubai.
As such, it represents a fundamental step forward for the jurisdiction.
Legal uncertainties over expatriate wills in Dubai will
become a thing of the past with the launch early next year
of a new registry.
The Dubai International Financial Centre (DIFC) hopes that
the DIFC WPR – open to all non-Muslim expatriates – will
benefit those wishing to hold financial and real estate
assets in Dubai, but who are concerned about the uneven
treatment of wills by the Dubai Courts.
The new registry will allow non-Muslim expatriates over
the age of 21 to register wills written in English in the DIFC
Courts, doing away with the current need for translating
wills into Arabic and having them attested by a local notary
public.
Crucially, the registry will issue a court order from the
DIFC Courts, enforceable in the Dubai Courts for the direct
distribution of Dubai-based assets in accordance with the
register will, thus removing any ambiguity as to how held
assets locally are distributed.
The DIFC’s Dispute Resolution Authority (“DIFC DRA”)
hopes that the new registry will begin offering services
during the first quarter of next year.
Only assets in Dubai can be included in wills registered
in the new centre, according to the draft rules. Sources
in the DIFC DRA said that the centre’s jurisdiction may be
expanded to cover assets outside Dubai, but that such a
move was not under active consideration.
While the existing UAE law in theory provides that the law
of the nationality of a non-Muslim should apply to the
devolution of his or her estate, in practice the Dubai Courts
have tended to apply Sharia law at first instance.
“Assuming the executors and heirs do not wish the Sharia
rights of inheritance to apply, they are then forced to
appeal such decisions through the Dubai Courts,” he said.
“Invariably, this process is uncertain and can take years to
resolve. In the meantime, assets located in Dubai may be
frozen, forcing some into financial hardship”.
Such uncertainties have made individuals reluctant to
invest in Dubai, choosing to minimize assets held in the
emirate by keeping cash offshore and holding real estate
(ultimately) through an offshore company, he noted. The
launch of the registry has been welcomed by Dubai’s legal
community for clearing up many of the ambiguities.
“After years of observing the pressing need for clarity on
the current UAE wills and inheritance legislation, and the
inconsistent approach of judges in inheritance matters, we
are pleased to welcome the new regime,” said Nita Maru,
managing partner of TWS Legal Consultants, and an active
member of the working group involved in formulating and
contributing to the registry’s rules.
The registry should provide certainty for non-Muslim
expatriates to pass on their Dubai estate in the event of
death to their chosen beneficiaries.
“It’s a very necessary step that the DIFC has taken. With the
number of grey areas around the application of the law
and the problems that we’ve seen with judges refusing to
recognize wills, something like this had to be done”, said
Diana Hamade, managing partner of IALS in Dubai, also
part of the working party.
The services of the new registry do not come cheap,
however. Under the draft rules, those wishing to use the
registry will have to pay €2.500 to register their wills, more
than double the standard cost typically charged by lawyers
for the drafting, translation, and attestation of wills with
the Dubai Courts.
“At the end of the day it’s about providing people with the
choice,” said a Dubai-based lawyer who did not want to be
named.
“If your situation is less complicated, or the total assets in
Dubai are fewer, then the Dubai Courts is still an option,
whereas for that extra peace of mind people can opt for
the new registry.
The draft rules are largely drawn from the UK’s
administration of estates law, and also draws on similar
legislation in other common law jurisdictions including
Australia, Hong Kong and Singapore.
IN SUMMARY
What is the DIFC WPR
An English language registry based inside the DIFC and
enabling the formal registration of wills.
Who is aimed at
Non-Muslim individuals over the age of 21 with assets
in Dubai. The DIFC WPR is not open to Muslims.
What assets are covered
Any assets physically located or registered in the
emirate of Dubai. The DIFC WPR does not extend to
assets located or registered in other emirates or abroad.
Real estate
Dubai located real estate can be covered in a DIFC will.
Who can register
UAE residents as well as non-residents can register a
DIFC WPR.
DIFC WPR’s legal framework
The DIFC is a common law jurisdiction. The WPR’s rules
are based primarily on the principles contained in the
UK Estates Act and Probate Rules. Shariah principles do
not form part of the DIFC WPR’s legal framework.
Any restrictions to the devolution of assets
The DIFC WPR provides for full testamentary freedom.
Some restrictions may apply depending on the
testator’s citizenship and/or place of residency.
Guardianship issues
The guardianship of minor children habitually residents
in Dubai with the testator may be specifically addressed
in a DIFC will.
How the DIFC WPR work in practice
An appointment is booked online (www.difcprobate.
ae). The execution of the will takes place at the time
of registration in the presence of a registry officer and
one witness chosen by the testator. The will is stored
electronically at the DIFC WPR as the original.
Registration cost
€2.500 for a standard DIFC WPR and €3.500 for two
mirror DIFC wills. They do not include professional fees
for assistance in drafting the DIFC WPR, registering it,
acting as witness, drafting the letter of wishes, being
appointed and/or acting as executor.
Cost of enforcement
€1.250 for an application for a grant of probate. A “grant
of probate” is a legal instrument that gives authority to
the executor to handle the disposal of the deceased’s
assets and debts.
Who can act as executor
A family member, a friend or a legal representative
(attorney). It is possible to appoint co-executors eg
a family member together with an attorney. Being
appointed as executor is not neutral and comes with
its set of specific duties.
Challenge to WPR
A challenge may be lodged before the DIFC Courts
who will hear any claim launched against a will.
(Courtesy “The National”, “M/Advocates of Law”, UAE)
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