His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai, has issued a new law regulating family-owned businesses.
The legislation aims to protect families’ wealth.
It is also designed to enhance their companies' contribution to economic and social development as well as foster growth.
For the family ownership contract to become legally binding, all parties must be members of the same family and have a single common interest.
Contracts must clearly define each member's share and can be extended by up to fifteen years.
They can be renewed for a similar term following the agreement of all parties.
The Law is optionally applicable to existing and new family ownerships, including corporate equity securities and proprietorship.
Family ownership in public joint-stock companies, movable and immovable property, are excluded.
The legislation also defines the responsibilities and authorities of government entities with regard to facilitating the formation of family-owned businesses.
The Law is valid from the date of its publication in the Official Gazette.