Emirates Free Zone

The DIFC initiative, launched by His Highness General Sheikh Mohammed Bin Rashid Al Maktoum, Crown Prince of Dubai and UAE Defence Minister on 16 th February 2002, aims to position Dubai as a universally recognized hub for institutional finance and a regional gateway for capital and investment.

The DIFC Development Company, which leads the commercial development of the DIFC initiative, will work in parallel with the DIFC Regulatory Agency, which focuses on regulation and market supervision.

Dubai International Financial Centre is a global jurisdiction of choice for financial institutions and brings world-class regulatory processes and market mechanisms to the region comprised of the GCC, the Indian subcontinent, northern Gulf, the Caspian states, the Levant, north and east Africa. By applying its fundamental principles of integrity, transparency and simplicity, DIFC offers a truly unique business environment that will enable world-class financial institutions, professionals service firms and corporations to operate regionally and globally our of Dubai with significant competitive advantages. Through the creation of nexus for financial institutions and regional corporations and b bringing together global investors and regional issues, DIFC serves as a catalyst for accelerated and sustainable growth and as the platform of choice for accessing the trillion dollar regional market. Perfectly situated between the financial centres of Europe and Asia, DIFC is a bridge between the east and the west serving as a gateway for the flow of capital to and from the region strengthening the regional links to international capital markets.

DIFC will initially focus on five areas of activity in the financial industry: viz., Asset Management, Islamic Finance, (Re) Insurance, Back office Operations and the establishment of a Regional Financial Exchange to foster a cross border, efficient and liquid capital market.

In addition, to pro-actively attract key players in its five areas of focus, DIFC will also be open to other sectors of institutional finance and will be the best regional location for the international business units of commercial banks, investment banks, wholesale financial institutions and funs management firms. DIFC will also host professional services providers critical to development of the regional financial sector such as credit rating agencies; professionals service firms, law firms and information service providers.

The UAE Federal Cabinet, by approving the Federal Decree on creating Financial Free Zones has paved the way for the full establishment of DIFC. Accordingly following laws are under consultation for enactment by DIFC:

1.	The Regulatory Law: - To establish a detailed constitution for the DIFC's Regulatory Authority, to set out the legal framework for licensing financial institutions and other service providers in DIFC, to provide a disciplinary and regulatory enforcement scheme that is fair to DIFC participants whilst enabling the Regulatory Authority to uphold the integrity of the Centre.
2.	*Companies Law: -* To protect the share holders and creditors of DIFC companies, to establish simple, workable legal framework governing the formation of limited liability companies and the ongoing rights, duties, liabilities and formalities to be observed by such companies, their members and officers; to establish the protected cell company as a legal entity in the DIFC and the establish rules governing the treatment of cellular and non cellular assets.
3.	*Contract Law: -* To establish freedom of contract in the DIFC, to provide for the creation of binding contracts without formalities; to establish a simple, workable legal framework governing the formation, validity, interpretation, content and assignment of contracts; to establish rules relating the performance of contract obligations and to provide effective redress in the event of non-performance for aggrieved contracting parties and third party beneficiaries; to establish complementary and coherent rules governing agency relationship.
4.	*Insolvency Law: -* To protect the assets and creditors of a company, prior to the onset of insolvency and whilst in liquidation; to promote creditor agreement as a viable alternative to liquidation or administration; to provide suitably qualified insolvency practitioners and to provide them with necessary assistance and protection form liability to perform their work; to provide assistance to foreign courts in respect of insolvency proceedings.
5.	Law of Security: - To provide for the creation of security interests which are valid and enforceable against a debtor, a debtor's creditors and a purchaser of collateral, to provide for the perfection of security interests by filling financial statements in respect of them (subject to certain exceptions and qualifications) and to provide the Council with authority to make further rules in respect of perfection of security interests, to establish rules to determine the priority of competing security interests; to provide for the establishment of Charges Registry at which financial statements must be filed and for filing offices rules to be made by the Charges Registry; to provide for third party right and for rights and procedures associated with enforcing security interests.
6.	*Personal Property Law: -* To provide rules relating to the formalities required for and timing of transfer of title in personal property including abandoned property and gifts; to provide rules relating to the validity of transfers by persons without good title and of transfers of unascertained and future property; to provide rules relating to the right of an unpaid transferor including the right to lien over property, the right to withhold delivery and the possibility of obtaining specific performance; to define securities and financial assets and provide rules governing the acquisition and transfer of securities and financial assets and interest therein including the validity of third party interests, of transfer by endorsement, instruction or entitlement order and of issuer-imposed restrictions on transfer; to create a property interest for security entitlement holders in assets held for them by custodians and to establishment the priority order of security entitlement holders and creditors of a custodian and any transferee of the securities, to provide the Council with power to make further rules about the nature, creation and transfer of securities, the obligations of an issuer of securities and about implied warranties in securities transactions.
7.	Law Relating to Application of DIFC Laws: - To provide for freedom of contract in the choice of governing law; to provide for effective contractual arbitration clauses; to provide governing law provisions workable in a context of multinational, multiparty dematerialized securities transactions; to provide for the recognition of foreign trust structures.
8.	*Prudential Rules for Insurers: -* The rules contain (a) limitations on the way in which insurance business may be conducted; (b) systems and controls requirement and (c) reporting requirements, including provision for audit and actuarial certification.
9.	*The Principle for Authorized Firms & Individuals: -* The rules contain (a) the application and purpose of the principles for authorized firms (b) the 10 principles for authorized firms (c) the application and purpose of the principles for authorized individual and (d) the 6 principles for authorized individuals.