The DIFC has identified the best practice for all those in wealth management to support their focus on becoming a leading, regional wealth management and succession planning platform for GCC families. The recommendations of the Wealth management Working Group will help strengthen DIFC’s core offering to the international wealth management community
The Dubai International Financial Centre (DIFC) Wealth Management Working Group has presented a report to the Governor of DIFC, His Excellency Essa Kazim, which underlines the importance of the Centre in becoming a regional hub for family business, the source of 60% of GDP and an employer of over 80% of the workforce in Middle East economies.
The DIFC Wealth Management Working Group, set up in August 2016, made the presentation following an extensive consultation process, during which a number of areas were explored: trusts; foundations; issues in respect of establishment and ongoing maintenance in the DIFC; Shari’a compliance; DIFC entities and structures outside the Centre; as well as a review of outcomes and existing arrangements.
His Excellency Essa Kazim said: “The DIFC Wealth Management Working Group was set up last year to discuss and compile an updated wealth management strategy for the DIFC. The new solutions and structural reforms identified by the Working Group not only allow us to deepen our core offering, boosting the Centre’s growth, but also facilitate ease of business for firms based in, or looking to join, the DIFC.”
“These recommendations will support our ongoing enhancement of the Centre as a leading regional hub for wealth management and succession planning platform for GCC family businesses, both of which remain important components of our 2024 Strategy,” His Excellency continued.
As well as deepening the DIFC’s core offering to the international wealth management community, the Working Group formulates and proposes strategies, policies and objectives relating to the Centre, which are submitted to the DIFC Higher Board for adoption and to the DIFC Authority, Dubai Financial Services Authority (DFSA) and Dispute Resolution Authority (DRA) for implementation.
Upon implementation, the DIFC Wealth Management Working Group’s new strategy will:
- Place the DIFC at the forefront of jurisdictions which provide modern and flexible structures in the form of companies, trusts and foundations;
- Provide an effective framework to establish sound family governance structures;
- Simplify the DIFC’s current administrative arrangements and costs, without compromising its existing standards;
- Offer an attractive platform for local families to structure their business and succession planning arrangements, particularly if complemented by the measures recommended by the Working Group; and
- Provide a favourable environment for Single Family Offices.
In addition to the high GDP contribution of family offices in the region, it is estimated that $US 1 trillion of assets will be transferred from second generation business families to the third generation over the coming decade.
Chairman of the Wealth Management Working Group, David Russell AM QC, said: “The DIFC’s regulatory and legal infrastructure provides an enabling framework within which family offices can operate. The Wealth Management Work Group’s extensive review, has brought together leaders across regional and international law firms and wealth management companies as well as the Dubai Financial Services Authority.”
The Working Group includes senior advisers including leading lawyers, accountants, barristers and senior executives of the DIFC Authority and Governor’s Office.