Dubai has announced legislation concerning Family Companies and Family Property Ownership in Dubai, effective 1 January 2024. Key points include:
Formation of the Committee: A judicial committee, known as the “Dispute Resolution Committee for Family Companies and Family Property Ownership in Dubai,” will be established to manage family business and property disputes.
Amicable Dispute Resolution: The legislation promotes and supports amicable dispute resolution by first referring disputes to conciliation boards consisting of family members or family shareholders, as outlined in the Family Property Ownership Contract, memorandum of association, or the family charter. Alternatively, if conciliation boards are not provided for or fail to resolve the dispute, disputes will be directed to the Centre for Amicable Settlement of Disputes before legal proceedings are initiated.
Committee Jurisdiction: The committee will address disputes arising from Family Property Ownership Contracts and conflicts between partners within a Family Company, or between these partners and family members. This will occur when the Centre for Amicable Settlement of Disputes is unable to reach an amicable resolution.
Appeals: Decisions made by the committee can be appealed to the competent court, as specified by Federal Decree-Law No. 42 of 2022.
To ensure the protection of Family Property and Family Companies and mitigate the negative impact of disputes, the legislation empowers the Committee to take preventative measures in order to ensure the continuity of the family-owned business. This will ensure that Family Property or the Family Company remains protected and operational during the dispute resolution process.
This legislation is in line with the UAE’s continuous efforts to support family businesses, providing flexible options for succession planning and wealth protection in the UAE. It also establishes a structured framework for efficient family business and property dispute resolution in Dubai.
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