Dubai: The UAE’s finance ministry said on Wednesday that an executive order regarding trusts is an important addition to the UAE’s advanced legislative structure.
The law supports the wealth management sector and provides for new mechanisms to manage wealth and funds. It also encourages the allocation of charitable trusts.
“The Ministry of Finance enacted the Trust Act to create legal tools that allow companies or individuals with various assets and financial rights to cede these wealth and rights as a financial trust to a trustee who is responsible for managing and to develop these funds, ”said Younis Al Khoori, undersecretary of the Ministry of Finance.
“This is done by means of a special document called a trust deed, and it is recorded electronically to reflect the assets – whether movable or immovable. After that, the existence of trust rights is indicated in the official records of these assets, ”he added.
Al Khoori noted that the decree law will increase the effectiveness of financial legislation and policies in the country and provide a competitive environment that keeps pace with the latest economies based on both business and technology.
He also noted that while all members of society will benefit from the law, family businesses in particular will be able to plan for the long-term continuity of their business assets.
The decree-law provides for an integrated system which allows them to manage their assets as trusts by qualified and experienced persons or institutions, called “Trustees”.
The law also establishes a section for “private trusts”, which are set up to carry out various forms of securities trading accepted in the financial markets. These include the acquisition and trading of securities and the investment in them. Private Trusts are also trusts set up to constitute pension funds or guarantee the availability of benefits for Beneficiaries in return for regular contributions paid to the Private Trust.
“The Ministry of Finance continues to work and cooperate with all relevant authorities to design appropriate financial and monetary policies,” Al Khoori said.