Setting up a foundation in the Dubai International Financial Centre (DIFC) offers individuals, families, and corporations a robust framework for wealth preservation, succession planning, and strategic asset management. A key part of understanding how a DIFC foundation setup operates lies in knowing the roles and responsibilities of its key stakeholders. Each role serves a distinct purpose, ensuring strong governance, accountability, and alignment with the founder’s long-term goals.
How Governance Works in Setup of Foundation in DIFC?
Founder
The Founder is the individual or entity that creates the foundation and contributes to its initial assets. Unlike other corporate vehicles, setup of Foundation in DIFC do not require share capital, offering flexibility and accessibility to founders. The Founder defines the foundation’s purpose – whether for family succession, philanthropy, or asset protection – and establishes its governing framework through the Charter and By-Laws.
Council
The Council serves as the governing body of the foundation, overseeing its operations and ensuring that its objectives are fulfilled.
Key governance principles include:
- A Council must have at least two members, who may be individuals or corporate entities.
- The Founder may also serve as a Council member.
- To maintain checks and balances, a Council member cannot simultaneously act as a Guardian.
The Council is responsible for managing the foundation’s assets, executing decisions, and ensuring compliance with DIFC laws and the foundation’s Charter.
Guardian (Optional)
The Guardian plays an oversight role, ensuring the setup of foundation in DIFC remains aligned with the Founder’s intent. While optional, this role becomes mandatory when a DIFC foundation setup has charitable or specific non-charitable purposes. The Guardian can be an individual or a corporate entity and provides an additional layer of governance and accountability.
Beneficiaries and Default Recipient
Beneficiaries (or Qualified Recipients) are individuals or entities entitled to benefit from the foundation’s assets. These can include family members, charitable organizations, or the Founder themselves. A Default Recipient is designated to receive the foundation’s remaining assets in case it is dissolved without identified beneficiaries, ensuring proper asset distribution.
DIFC Foundations: Secure, Flexible, and Global
The setup of foundation in DIFC provides a unique structure with its own legal personality, offering enhanced asset protection, privacy, and continuity. With strong legal safeguards and an advanced financial ecosystem, DIFC stands out as a leading jurisdiction for families, entrepreneurs, and institutions seeking a sophisticated, secure, and globally recognized solution for wealth and business structuring.
How Can MS Help with Setup of Foundation in DIFC?
MS provides end-to-end support for clients looking to establish a DIFC foundation setup, ensuring a seamless and compliant process. Our services include:
- Advisory on Structure and Governance: Guiding founders on the optimal framework, Council composition, Guardianship, and beneficiary planning to align with your objectives.
- Documentation and Registration Support: Assisting with drafting the Charter, By-Laws, and submission of all required documents to the DIFC Registrar.
- Compliance and Ongoing Administration: Ensuring annual filings, Council meetings, and regulatory obligations are managed efficiently to maintain the foundation’s legal standing.
- Asset and Succession Planning Advice: Providing strategic guidance for intergenerational wealth preservation, philanthropy, and business continuity.